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Poor legal responses to disruption delay growth and add to exhaustion
Technological research and consulting firm Gartner has highlighted that insufficient legal department responses to disruptions are leading to costly trade-offs, like delaying growth opportunities and contributing to exhaustion for lawyers.
Jess Feyder
An ad-hoc approach to managing incidents is ineffective in an era of persistent disruption, according to Gartner.
Persistent disruption has arisen from both macro shocks, such as the ongoing Russian invasion of Ukraine amid other geopolitical tensions, and from rapid societal shifts in environmental, social and governance (ESG) expectations.
Raashi Rastogi, director of research in the Gartner legal risk and compliance practice, commented: “An era of persistent disruption is — and will continue — taxing constrained legal departments and resources.”
“Legal leaders need to find efficiencies in the way their department handles disruption.
“They should not anticipate getting a lot more resources to cope, nor should they expect the volume of disruptions to significantly decrease in the near future.”
Legal departments typically treat disruption response as high-value urgent work and therefore accept trade-offs to get it done.
However, in the era of persistent disruption, continually making such trade-offs starts to add up and have a negative effect on the overall departmental workload and efficiency, highlighted Gartner.
A survey of 140 general counsel, done in mid-2022, showed the extent to which having an efficient disruption-response process in place reduced the number of costly trade-offs that legal departments had to make.
It showed that general counsel who had a low-efficiency approach made costly trade-offs 69 per cent of the time, while those who had high-efficiency approaches in their response to disruption made costly trade-offs 24 per cent of the time.
“Legal departments that have developed a high-efficiency approach for handling disruptive events are essentially making one trade-off for every three in a low-efficiency department,” noted Ms Rastogi.
“With disruption now being the norm rather than the exception, very few legal departments can afford the volume of trade-offs that comes with an inefficient response to disruption.”
The most significant costs tend to come in three forms:
- Missed business value capture – where the response to business disruption is prioritised over matters of long-term strategic importance;
- Delayed development of legal capabilities – where investments in lawyer and business partner training and technology implementation are neglected or delayed; and
- Lawyer exhaustion and disengagement – faced with more work and the same amount of resources, lawyers are burnt out and leaving or actively seeking other opportunities.
Departments that prioritise learning from disruption, rather than simply fighting one disruption after another, are far more efficient and provide higher-quality guidance than departments that do not.
They’re more effective in helping the business avoid unnecessary risk — risk outside their risk tolerance — while still capturing as much value as possible.
Legal departments that excel in learning from disruption are 3.5 times more likely to be highly efficient in their disruption response and 2.3 times more likely to provide high-quality guidance.
Greater efficiency ultimately leads legal to make fewer costly trade-offs in responding to disruption, highlighted Gartner.
Ms Rastogi commented: “What this means in practice is an ongoing process of learning what actions to take when disruption occurs, and then figuring out how to execute those actions more efficiently.
“That may involve identifying in advance what the highest-impact disruptions are likely to be, determining how to respond to them, and building the department’s collective experience in executing these responses efficiently.”
