Free strategy advice for law firms with Andy Cooke – Part Two

After our stroll in Harewood Park, we get lunch at a nearby café. At this point, we’ve been talking for hours, but our conversation shows no signs of flagging. Even my co-founder Jake Jones, who so far has stealthily stayed out of the frame, can’t refrain from joining in. We’re getting into the finer points of the legal sector’s radically uncertain future. We discuss broccoli, mashed potatoes, and sweeties. 

Lilian Breidenbach: Tomorrow we’re filming with Ben from Crafty. I haven’t met him. I think it’s going to be cool. 

Andy Cooke: He’s super nice. He just wants to get people together. I’m sure there’s a grand plan somewhere, but he’s not doing it with some kind of angle. He’s just like: This didn’t exist when I was working in private practice, so let’s create it. 

LB: And people seem to really love it. I’ve not experienced so much love for a community as I have seen with Crafty Counsel. And I get it. When I started speaking to small in-house teams, the one thing I felt most was a sense of loneliness, because it seems to be a very lonely road at the beginning, especially if you don’t have the best relationships with the rest of the company. 

AC: There’s some big questions there, an underlying legal nervousness. If it’s not about the documents, and it’s not about me being a trusted advisor, then what is it about? That’s the quiet voice in the middle of the night thinking that underpins a lot of that. I’m here doing this thing, but I don’t necessarily feel like I’m 100% adding value. If you can build a community where people are comfortable with sharing that kind of thing, then it’s a good start. Even within our team-building atmosphere we talk about “celebrating wins”. People feel a pressure to constantly talk about wins. But I don’t just want to hear about your sub-four hour marathon. I want to hear about the days when you got up and it was hard to run, and you only just made it round the block, because you were tired or it was wet. Celebrate that as well. I know it’s a bit cliché, but I think it’s important. 

I don’t just want to hear about your sub-four hour marathon. I want to hear about the days when you got up and it was hard to run, and you only just made it round the block, because you were tired or it was wet. Celebrate that as well.

LB: Absolutely, and I think it requires a sense of safety. We think about this a lot at Legal OS. This year has been super exciting, but there’s going to be moments where it’s not exciting and really tough. You need to create a safe enough environment for people to talk about that. 

AC: Has Tom mentioned the terms broccoli, mashed potatoes, and sweeties to you? 

LB: No, but I want to hear about them as we’re eating. 

AC: Mashed potatoes is the kind of task we want to get rid of, because it’s bland, repetitive, and all the same. If you’re eating mashed potatoes, then you’ve got to change the process. Whereas building better underlying source materials is broccoli, because it’s good for you, it’s all vitamins, you gotta fork it down. 

LB: You’ll feel great in six months. 

AC: Exactly, and if you eat enough broccoli, then occasionally you might get to eat some sweeties. 

LB: That’s nice. I like that. 

AC: Personally speaking, I strongly dislike my potato. For some people, mash is comfort food, it’s that safe space of knowing what you’re forking down, but there’s no nutrition to it. 

LB: And if 80% of your day is eating mashed potatoes, and you want to change that, then you have to be very comfortable with uncertainty. Because if you replace that 80%, then you’re confronted with something new. 

AC: That’s why the first word in the DNA on the back of our hoodie is change. We start with the premise that everything about the way in which things get delivered by in-house teams is genuinely wrong. It’s not customer-centric, it doesn’t deliver visibility, innovation, or wow moments. Instead of doing just a few tweaks, we should be rethinking not just how we do things, but also where we need to be working. So, we get rid of all the mash. Lawyers should be working and innovating in the space of radical uncertainty. Do you claim to be competent at managing risk? You can’t just make a wonderful risk register that says all the things you know everything about. It may help you sleep at night, but it’s the illusion of control. Because when Covid came along, all those things got completely ripped up. Lawyers ought to be working in the space of radical uncertainty and behavioral risk. You have to actually get out from behind the product and speak to people about what their needs, concerns, worries and goals are. A lot of lawyers are not super comfortable working in that space, because you’ve got to ask some hard questions. 

We start with the premise that everything about the way in which things get delivered by in-house teams is genuinely wrong. It’s not customer-centric, it doesn’t deliver visibility, innovation, or wow moments. Instead of doing just a few tweaks, we should be rethinking not just how we do things, but also where we need to be working... Lawyers should be working and innovating in the space of radical uncertainty.

LB: I’m not a lawyer. I didn’t go through law school. But I’ve talked to a lot of lawyers, and I have a lot of lawyers in my family. To me, it seems like that’s a daunting cultural shift that needs to happen, that lawyers need to become very comfortable with uncertainty. 

AC: Yeah, with radical uncertainty, with things that aren’t easy to predict. When those things happen, how do we create resilience in an organization in order to be able to deliver against them? Resilience is not a quality of your risk register. That’s all mash. Once we’ve used technology to eliminate a lot of this stuff, what do we do then? The answer is dealing with radical uncertainty, but it’s an uncomfortable answer, because for so many law firms managing risk means wrapping it within a contract. It ends up being about deliverables, and it’s not about deliverables. It’s about super deep customer-centricity. Customer-centricity is not something we do because we want people to like us. It’s absolutely fundamental to the goal state of working with radical uncertainty and helping people think in a way that is more resilient. That’s a much more seismic cultural shift, but it’s an answer to the question of what you do when the AI is here and does what you used to think was the core of the job. 

LB: If you’re someone just starting your career, how do you get into that space? 

AC: You could start by making some assumptions about what your day-to-day work is going to look like in the future. Because why, if you’re a tech-minded young lawyer, would you want to work in a place that doesn’t talk about these kinds of things? Eventually some law firms are going to switch into that. People come up to us all the time, asking if we have any places available. They would love to work for us, because they see that we’re trying to innovate. So eventually there will be some pressure from that group of young lawyers. We all want to work in innovative spaces. If you’re not prepared to innovate, then we’re just going to find a place that is. 

LB: 100%. And those core assumptions (about your day-to-day work in the future) would be that you’ll be curating knowledge, working with a huge amount of complexity and uncertainty, and figuring out those really gnarly problems in fast-growing organizations. 

AC: Yes. Think of all the queries you’ve ever answered as a legal team. On one end of the complexity-spectrum, you’ve got questions like “who’s authorized to sign for this business”, on the other end, things like “we want to IPO”. That’s your range. We can now assume that half of that will be gone, so you’re already starting with quite a high level of complexity. How can we leverage the entire history of our firm’s dealings in relation to this work? The rock face is higher, but you have the advantage of all this technology to facilitate you climbing it. 

Customer-centricity is not something we do because we want people to like us. It’s absolutely fundamental to the goal state of working with radical uncertainty and helping people think in a way that is more resilient. That’s a much more seismic cultural shift, but it’s an answer to the question of what you do when the AI is here and does what you used to think was the core of the job. 

LB: And you have a much denser body of knowledge that could support you in tackling these high-complexity problems. 

AC: Yeah, it’s like strapping on a mech suit. You now have access to all this history that you can leverage. How many times has that clause ever been litigated? How many times have we ever changed it in the entire body of our firm’s workflow? What other information is available from the market right now that is relevant to this analysis? We’re going to bring some of these features on stream with Legal OS in TravelPerk. It’s not just about serving the cold query. It’s about what other information or data is out there that is germane to the query and that will hyper-accelerate the chance that the TravelPerk-negotiator is going to win. Indeed, the win is not just to get my clause in, but also to position TravelPerk as a hyper-innovative business from moment one. 

How can we leverage the entire history of our firm’s dealings in relation to this work? The rock face is higher, but you have the advantage of all this technology to facilitate you climbing it.

LB: It’s a different experience throughout. 

AC: Yes. If you’ve had a lovely conversation, where an SDR has gone out to you, and they’ve really sought to understand your business, but then you hit a contract negotiation, the gloves come off, and it’s ruthless, we don’t want that. That’s not consistent with us helping to create an enjoyable business travel experience. We want that aim to infuse the way we work, and for that gen AI opens up all kinds of opportunities. I would much rather be having difficult conversations about what the future of law looks like, than awful conversations about contract throughputs or other dumb metrics that don’t speak to happiness. 

LB: You talk a lot about the upsides of AI. Do you have any concerns about AI, either for your legal team, for the legal industry as a whole, or just as an individual in the world? 

AC: My concern for the legal industry is that it will collapse in on itself. When I first started talking to friends about AI, their immediate response was that all those lawyers are going to find a way to become like notaries, where essentially you’ll have to speak to them about something and get a piece of paper stamped, and that’s how they’re going to get paid. They’ll work out a way so that you have to speak to them. 

LB: In Germany, the notaries have to read out every word of that contract in your presence. 

AC: Right, and that was their instant response, which says, I think, a lot about how they look at the ability of the profession to innovate. Generally, my impression is that people are not seeing lawyers as being okay. It’s where they go to get solutions, and it’s pretty painful and super expensive. That’s my concern, the gap that we were talking about. Everything in our daily lives is becoming so much more convenient. AI just hypercharges that from a knowledge- and data-availability standpoint. That’s all happening in our personal lives. And here Law is just refusing to innovate. The gap is becoming so big, that eventually people are just going to roll the dice. I think a lot of companies are already in that space, particularly in the tech sector. They’re just going to roll the dice, because the thing they’re worried about might actually never happen, but the bill for that law firm and the friction of dealing with them is definitely unsustainable. 

LB: I talked to a founder at the Gradient event in San Francisco, and she was saying how they used to send all their contracts to the law firm they were working with, but very often the bill for reviewing and supporting that negotiation was higher than the ACV of that contract. So at some point she just decided to sign. She knows she needs to watch out for these three clauses, and if they’re not in there, then she’ll just sign. She’ll take the risk, because otherwise her business will die. 

AC: That’s the perfect expression of it. I can either speak to law firms and my business will die, or I cannot and it probably won’t. Bells should be ringing about these kinds of things. I think the problem is not any specific AI, it’s the steadfast refusal of firms to innovate. I always say that there’s no party you’re not part of. If you don’t have technology in your workflow now, you just have to start somewhere. There will be a point where it becomes very difficult to cross the divide without completely reconfiguring how you do things. Legal happiness is something that’s super important to us, but all the incentives in the legal sector are for it to stay exactly as it is. I think that’s a shame. Other functions care so much more about releasing the capabilities of individuals than lawyers do. 

LB: I see it on LinkedIn, just following a few people who are talking about their daily life as GC. The amount of time I see the word burnout in the legal team is much higher than in other teams. You’re the only person I know who talks about their legal happiness. Otherwise I never hear those words. 

AC: What’s super interesting is when you do surveys. We have an internal engagement survey that we replicate for our partner firms. It has questions like When was the last time somebody talked to you about progress in your career? Have you got the resources you need to do your job? So we pushed it out to all the firms. In some firms, no associates responded, and in other firms, all the associates responded. First of all, those are great data points. But one of the firms actually lawyered the survey. Two of the questions were Has someone talked to you about your career progress in the last three months? Has someone given you praise with regards to your work in the last seven days? They took out “three months” and “seven days” and replaced them with “recently”. 

LB: I can’t believe they edited your survey. 

AC: Right? It’s supposed to be binary, do you not see that? That’s the worst possible response, introducing uncertainty into our survey about happiness. You’ve told me everything I need to know. That’s the kind of thing we’re dealing with when we talk about happiness. 

Jake Jones: They’ve answered the survey on your behalf. Done.

AC: Perfect, thank you very much! Regularly I’ll carve off associates, maybe while we’re having coffee, and go: I noticed you didn’t respond. I don’t want to put any pressure on you, but how’s it going? Do you understand where your career is going and why it’s going there? Is this working for you? And they’ll be like: At the moment I’m just trying to keep my head down. So you’re working with one of these firms, you’ve crushed school, crushed law school, you’re extremely intelligent, extremely hardworking, and yet that’s what you aspire for. I aspire more for you, and you’re one of the associates of the firms that we work with. Tell me about it. I will do whatever we need to do to help here, because this sucks. All the incentives within law firms benefit that group at the top. And it’s working for them, I mean look at the amount of money they’re making. But the human cost is high. If we’re going to evolve how all this works, a significant amount of the great strategy stuff comes from the people who are at the coalface, who are not already preconditioned by the system and are unafraid to lose political capital. 

LB: When we started Legal OS, we thought it might actually be good that we’re not lawyers, because we can think about things in a different way. Going to law school forms your beliefs, and many of those are limiting beliefs. So we felt like it was a risk, but also an opportunity. 

JJ: I’d also worked in consulting, where there was still the privileging of human effort, raw human effort being valuable in its own right, the outcome being irrelevant. If you’re billable, if you’re chargeable for 100% or more, that’s a good thing. So if you’re working late, it doesn’t matter if your output is dreadful. What we’ve seen with some of our customers, who arrived in in-house teams from being associates in law firms, is that it’s hard to get out of that mindset where grinding is success. Because it’s not. The outcome is customer delight. And if the outcome is customer delight, you need to get there by hook or by crook. If grinding doesn’t lead to customer delight, it’s irrelevant. Equally, if you appear to not be grinding, and it does lead to customer delight, that is success. I wonder what your experience has been, especially with more junior people, in getting them away from the incentives to merely grind, towards this more strategic mindset, which I think I see in your team. 

We’re gonna take successes from our customers being happy, but it’s a much slower burn, and it’s going to involve fewer peaks. On the plus side, you’re going to have a really clear idea of what your growth is, and you’re going to work, we like to think, in the most innovative team in our space.

AC: Prioritizing building is front and center of it. The hardest thing to overcome is the individual incentive of the dopamine hit that comes from grinding. If we’re just building, if it’s a constant process of building, we’re getting the product iteratively better through our work. There are fewer high fives in that, and that’s one of the important principles. You won’t get people constantly praising you for how hard you’re working. You’ve got to forget about all that. We’re gonna take successes from our customers being happy, but it’s a much slower burn, and it’s going to involve fewer peaks. On the plus side, you’re going to have a really clear idea of what your growth is, and you’re going to work, we like to think, in the most innovative team in our space. So if you spend time in this kind of environment, wherever you go next you’ll be the leading voice on how this gets done. That’s how it pays back to you. But some people find themselves going back to the dopamine hits. It’s like that test where they give kids a marshmallow and leave the room. I know I need to do that thing to make the model better, but actually I’ll just do a few quick contracts first. Take that pain and use it to build a better product. 

Check out Part One of the conversation here.

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