One of the most important yet often overlooked aspects of building a business case for investing in legal automation is understanding your stakeholders’ motives and getting their buy-in. The art of building a business case is not unique to in-house legal, however, it requires lawyers to think outside the box and consider who will this legal tech solution be impacting and what will it take to get the stakeholders on board.
3 Tips For a Compelling Legal Automation Business Case
To help you with this process, we’ve put together our top 3 tips for building an extremely compelling legal automation business case. Let’s dive in.
1. Identify all your stakeholders and where they fit in the process
Often when in-house legal teams are building a legal tech business case, they focus solely on the legal team. This approach in part makes sense because they are thinking about their department. But often what legal professionals may not understand is that the person signing off on the budget isn’t necessarily from the legal team. She or he may be a business user with responsibilities that extend to the entire organization, like the CFO, who needs to understand how the investment is going to benefit the business beyond the legal department.
So, when you’re analyzing and presenting quantitative and qualitative benefits, it’s important to not just focus on how the legal team alone would benefit from the adoption of a certain solution, but how the wider business will realize faster time to value. For example, when presenting a case for a legal document automation system, your case should highlight the speed at which legal can help business users access contracts for a sale so business users can deliver the outcomes they need without delays and ultimately, contribute to the bottom line.
As soon as you can show the top-line revenue and business-focused benefits, your business case will start to resonate with the stakeholders and become more compelling. Because you are now seen as a partner in their success. This is the ideal win-win scenario that will get you the support of the business making your case stronger.
2. Calculate ROI and justify your investment
The other piece is around really honing in on the basic metrics based ROI formula. This is about asking, how many people are involved with this process? How often do we do this process? How long does this process take each time? Answering these questions will then allow you to calculate the total human hours for that particular task in a given week, month or year. This will also allow you to attach a dollar figure by multiplying the salary of the average lawyer which will calculate the cost of a certain activity. You will then be able to look at the equivalent before and after state and ask, “how does that compare?”.
The delta in this equation is then going to determine the money on the table.
To take it one step further, you can multiply that by the number of use cases you have, and you’ll have your total quantitative business case figure. For example, if you’re buying a technology that costs you $100,000 per year, but your business case shows a delta of $500,000 per year, then that’s a good investment. You can’t save $100,000 by spending a $100,000 or you can’t save $150,000 by spending $100,000 because there’s several other costs associated with the process i.e., training, change management, switching costs and risk of execution and transition.
To successfully present ROI for the solution you’re bringing to the legal team, you’ll need to find a multiplier from the saving and the investment.
3. Align the legal tech business case with the broader corporate strategy
Another important point is to align your business case with the broader corporate strategy. In the same way that in-house legal teams often make the mistake of building a legal focused business case, they may also overlook the opportunity to think about how the adoption of this technology meets the strategic needs of the wider business.
For example, a client’s corporate strategy irrespective of the legal team’s challenges, may be around simplification and efficiencies; a key strategic pillar often seen at the ‘whole of organization’ level to achieve competitive advantage.
So, the terms ‘simplification’ and ‘efficiencies’ should be embedded in the legal team’s case to show alignment and how a legal automation solution will deliver competitive advantage for the business. Legal software like Checkbox will simplify processes, make them faster, remove bottlenecks, reduce risks and allow business users to deliver outcomes at scale when needed. This in turn will contribute to the organization’s competitive advantage.
At Checkbox, we have seen this approach in helping legal teams with their legal automation business case for investment time and time again. After all, in-house legal is a critical part of any organization that is committed to safeguarding the stakeholders and the reputation of the company as a whole. Their success translates to the success of all business users.
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