Andrew Magowan, GC of ASOS - harnessing innovation in the legal industry

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Lexoo speaks to Andrew Magowan, GC of ASOS, to find out what he thinks are the most significant innovations in the legal industry, why he’s pessimistic about traditional law firms, what legal department success looks like, and the most important thing he’s learned.

Thanks for speaking with us, Andrew. To start with, can you give us some background on your legal team - how big is it and what kind of specialisms do you have?

There are about 18 in the team right now and it's broadly split into three areas. The biggest is Brand and IP, which is not surprising for a big consumer-facing company. Protection of our brand is paramount. How something strengthens or impacts our brand actually goes to the heart of almost everything we do.

The second division is Media and Content, which would probably be a marketing division in a more traditional business. ASOS is all about engaging with our 20-something fashion-loving customers about the things they care about, through whatever channels they’re using and in whatever places they’re hanging out. That results in lots of innovative, interesting campaigns and initiatives that our Media & Content lawyers have the fun and challenge of helping to pioneer and bring to life. So they get directly involved in things like ASOS Supports Talent, a programme where we take on young creatives from a variety of spheres to nurture them, and ASOS Fashion Discovery, which is our Dragon's Den-type search for up-and-coming fashion brands.

The final part is Global Operations, which deals with all the contracts that govern the infrastructure from which the business is built. When I first got to ASOS five and a half years ago, we really zeroed-in on protecting our Brand and IP; we're now focusing more on the operations side and the media & content aspects, both of which continue to adapt and change as we continue to grow across the globe at 30% year-on-year.

I then sit across these functions and get the luxury of not having to do any of the legal work myself. I’ve got a great team. I trust them to get on with whatever needs to be done, so my job is to get them the money, information and steer they need to do what they do best. I spend the rest of my time as a member of the executive board of ASOS, making sure we're thinking about the things that we should be thinking about. I'm also responsible for corporate responsibility, including The ASOS Foundation, and business assurance, which covers things like risk management, insurance and internal audit.

What do you see is the biggest challenge for you and your team?

The culture, spirit and attitude we have at ASOS has been fundamental to the business becoming what it is. You don't get to be this size without being excited about potential and without being very good at cutting to the chase quickly, taking risks in order to drive yourself forward and not blaming people if things don't turn out as expected. It's a place that's used to saying yes to trying things, and we will only get to our goal of becoming the world’s number 1 destination for fashion-loving 20-somethings by continuing this attitude and approach. Yet this attitude and approach is almost the opposite of what lawyers are trained to do.

So the biggest challenge that we will always have as a team is: how can we as lawyers be effective at the same time as enabling ASOS to foster and grow its entrepreneurial culture? While continuing to move and grow at speed, we have to make sure that what we're building is sustainable in the long term and our decisions are not just good now, but they're good in two, three, five, ten years' time.

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That’s less about the ‘what you have to do’ but much more about the ‘how you do it’. How do you interact with people? How do you influence people? How do you get them to understand your point so they want to do it themselves? That requires a variety of different things - people with deep knowledge of ASOS, who are good at interacting with the various parts of the business, who have great perspective on what matters and what doesn’t, and who are comfortable with taking on responsibility and aren’t paralysed by it. I’m lucky – every single one of the team gets that and is energised by that.

From your perspective, what has been the most significant innovation in the legal industry in the past few years?

I'll start with what innovation means to me - innovation just means doing something differently. It’s recognising that the way things have been done before may not be the best way to do them. It's believing that there are always better ways of doing things and constantly looking for and trying them. If that's your definition of innovation, the change or the new way doesn't actually have to be or seem that radical, although it absolutely can be.

An example that’s rarely seen as innovation, but I actually think is the most significant as it underlies everything else, is the extent to which companies have woken up to the value of a properly positioned legal department with the right attitude. Once you've got people within companies going “right, legal can add value, they are there to make us a bigger, better, stronger, more sustainable business, and I'm going to push to make that happen", that is the enabler for everything else - whether that is the adoption of alternative legal service models, using legal tech, looking at the legal operations skillset, or really considering where the value lies. That to me is the biggest change; it's companies getting a different calibre of people with the right sort of attitude and way of thinking that will bring about much needed change and innovation.

When I look back to when I went in-house, the people in private practice thought (and far too many of them still think) that those who went in-house couldn’t hack it and went for the easier working hours and that there’s a good reason why in-house lawyers earn less than in private practice. I still see private practice peers of mine slightly looking down their noses at what I do. They don’t understand what GCs really do and the value they really add. And what they don't seem to have realised yet is that GCs like me control the money and if traditional law firms fail to adapt, they might find that the money ends up going elsewhere very quickly.

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Right, so you don’t see traditional law firms adapting to this change in attitude quickly enough?

They're not even sure they’re trying to. I get the added perspective of sitting in a business that built a new way of doing retail, but it was done by people who weren't in retail. When you're an incumbent business in an incumbent industry that has worked very well for a long time (and in the legal industry's case, for an incredibly long time) - it's very hard to tell yourself to throw the old model out the window because it's about to die. I think the partnership model is at the heart of it; it puts power in the hands of people who are least inclined or incentivised to change. So I'm exceptionally pessimistic of traditional law firms.

Some of them will still exist in some way, shape or form. There will still be big ticket, very specialist work that requires specialist people, but I strongly believe their role will be cut back to where the real specialism and value-add is.

It’s also a self-fulfilling prophecy: people who are remotely revolutionary or trying to think a different way are leaving traditional law firms and going to join better places that provide them with an outlet for that kind of thinking. Traditional firms are losing - and quite often, happily losing - the people who are most likely to enable them to change.

You mentioned a couple of new developments - the incorporation of tech, the alternative legal services model, the legal operations skillset - to what extent is ASOS pushing through these kinds of changes?

I don't do any legal work, which gives me the time and headspace to work out where I should be pushing my team and the people I work with, and that’s where I can make the biggest difference.

It’s about questioning, for example, why we are using the same tech as before and whether there are things out there that can help us with what we do. When it comes to tech, what really matters is the user interface. Give me something that's very easy to use, with 50% of the functionality, any day of the week over something that's got 100% functionality but is just downright difficult to use. Because if it's annoying to use, no one's going to use it, so the 100% functionality is actually zero.

However, I also don't have the time to look into everything - there's tons out there and you could fill an entire year just trying to look at all the e-billing systems and contract management systems that are kicking around. So you can't really do it by yourself, and it also can't be done by someone who's got a day job, which is effectively where legal operations as a skillset has come from.

Legal operations is pointing people exclusively at the question of how to get things done more effectively, not what needs to be done. It is considering what the best combination of resources is - and by that I mean between in-house lawyers, external law firms, external legal service models, external tech and external consultants. What that does is free up your expensive lawyers to do things where they really add value. People in legal operations are really smart; a number of them are ex-lawyers, which is helpful, but a lot of them are not and that's equally good because they bring a different perspective. It’s fascinating. If I was just starting out in my legal career, I'd be interested in it myself.

Also, the people in legal operations aren’t competing with each other, so they've gotten together in various groups to share intelligence: what are people using in terms of systems, what’s good, what’s bad. This crowd-sourcing is what will sort the wheat from the chaff, because up to this point, every remotely interested business was trying to look at this by itself, and as I said, you can't look at everything.

So by separating the “how” from the legal value-add, by having people look specifically at that question and by crowd-sourcing ideas, legal operations will absolutely turbo-charge the change that's coming - that is the biggest engine I've seen to change in the legal industry.
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When you think of legal department success, what are the KPIs you use and what are the most important metrics and markers for you?

As someone who talks a lot about the importance of metrics, I'm going to completely contradict myself by saying that success to me is fairly intangible.

I like to say to people that I could walk them around ASOS and they wouldn't be able to tell me who's from the legal team and who's in other departments (other than the fact that there's a great big sign above our desks). If the value that legal brings is from interacting with the business, then success is ultimately all about relationships and the ability to influence and connect with the people in this business.

That's not to say that I'm not doing things like scrutinising our department financials, making sure the team are turning invoices so that I can keep my budgeting credibility and can keep getting them the resources they need. But the only thing that really matters to me is whether they are talking to all the right people, and asking the right questions, because if they’re doing that, I know they’re making ASOS better, stronger and more sustainable. I'm not interested in the contracts or the number of hours they put in. It's people saying to me "your guys are effective" or indicators of that - I'm all over that.

It’s also then about whether the work gets done as promptly and as effectively as it should do, i.e. are the legal operations in the background working efficiently, because that’s the platform underpinning everything else - without it, the good stuff can’t happen.

Do you feel that services like Lexoo help in this regard?

I've always felt that a model like Lexoo's should work in legal and it's great to see you've picked up on that. I’m here to look for new ways to get my team the kind of advice and help they need. Lexoo's model should be able to connect us to smart, effective people that we wouldn't have been connected to before, and that absolutely will help the team achieve what they want to achieve.
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And finally, what is the most important thing you’ve learned?

It's all about value, and value is quite often not where you think it is, or where a lot of the effort has traditionally gone in.

Look for value, understand exactly what it is and what really matters to your business. Don’t just assume it’s where everyone has always looked before. Because if you can identify it, you've got a massive opportunity to get some big wins.