116: The Iceberg Effect with Cameron Findlay of Archer Daniels Midland
Creating an In-house Legal Department of Value
Cameron Findlay is the SVP General Counsel and Secretary at Archer Daniels Midland (ADM), the largest food processor in the world. The legal department Cam leads has been recognized as one of ‘Corporate Counsel’s 2018 Best’ for executing change; notably firm convergence, upgraded matter management and insourcing.
Wanting the legal department to be a value center for ADM, Cam and his team set out to preserve and affect value where they could. At the outset current spend and therefore savings goals weren’t clear, but ADM knew they needed to spend less and put better controls in place. Their efforts were less about innovation and more about executing change, applying ideas that had been used elsewhere.
When they looked at spend, a key factor was a total spend of which 85% was being spent on outside firms, and 15% was being spent on in-house work. The iceberg effect was in full force, ADM’s time and effort were being spent managing the 15% above the surface with little time and effort focused on the 85%, below the surface. By seeing and focusing on the 85% they were able to implement change and achieve real savings.
Educating and changing the mindset that a small in-house staff does not equate to lower legal spend; Cam and his team educated their colleagues on a more effective process, showing business leaders that a larger in-house team would create savings. While the naming of panel firms is a suggestion, not a limitation, and that 100% compliance to matter management is a challenge a hurdle that pays off. Technology is a great enabler to practicing higher value law, focusing on matters that matter and having the data to better manage matters and matter cost. We can’t underestimate the impact of technology on the legal profession.
Outside counsel guidelines, agreeing to a specific rate structure, and concentrating work with a smaller group of firms in exchange for a value agreement is a culture change. Budget certainty for in-house teams and volume-based incentives for firms requires communication and culture; as a profession, the legal industry needs to do a better job up front as to what ‘work’ will cost. Firms add value when they proactively present cost saving and fee arrangement ideas, getting in front of alternatives; that proactive management matters.
Cam commented on the rise of activism putting pressure on companies to change the agreements they have with law firms; that every organization will have to do more with less. Today there is an opportunity to disaggregate the legal process to a variety of resources – contract lawyers, non-lawyer professionals, and that opportunity exists to utilize alternative providers. Cam and others are asking firms to understand the spirit in which they are entering into agreements and to come up with innovative ways to provide great legal service at a lower cost.
Cameron Findlay has been the General Counsel for three important organizations after a career in private practice and government – which included time as a law clerk for Justice Scalia. Cameron Findlay Bio