Mitratech today released its latest research findings in the whitepaper, Maximize Your Corporate Edge: Legal as a Driver of Competitive Advantage.
Warren Buffett has noted that when it comes to companies in which he wants to invest, he looks foremost for what he has called “durable competitive advantage.” This means having a fundamentally superior position to the competition – defensible over time against all reasonable threats, both internal and external. He likens this position to a castle, replete with battlements and surrounded by a broad moat.
Among the departments of an enterprise, the legal department is often viewed as a necessary cost of doing business: an overhead organization for dealing with contracts and IP management; an expert coordinator of legal actions and procurer of vendors; or an administrator of claims, disputes, and other unhappy business realities.
Viewed from this perspective, the highest aspiration for general counsel is to be maximally efficient, responsive to needs, and operating with reasonably predictable costs.
These are certainly desirable goals, but leading-edge legal teams are showing that there is an opportunity for the legal department to move beyond the role of “efficient helper” to a role as “the castle builder”: the architect of durable competitive advantage for the enterprise. As Ralph Schroeder, Managing Director at Hyperion Research, notes in the whitepaper, “Companies are recognizing they have significant untapped value in their intellectual property assets. Technology licensing, merchandising and other IP-based business ventures allow the law department to drive revenue producing activities that are highly profitable.”
Compared to the tactically successful legal department, the visionary castle-building legal department:
- Operates with more forethought than afterthought;
- Understands that sometimes the best defense is a good offense, which means acting in concert with the corporate positioning, sales execution, and strategic resource planning;
- Optimizes overall spend — moving beyond simply cutting legal costs to optimize spend for business outcomes even outside of the department;
- Protects intangible assets like corporate brand reputation proactively, in concert with strategic positioning;
- Proactively mitigates risk in a way that increases business investment opportunities;
- Facilitates decisions by predicting successful business outcomes — in addition to advising in a way that prevents legal risk;
- Minimizes commercial friction to the point of being an accelerant of revenue;
- Views effective legal management as a key business selling point; and
- Does these things better than other companies in the industry
Through interviews with key Mitratech clients like Textron, KONE, and industry analysts, the new whitepaper outlines specific and practical best practices that legal departments can undertake in order to create a competitive edge for the corporation.