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Practice Management

The Rise of Legal Project Management

J.B. Ruhl

The Rise of Legal Project Management
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One of my friends is a construction project manager. He oversees large commercial building projects, making sure the right things happen at the right time, in the right order, in the right amount, and at the right cost. He’s deeply trained in the project management discipline, very good at what he does, and is well compensated.

Many lawyers would bristle at the idea that their litigation, transaction, and compliance work could benefit from a dose of rigorous project management. They are good at what they do and have their own “systems” for planning and keeping track of what they do. But using calendar and docket systems is not project management. Project management as a discipline focuses on developing the tools and skills to proactively scope, plan, budget, execute, evaluate, and communicate about a given undertaking, whether it be delivering a product or a service. Of course, most lawyers would like to think they do all that too, but a number of trends are demanding that they do so in a far more structured and skilled manner. In short, the demand for disciplined project management in the legal services industry is on the rise.

Legal project management (LPM) can be thought of as fitting between legal process and legal practice management. Process management is designed to eliminate waste and improve efficiencies in a particular process, such as assembling a litigation brief or transaction document. Practice management focuses on organizing and developing a broad program, such as a firm’s real estate finance practice or a legal department’s suite of intellectual property litigation. Project management bears down on the discrete matters that require assembling multiple processes and that make up a practice—the cases, transactions, and compliance counseling matters in which lawyers engage.

Project Management Has Been Employed in a Variety of Industries for Decades

Project managers are highly skilled professionals who have undergone extensive training and certification. LPM has emerged as a specialized form of project management that adapts the core tools and skills of the discipline to the particularities of legal matters and the lawyer-client relationship. Using LPM, a lawyer and his or her client will develop a more complete understanding of the scope of a matter, a plan for how the work will be conducted, the budget for implementing the plan, a system for continuous monitoring and communication as the plan is implemented and revised, and a process for evaluating the outcome and improving on it for the future. The goals are improved predictability, decreased risk, lower costs, a more dependable profit margin, and, of course, greater satisfaction for lawyer and client.

Three Main Drivers Behind the Rise of LPM Today

  1. First, legal departments, many of which have embraced LPM internally, are increasingly being held cost-accountable, so their procurement of outside representation has a more rigorous cost control element to it these days. Many clients now issue requests for proposals (RFP), and more and more of those RFPs request information on how the outside lawyers will employ LPM.
  2. Second, as clients and lawyers experiment with alternative fee structures such as fixed fees and even “soft” budget caps, more risk is being borne by the outside lawyers than is the case under the billable-hour fee method. LPM helps firms control that risk.
  3. Third, even when operating on a billable-hour basis, law firms increasingly are shifting attention from practice revenue to practice profitability. LPM has significant cost-control benefits that can deliver improved profits.

By no means has LPM taken over the legal services industry. Based on research I have conducted with Vanderbilt business professor Nancy Hyer and adjunct law professor Larry Bridgesmith, it appears that only a few major law firms have embraced LPM across a wide profile of matters and practice areas. A growing number of firms are in the exploratory stages, using LPM on pilot projects to test its results. Yet most large- and small-sized firms are unfamiliar with the LPM discipline, and some lawyers and firms operating at the most bespoke level of the practice may never have need for LPM.

In an increasingly competitive environment, however, knowledge of LPM tools and skills can help the young lawyer and his or her firm or legal department stand out. An excellent resource for introducing you to LPM is the book by Susan Raridon Lambreth and David A Rueff Jr., The Power of Legal Project Management (American Bar Association 2014).