What would I advise if I only had 5 minutes? When was the last time I had to give really rough and ready advice in a hurry? How much was the end result for the client really adversely affected?
As with practically everything, asking clients what they find most helpful can be illuminating. So often it is just a very high-level steer or identification of real red flags. If the relationship is good, they will accept and understand the caveat that this is high-level advice – it may need further building out once more details emerge. But it will move the project on for them and build trust that you won’t burden them with detailed advice at a stage when that is not what they need.
Trusting your experience is also really important – a high level view may feel very “low effort” and somehow short-changing the client. But a gut instinct based on first principles that is underpinned by years of experience and understanding of the business or sector can be what in-house counsel is most effective at delivering
Rebecca Staheli - Head of Competition and Regulatory Law, BBC
It has been said that one of the problems with the law is that there is no ‘right’ answer – but that getting it wrong can easily lead to a professional negligence claim. Advice must be legally sound and expressed in a way that is clear, accurate, and balanced.
This can mean that lawyers are seen as unwilling to express a view – at least without a great deal of backup information. They will often want to know much more about a particular issue to say what they think than their business colleagues do. Those colleagues may want much more financial information but will often be content to decide on instinct or experience.
This can lead to lawyers being seen as seeking perfectionism at the cost of making efficient decisions – or worse still, not being consulted by colleagues. Many experienced in-house lawyers develop something of a ‘sixth sense’ about something that feels wrong – and the confidence to say so – and that is an invaluable skill. So, what should you consider in deciding what is ‘good enough’?
- Getting the law right. What can’t be compromised is getting the law right – understanding what the legal issue is, what that means, and being clear on the implications. This is especially important if the legal issue isn’t within your specialism, as can often be the case in-house. If you don’t know, be happy to say so and find out.
- Understanding the risks. If you don’t understand the risks – and the downside – it’s quite likely that your non-legal colleagues don’t either. If you establish that the downside is limited, you may feel that it becomes a commercial decision. If not, don’t be afraid to say so, and to push the point.
- Clarity and communication. One criticism one hears is that the lawyers simply delay matters. In many cases, though, this can be because they don’t have a full picture or understanding, and don’t want to commit without it. If you do need more information, or can’t give a view, do be clear and talk through the issues clearly with your colleagues. Explain what you are thinking, and you may find you’re not alone, but that others haven’t felt able to raise the issue.
- Ethical issues. It used to be said that the in-house lawyer was the ‘conscience of the company’ – and as a lawyer, you are bound by professional duties as well as the duty to your client organisation. If you have doubts about whether something is right, that is not a question of perfectionism v. efficiency, but something you should raise clearly and effectively.
- Presentational perfectionism. Last but not least, you may not need to advise at length in writing – but what you do advise must be clear, must be free of mistakes, and be recorded – even if only in a file note or email – as something you are prepared to justify later should the need arise.
Richard Tapp - legal sector specialist
Pareto’s Rule says that you get roughly 80% of consequences come from 20% of causes (the "vital few"). In other words, 80% of the results are achieved from 20% of the effort. While as a lawyer you should always aim to be accurate, given the amount of work you do, you won’t be able to be perfect in everything you undertake otherwise you will have no chance of completing other than a fraction of your work. So aim to do the best you can in all that you do but perfectionism is beyond the reach of most of us. Another way of looking ats this is to say, “Don’t let the great be the enemy of the good!”.
Ian White - in-house legal consultant
My sense is that we know what “good enough” is after a pretty short time in-house, and we learn that from understanding what our clients and organisations need to conduct their business legally and safely.
The difficulty comes when that natural sense of good enough is over-taken by perfectionism. I think perfectionism is driven by fear. Fear of making mistakes, fear of being seen as less than perfect, fear of the consequences that our mistakes might have on our clients and others.
But fear is disabling. It is not in your client’s interest, it is not in your interest, it is not in the interest of your family or loved ones, for you to be overly motivated by fear. Over the long term, fear takes its toll on your health and your enjoyment of your role.
We must have a realistic sense of ourselves. Lawyers are human. We make mistakes. I have had my share of them. Whilst each one felt dreadful (some more than others), each mistake is a lesson to learn about how you can do better.
One way to avoid perfectionism is to accept that you will make honest mistakes and think in advance about how you would deal with a mistake when you make one. For example, commit in advance to owning up to it and taking responsibility to fix it. Commit to being brave enough to speak to your affected clients about it and tell them what went wrong. Usually, they have a far more realistic sense of proportionality than you expect and will thank you and respect you for proactively bringing the issue to their attention so it can be fixed.
Second, get a sense of proportion. Not all mistakes are the same. Commit to taking a moment to step back and do a decent risk assessment to see what the practical issues are. One of the things I say to people I work with is that it isn’t a mistake until it’s left the organisation. I have no qualms calling my internal clients and telling them to ignore an email I sent, because it has an error in it. But I do put extra focus on documents that will be seen by 3rd parties, or which could be filed in court or by a regulator.
Lastly, it helps immensely to work in an organisation where there is a culture of psychological safety and where you know you will be supported when you put your hand up to say you made an error. You also need to exhibit that respect and care for others in your team when they make mistakes of their own.
When addressing an issue/contract/legal analysis/decision to sue/to defend, how to reply to a litigator etc, ask yourself the following questions:
- Do I understand the factual context enough to make a decision? If yes, go to question 2. If no, go do some more factual research until you can go to question 2.
- Do I understand the applicable law and regulation well enough to apply it effectively to the factual context? If yes, go to question 3. If no, do some more legal and regulatory research until you can go to question 3.
- Do I understand the applicable policies, standards, and governance of my company well enough to understand how those policies standards and governance affect the factual context, the law and the regulations? If yes, go to question 4. If no, go do some more research until you do.
- Do I understand my company’s strategy, plans and priorities as they affect the matter in question? If yes, go to question 5. If no, do some more research until you do.
- Do I understand my company’s risk appetite in relation to the issue, particularly in relation to legal and regulatory risk (nb see issue spot question)? If yes, you can assess the situation. If no, do some more research, and if there is no risk framework and risk appetite calibrated against it – then help to get one set up.
- “good enough” is when something is below your company’s risk appetite (not your personal one) – even if only just;
- more needs to be done when there is something that is both above risk appetite, and what you can do about this will materially lower that thing closer to, or ideally within, that appetite (but not significantly below the appetite – that is wasting effort); and
- you have documented your analysis so that there is a record of the thinking behind your decision.
Worked example (aligning with the above questions)
- We sell widgets to business. We have never had a product liability claim of more than £50k, the product is highly reliable, faults are easy to spot and the widgets either work or they don’t – you cannot use them while broken. They sell at £10 and cost £5 each, and the company normally issues a replacement immediately if one does not work. Your insurance cover is for all claims over £250k and your insurer does not require you to notify them if you raise a liability cap in a supply contract. A major potential new customer wants you to raise the liability cap in your T&Cs to £300k in aggregate per order from £200k.
- Our legal terms and conditions are recently drafted and watertight.
- Our company reviews its insurance cover regularly and is comfortable financially with uninsured losses up to the policy excess level. Your internal client has authority to commit the company under the financial and contract approval policy to losses and costs up to £300k.
- The new customer is near the top of the company’s key target list and the company is quite happy to spend significant sums to get its first order with them.
- Your company is only worried if there is a high probability (4 out of 5) of a un-mitigatable risk of more than £500k crystallising in the business.
Bringing all of these things together means that:
- The company is very keen to win the client with a safe product;
- Moving from £200k to £300k liability only exposes the firm to £50k of incremental cost if an issue arises (because of where the insurance is activated); and
- The claims history on the product makes it highly unlikely that there will be a supply or product liability claim exposure remotely at that level because of the cost of the product, its performance, the warranty replacement approach and the historic liability record.
- The probability of engaging a claim that exposes the firm to a £50k exposure is 1 or 2 out of 5 and the consequence of that exposure scores as 1 or 2. 2 consequence x 2 exposure = 4. 4 is well below 16. Therefore, is below your company's risk appetite.
- Perfectionism is spending time and effort fighting to keep your cap – and possibly losing the client in the process. Good enough is accepting that there is an acceptable level of risk to accept the change, sign the contract and book that vital new client.
- However, always document your logic!
Perfectionism is something I have found myself being pulled towards in the past. This can be a problem if perfection gets in the way of efficiency. I think a lot of lawyers feel a pull towards perfectionism. This is often due to a misalignment on what risks are acceptable to the business, or more work being needed to build and maintain a positive working relationship with clients.
To resist the pull towards perfection over efficiency, I think most lawyers would agree that it is fundamental to develop a sense of safety in speaking up for alternative points of view, approaches and ideas, and that this is a key part of the job.
However, it is also true that not everyone knows what they don’t know, and the drive for efficiency can get lost in the need to get things done. Don’t forget that that separation is an illusion. Whilst lawyers have specific pressures and regulatory drives, there is much that unifies us with our business. When speaking up for efficiency, our voices are likely to get lost amongst the noise unless we put business and customer needs at centre of what we do.
Have a think whether you really understand key business and customer challenges. Do you have any blind spots? Is the only time you speak with clients when you work with them, or do you speak to them more widely? If you don’t have a clear picture of business and customer needs, does this impact your working relationships and your efforts to build a consensus on what is 'good enough'?
The starting point for action is being aware of the pull for perfection. If you are not aware of when the pull is strong, how can you act to maintain a balance with efficiency? For example, if you get the feeling 'there is not enough time' should this be an alarm bell and trigger to question whether perfectionism and efficiency are out of balance. Is there work you could agree with your clients to do differently, and are there risks that your business can accept following legal advice which will not adversely affect meeting strategic objectives?