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FROM THE PROFESSION Key factors for successfully managing a decentralized law department By Renee S. Dankner organizational reporting structures to business leaders? Daniel Desjardins, se- nior vice president and general counsel for Bombardier Inc., recently provided his views on law department manage- ment and noted the keys to successfully managing Bombardier's decentralized law department included proper align- ment with the business structure, strong governance, good communications, tal- ent management and empowerment. While Desjardins' law department is H "decentralized" and structured to align with the company's two key business lines (aerospace and transportation), he sees the 120-lawyer department as ulti- mately "one legal function." For Desjardins, key factors of success are having the right tools and the right people. Additionally, with the increase in multinational corporations having op- erations around the world, law depart- ments must be able to adapt to new situ- ations and help to ensure that the overall model continues to work. Whether your law department is large or small, Desjardins' insights provide useful "nuggets" to consider as you re- view and refine legal-service delivery models and management practices for your company. PROPER ALIGNMENT For a better appreciation of the intrica- cies involved with Desjardins' law de- partment, it is helpful to understand its structure. ow do you successfully man- age in-house lawyers located in multiple jurisdictions around the world with day-to-day re- sponsibilities and solid-line • Bombardier's global operations include 40 plants and 60,000 employees. • There are 120 lawyers located in 17 ju- risdictions around the world. • The two key business functions have a vice president for law, reporting directly to the CEO for the business, with a dot- ted line to Desjardins. • In-house lawyers supporting the busi- ness lines report (at least on a dotted-line basis) up to the relevant VP for law and then to Desjardins. • Within the legal team, a core group of lawyers focus primarily on finance and mergers and acquisitions issues affecting the entire company, reporting organiza- tionally on a solid-line basis to Desjar- dins. While decentralized (so as to follow the company's business structure), the law department is described by Desjar- dins as "ultimately one function that has to deliver on a consistent basis the best legal services to the company." STRONG GOVERNANCE Desjardins notes that effectively manag- ing a law department — where day-to- day responsibilities of in-house lawyers are to the business units — is possible if done in a "co-ordinated fashion with common sets of rules." This includes having a single, clear set of governance standards and effective internal reporting practices. He emphasizes the importance of having "rules and guidelines that drive the efficiency of the corporation; people on the ground able to make quick deci- sions; and clear internal reporting prac- tices that provide for structure and speed in execution as information is reported up the chain." Bombardier's governance standards are important "tools" for in-house law- yers as they apply to everyone in the company and should be understood and followed by all. If not, a flag is raised within the relevant chain of command, and appropriate discussions and actions can be taken. Some of the rules and reporting prac- tices that help support Bombardier's governance practices include: • quarterly reporting-up practices and processes; • clear approval rules with respect to con- tracts execution and related terms and conditions; • guidelines that no legal entities may be created at, or for, Bombardier without approval from Desjardins; and • a database with information on the company's more than 200 subsidiaries. GOOD COMMUNICATIONS Desjardins describes himself as a "true believer in good communication." In ad- dition to communicating corporate ex- pectations and standards, an important aspect of "tone at the top" for Desjardins is explaining why governance standards and processes are needed. He emphasizes that, "Behaviour changes when people understand why decisions need to go up the chain for approval." Quarterly conference calls are a vital communications practice, implemented across Desjardins' global law depart- ment. In addition to day-to-day com- munications on important matters, the entire legal team participates in quarterly calls to highlight key developments and considerations for the law department as a whole. Conference calls are also used to C ANADIAN Lawyer INHOUSE A UGUST 2008 23