Leveraging Legal KPIs: A Strategic Driver for Business Growth

In the fast-paced world of business, the true value of the legal department expands beyond the usual legal victories. It hinges on effectively communicating these triumphs to key stakeholders, such as board members and management teams. 
This article delves into the strategic importance of a robust Key Performance Indicator (KPI) strategy and the transformative role of technology in its implementation and execution.

Decoding Legal KPIs: A Power Tool for Business Alignment

A Key Performance Indicator is a measurable metric, utilised to assess the progress of an organisation, team, or individual, in alignment with specified objectives. Just as with other departments, KPIs serve as crucial benchmarks for legal departments. Efficient monitoring and tracking of these benchmarks can significantly shape the strategic business outcomes of an organisation.
KPIs have emerged as vital tools, enabling legal departments to track progress, and align their activities with the broader strategic objectives of the company. 
These measurable metrics act as benchmarks, providing  insights into how the legal department can contribute to achieving business goals. They also highlight potential areas for improvement. 
Utilising a combination of both quantitative and qualitative KPIs amplifies performance understanding, paving the way for informed decision-making.

KPI type	Definition	Use cases
Quantitative KPIs	Provide insights on the efficiency and effectiveness of processes within the legal department. They are expressed numerically.	Use the quantity of contracts reviewed as an indicator of legal team productivity and efficiency. Monitor contract approval turnaround time to assess the responsiveness of the legal department. Evaluate legal spending as a percentage of revenue to effectively manage legal department costs in relation to company earnings.
Qualitative KPIs	Provide understanding of a process, service, or outcome through subjective experiences, emotions, and opinions.	Use internal client satisfaction ratings to assess the quality and value of the legal department's services. Track the enhancement of legal process efficiency to evaluate the impact of implemented process changes or legal tech tools. Measure the legal department's influence on strategic decisions to gauge the legal team's impact on business strategy.

By linking actionable insights with strategic performance, KPIs aid legal departments by providing an understanding of the situation from a legal perspective , aligning operations with business objectives, identifying potential risks or improvements, and simplifying stakeholder communication and reporting.

Read also -> How to set the ideal KPIs for your legal department

Reflect on your legal department's growth potential and how data can play a pivotal role in making that case. Data not only supports the work done but also establishes the foundation for securing additional resources. Moreover, KPIs can strengthen the business case to present to the board and leadership team for adopting software solutions that boost performance and efficiency.

Unleashing the Power of Technology and KPI

The success of a legal department hinges on understanding, choosing, and implementing the right KPIs, along with effectively using technology. The combination of KPIs and legal technology can boost the efficiency of the department and the entire business. 
Legal tech solutions simplify KPI implementation and unlock the department's potential. These solutions offer:

• Efficient data collection and analysis, providing the legal team with  visibility on information, including  of contractual obligations and improved litigation management.
• Automation of tasks, like document creation, which enables the legal team to concentrate more on strategic goals and ease the measurement of KPIs.

The success of the  legal department fundamentally hinges on understanding, selecting, and leveraging the most suitable  KPIs, powered by technology. Hence, the interconnected roles of KPIs and legal tech are critical to the success of not only your legal department but also the  entire business. Utilising advanced legal tech solutions can unlock the full potential of your legal department and simplify KPI implementation.
Implementing a comprehensive software solution like Legisway allows your business to optimise data collection, analysis, and application, enhancing legal processes. This approach not only integrates technology into daily operations but also ensures it effectively aids in achieving your KPIs in line with broader business goals. 

“We use our legal software to monitor some KPIs, such as the number of connections to the software or the creation of contract forms. At the end of the year, this enables us to get a performance overview and foster motivation within the legal team.” 
- O.M., Legal Counsel, Transportation company - User of Legisway

Discover how Legisway  can assist you in generating and monitoring your KPIs and enhance your legal department’s contribution to business growth: Reports & KPIs: Creating insights & tracking performance with Legisway | Wolters Kluwer.