The business of successfully running an in-house department
It started as an urgent request. Our company faced a time-sensitive issue, and with a live sports event just nine days away, we needed answers fast.
It was early in my tenure, and I leaned on the outside counsel our corporate parent had used for years. “Better not upset the applecart,” I thought.
The kickoff call went well enough. We handed over the materials, set a budget and agreed they would return in three days with a recommendation. By day two, red flags appeared. An associate rang our paralegal with questions we had already answered. A managing associate asked for information sitting plainly on the first page of the first document.
On deadline day—silence. When pressed, the lead partner explained they needed more time—they were still researching Massachusetts law. Odd, since our issue had nothing to do with Massachusetts. They had misunderstood where a key party was based.
Three days later, the product arrived: a dense, esoteric seven-page memo with no recommendation. The final bill was $6,000 over budget. That was the last time we hired that firm, as the business of running our in-house department was paramount.
Two sides of the mirror
In-house lawyering is about running a business inside a business. That means managing internal clients, knowing the revenue model, guiding decisions, hiring with leverage in mind, and deciding when to build versus buy.
For those of us working inside, success means credibility, speed and judgment. For our colleagues at law firms, understanding what we value most can mean the difference between a long-term partnership and becoming a line item to cut.
Managing clients from inside
When you move in-house, your “clients” are your colleagues—sitting two doors down, pinging you on Slack or pulling you into meetings with 10 minutes’ notice. They don’t want a polished memo; they want a decision that moves the ball forward.
The most effective in-house lawyers understand how decisions really get made. They embed themselves in boardrooms and strategy sessions so they’re the first—not the last—to know about major moves. They trade perfection for responsiveness, build bench strength so deadlines don’t fall through and teach their teams the art of reframing: “yes, if …” instead of “no.” They also learn to speak in business terms: “This could delay revenue” or “the public relations risk is real” lands faster than “This violates Section 14(b).”
Law firm partners need to know their advice must stick the landing in this environment. The general counsel they’re advising will be asked immediately, “What should we do?” A dense seven-page memo without a bottom line is worse than useless. Clear recommendations matter. And context matters: Advice anchored in commercial realities beats theory every time.
Learn the business
Your credibility as in-house counsel is rooted in how well you know the business. The GC who understands revenue streams, cost levers and what keeps the chief financial officer awake at night has a seat at the table. The associate GC and counsel who build relationships with sales leaders, read the quarterly decks and spend time in operations aren’t just “good lawyers”—they become indispensable.
For law firm colleagues, the same holds true. Don’t assume the in-house team has time to explain their business model. Show up curious and prepared. Read the annual report, listen to earnings calls, scan the trades. Then tailor your advice to what matters commercially: “This may lengthen your sales cycle” carries more weight than “Here’s Delaware indemnity law.” Firms that ask business questions, not just legal ones, signal that they’re real partners.
Using outside counsel
In-house, we think of outside counsel as “special forces.” You don’t use them for routine skirmishes; you call them in for high-stakes missions. That might be a bet-the-company issue, a regulatory matter requiring niche expertise, or moments when an external voice is needed for credibility.
But smart departments avoid using firms for recurring contracts or everyday human resources issues. In lean teams, yes, we sometimes delegate overflow work—but only on pre- negotiated rates and with expectations set. The rules are simple: Set a budget, define the scope, ask a precise question and demand immediate updates if anything changes. Surprises are the enemy of trust.
Law firms that thrive in this relationship understand discipline. They scope tightly and don’t wander. They push routine work down to juniors rather than charging partner rates to proofread senior associates’ emails. And most importantly, they answer the actual question asked. If the GC asks, “Can we sign this deal as drafted?” the right response isn’t a 12-page treatise. It’s: “Yes, if you’re willing to accept X risk, and here’s how to mitigate it.”
Building the right team
Hiring internally is about leverage. The right lawyer reduces outside spending, increases coverage and changes how the business operates. The wrong hire might add cost and drag down the department’s internal capital.
In early-stage companies, that means hiring versatile “athletes” who can cover multiple areas. As the business grows, pressure points reveal where targeted expertise is worth the investment. Each hire should be judged by how much outside spending decreases and how much credibility with internal client groups increases. And caution: Don’t binge-hire. Legal departments that bloat too quickly could force you to cut back just as fast.
From the firm side, don’t panic when your client grows their team. A savvy GC isn’t eliminating you—they’re redefining your role. The firms that stay close are those that share templates, train their in-house colleagues and gracefully evolve into specialists called on for the hardest work. Help your client get smarter, and you’ll always be in the room when it matters most.
The in-house mindset shift
At the end of the day, in-house success isn’t measured in hours billed. It’s measured in trust with leadership; risks managed without blocking growth; and deals enabled, not delayed. You’re not a law firm in miniature—you’re a business unit with a profit and loss, whether you like it or not.
Firms that want to stay indispensable must recognize this. Their in-house contacts are judged on business outcomes, not legal purity. Advice framed in commercial terms—delivered with speed, clarity and budget discipline—earns loyalty. Anything else becomes an easy cost cut. And when a client steals your best lawyer to join their in-house team? Don’t be resentful—be flattered. If that person thrived under your mentorship, they’ll keep calling you when it counts.
Closing thought
In-house lawyering is running a business inside a business. The lawyers who thrive combine judgment with discipline: managing budgets, sticking to scope and aligning their work with strategy. The outside counsel who keep their trust deliver clarity, respect and value in equal measure.
Because at the end of the day, it’s not about the memo—it’s about the business.
Tracey Lesetar-Smith. (Photo courtesy of Tracey Lesetar-SmithTracey Lesetar-Smith is CEO of TLSK Advisory and a seasoned sports and entertainment executive with over 20 years of experience, including as general counsel of NASCAR and general counsel of Bellator MMA.
Editor’s Note: The ABA Journal, in partnership with the ABA Young Lawyers Division, is publishing Survival Guide, Esq., a column offering advice for early-career lawyers. The authors of the column welcome any of your questions. Send them to [email protected].
This column reflects the opinions of the author and not necessarily the views of the ABA Journal or the American Bar Association.
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