By Heather Kidd, LawVu.
With the right operational and technological foundations, legal departments can be revenue enablers and a competitive advantage to their organizations – and a recent study by the International Data Corporation (IDC)* is sparking conversations about how in-house legal teams can best deliver more value.
Ryan O’Leary, Research Director in IDC’s Security and Trust program, and David Lancelot, CLO at LawVu, believe the time is right for in-house teams to reinvent themselves as business accelerators, but the hidden costs of inefficiency and under-resourcing are hampering the legal function.
The IDC white paper; Legal Friction: The Real Cost to Your Business, paints a clear picture. Other functions run on centralized systems of record: HR has its platforms, sales has Salesforce, finance has ERP. Legal, by contrast, too often juggles email, spreadsheets, document repositories, and point solutions that don’t talk to each other. This leads to a Frankenstein of solutions across legal departments that result in what the report terms ‘legal friction’ – the operational drag that slows down business velocity. For mid to large sized organizations that works out to USD $141 million annually/GBP £106 million on average annually** in delayed or lost revenue.
O’Leary insists this is not a doom-and-gloom scenario; while the data is confronting, there’s an upside worth focusing on. When legal modernizes, the business gains speed, efficiency, and competitive advantage. ‘Legal sits at the core of the organization. If we modernize, run legal like a business, and embrace legal operations, we can shift from being seen as the department of ‘No’ to being recognized as a critical strategic partner and generate real impact to the bottom line.’
Lancelot calls this moment an inflection point. He remembers the traditional model well: reactive, siloed, and perfectionist. ‘We’re moving from that traditional approach where any need for resources was met with more lawyers. People came to us only when they needed our substantive expertise, not when strategy was being shaped. It was always the late invitation – ‘the party’s almost over, bring legal in to sign this off.’ That has to change.’
For Lancelot, the modern in-house lawyer’s purpose is crystal clear: ‘Today’s in-house teams must be a competitive advantage to the business – be businesspeople with legal skills who operate proactively. And the only way to do that is to create the headspace to think strategically, to improve deal velocity, to be part of the conversation early.’
How do legal teams create that headspace? The answer lies in technology. Both O’Leary and Lancelot stress that scaling without technology is impossible. Yet the research showed that less than a third of legal teams surveyed currently use dedicated legal platforms. Compare that with the rest of the enterprise, where systems of record are as standard as email, and the gap is striking.
‘You wouldn’t hire a new head of HR and let them run everything on email,’ Lancelot points out. ‘Yet for years, legal has had to make do without a nucleus. We are the last function to be SaaSified. But now the transformation is happening, and it’s non-negotiable if we want credibility with the business.’
The transformation he envisions is not about cobbling together yet more point solutions – and the research shows that more systems can be problematic. Rather, legal teams should consider the advantages of consolidated platforms purpose-built for in-house teams – systems such as LawVu have built that handle intake, matter management, contract lifecycle management, spend management and analytics in one place – ideally supported by purpose-built AI.
‘Consolidation leads to optimization efficiency,’ O’Leary explains. ‘With one system, you eliminate duplication, wasted time, and the endless jumping between tools that eats up hours every day.’
The report found that 99 percent of business and legal leaders who had adopted unified legal technology agreed it helped them achieve better business objectives. That kind of single source of truth has a ripple effect far beyond efficiency, it generates real-time data, and with it, credibility. ‘When I go to a leadership meeting, I want to speak the language of the business,’ Lancelot says. ‘That means charts, graphs, and hard numbers – not anecdotes. Without data, I don’t have the same credibility in the room.’
This is where legal’s narrative begins to change. O’Leary urges in-house teams to treat data the way they already treat precedent and case law: as the foundation of persuasive arguments. ‘We’re really good at building persuasive arguments for others,’ he says. ‘Now we need to build them for ourselves.’
The effect is transformative. Suddenly, legal is not just reporting cost savings or external counsel spend; it’s showing direct impact on deal velocity, risk management, and strategic goals. In a business environment where speed matters as much as safety, that’s a game-changer.
But technology is only part of the story. Lancelot is quick to emphasize that modernization does not replace relationships – it makes space for them. ‘One of the most important skills for in-house lawyers is the ability to build rapport and trust,’ he says. ‘The purpose of scalable technology is not to replace relationships, but to give you the time to have them. For example, if you don’t have time to grab a coffee with the head of tax, you won’t have the goodwill when you need it most.’
Freed from the administrative churn of email chains and manual triage, lawyers can invest in the relationships that get them invited to the strategy table early, ‘the room where it happens,’ as Lancelot puts it. This is where legal stops being a cost center and starts being a co-architect of growth.
Timing is critical. ‘We are in an AI arms race,’ O’Leary warns. Every function in the business is rushing to embed artificial intelligence into workflows, from HR analytics to sales forecasting. Legal cannot afford to lag. But he says AI is only as good as the data behind it, and fragmented systems mean ‘garbage in, garbage out’. A unified legal platform doesn’t just reduce friction today; it creates the foundation for AI to deliver value tomorrow.
And that future is closer than many think. AI-powered contract review, predictive analytics, and workflow automation are already embedding themselves in purpose-built legal systems. With the right foundation, legal teams can harness those tools not as novelties but as everyday accelerators of business.
According to Lancelot, legal is on the cusp of transformation. And while the IDC report makes it clear the costs of legal friction are real, it also notes that the gains of modernization are finally being acknowledged. Business leaders are no longer skeptical about the benefits; they overwhelmingly agree that unified legal technology drives better outcomes. What’s needed is the courage for legal teams to tell a new story, backed by data, relationships, and technology.
As Lancelot puts it, ‘Lawyers are natural storytellers. The challenge is using quantitative information to create a narrative that gets us resources. Speaking the language of business will get us there faster. Using data, such as that revealed in the IDC report, is an obvious and impactful way to engage the people who you need to support your investment and your transformation.’
‘Legal’s reputation and impact hinge on modernization,’ O’Leary concludes. ‘With the right tech, the right mindset, and the right relationships, we can solve the friction problem and become the business partner the enterprise needs us to be.’
Click here to access the IDC study
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By Heather Kidd, Senior Writer, LawVu
*Source: IDC White Paper, sponsored by LawVu, Legal Friction: The Real Cost to Your Business, #AP15041X, April 2025
**Businesses surveyed with mean revenue
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[ This is a sponsored thought leadership article by LawVu for Artificial Lawyer. ]
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