LB: How do you think about invention, innovation, and improvement? Are they different? If they are, are they equally important, or are they important in different contexts?
RS: Well, I think for all of us as students of innovation. When we first started doing our work in the legal sector on innovation, we couldn’t even use the word because it was so open to interpretation. We had to talk about it in terms of value or exceptional value when we were doing our interviews in the early years. I think the point is about innovation. People get scared about it because you’ve got that idea that it’s got to be about a eureka moment and Archimedes running out of the bath going, “I’ve got it, I’ve got it.” And actually, of course, we know it’s not about that.
It is about these incremental improvements that you make that add up to something that’s highly significant. And there’s a great writer called Steve Johnson who always says, “You can only innovate in the adjacent possible or in the room next door. You can only go from one place to the next place. You can’t leapfrog things; it’s very rare to be able to do that.” So, innovation is a sum of all these steps, and they are often little tweaks. And when you unpick all of these innovations, which is something that we find fascinating, I don’t know the aetiology of people’s innovations; you see that time and time again about how that gets mixed up. Darwin didn’t just come up with his Theory of Evolution; it was a painstaking study and detailed concentration and observation of what was happening.
LB: How do the leaders in law ignite innovation in their team? How do they support it, how do they sustain it? Are there any common threads or common themes? If you’re a new business leader, I’ve got to assume that’s now one of the challenges that come to mind in 2021.
RS: I definitely have three words to them. They’re inclusive, they’re humble, and they’re empowering. It’s quite extraordinary. Looking at it across the piece, leadership is so incredibly important, and I’ve known most of the world’s big law firm leaders pretty well and a lot of general counsel. And the ones that really stand out and the ones that are really different, and the ones that have moved the dial, either in their legal teams or in their law firms, are ones that are incredibly inclusive. They allow or give the conditions for their people to flourish and find their own creativity. Because it can’t be autocratic if you’re going to create that innovative culture. Innovations got to be democratic. It’s got to be something that everybody has a part in, and particularly, say within a law firm, I know you’ve got your different practice areas. There are different ways that you’re going to innovate within those practice areas. You have different clients; you’re going to innovate with them in different ways as well. Same with general counsel, they’re going to have different types of teams with different footprints in different countries in different business lines, and they’ve all got to be able to share knowledge because we’re also talking about innovation in a knowledge sector.
So, they’ve got to be able to share knowledge, allow that to transmit, have ideas going back and forth. Innovation in the legal sector has got to be around knowledge and expertise and things like efficiency; what Elevate does is absolutely brilliant. It takes the friction out of doing law.
LB: I’m interested in your statement; in law, knowledge business is a democratic process; therefore, it’s messy. These knowledge businesses really require quite phenomenal leadership. I struggle with having just enough framework because I’ve got so many colleagues who have so many great ideas I can’t invest in all the experiments. So, I have to try to put some structure and framework around that, but too much structure and framework or too much focus on ROI, or actually on measurement, can cause people to shut down and worry about their reputation.
RS: The leader has to set the vision, and it’s not management, and it’s something that everyone then plays into. They have to keep repeating that vision, refreshing that vision, and making that vision relevant to everybody.
LB: You’ve touched on general counsel and how they have to manage business units or geographies, etcetera. What’s your sense of the difference for leading in innovation between being a law firm leader and being a general counsel? Do you sense that there is a difference?
RS: A GC doesn’t have quite the people challenge that a law firm leader does. The law firm leader is running a democracy of partners. He or she has to lead by consensus, influence, soft power, if you like, that is a different kind of leadership style. A general counsel has got far more of a corporate structure behind them, so they can lead in different ways. But the similarities are they also have soft power in the sense that they are increasingly influenced within the business, they’ve got the strategic role, they are the CEO’s right-hand person, and they’re champions of sustainability; they’re often called the conscience of the business. And to have that influence within the C-suite, they also need that soft power and that sort of persuasion that a law firm leader would need. But what they don’t need is generally within their teams; they don’t need to, I think, necessarily be quite so influential. You’ve got far more of a structure with your assistant GCs, your head of legal ops. With the rise of legal ops, they’ve delegated a lot of the management and the operational management to a different kind of skill set, and that’s good for them.
LB: Everyone’s talking about digital. It takes up about a third of my time personally; why do you think it’s so important to CEOs? And therefore, what from those flows to the importance of it to the law department or the firm?
RS: It’s really an interesting point. A couple of years ago, I was doing the usual roundtables for the FT Innovative lawyers’ programme; I seriously posited with a bunch of people about whether we should rename FT innovative lawyers to FT digital lawyers because I thought this is the next thing. We had these focus groups and thought about it. One was the brand of the FT Innovative lawyers programme was established, and we didn’t want to change it. But equally, question whether becoming digital is innovation? Or is it just about business as usual? Would you say because you’re adept at using Microsoft Teams, and you’ve done it very quickly in the last 12 months, that that was the innovation? Or is that business as usual? It’s an imperative. It’s something that everybody has to do. It’s sort of part of innovation. The word digital means so many things to other people. It’s a bit like how innovation was 16 years ago when we were just starting it, which is what do you mean by it?
For a lot of people, it means the use of technology and data better. For others, it means a whole scale business model transformation. And this is something we talk about a lot in the digital legal exchange, the non-profit that was set up to help our legal departments accelerate their digital transformation. And it is surprising, I think, how many people have misconceptions of what it is; in the last 12 months, 2 billion people overnight became digital, it is absolutely amazing what we’ve just gone through in the last 12 months, but what it has been, it’s about everyone becoming digital.
LB: How do the customers of a business behave? How do they buy, explore, research or engage with you as a business differently? I think that is, for me, a real driver for this digital imperative. And I do consider that if not business model transformation, it’s business model evolution, how do people buy and engage and have a relationship with your company, it’s causing CEOs to say we have to at least evolve, if not transform our business to embrace digital ways of connecting or options, at minimum digital options. I am a believer that there is a time to call up the travel agent for that fantastic trip around the world. And another time to be able to book the flight, specifically online in minutes from your iPhone, and I use those as extremes I know, but there’s still a place for people relationships, expertise, etcetera, that’s necessary, but not sufficient, as you also need to be able to engage buyers, customers digitally.
RS: Keeping up with the pace of the business is really tough. And it’s just got faster. Only two out of 10 legal departments are digitally enabled enough to support their companies. But when they are, they enable projects 65% more likely to land on time; the impact of a corporate legal department being digital on the business is huge on the top and bottom lines; I don’t think they have a choice. They’re part of the business, so they have to keep up. You’ve got legal departments that are digitising in pockets, who are doing phenomenal things. The efficiency gains are dramatic when you digitise contracting, or you digitise IPs and its leaps and bounds that’s going on at the moment, actually. This is not the slow pace of innovation that we’ve seen in previous years.
But I think they will get there partly because they have to get there. And partly because you’ve got really pretty sensible teams in these major sorts of corporate functions. I think a lot of the push, though, isn’t necessarily coming from the GC; a lot of the push is coming from the CPOs, the CIOs, the CTOs, CFOs. What fascinates me when in our programme we’ll rate a department said three or four years ago.
LB: There was an experimentation in the last say five years, digitising workflows and even within a law department digitising different workflows. The challenge with that if you compare that to the activities around digitising HR, or people digitising the finance organisation or the accounting organisation, the challenge with that has been similar lessons are being learned in the law department, as were learned in those other functions, in that you can digitise workflows or with the term we use, jobs to be done. But then you have data in silos. And until that data is able to flow back and forth between other functions and other digital workflows, these pools of data lose their value, it’s relevant to the commercial contracting leader to be able to have insight into transaction velocity or contracting velocity, or even the simplification and the ease of doing business on contracting that’s relevant to which clauses do you include, or your negotiating positions do you start from. All of that’s very interesting and going digital right now, in law departments.
That’s kind of not that interesting to the rest of the business; it starts to get more interesting when the salesperson can, from their dashboard of operating in their CRM, be able to get to contracting close without having to think about legal as much as they had to before because now the digital legal department is interwoven, I call it law in the core, is interwoven into the business process.
And if I can use that term of getting a customer to agree to buy something from you, that’s going to be one of the next challenges for law departments is these different silos of data needs to be woven together, but also woven into and back and forth with the other corporate systems around data and going back to the interdisciplinary piece. I think that’s going to be interdisciplinary. I think step one was you brought along legal Ops; step two will be automating and digitising workflows. Step three, we’ll be going, “Oh, actually, I can’t just stay within the law department. I need to be integrating and partnering with business professionals and business partners in the rest of the core of the business, and sometimes that will mean unwinding some of the experiments or work done in version 1.0 of becoming a digital law department. Let’s bring it a bit closer to home. This has been a year; you’re a business leader, a human being, being a business leader. What has leadership in a tough year meant either in terms of what you’ve learned about yourself or about being a leader, or in what you think you need to develop for the next tough time?
Leadership in tough times requires dot, dot, dot, just let that marinate in the back of your mind for a second. I’ll ask you another question, and then I’ll just let your subconscious work on that. Have you had any experience in mentoring, either being mentored or mentoring people?
LB: How was that? And then we’ll go back to that last, final, closing question.
RS: I did the Mary Campbell Elements Coaching programme, and so have coached people, been coached and mentored in the business. I run a small company, so my management style is far more one of the mentors, and it’s been overall quite good. It’s difficult to do, though, because you know there are sometimes you just want to say, “Just do it. Just do that and get that to me by tomorrow.” On the leadership question, for me, I think it’s been a fascinating year, I have a business, and a large part of it is events-related, in-person events, so it’s been a pivot, pivot, pivot. And I think it’s really funny because I had to give up my office in December. We decided to give it up, and we were on this trajectory to just keep expanding, and I remember I had this moment looking at the removal van, full of these most beautiful desks that I had bought about five or six years ago.
And I remember thinking, I’ve made it now. I’m a proper businessman because I can afford these desks. I’ve got this bricks and mortar. I’ve got this stability and solidity, and actually what I’ve learned about leadership this year, and company resilience and all the rest of it is that the biggest asset that we’ve had has been able to pivot just like that, to pivot on a dime in a second and go, “Actually, this is a hell of a shit show. Things are going down the Swanee, but how can we make the most of it? How can we take this into being an opportunity?” And so, what we did with our awards events, we said, “Let’s stop doing awards. Let’s just not do so many awards.” I just said, “Let’s stop doing them. Let’s make them into thought leadership programmes. We’ll make them into shows. We’ll celebrate what people are doing in this time of crisis.” And so, we cut that down, the industry really liked it, and I think that way of thinking is what leaders have to do.
People talk about sustainability all the time and sort of keeping going. It’s not keeping going. It just knows when to go, “It’s not working anymore. Get rid of it. That’s not going to work.” And being able to see ahead and say, “Actually, this is going to take longer for the world to come back.” So, we’re not doing in-person events again this year. So, it’s what I’ve learnt is just you’ve got to not be scared to chuck things out and just to go, “What is value? What is the most valuable thing we do, and what do we love doing?” Because I realised, we were going off on this trajectory with my company. It was just getting bigger and bigger, and we were adding more and more business lines to it, and I was thinking, But I turned into a kind of manager, an operational manager. And the quotient to things that I wanted to do was very small, so I was probably becoming less of a decent leader.
LB: Really, what I heard there, interestingly, is closing the loop on what you started out by talking around. So, you’ve continued to innovate, and you’ve continued to innovate, definitely nudged by just sort of exogenous outside factors, but you’ve continued to innovate around what you’re passionate about. I might reflect on that myself. [chuckle] Reena, this has been fantastic. As always, fun conversation. I look forward to being able to see you again in person. Thank you for spending the time with all our listeners and me.
RS: Absolute pleasure. Thank you, Liam.