Do you see your lawyer as a key member of your strategic business team?
Do you feel that you can sound them out about commercial and strategic issues, without fear of the cost?
Or, is your lawyer the last person that you call when a problem has got so bad that there is no alternative?
Successful businesses are well supported by specialists in all the management disciplines, such as production, operations, strategy, HR and finance as each specialist has expertise in generating growth or reducing risk.
Sadly, legal advice is not always taken in advance of strategic decisions in the same way that most businesses would consult with their accountant or HR manager. Consequently, problems can arise down the line, for example when a contract does not protect you in the way that you envisaged.
Successful businesses make the most of their legal adviser and typically display the following 5 good habits:
1. Choose a legal adviser that understands your business
When selecting a new legal adviser, consider how interested they are in the businesses and whether they understand the issues that your business faces. For example, a bio-tech business will need to ensure that their adviser is familiar with regulatory and intellectual property law relating to their sector.
Do they ask about your personal and business objectives? This is particularly important if you are thinking of an exit strategy in the future.
2. Include your lawyer as part of your strategic business team
Whilst lawyers can advise you on your regulatory obligations and compliance, a good commercial lawyer will advise you on the commercial implications of strategic decisions. Keep your lawyer in the loop. Keep them apprised of your business strategies so they can identify legal risks at an early stage of your strategy and give you proactive solutions.
A lawyer who understands your business can provide you with innovative business structures that help your business grow and protect your market position, as well as identifying risks.
3. Provide a clear brief and feedback
Provide clear instructions, agree budgets and provide any information promptly. Consistent communications are vital especially where there are critical deadlines. Provide feedback to your lawyer, especially if you feel that you are not getting the level of service that you require.
4. Invest in proper legal documentation processes
A successful business will have efficient systems for purchasing, quality control, accounts, and HR. Yet few businesses have efficient legal systems and this often causes problems as a deadline for contract renewal can be missed or it can cause unnecessary delays when preparing a business for sale. Without proper documentation, evidence can be difficult to find when disputes arise and oral evidence is only allowed in limited circumstances so the written word remains paramount.
5. Budget for legal advice
Budgeting for legal advice is no different than budgeting for accounting or HR costs. You may also be able to insure against certain legal costs.