Are you making the tough business call? Or are you having your lawyers do it by accident?

Too often, business leaders use lawyers as a crutch or an excuse to avoid the hard decision, that in truth is theirs to make.

At risk of over-simplifying, a business leaders job is to make really hard, nuanced judgement calls based on imperfect data that continues to move a business forward, in a risk adjusted fashion. A lawyers job is to inform their partner of their risks, to educate, and to help.

So, what is the problem you ask?

In most businesses, the minute a business lead gets an SOW or MSA back from a client with red-lines, we reflexively ship it to our lawyers.?Let's call that step 1, which is super normal and encouraged.

Next, a great lawyer helps you understand liability, privacy law, negligence standards, or perhaps even indemnification, and whatever else you need to know.

Next, what too often happens is that the business partner just takes the lawyers lead, because without legal knowledge, they feel worried or anxious about taking on ANY risk. The issue is that its impossible to lead or grow, without taking on any risk.

Let's make this more real. Let's say Digital Consultancy Y is dealing with Client X on a contractual issue around User Generated Content. My dollar guess is that a very smart and well educated lawyer at the Consultancy would try and help their internal client (call her the business leader) understand that there is too much risk if the client insists on them taking on all accountability and liability around user generated content (which inherently is riskier and harder to control). In an ideal world, that business partner or their CEO, has to feel they can make a call. They have to be able to ask key questions:

a) how likely is it that the User Generated Content (UGC) will create a legal issue?

b) how often has that gone wrong in the past year?

c) do clients usually let us cure and remedy?

d) how often has that ended in a law suit?

d) what is the downside financial risk relative to the upside in the partnership and fee?

e) and so on....

Well, if those answers come back solid, than someone needs to step-up and be willing to accept SOME risk to get a deal moving and progress going forward.

In a smaller business, usually, a good CEO or GM can step in, and say to the lawyer "thank you for your advice, I feel as a business owner, we can accept X level of risk...and frankly, we trust our ability and this client...so let's get this done." At larger companies though, and I have seen this 1000X, "risk shifting" happens where nobody wants to make a call because everyone is CHASING ZERO RISK...which only exists if you sit inside your home every day in the dark and never put anything on the line. The road to zero risk is slow. The road to zero risk involves 20 people and 20 meetings. The road to zero risk means you got beat by a faster moving company where leaders work with their lawyers, NOT FOR their lawyers.

My two cents from a lot of tough learnings:

1) Pay for great legal counsel...a good lawyer is so helpful....

2) ...have a culture where the business leader, CEO or GM feels empowered to make a few calls and accept some risk in the name of progress....

3) ...if you work in a medium sized business (like I do), know, this is a super advantage for you so use it...

4) ...if you are reading this coming from a larger company...well...you know the deal here...but...I would say...great leaders respect advocates for common sense and if you can bring facts to your GC and C-Suite, even if in a big company, and advocate for compromises....you can make a difference....but you have to be willing to not just "listen to the lawyer" as a voice of god.?

Caveat - My dad is a lawyer and I love him dearly. Our legal counsel at Acadia is second to none and without them all, we would be nothing. Lawyers are essential. The message above is that business leaders need to get interested, learn, ask questions, and then ultimately, be informed enough to make some calls...not jut shift all the risk back to the lawyer or blindly accept their recommendations.

Until we meet again folks. Thanks for being part of this 37K+ strong community looking to get better at leadership, making hard calls, and being better client or customer stewards.

-Jared