Articles Posted in Productivity

Striving to codify its best practices for “prep and prosc,” willing to take time to train lawyers and scrutinize processes, setting the stage for offshoring some of its work, Cisco’s patent group maintains what must be a sophisticated and complete guideline. At 70 pages, this form of knowledge management is probably maintained online – it would make an excellent wiki – and undoubtedly it memorializes years and years of experience. It is a good practice for legal managers to set down their practices and procedures for activities that are often repeated with minor variations.

All that I heard about this, from a recent conference, was the length of the guidelines and that they proscribe some billing practices by law firms, notably charging for phone calls, docketing, and “administrative services.” My comments, therefore, extrapolate from a narrow base.

“The average computer user types at 33 words per minute, 19 words per minute for composition tasks. The average person speaks at a rate of 150 words per minute for standard conversation, although trained dictators can speak significantly faster.” We learn this from Met. Corp. Counsel, Vol. 17, April 2009 at 41, and a marketing person at WinScribe, a provider of “digital dictation workflow management solutions.”

The author makes the definitional point that “digital dictation” does not imply “speech recognition” and “should not be confused with voice or speech recognition technology.” The article lays out the superiority of digital dictation over cassette-tape-based dictation, especially in regards to management of the flow of transcription and review. In-house attorneys who draft much should investigate and try dictation systems (See my post of Feb. 23, 2008: dictation with 5 references; Feb. 4, 2009: 7 dictation vendors at LegalTech NY; and April 8, 2008: dictate while commuting.).

More often than any other function, the corporate legal department manages contracts once they are executed. The following findings that elaborate on that statement come from Exari, which compiled data from more than 100 corporate respondents at the ACC Annual Meeting in 2008 and LegalTech New York in February 2009. Three quarters of the respondents were from Fortune 1000 law departments.

According to Figure 5 in the Exari report (at 10), the legal department manages contracts at 46 percent of the companies who responded. Next most commonly the lines of business had this responsibility (25%), followed by a “contract management team” (17%), a “vendor management team” (17%) and someone else, such as finance or accounting (2%). I have taken the position that contract administration is not a responsibility the legal department should willingly take on (See my post of March 19, 2009: business units should assign a contract coordinator.).

One reason law departments should not enmesh themselves in contract management is sheer volume. The Exari study found that almost half the law departments manage about 10,000 active contracts. A quarter of the departments manage about 1,000 contracts (at 11).

A report by Exari, “Corporate Counsel Contracts Survey Report,”compiles data from more than 100 corporate respondents at the ACC Annual Meeting and LegalTech New York in February 2009. Three quarters of the respondents were from Fortune 1000 law departments.

One of the findings has to do with the proportion of contracts reviewed by the legal department. Here are the six categories and the percentage of the respondents who selected them: None (7%), Quarter (28%), Half (13%), Three Quarters (22%), Everything (26%) and Unknown (4%).

It astonishes me that about half the legal departments review half or fewer of all contracts. I have been under the impression that in most US companies, lawyers review most contracts. At the other extreme, it is a waste of legal talent (or paralegal talent) to review every contract – which is the policy in one out of four companies.

To paraphrase a recent article, a general counsel should not ask, “How can I get people to collaborate more?” The general counsel should ask, “Will collaboration on this project create or destroy value?” The article, in the Harv. Bus. Rev., Vol. 86, April 2009 at 84, makes the intuitive point that greater collaboration may cause delays and wasted time; not every project requires a team at full throttle (See my post of Feb. 1, 2009: project teams of law departments with 39 references and 4 metaposts.).

The author explains a “simple calculus for differentiating between ‘good’ and ‘bad’ collaboration using the concept of a collaboration premium.” The collaboration premium is the difference between the projected financial return on a project and two other factors – opportunity cost and collaboration costs (See my post of Sept. 9, 2008: opportunity costs and legal department management.).

Hence, if you designate six people to work together on selection of a software system, you should try to figure out the return on investment from the software, and then subtract the value of alternative uses of team members’ time as well as impediments all the coordination and demands of teamwork cause the team (See my post of Oct. 22, 2008: ROI with 17 references.). Readers may agree with me that the suggested formula is much easier to state than to calculate.

A general counsel on a recent panel said that he wants an answer to this question from his team every quarter. He does not want to hear about matters that ended; he wants to hear about low-value activities that are no longer done by the law department, such as quasi-legal time consumers (See my post of April 9, 2008: quasi-legal tasks with 14 references.).

The general counsel sets a tough standard, but his question, repeated frequently, makes his team scrutinize what they are doing and how they are doing it. Simply being more conscious of pursuing efficiency will increase it over time as will being forced to state what you have done or failed to do (See my post of Dec. 21, 2008: require and publish a cost-saving idea every quarter from every lawyer who manages outside counsel; and Jan. 2, 2009: push for regular contributions to knowledge management repository.).

Likewise, even if people only articulate and question their assumptions, positive change becomes more likely (See my post of May 16, 2007: assumption that law firms have infinite capacity not borne out; and Aug. 21, 2008: family-friendly policies shouldn’t assume employees have children.).

Publicly-traded companies must collect from each of their board members and “named executive officers” (the top five by compensation as well as the CEO and CFO) a signed certificate regarding their possible conflicts of interest. The form is based on SEC rules and regulations but it may need to be updated each year for the 10-K.

The company’s independent accountants may also need a certificate from board members regarding relationships with the accounting firm. That form typically is shorter and takes less time to fill out.

A lawyer in the law department certainly may need to review the 10-K forms if any issues surface, but it is an administrative burden that should not fall on the legal department to collect and bird-dog either of the forms (See my post of April 9, 2008: quasi-legal tasks with 14 references.); and Dec. 12, 2007: Boards with 18 references.).

A friend sent me some ideas Steve Prokesch posted on April 21, 2008 for the Harvard Business Review site. I have slightly edited them.

Compare your calendar with your priorities. Label the purpose of every regular or recurring activity on your quarterly calendar and highlight those activities that further your top five priorities. This simple exercise will reveal where you’re squandering time (See my post of Sept. 3, 2008: general counsel lose control of their calendar.).

Be ruthless. Instead of persuading yourself why you can’t give up the time you’ve been devoting to [minor legal tasks and risks] that seem important even if they aren’t connected to a strategic priority, start with the attitude that you simply cannot deal with them anymore. In some cases, you’ll realize that you’ve been treating the symptoms of the disease and should finally cure the disease (See my post of June 26, 2008: priorities with 6 references; and May 23, 2008: core competencies with 12 references.). In others, you’ll discover that the task will provide a growth opportunity for someone else.

At first glance, it seems fair to reward inventors who are granted a patent a share of the later income from that patent. But at a recent conference, the panelists rejected that incentive. The administrative difficulties of tracking and apportioning income plague such an incentive. Additionally, the arrangement practically invites disputes and even litigation. Then too, it is often very hard to tell for years whether a patent has value, let alone how much value.

Cash awards at various milestones – submission of an invention disclosure, completion of the patent application, receipt of the patent award – are far more common. The amounts can be in the four digits but what an individual inventor receives may depend how many inventors are listed as contributors (See my post of Oct. 10, 2006: Dial Corp. and its awards; Jan. 27, 2006: incentives to researchers at H-P; July 25, 2007: Halliburton Energy’s policy; and Feb. 6, 2009: higher ROI for R&D with inventor rewards.). Sometimes other employees are involved in the process. For example, AT&T has “patent developers” who interface with business groups to foster patentable innovations.

In addition to cash payouts, one of the companies on the conference panel holds an annual awards ceremony, modeled after the Oscars, where the CEO attends and honors inventors, such as those who have reached milestones like 50 patents or more.

Work has become more complicated for patent lawyers as organizations have combined to create ways to buy and sell patents. What a recent conference presentation referred to as the “secondary market” can be thought of as “offensive buyers,” “defensive buyers,” and “brokers.”

The offensive buyers of patents include Intellectual Ventures, founded by Nathan Myhrvold after retiring from his position as chief strategist and chief technology officer of Microsoft Corporation; Altitude; Acacia Technologies, where Paul Ryan is CEO;

Rembrandt Management Group,and Winn.