Peer to Peer Magazine

WWW.ILTANET.ORG 51 LEVELING UP AT AIG By 2020, the best legal departments will be those that create lasting competitive advantages for their companies by embracing this change and moving up the value chain. AIG's legal function was recently honored as New York's Best Legal Department of 2014 by the New York Law Journal and as one of Corporate Counsel magazine's Best Legal Departments of 2014. As a model for legal departments seeking to move up the value chain, AIG's story can provide lessons for legal departments of all sizes and stages. I recently sat down with Brian McGovern, Senior Vice President of Process & Information and Legal Chief Data Officer at AIG's Legal Operations Center. What it will take to be one of the best legal departments in 2020? Brian: The best legal departments will take advantage of the enormous opportunities that exist to regularly and demonstrably get the best value for their department and company. To do this, they'll leverage the best people, the best processes and the best technologies to focus on the goal of consistently getting the best results. They won't become the best because they invented a new AFA or got rid of lawyers. Those are short-term tactical measures that can't support lasting value. What do you mean by "leverage the best people"? Brian: You need strong legal staff, but top departments recognize that lawyers can do even better by partnering with resources with different areas of expertise. One of the primary reasons we've had success is because we brought in great people who aren't lawyers. These professionals had the skills to help our function evolve in becoming more like our business partners. We needed to build tools and processes that would allow our lawyers and claims litigation managers to make more informed, data-driven decisions so they could have confidence they were consistently obtaining the best legal outcomes at the most compelling overall cost. That meant we needed team members skilled at data analytics and architecture, process re-engineering, project management and IT configuration. The legal departments that succeed will continue to complement their legal expertise by bringing in more business expertise. When you embarked to create a legal department focused on data-driven decision-making, what goals did you set and how did you accomplish them? Brian: Our goal has been to consistently move up the value chain. We're focused on getting the best overall value for our company and our clients — more than reducing legal spend. Driving overall value is a key part of our mission as an insurance company and a key competitive advantage for any insurer. The journey to achieve these goals was not quick. I would say we are in the final phase of a three-phase program that began several years ago. • During phase one, we focused on understanding the sources and causes of our legal spend and matter duration across all our different businesses and geographies. This was a big first step, and getting it right was critical. • We leveraged that data in phase two and asked some meaningful questions that would give us better insight into the department's operations. We needed to make informed decisions to target opportunities that would positively influence our legal spend and results. • Phase three is where we are now, and it is focused on two areas: broadening the scope of the data we are analyzing to get additional insights and building tools to automate previously manual processes so we can get high- powered, user-generated analytics onto our clients' desktops. As part of this phase, we will take advantage of unstructured legal data to give us an even deeper understanding of the complexity of, and contributing factors to, litigation. What process and tool changes have you implemented to get that kind of data visibility and integrity? Brian: We started with a diverse set of tools used across the department, which ultimately led to a fractured infrastructure and data environment. That led to a global About the Author Jason Parkman is the CEO at Mitratech. Prior to that, Jason was responsible for the Thomson Reuters large law firm business, and he was vice president and general manager of Hubbard One. Contact him at jason.parkman@mitratech.com. Brian McGovern Brian McGovern is the Senior Vice President of Process & Information and the Legal Chief Data Officer at AIG's Legal Operations Center. Contact Brian at brian.mcgovern@aig.com.

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