How to create a tech-savvy in-house legal function; Bjarne Tellmann, Senior VP & GC of Pearson PLC

Bjarne Tellmann VP and GC Pearson PLC 

Brave new world: how to create a tech-savvy in-house legal function

 In the emerging legal landscape, technology and an innovative team structure are integral parts of an efficient legal function. We talk to Bjarne Tellmann, Senior Vice President and General Counsel of Pearson Plc, about the new skills lawyers need to suceed and the impact of technology on service delivery.

Tell us a little bit about your background and your career to date…

I have a somewhat unconventional background for a general counsel. I started out as an actor in Norway, where I did some film work in the 80s. In the mid-80s I began taking a Bachelor of Fine Arts at Boston University’s School for the Arts, majoring in theatre, but half way through I added political science. Over time, I became more and more infatuated with politics and economics and eventually dropped theatre altogether. After graduating, I did a master’s degree in International Relations at the LSE. I then returned to the US to figure out what I wanted to do. After a gap year in which I watched a lot of LA Law, I decided to apply to law school. I took my Juris Doctor at The University of Chicago where I fell in love with the law from day one, as it joined up my interests in economics, politics and human nature.

I graduated from Chicago in 1995, which was when the globalization of corporate law was just taking off. I knew I wanted to work internationally so I joined White & Case and worked out of their New York office for a couple of years until I was asked to go to the Stockholm office to work on the restructuring of Coca-Cola’s Nordic and Northern Eurasia bottling operations. I stayed on in Stockholm before relocating to the Helsinki office. Later, I moved to Frankfurt to join Sullivan & Cromwell, specialising in capital markets. But after nearly three years there, I found myself at an inflection point where I would either go back to New York and specialize further or go in house and broaden my practice. I decided on the latter route and ended up at Kimberly-Clark in London.

Then the people I’d worked for at Coca-Cola in Stockholm asked me to join as Deputy GC of Coca-Cola Hellenic, a new and independent Coke bottler operating in 28 markets across the CIS to the EU and Africa. I was initially based in London but was moved to Vienna and then finally to their HQ in Athens.  After that, I joined The Coca-Cola Company itself, first in Tokyo as the GC for Japan and then as the GC of Asia Pacific, before transferring to Atlanta to become associate GC for one of Coke’s three global business units. I spent about four years there managing a global team of 100 lawyers. I learned how to build teams of diverse people out of nothing. I was constantly thinking of new ways to structure the team and build culture rapidly.

When I got a call from Pearson in 2014, it sounded like a fascinating opportunity. Pearson at the time was a decentralised global company that was starting to centralise. This meant that the legal team – which consisted of about 200 people globally – was being put together into one organisation with one GC and one budget. I’ve been there for just under two years and we’ve done an enormous amount in terms of building the team and creating a structure.

How did you approach creating the new structure at Pearson?

I started with a full global risk assessment because nobody could tell me what our global legal risks were; everyone had a different perception based on the silo they had been sitting in. We interviewed outside counsel, in-house counsel and clients, and patterns emerged of what the key risks were.

Generally, the teams needed to get closer to their business partners so we embedded people into the businesses. We made sure that every lawyer had a client and, more importantly, that every client had a lawyer they could develop. I also developed teams of lawyers accountable for each of the core areas of risk that we identified and appointed a Head of Strategic Initiatives to address productivity, service delivery, and efficacy, particularly within the context of the impact of technological innovation.

We’ve cut $7 million from our total spend in the last 18 months by readjusting our internal to external spend ratio and reassessing our partnerships. 80% of our external spend was with a very small number of firms and we wanted to understand whether we were using the right firms. We put in place a gatekeeper policy so only legal could go to outside counsel. We also introduced billing guidelines to make sure we were getting competitive rates, plus a panel process to select the right partners for the right types of work. This has been hugely beneficial.

We looked at our culture to understand which parts we wanted to build on and which we didn’t. The focus was on putting strategic priorities and a proper mission in place. It centred on being proactive and pragmatic, whilst enabling and protecting the business. To achieve this we needed to embed people development into our culture, including leadership, so that everyone learned to take initiative and accountability for their own progress. We’ve also worked hard to encourage more curiosity and the import and export of good ideas. That in turn requires people to build better networks. I have a policy that anyone can take anyone they want out to lunch once a month and the only requirement I have is that they bring back three ideas. It’s a great way to start conversations and builds people’s awareness of the fact that there are good ideas out there.

How have you addressed the role of technology in the team?

We didn’t really have much technology so the first thing we did was look carefully at what we needed. We came up with a list of four or five core areas to focus on. What we were missing most were matter management tools, e-billing tools, contract management systems, better IP tracking systems and an e-signature tool.

In terms of deciding the core areas, it was partly intuitive but also flowed back to the priorities we had. With costs it was clear that our legal cost structure was opaque and we had no clear picture of what we were spending money on. And an e-billing system is key because it gives you the metrics you need to drive other initiatives.

The focus on matter management tools was driven by a need to manage our litigation holistically. There were excellent individual lawyers but no holistic litigation or settlement strategy, so we ended up a scorched earth approach where everything got litigated until it burned up.

The tools have saved us enormous amounts of money. For instance, our e-signature initiative, which was very low cost to implement, has saved us $200,000-$250,000 in nine months. The tool cuts processing time by exponential amounts.

How did you go about engaging with your clients in the organisation?

We made sure that we understood what our clients felt was important. It’s easy to forget that clients also have an opinion! Initially, we did a survey to find out what they saw as the key risks and how they perceived a good legal function. It was probably the best investment I’ve made so far as I’m still working off all the things it uncovered.

I set up monthly calls with the head of every function in the business. If you make sure you’re selling your initiatives and thinking about new ways of doing things then people really appreciate the fact that you’re interested in what they think. Many of them have huge amounts of experience that can be leveraged and fed into your own strategies.

Did you need to build business cases to get the funding for these projects?

Yes, I did. When I went to the suppliers we wanted to work with, I was quite honest with them that I didn’t have the money and that I needed help to make the pitch. I needed them to put the slides together and tell me how I was going to save money. By and large, they did help and provided a wealth of great looking charts, slides and benchmark surveys showing what we could save.

Using that information, I put together a white paper showing what I’d found, the issues faced, and the technology we needed to invest in to make us more efficient and effective. I promised that it would be cost neutral, which was a calculated gamble, but if I wasn’t prepared to commit to that I’d never have gotten the money. It was unlikely to yield a return in year one but over the next couple of years we would generate sufficient returns to justify the expenditures.

How do you sell the benefits of all the changes back to the business?

By the end of 2016, my goal is to feed the key metrics from our contracts, IP tracking, litigation and spend tools into a professionally integrated dashboard. It is this data that we can sell to management. You can’t sell anything unless you know what your numbers are, especially when you’re trying to impress clients who are numbers people. It gives you credibility and earns their trust. It’s a long term project as you need a year’s worth of data before you begin to have an idea of how it’s working.

What have been the challenges and successes along the way?

After you’ve made the decision to purchase and roll out the technology, it’s very easy to drop the ball and declare victory. But the real work starts once the technology is in place. The biggest challenge is changing behaviours and business practices to make sure the technology is actually being used every day by those who need to use it. It’s been both the biggest success and the biggest challenge that we’ve had.

A key lesson is not to skimp on the implementation side of technology. Do it in the right way. The other important thing to consider is that you need a way to capture the enormous amount of data produced. You need the resources to crunch the data or else you risk losing a huge part of the value of the tools. If you have a large team, have someone full-time who’s in charge of your technology.

How do you think the skills needed by in-house lawyers will change in the future?

The provision of black letter law is becoming more of a commodity. Even at the very high end, you’re not paying for somebody to tell you what the law says; you’re paying for somebody to analyse your problem. The more the law gets commoditised, the more the real value will come from how you’re delivering your service. That’s where technology is pushing the skillset of the next generation.

We need people who are comfortable not just with technology but with thinking outside of the box and bringing in disciplines from other parts of the industry. They need to understand software design, process, and communication skills. There are a whole series of things that lawyers are not necessarily trained to do. If you consider where technology is heading in the next 10-15 years, I think the profession will be unrecognisable. I speak with a lot of people in the Big Four accounting firms and see many parallels between where they have travelled with accounting and where law may head in the next decade.

The places where we add value are service delivery, making sure it’s efficient and effective, and in providing pragmatic and proactive advice. To provide that advice you need to be embedded in the business and have a passion for it. Ultimately, you need to know your numbers and your business. Those aren’t things you necessarily learn in law school, which have no classes on managing ambiguity, resolving conflict, communicating clearly, persuading people or exercising leadership.

The way for lawyers to have a successful career in house is to spend three years at a big law firm, and then get off that treadmill and think more holistically about what their options are. If you do that then the profession is incredibly exciting. But you need to be ahead of the curve. You need to be out there picking up on what’s happening, testing things and constantly innovating. It’s a brave new world and there’s a ton of great directions you can take if you’re prepared to take some risk and seize the opportunities.

 

 

 

 

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