The Law of Increasing Returns

How Lois Bingham’s three-year strategic plan reduced the budget of Yazaki’s legal department and simultaneously improved customer service and alignment with company priorities

Just weeks after Lois Bingham assumed her role as Yazaki North America’s general counsel, the CEO posed a question: Is our legal department efficiently and effectively handling the most strategic and important tasks to maximize opportunity and minimize risk for the company?

In response, Bingham undertook an exhaustive three-year strategic overhaul of her office—one that has transformed it into a department that better fits both her vision and the business needs of the company.

Bingham began her assessment by engaging Lumen Legal to conduct a survey that asked legal’s clients from five countries in North and Central America to rate their opinions of the department. The results surprised her. “We found that they respected us but didn’t really know how to use our services,” she says. “They didn’t understand our processes and wondered why they couldn’t speak directly to an outside lawyer when they had an issue.”

In hindsight, those responses appear reasonable, since company attorneys weren’t consistently using the department’s existing matter-management system. Service requests were being submitted by e-mail with no way to track metrics such as the number of requests, which business units they came from, or how quickly they were being handled. Five different value sets were identified from the survey: exemplary customer service, operational excellence, profit focus, employee enrichment, and regional corporate governance.

To address the first two, Bingham implemented two key changes for better customer engagement and satisfaction. First, attorneys were assigned to work with specific regional business and functional groups. This helped streamline workflow, strengthen attorney-client relationships, and increase attorneys’ expertise about their customers’ businesses. Second, a bilingual legal service request (LSR) system was created that tracks the number of requests received, routes them to the appropriate attorney, and responds with an acknowledgment of receipt. It also provides a dashboard that shows employees the status of their requests.

The first available key-performance indicator from the new system is that 98 percent of the time, high-volume, repetitive contract requests are successfully addressed within 48 hours. “Since we’ve changed how we work with customers, they have been very happy with the transparency and feedback they receive about their requests,” Bingham says. “Previously, we only knew when there were complaints.”

With new LSR data from the automated system, Bingham discovered another surprise: the answer to the question that launched the department’s restructuring. Many requests were related to procurement issues that she characterizes as “low-risk, low-value contracts that don’t really need legal review.” That finding has prompted an ongoing evaluation of a wide range of contracts. “We’ve proposed that certain ‘buys’ do not really require legal review,” Bingham says. For such transactions, the legal team proposed that the use of a purchase order or approved contract template is sufficient, thus freeing the legal resources to focus on issues with more strategic value. “We’re currently confirming the risk appetite with the internal stakeholders and the proposed solution,” she adds.

Adapting for Growth
When Bingham joined the legal department, it covered Yazaki’s US and Canadian operations and a portion of Mexico. That has expanded to cover 20 different legal entities and 74,000 employees across five continents. The strategic overhaul has allowed the office to better accommodate the increased scope of its responsibilities.

“The survey was just the start,” says Bingham. After she shared the results, the executive management team agreed with her proposed action plan, which included adding staff to provide more extensive in-house expertise. The general counsel’s office previously consisted of Bingham, another attorney, a paralegal, and an assistant. Today, it is made up of seven lawyers plus support staff. That includes a newly created three-person department specializing in the company’s Mexican business, as well as additional expertise in regulatory litigation and compliance.

The new structure and added personnel have done more than increase the department’s capacity; they have improved the company’s bottom line. The GC office now handles 80 percent of the business that used to require outside counsel, and Bingham has been able to reduce her budget by 19 percent.

Positioning for the Future
The final steps of Bingham’s strategic plan are underway. The first is the implementation of e-billing to automate the department’s invoice processing and management. The goal is to ensure all billing guidelines are followed and to make the process—which is now manual—more accurate and efficient.

She is also focusing on regional corporate governance. This includes ensuring that all software, employee training, policies, and procedures are positioned to adequately protect partner companies’ proprietary information. “Business today requires global information sharing,” Bingham says. “So even though we have all of the necessary elements in place, we want to review and enhance them to be sure they are all aligned with the highest standards possible.”

With all she has accomplished within her department in the last three years, Bingham is quick to point out how much she has continued to learn. In addition to learning to balance her legal practice with management responsibilities, she now understands how to be successful in a traditional Japanese company. “I’m a direct, outspoken woman, and even though this is the most diverse group of people I’ve ever worked with, that isn’t always the right approach,” she admits. “I’ve learned to take the time to develop relationships, get to know my colleagues as individuals, and then choose the most appropriate path.”