Flexible management methods (Agile) were first used in IT and then branched out to marketing, HR and other fields. Following the trend, many people forget that Agile is not suitable for every company, which results in no benefits after reorganization. See this article to learn how the transformation started in ILF and what organizational structure to choose depending on your projects and internal communications.
First we made a description of the existing business processes in the company and realized that old project management techniques are not as effective as they used to be. There are three reasons for this:
- High degree of uncertainty in legal projects. Goals and objectives often change mid-flight: new circumstances emerge, previously unknown facts come to light, or the client remembers that he had not told everything at the beginning. Given the clients’ preference for fixed budgets and the company's initial consent to this, this uncertainty makes it difficult to keep projects financially successful.
- Uneven distribution of workload among the lawyers: someone needs a week to perform one task while others have to do everything else. The more employees there are under one partner, the harder it is to keep track of tasks set to each of them.
- Lack of transparency - and thus, unclear contribution of each employee to to the overall results. The work of two departments may differ so drastically that responsibilities of two employees that have worked for many years at the same company may never overlap even in the same project. This makes it hard to tell who does what.
In search of tools that could fix our project management system, we turned to Agile (read in more detail in the previous article), starting with changes to the organizational structure.
Functional, project or matrix structure
Initially, ILF had a functional organizational structure, which is popular in the legal market - lawyers with similar duties were joined into practices (departments), with their work run by partners - department heads. This organization model has its advantages: the employees are on the same wavelength and can help each other out or even do the work of their colleagues; they can exchange knowledge, which leads to rapid professional growth, and managers are usually excellent specialists themselves and thus could serve as mentors in their respective fields.
However, it’s often the case that a single project requires the knowledge and expertise of different branches of law, which means that you need to involve employees from several departments. The functional organizational structure doesn’t handle this well, since those involved in the project do not have common leadership, plus the project cost management gets more complicated: each department manages its own share of the project budget, and forming a general schedule requires joint planning meetings of the leaders of all departments involved, not to mention the risk management and expectations of stakeholders. As a result, a project that is a top priority for one department could be of no interest to another.
Difficulties with complex multifaceted projects prompted us to check out the project-based organizational structure, where specialists from different fields work together as part of project teams. A team, led by the project manager, is able to successfully plan and carry out the project due to have all the necessary skills and expertise. This organizational structure has proven its worth in IT.
However, this organizational structure did not suit us because of the specifics of legal projects. As an example, the total amount of work on one project for 4 specialists can be 70 hours over 9 weeks. At the same time, one lawyer can work on 50 projects during the same period of time. Thus, if we organize work as an IT firm, the meetings will make up 90% of our time.
Fortunately, there’s also the matrix organizational structure, which combines the two above-mentioned approaches. It can be imagined as a grid, with the vertical representing departments and the horizontal - projects. At the intersection of the vertical and horizontal lines we have specific lawyers, who are from specific departments but are working on specific projects. What does this give us? Only the best of both models.
Within his horizontal coordinates, the project manager can act as under the project organizational structure. All project aspects, be it the budget, risks or work schedule, are under his complete control. The projects manager also handles all communication with the clients. Aware of the big picture and possessing the authority to decide the work schedule, the project manager is able to coordinate the team’s work so that a lawyer defending a client in court could receive an opinion from an expert on international treaties in time, with enough time left to adjust the defense strategy.
The partners - practice heads - also feel confident when running their departments. Tasks in all projects in which employees are involved are collected into a single stream, the processing of which is the department heads’ job, who no longer need to be distracted by project minutiae like drawing up a table of stakeholders, budgeting each project, assessing and reassessing risks, etc. They can just focus on creating a comfortable atmosphere for the team, quickly addressing the problems encountered by employees, evenly distributing tasks among them, all the while keeping in mind their personal and professional growth.
How it is in practice
So does this make the matrix structure the holy grail? The skeptical reader is probably thinking that there must be a catch, and that’s true. The matrix structure is fragile and tough to set up due to a high probability of conflicts between managers of horizontal and vertical structural units, as well as the risk of dual management for employees.
To overcome these difficulties, it is necessary to consider and establish the rules of the game right from the start, to determine who and when makes final decisions and who is responsible for what. You should aim for a balance between the powers of project managers and department heads.
We get different types of the matrix structure depending on the direction in which this balance shifts:
- strong, if project managers have greater authority than department heads;
- balanced, if their powers are roughly equal;
- weak, if most issues are decided by department heads.
At ILF, we went for the balanced option, leaving to the project managers the tasks of communicating with clients, forming teams and managing content, schedule and costs, while the partners handle operational management, selection and mentoring of lawyers, as well as short-term work planning. There are also “brainy” projects (unique, complex and high-risk projects), in which partners can also play the role of project managers.
In out next article we’ll speak in more detail about how lawyers and non-lawyers handle planning in ILF these days, how law firms make use of Scrum and Kanban, and how to measure intermediate effects of the Agile transformation.
