Legal Shared Services Model

Six key principles will guide your organization through the SSA implementation process. A company has many obligations to fulfill – with employees, external consultants, subcontractors, etc. Therefore, any new club must be free from conflicts that may arise as a result of previous agreements. Let`s say your sales team wants to enter into a service contract with X and outside counsel approves it because the terms seem acceptable. Fast-growing companies need a dynamic HR team that can keep pace with their business needs. This often requires multiple expertise that is readily available within shared services teams. Otherwise, it could lead to a drop in efficiency that could have a major impact on overall business operations. If your business is struggling to manage its operational performance, you should consult with experienced consultants to find out areas for improvement. By centralizing these functions, companies can avoid such duplication of tasks and let one person do everything from a single connection.

It may seem trivial, but neglecting such discrepancies can significantly increase overall hiring costs for businesses. Currently, companies in the U.S. spend an average of $4,129 to recruit an employee, and the numbers increase based on the candidate`s experience. Therefore, the HR shared services model works much better than when your HR resources are fragmented across multiple business units. Information networks and databases offer better ways to access accumulated knowledge. A large legal department has established a Legal Information Sharing Network (LISN) to enable the electronic creation, access, tracking and storage of information and documents worldwide. These networks, also known as letter banks, allow the organization to accumulate and improve access to its entire knowledge base. A central concern is to ensure adequate protection of this strategic information and to conclude contingency agreements (e.g. contacts with local offices) in the event of system problems. They also selectively provide this information to external law firms in order to disseminate consistent data.

In this case, it is quite possible that the legal counsel was not aware of your law firm`s previous contracts in the context of business cooperation, which prohibit you from hiring X for a certain period of time due to a non-competition clause. This could save the business relationship between your company and other business partners and even lead to litigation. Segmentation of services into discretionary/non-discretionary services usually involves contributions from company employees and companies. Only services that have been designated as optional should be candidates for inclusion in shared services. A leading legal expert on shared services points out that this separation has improved the efficiency and quality of services. Much of the work entrusted to a central committee to ensure that appropriate legal input has been obtained on important decisions is now carried out by an empowered network of lawyers, reducing costs and lengthening delays. Once the work to be included has been identified, efforts should focus on how to staff, deliver and manage services in the most effective and efficient manner. Also think carefully about whether you want a for-profit or non-profit business. Tom Conophy, CIO of InterContinental Hotels Group, believes a for-profit model could work better than a nonprofit model because the shared services organization and participating partners would have more incentive to invest in new technologies and improve their operations. All this and more can be achieved through AI-powered solutions like StartingPoint, which enable workflow automation, creating a self-service FAQ section, and more.

You can also use it to securely share files and track requests and comments, which is critical to measuring the success and contribution of shared services teams. We will now assess why HR and legal shared services teams are essential to any business and how they contribute to business success. Both the shared services model and centralized services promise significant process standardization and economies of scale, making them popular with executives who need cost-effective and reliable services. However, the benefits of the shared services model are different from those of centralized services: better operational expectations, greater motivation to reduce costs, and increased responsiveness to changing business needs. Because the shared services model places a strong emphasis on transparency, continuous improvement, and customer centricity, one of the benefits of the shared services model is to equip the business to make a lasting impact in the face of ever-changing requirements. It is important that the shared services business entity be able to compete with other external providers. Business units must operate in accordance with market discipline. You must also be able to request support services of the same level. For business units to gain a competitive advantage, best practices are in place and corporate culture is excluded.

In a sense, this is a problem for all shared services. Create smart customers who know how to get the most out of the services offered. There are many examples where companies have studied shared legal services and then opted for the traditional approach. However, many companies have also applied the shared services approach very effectively to provide leveraged solutions to their customers. Shared service centers don`t appear to be being used enough, according to the results of a 2021 EY study conducted in collaboration with the Harvard Law School Center on the Legal Profession. While 73% of companies use it to support the legal function to some extent, only 9% use it widely. A common factor in this delay in the adoption of shared services is the lack of clearly articulated objectives for the initiative. Otherwise, shared services models can stagnate, reducing overall value and frustrating internal resources due to lack of progress. To avoid this outcome, formally define the objectives from the outset and involve all stakeholders involved in the process.

According to Scott, limited liability companies tend to work well because they offer participating organizations the flexibility of a partnership as well as some of the legal protections of a business. If the development team needs a product specialist or if a patent needs to be filed immediately, the HR and shared legal team can take care of it. However, managers must be aware that these services are working under time pressure and with limited resources. In addition, the shared services business model requires that they remain accessible to all departments. Therefore, these teams must have access to a unified platform to provide fast and systematic services to the various internal business units. Gartner`s 2022 Leadership Vision for Shared Services study outlines three key questions that SSA leaders and their teams will address in 2022 and the steps they should take to communicate the value of shared services to stakeholders and uncover issues through process exploration. Quick decision-making and legal processing are essential to take advantage of growth opportunities such as onboarding new customers, collaborating with other companies, licensing intellectual property, etc. Each of them requires the preparation or review of legal documents to protect the best interests of the organization. Rapid changes in business conditions are forcing finance and shared services leaders to reassess the delivery and structure of services that have the greatest impact on operations.