Large law firms are hiring general counsels. Will this have an impact on knowledge management? 

Spurred by Insurers, General Counsel Posts Popping Up at Large Firms in Corporate Counsel magazine (December 2004) reports, citing an Altman Weil study, that “63 percent of the nation’s 200 largest firms had designated a general counsel and 10 percent planned to do so in the next year.” Malpractice claims and conflicts are among the factors driving this trend.

Corporations employ various quality control (QC) measures to avoid both defective design and manufacture. Legal advice can be defective in its “design” or “manufacture,” that is, the theory of the case or transaction can be wrong or the execution can be flawed. Presumably, one function of a law firm GC will be risk management and reduction – the moral equivalent of QC.

One way to control risk is with knowledge management. KM can help assure that lawyers have access to vetted documents, prior research, and the right experts within the firm. Other ways include training and systematically reviewing work product prior to delivery to clients. It will be interesting to see if any law firm GC become advocates for KM, arguing that the cost of KM is warranted by risk reduction.

Playing devil’s advocate to my own argument, a GC might argue against KM. A systematic program of KM, including vetted precedents and best practices, would demonstrate that a firm had determined the “best” or “right” way to deliver certain advice. If so, and if a lawyer failed to use the KM system, it might be easier for an aggrieved client to make a malpractice claim than in the absence of the system. This seems a weak argument to me though – to the extent it has any legs, the answer is to ensure consistent use.