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CCCA61_012,013.qxd:CCCA_V1No2_Dept-MgLaw-V1.qxd 02/07/2008 04:37 PM Page 12 Performance In The Law SMART rewards The contribution of the law department to corporate priorities. id-sized and larger companies typi- Mcally have organization-wide per- formance management programs in place. It is one thing for a Board of Directors and the CEO to craft a vision, a statement of values, and corporate business priorities. It is quite another to ensure that divisions and departments develop annual business plans that are sufficiently detailed and effective in achieving all targets. The barriers to the effective execution of strategy are serious when one considers the statistics: • 95% of a typical workforce does not understand its organization’s strategy; • 90% of organizations fail to execute their strategies successfully; • 86% of executive teams spend less than one hour per month discussing strategy; • 70% of organizations do not link mid- dle management incentives to strategy; and • 60% of organizations do not link strat- egy to budgeting. in the organization. It depends on the pro- • best practices in the choice of key Performance management programs, cesses,the relationships and the tools that it performance indicators (KPIs) for patterned on a “balanced scorecard” archi- can bring to the table. Taken together, legal services; tecture, can be a valuable tool for a corpo- these can be assembled into what some • the substantive legal work they do; ration.Well conceived and properly execut- (Drs. Kaplan and Norton, creators of the • outcomes and measures which are ed, they are the connective tissue between Balanced Scorecard concept) have termed rarely in their control; and strategy and individual action.However,the a “strategic services portfolio.” Admittedly, • the development of lawyers and staff as application of performance programs to a law department does not exist to make a intellectual capital. support units such as law departments, profit or deliver programs to customers. There are also five sets of inputs that gen- human resource services, IT and finance Moreover, its primary users are almost eral counsel should use in constructing the departments carries a separate set of chal- always internal, either corporate or a busi- law department’s performance plan. lenges. Two surveys reported in 2006 that ness unit, or perhaps, a division. On the 1. The corporate strategic plan.This usu- fully two-thirds of support units were not face of it, a law department scorecard must ally sets out the organizational and aligned with their organizations’ business enable corporate and business unit initia- operational customer-facing objectives, unit and corporate strategies. It should tives, demonstrate efficiency, and develop strategic business initiatives, and cost come as no surprise that the performance the resources which are entrusted to it. control targets. Sometimes over-riding objectives of individual lawyers in law The devil is in the details. priorities such as safety and the envi- departments are seldom connected with It is always a challenge for the law ronment are added. what the organization considers valuable. department to incorporate the basics into 2. A critical success factor framework or ISTOCKPHOTO Still,a law department can create value their performance plans (scorecards): checklist.This is often a diagnostic tool 12 CCCA Canadian Corporate Counsel Association SPRING 2008
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