(Note: This post was initially published on LinkedIn, and the following iteration is a syndicated and updated version of the same.)
Not every company has a law department.
Today, there are approximately 60,000 companies in the U.S. with more than 100 employees. While estimates vary, only about a third of them, 20,000, have law departments of any size.
And we suspect many of these law departments are unstructured, understaffed, overworked, or just stretched too thin.
That means about 40,000 companies, mostly small and medium-sized businesses, have no law department at all. No legal team responsible for substantive and procedural legal work. No lawyer tasked with drafting contracts and keeping them compliant.
So what, you may say, many small and medium-sized businesses don’t have legal departments. They have outside lawyers and law firms. Correct, but many smaller companies only work with outside counsel on specialized, not routine, matters.
A great deal of small and medium-sized businesses’ legal work is routine, including contracts. So, contracts, the lifeblood of business, are left unstructured, improvised, ad hoc, or worse. Managing legal functions like contracts, even under the best of conditions, can be difficult for small businesses. Understandably, having a law department may not be perceived as critical to small business success.
But access to affordable, flexible and effective legal support in areas like contracts sure makes life easier.
Small and medium-sized businesses can look to legal service providers that leverage subject matter, project management and technical expertise to support practice areas like contracts. Even in the absence of a law department.
Legal service providers offering professional contract management solutions can work with smaller companies to assist key tasks along the contract lifecycle A legal service provider can also add value to contracts where a company has no formal procurement, sales, finance, or HR department.
Not every company needs a law department. But every company needs lawyers, specialists and technologists who can improve contract workflow, increase efficiency, lower costs, and deliver results.