Earlier in this series we diagnosed the problem (overload, ungoverned data, and fragmentation) and presented a solution that puts people and processes before tools. But how can we actually make the legal department transformation happen?
Most legal departments are aware they need to transform. Some start the transformation process because senior leadership requests it, or simply because they must adapt to this changing landscape. Nevertheless, knowing what to do and successfully executing a digital transformation are two different things.
Using the modern governance blueprint that places people and processes before tools as our foundation, we’ll explore why most transformations fail and what it takes to get them right.
Why the legal department transformation tends to fail
Companies waste millions attempting what Nadim Baklouti, Co-CEO at DiliTrust, calls the “big bang” approach: moving from manual Excel-based processes to a fully deployed enterprise CLM with hundreds of users, complete coverage of all contract workflows, AI features, and the works—overnight.
On paper, it sounds great. The issue? More often than not, teams want to go from 0 to 100% in a single leap, and this strategy simply does not work.
This problem is even more visible in international environments. The pattern repeats across regions: a year in— sometimes only months — the transformation project grinds to a halt. Poor adoption and overwhelmed teams force leadership to pull the plug or start over —having burned millions and lost credibility.
The core mistake is trying to run before the team can even walk. Think of it like a child learning to move: first they crawl, then they walk, then they run. You cannot skip the early stages without falling flat. Legal department transformation follows the same logic. Attempting to sprint from day one doesn’t accelerate success—it guarantees failure.
Crawl, walk then run – The only approach that works
1. Crawl: Start small and prove value
“Starting by crawling does not mean picking a point solution for that problem and another for the other and another for the third. After six months you have a fragmented system with many point solutions that creates more noise than you had before.” — Nadim Baklouti
Crawling means choosing a platform that can grow with you, then implementing one use case first, proving value, building trust, and preparing to expand.
The main goal is to pick an entry point and focus on executing that entry point well. This can mean tackling the biggest pain point as it can mean tackling a quick-win that demonstrates value immediately. What matters the most is that your team and end users consolidate the results before moving to the “walking” phase.
In practice it can look like this:
- Deploy contract intake and approval workflows for one business unit
- Centralize executed contracts in a single repository with basic metadata
- Automate routine NDAs or low-risk vendor agreements
- Connect contracts to entity records for a subset of high-value relationships
Remember, the key is to solve a real problem completely, not superficially.
2. Walk: Expand and connect
Throughout the walking phase, the system starts to reveal its full potential. Once the chosen platform has proven value, the team naturally begins to trust the approach. This trust is crucial—without it, no one will follow. Now the system can enter the expansion phase, connecting data points and teams across the legal function and beyond.
What walking looks like:
- Extending contract workflows to additional business units or contract types
- Connecting contract data to entity governance and delegation of authority
- Adding obligation tracking and compliance monitoring to contracts
- Integrating matter management or outside counsel spend
- Enabling cross-functional reporting: who signed what, under which authority, with what obligations
Early wins create momentum and accelerate adoption. The team has an incentive to embrace the next phase because they’ve seen the benefits and know the system actually works.
3. Run: Unlock strategic capabilities
Running is the last stop, when the Legal Function is no longer reactive but proactive because the implemented system is unified and operational. This is the phase where more advanced capabilities, such as AI, comes into play.
Trying to skip steps and run straight to more strategic features will result in chaos because without the proper foundations (the clean data, internal organization and trust) the chances likelihood of failure increases sharply. What running looks like:
- AI-powered capabilities such as ontract analysis across the entire portfolio
- Real-time risk identification: flag delegation breaches, expired terms, unfavorable clauses
- Cross-functional insights: legal + finance + compliance data interrogated simultaneously
- Strategic decision support: answer executive questions in minutes, not weeks
- Legal moves from cost center to strategic business partner
This is where the 80% that used to drown the team gets automated. This is where teams finally have time for what only legal professionals can do: judgment on the edge cases that carry the highest risk and the highest value.
If you can automate the more tactical work, the workaday stuff, then it frees you up for the edge cases. And the edge cases can be the riskiest things for the enterprise, which I think lawyers are pretty comfortable doing. But here’s an opportunity for us as lawyers: we can also help with the things that are the most accretive to the enterprise—revenue generation, revenue maximization, management of your talent, your information assets.
— Rupali Patel Shah, Head of Legal Solutions NA
The key recommendation is to always think in terms of the big system, one that connects contracts, entities, governance and more in one single place but build it little by little.
Beyond the Steps: Common challenges in the legal department transformation
The crawl, walk, run approach provides a roadmap but just like any strategy, people need to follow it for it to work. Transformations fail not because the tech is wrong but because managing change in a Legal Department is inherently complex. To succeed, it is best to go phase by phase, starting with the path of least resistance. Otherwise, teams kick off the transformation project with frustration and low engagement.
Getting everyone onboard
One of the hardest parts is reaching consensus. This means getting everyone aligned on the roadmap, not making everyone happy – which is impossible. But the roadmap only works if people follow it. It is key for the Legal department to feel the system was designed for them and not against them – something the modern governance blueprint emphasizes quite well.
The cultural shift
Legal departments tend to operate in what Baklouti describes as an “ivory tower”—separate and reactive. But if the job is to protect the enterprise, legal should be embedded in it, side by side with colleagues, not standing apart. This cultural shift is necessary and comes hand in hand with the change management strategy. Once the change starts building, there is only one way: up.
Building trust through early wins. Consolidating results before expanding. These aren’t technical requirements—they’re human ones. And they’re what separate transformations that succeed from those that fail.
The Path Forward
There’s enormous pressure to adopt AI, to digitize, to transform. But the question isn’t “What AI should we use?” The question is “Are we efficient enough for AI to matter?”
Systems, efficiency, governance and only then, AI.
The blueprint is clear: people, process, and tools working together. The approach is proven: crawl, walk, run. The outcome is worth it: a legal function that leads strategically instead of reacting tactically.
Legal department transformation is hard. But when done right, it is possible.
