For many years, in-house counsel, also called corporate counsel, were hired based solely on their legal acumen. The only things that mattered were their length of practice and the breadth of that experience. But, in recent years, and especially with the rise of digitization, the role of lawyers in corporate legal departments has shifted. In-house counsel who want to excel can no longer rest on their expertise. In these disruptive times, in-house counsel need a new set of skills that enable them to serve as their clients’ trusted advisor.
In this article, we’ll take a closer look at the role of in-house counsel, including how that role has transitioned over time and how it differs from the role of attorneys in private practice. We’ll also discuss five key skills that in-house counsel should develop to ensure that they are well-prepared to serve their company in the future.Here's what we'll cover:
Depending on their company’s size and complexity, in-house counsel may be generalists who handle a range of issues facing the company or specialists in a particular area of law. Common specialties for in-house counsel include commercial litigation, employment law, contracts, and tax law. Typically, in-house counsel also oversee the work that outside law firms perform for the company.
In-house counsel may span several levels, from a general counsel or chief legal officer, who heads the legal department, down to senior attorneys and staff counsel. Different companies may call the more senior attorneys by different names, including senior corporate counsel, assistant general counsel, and associate general counsel. Often, in-house lawyers gain several years of experience working for a law firm before they join a company’s legal department.
In-house counsel and outside legal counsel differ in several aspects, most importantly in the way they are viewed, the clients they serve, and the nature of their work.
Lawyers in private practice are fee earners; they make the money that keeps the law firm going. In-house counsel, by contrast, are typically viewed as a cost center. Because they generate expenses for the company rather than bring in profits, in-house counsel may find that their requests take a lower priority compared to those from revenue-generating departments. While law firms eagerly provide legal reference materials and research databases for their attorneys, these resources may be harder to come by for in-house counsel. Moreover, because the practice of law isn’t a core function of the company’s work, the legal department may not be an early focus when the company rolls out new technology or answers service requests.
Most in-house counsel only have one client: their employer. That said, in-house counsel are likely to work with a wide range of people from different business units and varying levels in the company’s hierarchy. That means they need to navigate different personalities, backgrounds, and areas of expertise—such as human resources, engineers, business line managers, executives, and other attorneys both internally and externally—as they try to figure out the best legal solution for the company. And, because they’re internal to the company, in-house counsel are always on call. As such, they generally form close relationships with their stakeholders.
Contrast this with private practice attorneys, who work for a portfolio of companies spanning different industries. Each client has different goals, budgetary constraints, and preferred approaches to legal matters, which gives outside counsel deeper—though often narrower—expertise in their chosen field of practice. However, instead of having regular, ongoing conversations, outside counsel typically only hear from their clients when they have a pressing matter that requires specialized assistance. Because they work intermittently on discrete matters, outside counsel tend to form less of a connection with the business.
The span of work of in-house counsel varies depending on the size and complexity of their employer. The larger the company, the higher the likelihood that it will need legal specialists in a variety of areas, including employment, contracts, intellectual property, and tax law. Smaller companies tend to hire fewer lawyers with broader expertise spanning multiple practice areas. Regardless of their degree of specialization, in-house counsel are expected to handle most matters internally and outsource work only when they need expert resources. That means in-house counsel must decide how to handle all of the legal questions they encounter. They must know what questions to ask, what approach to take, and how much to spend on any issue. They also get to think proactively and strategically about how legal decisions will benefit—or damage—the business. No matter what work they do, in-house counsel must always keep the best interests of their employer in mind. This is a long-term engagement that requires deep, strategic thinking.
On the other hand, lawyers in private firms tend to do work that is more reactive and prescriptive, as it’s designed to meet a client’s specific request. For example, clients are likely to direct their outside lawyers about what strategy they want to follow and how much they will spend on legal research and writing. Remember that in-house counsel typically hire outside counsel for their subject-matter expertise on a project-by-project basis. As a result, law firm attorneys rarely have the chance to weigh in on the client’s overall business strategy.
For instance, an in-house attorney may retain a partner from a law firm to handle an employment discrimination lawsuit. The partner will draft discovery and pleadings to file with the court. The in-house lawyer will review and approve those drafts and direct the case strategy and budget. Once the matter is settled or litigated, the partner will move on to their next case. Meanwhile, the in-house lawyer will still be considering whether there are deeper, underlying trends at the company that resulted in those claims of discrimination. In-house counsel will therefore seek solutions to ensure that similar problems don’t arise in the future.
For many years, technological acumen wasn’t viewed as a necessary skill for lawyers. In many senses, technology and innovation run counter to the system of historical case precedent upon which the legal industry is built. This gives rise to lawyers’ oft-maligned resistance to change. Lawyers are traditionally reluctant to shed their tried-and-true manual approaches in favor of the latest tools, even when those new tools are faster, better, and equipped with shiny bells and whistles.
Only recently have law schools recognized the need to educate future lawyers about how technology can make legal work more efficient and provide them with practical, technical skills. That means most in-house counsel will need to learn these skills on the job. This is a heavy ask on top of their already daunting work requirements, but its importance cannot be overstated.
The trend toward digitization has been picking up steam for years, but the disruption wrought by the coronavirus pandemic has substantially accelerated digital transformation. Now, with remote work, budget cuts, workforce reductions, and hiring freezes, corporate legal departments must find ways to do more with less. According to HBR Consulting’s 2020 Law Department Survey, 64 percent of corporate law departments expect to face budget reductions, yet 84 percent expect to receive an increase in demand for their services. To handle that demand with a lower budget, the survey reported, many legal departments are “focused on maximizing their internal staffing and technology resources.”
Source: HBR Consulting 2020 Law Department Survey
In short, that means corporate legal departments will only increase their reliance on technology—and with it, their demand for lawyers with strong technical skills and with an appetite for innovation.
In-house counsel must become digitally savvy to keep pace with their business partners in the organization. Like every other department in the company, the legal department must look for new ways to use technology to improve their service and lower their costs.
Change can be uncomfortable, but for in-house counsel, developing new skills is imperative to creating a work environment that fosters greater productivity and innovation. Digitization of the work environment confers numerous benefits for in-house counsel, improving workflows, yielding greater insights into data, and eliminating tedious, manual projects. This frees up time that they can spend on higher-value, more strategic matters.
Take eDiscovery technology, for example. As the volume and complexity of data have increased in recent years, lawyers have needed an expedient way to determine whether data is relevant and privileged. Hands-on manual document review is no longer effective or efficient. That’s especially true given that datasets often include multilingual documents, due to globalization, and that new data formats are constantly emerging. The rise of artificial intelligence and machine learning has revolutionized eDiscovery processes, rendering manual first-pass review obsolete. Thanks to technology, lawyers can now prioritize the most critical documents first.
Digital transformation is here to stay, and thus upskilling is paramount for in-house counsel. In fact, 69 percent of chief legal officers “expect the use of artificial intelligence in legal technology applications to accelerate,” according to the 2020 ACC Chief Legal Officers (CLO) Survey. In the future, the more digitally mature a corporate legal department is, the better it can deliver high-quality, cost-effective legal support to its client. And, while technological familiarity is an essential competency, other softer skills are a necessary complement to the lawyer’s arsenal.
To equip themselves for the waves of change in the future, in-house counsel should develop five key skills: technological competence, emotional intelligence, communication skills, creativity, and learning agility.
Lawyers have always been required to stay on top of their game when it comes to their legal expertise. But, as the business world has become more digital, lawyers have been left behind, according to research from Gartner:
Digitalization may change products and services (e.g., driverless cars and automatic replenishment), channel strategies (artificial intelligence to drive sales, mobile service apps) or the workforce and operations (robotic process automation or digital manufacturing). Whatever the specifics, digital business transformation is changing strategic assumptions—and, in turn, the demands on the legal and compliance function. As the general counsel of one drug company put it: “[Now] we are a pharmaceutical and technology company. That requires a different legal department.”
In 2018, Gartner observed that 81 percent of legal departments were unprepared for digitalization. Now, especially as the pandemic has forced lawyers to embrace more technology faster than ever before, the gap in lawyers’ understanding of—and ability to harness the advantages of—technology has been exposed.
As early as 2012, the American Bar Association sought to address lawyers’ lag in acquiring technological competence by adding new language to Comment 8 of Model Rule of Professional Conduct 1.1, which explains that lawyers have a duty to “stay abreast of changes in the law and its practice, including the benefits and risks associated with relevant technology.” Since then, nearly 40 states have enacted similar provisions in their own rules.
Generally, these rules mean that lawyers must be able to know how technology can benefit their clients, how to avoid the risks of using technology, and how their clients use technology—to the extent it affects their representation. Most lawyers today are equipped with the skills to handle word processing and email—but beyond that, the depth and breadth of their technology skill set varies wildly, and a lack of seemingly basic technological competence can lead to perilous consequences. Take, for example, one lawyer’s belief that redactions could be performed by obscuring text in a PDF file with a black box. Given this faulty understanding of PDF redactions, someone later copied and pasted the hidden text into a new file, enabling them to read the entire document.
Technological competence is imperative for all lawyers, but it’s an especially valuable skill for in-house lawyers, who must continuously find new ways to make their work more efficient. In-house counsel should keep tabs on the latest technological tools and consider ways they could streamline workflows and improve outcomes for their client. Some ways to get up to speed quickly are to attend CLEs and conferences focused on legal technology, listen to podcasts by legal technology leaders, and read legal journals that cover tech developments.
In the past, corporate counsel could get by on their skills, logic, and expertise. Today, in-house counsel must combine their legal training and experience with situations that require them to persuade, collaborate, and resolve conflict. Whether they’re offering legal advice or influencing business decisions, they may have to address a variety of stakeholders from different perspectives and backgrounds—none of whom think or talk like lawyers. That means in-house counsel must not just have legal skills; they must also be fluent in skills associated with emotional intelligence.
Emotional intelligence enables us to “use the power of emotion (our own and others) as a source of energy, information, motivation, and connection to inform one’s thinking, decision-making, and actions.” This set of skills encompasses empathy, active listening, negotiating, and influencing others.
While some of these skills may seem like common sense, to function at the highest levels of an organization and contend with high-risk situations, in-house counsel need to upgrade their emotional intelligence competencies so they can build the trust required to offer advice to corporate leaders. This is a process that takes time, but some steps to take include becoming aware of and discussing your emotions, reflecting on what is happening in a situation, practicing mindfulness, and seeking out feedback—and listening to it.
From one day to the next, in-house counsel may speak with a variety of audiences, ranging from C-suite executives and boards of directors to entry-level employees and contractors. There are a host of new players in the corporate legal department as well, from legal operations directors to project managers and technological specialists. Lawyers must understand how to share their message with these varied audiences, using appropriate, accessible language. They must also determine how much to share with whom and when and how they should share information.
For most in-house counsel, especially those transitioning out of a law firm, the hardest communication lesson to learn is to stop using “legalese”: legal concepts and jargon that will annoy—if not alienate—business partners. At the same time, it’s critical that lawyers learn the language of their business, including industry buzzwords and their clients’ preferred vocabulary.
Lawyers also must be aware that businesspeople often just want the answer. Complicated, detailed analyses of the law typically don’t interest anyone other than lawyers. When offering advice, boil the advice down to its essentials, and keep the research and supporting arguments for your files. Make sure you’re offering advice in a clear, digestible package that is tailored to your audience. It may be helpful to canvass your internal clients on what information is most meaningful and useful to them.
Typically, lawyers aren’t thought of as creative. Because they have been trained to follow precedent, many in-house counsel are reluctant to think outside the box or to propose new ideas. In fact, as junior lawyers in a corporate legal department, they may feel too intimidated to offer a new solution to an old problem. In some cases, it may just be that lawyers are too busy to brainstorm new approaches or solutions, so they revert to tried-and-true methods.
But, for in-house counsel to effectively help their organizations harness the power of innovation, they must learn to think differently—and not just linearly. They must question how things have always been done and look for new ways to accomplish work. They must also recognize the value that partnerships with others who process information differently, such as legal technologists and alternative legal service providers, may bring. According to one lawyer turned judge, “creativity is simply the act of creating new combinations”: lawyers who can embrace that approach will find themselves best able to problem solve for their business partners.
To break out of the lawyer’s standard analytical formula—IRAC, or identifying legal issues, explaining the rule of law, analyzing the law, and offering a conclusion—in-house counsel should study other ways of problem-solving. For example, techniques like design thinking, used for years by technology and engineering companies, can help lawyers re-evaluate clients’ needs and generate new solutions designed to deliver the optimal client outcome. Models for design thinking vary, but one option for lawyers is to follow six steps: empathize with the client and discover the problem, synthesize information and define the problem, brainstorm solutions, create a prototype solution, test the solution, and implement the solution. These steps allow more room for more creative experimentation with alternative solutions and center on the client relationship, requiring in-house counsel to consider the problem from a more collaborative viewpoint. Design thinking also encourages innovation, because you’ll uncover many new ways to address the same challenge.
As work becomes more digital, in-house counsel should expect their practice to combine technology and business with the law. The legal function is now not only supposed to deliver advice designed to protect the enterprise but also to find new ways to generate value for the business. This requires lawyers to develop new skill sets as the business evolves. Unfortunately, “constant learning and improvement,” while a mainstay of other industries, is “presently considered outside the core knowledge of the law.”
But it doesn’t have to be. In-house counsel must be willing and able to learn from their experiences and apply those lessons to new challenges. As legal work becomes more complex and technologically demanding, in-house counsel should welcome opportunities to learn rather than shy away from them. Though it may not be easy for lawyers to move out of their comfort zone, one way to become more agile is to consider unfamiliar tasks a positive challenge, self-reflect on any mistakes they make, and course-correct thoughtfully to prepare for the next learning opportunity.
In-house counsel should build new skills now to prepare for the future
The future may be uncertain, but one thing is clear: the practice of law isn’t getting any easier. It’s critical that in-house lawyers start developing the essential skills—technological competence, emotional intelligence, clear communication, creativity, and learning agility—that will prepare them to practice law in a constantly evolving environment.
As technology continues to digitize the practice of law, in-house counsel must take steps to not only stay apprised of the latest and greatest tools but also determine how to apply them strategically and cost-effectively to their business.