“A particular bugbear of mine is the application of financial metrics to nonfinancial activities. Anxious to justify themselves rather than be outsourced, many service functions (such as IT, HR, and legal) try to devise a return on investment number to help their cause. Indeed, ROI is often described as the holy grail of measurement — a revealing metaphor, with its implication of an almost certainly doomed search.” This view comes from the Harvard Bus. Rev., Vol. 86, Oct. 2009 at 99-100, as part of an article about performance measurement.
Often have I written about the slipperiness of calculating a return on investment for specific programs, but never about the ROI for the legal function as a whole (See my post of Oct. 22, 2008: ROI with 17 references.).
A fortiori, if individual initiatives can’t support an ROI calculation, neither can the entire department.