ceb legal executive webinar - a conversation with axiom and the vanguard group

CEB Leadership Council for Legal Executives

28-July-2016

Flexible Legal Talent Models

A Conversation with Axiom and The Vanguard Group, Inc.20 June 2017

28-July-2016

A Framework for Member Conversations

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3© 2017 Gartner, Inc. and/or its affiliates. All rights reserved. GC171851

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ABOUT THIS WEBINAR SERIES

This roadshow series will highlight the growing use of alternative providers in an effort to help in-house counsel design their own flexible, low-cost legal supplier network.

Learn about non-law firm providers, their services and value propositions, and the experiences of other legal departments working with them2

Understand and navigate the rapidly changing market for legal services1

Design a strategy to reduce the cost of specific legal workflows3

Project # xxxxxx

Catalog # GCR170464PR

Year Range 170464


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OUR PANELISTS

Courtney FletcherVP, Financial Services

Axiom Global, Inc.

Courtney Fletcher leads client development and partnership for Axiom’s Financial Services practice in the Northeast. Her team partners with global investment banks, asset management firms, hedge funds, private equity firms, fintech, insurance, and other diversified financial services clients. Prior to joining Axiom, Courtney worked in the investment banking industry, and also practiced as a commercial real estate attorney. She received a BA from Duke University in 2001 and JD from the George Washington University School of Law in 2007.

Michael Kimmel is responsible for the core legal support functions for Vanguard, a top global asset manager. He has shared responsibility and oversight for a global legal and compliance team of 300+ in seven countries. Michael leads the Technology, Digital, & Mobile; IP; Privacy; Commercial Transactions; Real Estate; and Corporate Governance legal teams. Prior to joining Vanguard in 2005, Michael was an associate at Robinson, Bradshaw & Hinson in Charlotte, NC. Michael received his AB from Dartmouth College in 1994 and JD from Duke University School of Law in 2000.

Michael KimmelPrincipal, Deputy General Counsel

The Vanguard Group, Inc.

Project # xxxxxx


Year Range 170464


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ROADMAP FOR PRESENTATION

The New Legal Operating Model

Panelist Discussion:

Flexible Talent Models

Question and Answer Session


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44% In-House Spending

TRADITIONAL RELIANCE ON OUTSIDE COUNSELAllocation of Legal Department Budgets

Only 4% of legal department budget is spent on alternative legal providers…

Source: CEB 2016 State of the Legal Function Survey. Source: CEB Managing Law Firms to Actual Quality.

...despite continued rate increases...

5.4% year over year increase in law firm rates

Source: CEB 2015 Real Rate Report.

…and mixed satisfaction with law firm quality.Percentage of Legal Departments Rating Outside Counsel as Effective

70% Accurate

28% Actionable

16% Risk-Aligned

4% Cost Effective

56% Outside Spending

Project # xxxxxx


Year Range 170464


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Project # xxxxxx


Year Range 170464

EMERGING ALTERNATIVESEvolution of the Alternative Legal Service Provider Market Over Time

Source: CEB analysis.

2000–10 2015 2020

Labor Arbitrage

Offshore LPOs offer savings on labor for highly-routine, rules-based work.

■ E-discovery ■ Document management

Technology-Enabled Process Improvement

Digitization and onshore talent enable outsourcing of low-level factual analysis.

■ Legal research ■ Trademark and patent filings ■ Contract drafting ■ Third party and anti-corruption assistance

Automated Problem Solving

Cloud storage, machine learning, and data analytics enable providers to take on more judgment-based activities.

■ M&A due diligence ■ Contract analytics ■ Business risk analytics ■ Tax law ■ Regulatory compliance


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RECOGNIZING THE CHALLENGEUnderstanding Discomfort Associated with Alternative Legal Providers

Source: CEB analysis.

Change Risks

Potential resistance from in-house staff and business clients

Financial Risks

Concern that total management costs will exceed advertised savings

Performance Risks

Discomfort with the quality of work produced by alternative providers

Project # xxxxxx


Year Range 170464


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Axiom


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4 © 2016 Axiom Global Ltd. Confidential and Proprietary Property of Axiom

-- Richard Susskind

“Until the platform is burning, most law firms aren’t likely to change radically. To successful law firms, I always say: It’s hard to convince a room full of millionaires that they’ve got their business model wrong.”


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STATE OF THE LEGAL INDUSTRY

From Artisanal... ...to Industrial


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Work Segmentation

Project & Process

Management

New Legal Delivery

Models

Tools & Technology

What Does “Industrial” Mean?

INDUSTRIAL DNA


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0

0.5

1

1. 5

2

2. 5

3

3. 5

4

4. 5

0 2 4 6 8 10 12 14 16 18 20 Time

Workflow

Capacity

Workflow Volume

Law Department Fantasy


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0

0.5

1

1. 5

2

2. 5

3

3. 5

4

0 2 4 6 8 10 12 14 16 18 20 Time

Workflow Volume

Workflow

Capacity

Law Department Reality


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0

0.5

1

1. 5

2

2. 5

3

3. 5

4

0 2 4 6 8 10 12 14 16 18 20 Time

Workflow Volume

Workflow

Capacity

Law Department Optimized


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11 © 2016 Axiom Global Inc. - CONFIDENTIAL

▪  Fixed costs in a dynamic environment

▪  Declining budgets even in periods of corporate revenue growth; Limited discretionary/investment funds

▪  Systemic career-pathing issues challenge cost and team retention

THE IN-HOUSE DEPARTMENT Under Immense Pressure

▪  Bloated cost structure

▪  One resource category (associates) generally available for secondment

▪  Limitations on volume and duration of secondments

THE LAW FIRM Stuck on the Status Quo

64%

36%

Traditional Composition of Corporate Legal Industry

Emerging Composition of Corporate Legal Industry

20%

50%

30% ▪  In-House Department ▪  Law Firms ▪  New Delivery Models

Axiom Fills the Void Between In-House Teams and Law Firms

▪  Variable, efficient delivery model drive significantly lower costs

▪  Suited for majority of corporate legal work: contracts, regulatory, compliance, privacy, M&A, and unbundling litigation

▪  Multiple resource categories and proprietary technology

NEW DELIVERY MODELS Enabling Better Performance


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12 © 2016 Axiom Global Inc. - CONFIDENTIAL 12

HIGHLIGHTS

We Support Clients Across the Globe

§  Axiom now serves over half of the F100 globally

§  17 Offices and 3 Centers of Excellence globally

§  Recognized as Top 7 Trailblazer by The Lawyer and #1 Innovation in Strategic Resourcing by the Financial Times

HIGHLIGHTS

~2,000 Axiomites worldwide

1,000+ Attorneys & compliance specialists

#1 World’s largest recruiter of legal talent

1M+ Contracts per annum


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13 © 2016 Axiom Global Inc. - CONFIDENTIAL 13

Scale & Experience

Scale

Our Clients

Our Attorneys

Experience

7-year growth of our top-10 client relationships

World’s leading & largest hirer of attorneys*

We work with nearly half of the Fortune 100 and all 10 of the world’s largest banks

>600%

Notes: *According to The NALP Foundation, Associate Attrition Report, 2014

Pace of >100 new engagements per month

We Are the Market Leader in What We Do

§  ~2,400 attorneys interviewed per year

§  >350 attorneys recruited per year

§  Seniority levels range from 2 PQE through to ex-law firm partners/GCs

We have engaged attorneys over 6,000 times

We know how to grow together with our clients

1,000+ attorneys

Real Estate

Capital Markets

Asset Management

Labor

Derivatives

Litigation

Intellectual Property

Corporate Transactions

Healthcare

Other

Compliance & Regulatory

Banking & Finance

Technology

Commerical

Number of Engagements

1500

1000

500

0


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Vanguard: A Case Study


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Elastic Subject Matter

Expertise

Integrated Substitute for Law

Firms + FTEs

Regulatory Compliance

Project Support

Variabilize Non-Core

Contract Support

Gapfills

Embedded Axiom Attorneys


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Applying Process, Technology, and Operational Excellence to the Contracting Lifecycle

18 © 2014 Axiom Global Inc. - CONFIDENTIAL

• Metadata extraction, storage and analysis

• Ongoing obligations management, compliance review and renewals

• Request/ Assign/ Draft/ Negotiate/ Execute

Business Outcomes

PROCESS TECHNOLOGY PEOPLE

•  Playbooks •  Forms •  Process Maps •  Productivity and training tools

•  Junior-ize work where possible •  Mix of FTE and Variable

Resources •  Expertise where needed •  Ability to adjust to volumes/

spikiness

•  Technology for document management

•  Tools for tracking volumes, throughput and performance

•  Ability to meet firm goals and mandates including cost containment •  Continuous improvement embedded in model •  Providing optimal internal client service

Contract Creation and Execution Contract Information Management

Obligations Management

FOCUS for TODAY’S DISCUSSION:

Foundational Capabilities via In-House and Outside Partners


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Thank You