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Small Legal Department, Lots of Value Tactics, Big Results

By Jennifer J. Salopek

"Jump right in.

"That's the advice offered to future ACC Value Champions by Stephanie Sciullo, associate general counsel at MSA Safety Incorporated.

"Jump right in, even if you don't have everything perfectly in place yet."

Sciullo walks the talk. When she was wooed to MSA from private practice in 2010, General Counsel Doug McClaine had one request for the company's first in-house litigator: to bring down costs. MSA, a manufacturer of safety equipment for the fire services, oil and gas, construction, and utility industries, was involved in its fair share of toxic tort product liability litigation. As a member of a department of only four lawyers, Sciullo would have to think creatively.

Stephanie Sciullo

"Our program's success couldn't hinge on leveraging large staffing or abundant resources," she says. "It was about taking a fresh approach to the same set of circumstances, aligning attitude and effort with value-based principles. Despite some initial skepticism, we knew that reducing costs didn't have to mean sacrificing quality.

"MSA's value journey—one that would eventually include a number of value techniques rolled out in a phased approach—parallels the company's journey over its hundred-year history. "Just as MSA was founded on providing innovative safety solutions in high-risk environments, we thought we could do the same. We knew that innovation—even in high-risk environments—can deliver a better outcome.

"The metaphor is one Sciullo proposes herself. She notes that the earliest gas-detecting devices were canaries, who were released into mines in advance of human workers. If the canary died, toxic gases were present. MSA built its business around producing alternatives to those canaries. The company continues to do business in a high-risk environment, a notion that Sciullo took to heart when designing her value initiative.

The first phase of the journey was corralling the data. At one time, defense counsel maintained various litigation databases around the country, requiring the same documents to be uploaded multiple times; this created significant redundancy. "That method made analysis and reporting very difficult," says Sciullo. "We wanted to find a way to press a button to get the information we needed."

In 2011, MSA Legal consolidated to one broadly accessible platform using cloud technology. Basic metric calculations and other manual functions were automated and all claims documents are maintained electronically.

"This platform provides everyone with more accurate data in less time, and key metrics are available on demand," Sciullo says.

Sciullo also issued MSA's first set of outside counsel guidelines—an exercise she describes as important to level setting—and elevated a select group of outside firms to defend the most complex cases as part of a "virtual law firm," or VLF. Whereas firms had previously been matched with cases based on geography, the VLF model staffs cases based more on expertise and prior experience. This approach has led to greater efficiencies, and also reflects MSA's culture.

John Hooper

"Like many MSA employees, many of our outside counsel have represented the company for 10, 20, and even 30 years. We wanted to invest our efforts first with those firms whose institutional knowledge couldn't easily be replaced. We were committed to driving value on more than just rate reductions or discounts," Sciullo says.

"We also wanted to reward counsel who understood our value-based approach by using their expertise nationally," she continues. "In this way, we elevated the people who really got it."

MSA also selected Reed Smith partner John Hooper as national coordinating counsel. Company and firm jointly develop an annual budget, each year aiming for improved efficiencies and greater savings. They monitor work levels weekly and track the budget bi-monthly against pre-established targets. Local counsel submit weekly standardized reports to national coordinating counsel weekly, who processes them into a template for Sciullo's review.

"The best national counsel is the in-house lawyer, except when the issue gets so large that it can't be handled by one person," Hooper says. "We tightly manage around a strategy that is consistent across the country, and ensure that only the necessary work gets done."Sciullo drew this "focus on the necessary" theme around the process of paying and documenting settlements as well. Working with MSA's continuous improvement specialists, she and her team developed value stream maps to illustrate current and future states of the legal department and its work. They brainstormed process improvements to reduce non-value-added work and streamline cumbersome tasks and forms.

"What lawyers do is very high-level, sophisticated work, but it is not all legal artistry," Sciullo says. "Where there are repeat, routine tasks, we can benefit from creating an optimized process. At the same time, we are not trying to stuff every skill into a box or a form. There's room for both creativity and efficiency."The outcomes prove that you can. Since beginning the value journey, MSA has achieved a nearly 20 percent reduction in defense expense of toxic tort litigation over 2011 levels. Retention of proper settlement documentation has been increased from 70 percent to 100 percent, and, in some areas, settlement expense has been reduced by millions of dollars."For many companies, litigation is a way of life," Sciullo says. "We can't make it disappear, but we can make the burden a little lighter."

From the Judges

"MSA is a small mine safety company that does it all to control costs. It's great that they set a baseline and estimated value against it."

"This small law department was able to implement a lot of value tools, resulting in improved costs, predictability and outcomes. They focused on use of technology and improved reporting."