Q&A: Transforming legal operations with managed services
Q&A with Andy Giverin, Global Head of Legal Business Services and Partner with KPMG Law in the UK, and Jeff Catanzaro, Partner and US Head of KPMG Legal Managed Services
KPMG research reveals how managed services can be a transformative approach to legal needs. Read our full report to learn more.
Legal Managed Services (LMS) are transforming the way businesses handle their legal needs. By outsourcing high-volume, repetitive legal tasks, such as sales and procurement contracts, to external providers, companies can free up their in-house legal teams to focus on more strategic and complex projects. This approach not only enhances efficiency but also ensures that everyday legal work is managed predictably and safely.
In this Q&A, we delve into the benefits, challenges, and future predictions for legal managed services, featuring insights from Andy Giverin, Global Head of Legal Business Services and Partner with KPMG Law in the UK, and Jeff Catanzaro, Global Legal Business Services partner and Head of Legal Managed Services for KPMG in the US. Let's explore how legal managed services can help your legal operations and drive your business forward.
Introduction to legal managed services
Legal managed services are gaining traction as a delivery model for transforming legal operations for efficiency, performance and value.
What are legal managed services and how do they benefit chief legal officers and general counsels of large global organizations?
Andy: In a legal managed services model, external suppliers deliver ongoing support of repeated high volume legal work to global clients—work that would otherwise typically be provided by the clients’ in-house legal teams. They enable large organizations to shift a baseload of day-to-day legal work off the desks of their in-house lawyers, allowing them to focus on more strategic, complex, and interesting projects, while knowing daily, repeatable work is still being supported predictably and safely.
Leading managed services providers also incorporate legal technology platforms that are embedded in their delivery models, further boosting the ability of in-house teams to reduce cost, manage risk, extract value, improve performance, and ultimately become a true partner to the business.
What types of legal work most benefit from the support of a managed services provider?
Jeff: Low-risk, high-volume, routine, repeatable legal activities are prime candidates. Contracts are a great example. Legal managed services are ideal for covering standardized, straightforward contracts that organizations enter into every day, such as sales and procurement contracts. Taken individually, these contracts may not seem significant or complex. But when you have thousands of them, and they need to be done quickly, they can become the lifeblood of the business. That's why legal managed services are so attractive for large organizations to deal with that workload.
Legal managed services are ideal for covering standardized, straightforward contracts that organizations enter into every day.
Jeffrey Catanzaro
Principal, Global Legal Business Services, KPMG US
Challenges addressed by legal managed services
Several trends and developments in the business environment are creating challenges that can be addressed through legal managed services adoption.
How is increasing regulatory complexity impacting legal departments? How can legal managed services providers help ease the burden?
Andy: The volume and pace of regulatory change in the current market can quickly overwhelm legal departments. General Counsels must track, interpret, and ensure compliance with rapidly evolving regulations across multiple jurisdictions. A legal managed service offering can provide dedicated regulatory monitoring and analysis, regular briefings on relevant changes, insights on how those assessments can impact the business, and provide implementation support for the new requirements.
What regulatory risks are having the most widespread impact on legal function workloads?
Jeff: Four big risks stand out as key drivers of regulatory complexity. These are the sort of critical projects that we see legal managed services helping alleviate and resolve.
- Significant cyber security and data privacy risks pose unique challenges for companies striving to maintain continuous monitoring and real time visibility of the information that they control. Companies must establish robust communication plans with their providers to manage security incidents in a timely way.
- Risks posed by the use of AI tools. AI integration can sometimes cause issues around governance. Responsible deployment and management and protection of AI systems and models is crucial, especially when you're using third party AI tools.
- Macro risks – such as geopolitical, third-party, and sustainability risks – are generating a lot of regulatory activity. As businesses integrate complex supply chains and partnerships, they face heightened risk and exposure as well as growing expectations from regulators and customers around those activities.
- Regulatory overlay around operational resilience are creating challenges for businesses to address vulnerabilities, maintain a proper disaster recovery plan, diversify the supplier base to reduce dependency, and improve security.
How is globalization exacerbating stressors on in-house legal departments and accelerating their need to transform how they operate?
Jeff: When organizations expand footprints, partnerships or customer bases, and operate on a more global scale, the changes force legal functions to tighten risk management, increase reporting obligations, and produce efficiency gains. This creates pressure to reduce costs, simplify processes, and manage enterprise-wide risks. It also drives the need for legal technology, such as cloud and contract management platforms, to help legal departments to operate more effectively and get the added work done.
How is the role of the General Counsel evolving due to the impacts of globalization on the legal function?
Andy: Businesses increasingly rely on their global legal departments to not just decrease cost and risk, but to accelerate revenue. To demonstrate all of those capabilities on a global scale, General Counsels are continuously improving the way in which their teams are working from a people, process and technology perspective. This is turning legal departments into genuine partners with the business, offering advice that’s more proactive, risk calibrated, evidence based and strategic.
Technology and AI in legal operations
AI can augment and empower lawyers and transform legal department value, efficiency and performance.
What role is AI playing in the legal department? How will it help solve complex challenges facing General Counsels?
Jeff: AI enhances legal expertise and decision-making by efficiently sifting through large amounts of data, interpreting it, and providing data-driven insights. It will significantly enhance the accuracy and consistency of data analysis across massive datasets, providing data-driven insights to support decision-making. With AI, legal teams will be able achieve optimal outcomes quickly, surpassing the capabilities of humans who manually sift through large volumes of data.
AI also helps automate routine tasks like drafting contracts and analyzing briefs, allowing lawyers and legal professionals to focus on high-value tasks. By augmenting human expertise, adopting AI can create massive effort and cost efficiencies without replacing lawyers.
For example, operational AI tools like Microsoft Copilot streamline and accelerate day-to-day tasks. Meanwhile, process-related AI allows for automation of repeatable tasks, helping lawyers deliver a specific use case quickly and more cost-effectively. And knowledge-based AI enables legal professionals to quickly analyze large data sets and provide calibrated risk advice.
How will AI change the way lawyers train, work, and deliver services?
Andy: AI will significantly alter how lawyers work and the skills required of them. Lawyers will need to be comfortable with AI, because we’ll see a seismic shift in tasks currently performed by lawyers being replaced by AI-powered self-service or on-demand legal services. Comfort with how to use AI technology, supported by continuous improvement and learning to enable them to do their best work, will be a new currency for lawyers.
We’re also likely to see new legal service offerings and business models emerge, as AI dramatically reduces the cost of delivery. AI will lead to more automated and technology-driven service delivery. Subscription-based and outcome-based pricing models will also become more common. All of that will allow lawyers to deliver greater value to the business by increasing their focus on critical thinking, problem solving, and strategic guidance.
What are the main challenges of integrating AI in legal services
Jeff: The main challenges include ensuring seamless integration with existing systems, maintaining data quality, and establishing controls, security and governance protocols. In-house legal teams that are grappling with how to embed AI in their systems and processes can greatly benefit from legal managed services, so they don't have to go through a complex integration process, and they can feel confident AI-enabled tasks have the right controls and governance in place.
KPMG Law US
Redefining legal services for leading companies at scale
KPMG Global Legal Business Services
KPMG Global Legal Business Services offers an extensive suite of services designed to address the full spectrum of legal department needs. From high-volume contracting to legal operations enhancements and advanced technology integration, GLBS helps empower organizations to achieve efficiency, scale, and strategic insight.
Meet the team
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Andrew Giverin
Partner and Global Legal Business Services Leader, KPMG LLP
Jeffrey Catanzaro
Principal, Global Legal Business Services, KPMG US
Andrew Giverin
Partner and Global Legal Business Services Leader, KPMG LLP
Jeffrey Catanzaro
Principal, Global Legal Business Services, KPMG US