What Diversification of Service Provision within Organisations Teaches You About Control vs Velocity
In today’s rapidly evolving business landscape, organisations are constantly seeking to accelerate growth and expand the scope of their business operations. This is affected by both efforts to expand their geographic footprint and the scope and diversity of services provided. For legal departments, this pursuit of velocity often creates tension with the imperative to maintain control and mitigate risk. The business demands speed, while legal is tasked with enabling growth without becoming a bottleneck. This paper, a collaboration between Steven Fink and Aaran Scott, explores how legal teams can navigate this challenge by transforming perceived obstacles into pathways for controlled velocity.
1. The Control vs Velocity Tension: Why Legal Feels Like the Bottleneck
Legal departments within organisations are inherently designed to ensure compliance, manage risk, and uphold governance. As businesses scale, particularly as they increase the diversity of services and geographic footprint, the complexity of these responsibilities escalates dramatically. The perception often arises that legal processes are slow, cumbersome, and an impediment to business agility; essentially, that an in-house legal function is a roadblock.
This tension is not a failure of the law or the in-house legal function to adapt. Rather, often it is a symptom of unmanaged complexity within governance structures and processes. The challenge lies in reconciling the need for robust control and for understanding and managing risk with the demand for operational speed.
2. When Governance Complexity Grows Invisible
Steven Fink highlights a critical issue: governance complexity often grows invisibly. As an organisation diversifies its service offerings and expands its geographic footprint, the intricate web of regulatory requirements, internal policies, and inter-entity relationships becomes increasingly difficult to track and manage. This is even more so when that diversification and expansion is incremental and a result of ‘scope creep’ as opposed to a deliberate strategy, such as where a business will start providing additional services to customers beyond those that have been contracted for.
This ‘invisible’ growth can lead to unforeseen risks, compliance gaps, and operational inefficiencies that only become apparent when a problem arises. The ACC and Deloitte’s 2023 Legal Entity Management Practices report underscores this, noting that while regulatory compliance and legal entity governance are top priorities, many teams face significant execution pain points [1]. Without a clear understanding and proactive management of this complexity, legal teams can quickly become overwhelmed. A specific example Steven has observed during his years of experience working as a senior in-house lawyer is the use of technology, the most recent trend of which is the desire to adopt AI. Businesses are always keen to adopt new technologies into their operations as quickly as possible – there is huge potential upside to first-mover advantage, and no one wants to be left behind. But navigating these changes can often create tension between the business and their in-house legal and compliance function.
As is evidenced presently with AI, the legal landscape is constantly evolving, with new and developing laws and regulations being implemented in different ways and timescales across different jurisdictions. This creates challenges for lawyers in managing associated risks, which first need to be identified, and is especially difficult when the diversification of services and adoption of technology extend beyond the core skills of the relevant legal teams.
3. Why Legal Teams Get Overwhelmed at Scale
Scaling operations to encompass diversifying business operations introduces a myriad of challenges that can overwhelm legal teams:
- Variety of Regulations: Differences in local, national, and international laws and regulations.
- Data Management: Tracking corporate records, contracts, and compliance documentation can become increasingly challenging.
- Resource Constraints: Legal departments often operate with limited resources, making it difficult to manage an ever-increasing workload.
- Extension beyond Core Competencies: Legal departments that usually advise on general areas of law, such as commercial contracts or employment law, are often called upon to advise on more technical and evolving areas of law, such as data protection and intellectual property (IP).
- Lack of Standardisation: Inconsistent processes and procedures lead to inefficiencies and increased risk.
- Reactive vs. Proactive: Without proper systems and processes, legal teams are forced into a reactive mode, constantly addressing issues rather than strategically preventing them.
The CLOC Core 12 framework for legal operations maturity emphasises the need for strategic planning, information governance, and technology adoption to move beyond reactive states [2].
4. Creating Control Through Structured Delivery
Aaran Scott‘s perspective offers a solution to this overwhelming complexity: creating controlled velocity through practical and structured delivery. This involves a multi-faceted approach:
- Process: Effective process alignment transforms legal from perceived bottlenecks into strategic enablers. This requires deliberately integrating legal considerations into the core Go-to-Market (GTM) processes and strategies [3]. By embedding these early and fostering cross-functional collaboration, organisations can achieve controlled growth without compromising compliance.
- Scope: Clearly defining the scope, objectives, and deliverables for each legal matter or project, in collaboration with the legal department. This prevents scope creep and ensures resources are allocated effectively; for more insights, see our previous article: why legal scoping is a competitive advantage.
- Standardise: Implementing consistent workflows, templates, and best practices across all business operations. This reduces variability, improves efficiency, and enhances compliance. The CLOC Core 12 functional areas, such as Service Delivery Models and Knowledge Management, provide a framework for achieving this standardisation [2].
- Tools: Leveraging technology for legal entity management, contract lifecycle management, automation, and legal matter management. These tools can significantly reduce manual effort, improve data accuracy, and provide real-time insights into governance status. Deloitte’s Legal Entity Management services, for instance, offer solutions to enhance transparency and reduce costs [1].
This approach transforms legal from a perceived bottleneck into an enabler of business growth. By establishing clear processes and utilising appropriate technology, legal teams can proactively manage complexity, ensuring velocity without compromising control.
5. Conclusion: Designing Governance for Scale
“Governance doesn’t slow businesses down; unmanaged complexity does.”
This key insight underscores the paper’s central theme. The goal is not to eliminate governance, but to design it in a way that supports, rather than hinders, business velocity. For organisations diversifying their service offering and geographical footprint, this means moving beyond ad-hoc approaches to a strategic framework that embraces structured delivery. By implementing structured matter scoping, standardising processes, and adopting advanced delivery tooling, legal departments can achieve controlled velocity. This proactive approach ensures regulatory compliance, mitigates risk, and ultimately enables the business to scale efficiently and effectively.
The co-authors:
By Steven Fink, a proficient senior lawyer with over 25 years’ experience, the majority gained in-house with global logistics business DHL. Currently exploring new and exciting opportunities to provide legal and commercially pragmatic support to businesses.
By Aaran Scott, a global legal operations strategist and founder of Telescope, drawing on 10+ years of partnering with leading law firms to transform matter management and deliver exceptional client value.
References:
[1] ACC and Deloitte. (2023). 2023 An Inside Look at Legal Entity Management Practices.
[2] CLOC: Core 12 – Evaluate the Maturity of your Legal Operations.
[3] DRATA: Turning Security Compliance From a Bottleneck Into a Growth Enabler.