How tech companies measure ‘legal’

INSUBCONTINENT EXCLUSIVE:
Daniel Doktori Contributor More posts by this contributor What It Means When Law Firms And Startups
Give Away Legal Documents Why Startups Hire Their Own Lawyers In a working environment obsessed with metrics dashboards, key
performance indicators, and objectives and key results, the legal function presents an elusive target
Compared to sales, marketing and product, &legal& in a growing tech company can seem an inaccessible alchemy of risk, contracting and
policy. But interviews with general counsels attechcompanies and a survey conducted byTechGC — a private community of top lawyers at
technology companies across the United States — reveal how innovative in-house attorneys measure both productivity and quality and
position their teams as central to advancing enterprise-wide goals. The Status Quo Legal lags behind other departments in the metrics game
While more than three-quarters of general counsels surveyed said their companies collected regular, department-specific metrics,only 29%
indicated that the metrics regime extended to the legal department. Many point to the unpredictable and reactive nature of a GC work as a
key barrier to collecting informative metrics
As Sarah Feingold, former general counsel at Etsy and Vroom, explains, &if there a dispute or there an employment issue, everything else
drops.& Absent an established operating history against which to measure, it can be hard to identify trends and put those disputes in
context
&I could say, ‘oh we didn&t get sued this quarter,& but that not necessarily so indicative of my performance as the general counsel,& adds
Katherine Hooker, Head of Legal at Greenhouse. Productivity - Quality Faced with these challenges, many general counsels first turn to a
&goal cadence& — a set of time-bound, objectively measurable goals against which to report progress
Goal Cadences come in many forms including &Objectives and Key Results [OKRs],& &Management by Objective [MBOs],& and &Goals/Signals/Metrics
[GSMs].& &At the beginning of the planning period, I map out key projects — closing a financing, data security audits, updating TOS and
privacy policies — and lay those out across the period
Then it simply: did I finish projects on time yes or no,& says David Pashman, former GC at Meetup and current GC at JW Player
More than 40% of GCs surveyed collect OKRs or something similar (the second-most commonly collected metric after legal spend
[74%]). Measuring outputs and productivity has its rewards, as Colin Sullivan, head of legal at Patreon explains
&When you measure, there are two purposes: one is to improve and the other is to demonstrate the value you are providing to the company.&
Many GCs stressed the power of metrics collection and presentation as key in characterizing how the company at large viewed the legal
department. But over-reliance on OKRs risks treating productivity as a proxy for quality, which can be more challenging to pin down
A full 45% of GC characterized the method they use to judge the performance of their own direct reports as &kind of a Potter Stuart Thing
(‘I know it when I see it&),& a phrase famously used by Supreme Court Justice Potter Stuart to characterize hardcore pornography in
Jacobellis v
Ohio. To to penetrate the qualitative side, GCs turn primarily to flash surveys of internal clients (e.g
the sales team) and to &360 reviews& — recurring professional feedback from both direct reports, lateral colleagues and managers
Regular reviews offer minimal disruption and a cost-effective method for generating metrics that can be compared over time to illustrate
trends
As Ben Alden, GC at Betterment assesses it, 360 reviews offer an efficiency play
&A fully-scoped procurement process could include metrics on speed, cost and comparisons against benchmarked best practices
But that takes a lot of overhead to set up; versus a solid 360 review process makes sure that people are performing at their best and is
ready out of the box.& Version 2.0 More sophisticated metrics regimes yield more granular measures
In addition to core financial metrics like spend on outside counsel and performance against budget and spend as a percentage of overall
operating expense, general counsels focus on tracking items like deal terms and risk exposure.