Business Attorneys: Are You a Strategic Partner or Legal Technician?

Attorneys,

I would like to share what I believe is the greatest way you can provide more value to your clients: focus on being a strategic partner, not just a legal technician.

There are great legal technicians (many attorneys), great strategists (many consultants), but few attorneys who combine these strengths to become a strategic partner, a trusted advisor. Both are vital.

Is the Role of Attorney as Trusted Advisor to a Company Dead?

Traditionally, many business attorneys embraced the role of a "trusted advisor." That is, the attorney was a strategic partner to the CEO, participating in strategy discussions and guiding the health and growth of the company.

Today, I have observed most business attorneys are legal technicians, not strategic partners. If you ask attorneys the last business book they read, most cannot name one, demonstrating they are not truly interested in the concepts essential to business. More importantly, their conversations with corporate clients are technical and tactical, not strategic.

It's no surprise that most business attorneys do not consider business strategy. It's not taught in law school. Nearly every law school tests students answering legal questions with the IRAC method: identify the Issue, identify the legal Rule, apply the rule in an Analysis, and Conclude. This rigorous methodology is essential to be a great lawyer, but a strategic partner does more.

Test Yourself

Think for yourself: when was the last time you discussed your client's 10 year goals, challenges to achieving those goals, and strategies to leverage what differentiates the company?

As another example, when your client raises questions about intellectual property, do you ask about the company's plan to take the product or service to market, or do you just dive into legal issues?

Clients Want Their Business Attorney to Be a Strategic Advisor

Clients want attorneys who understand business strategy. See What Clients Want From Their Lawyers: Business Strategy Advice. Why? Attorney Douglas Park explains, "The benefits to bringing business strategy into legal advice include:

1. The client can better balance business and legal risk
2. The client can better achieve its strategic, financial, and operational objectives
3. More trust and communication in the attorney-client relationship
4. The client receives greater value from their attorney's counsel"

See The Benefits of Bringing Business Strategy Into Legal Advice

Leading Law Firms Recognize This Void

The Wall Street Journal recently observed business attorneys who understand strategy have a competitive edge:

Bankers, consultants and marketers aren't the only professionals looking to beef up their business skills for competitive advantage these days. At a growing number of law firms, top attorneys are being trained like business people, using executive education courses designed to strengthen management and business skills.

Some firms have been actively teaching lawyers business skills for the past half-decade. But this year's shrinking client lists -- and profits -- have encouraged more law firms to invest in management education. "Law firms are still run the way they were in the 17th century," says James Bailey, a leadership professor at the George Washington School of Business who studies law firms and helps run a program for managing partners. "They never really had to worry about [management skills] because every law firm in the country made money every year."

See Law Firms Embrace Business School 101.

The Need for an Attorney as a Strategic Advisor is Obvious to Companies

A senior marketing manager at Yahoo! told a story that illustrates the point:

She said that the marketing team spends substantial time and effort to develop a marketing campaign, which is then reviewed by in-house counsel. In-house counsel will often come back and explain the legal problems with the plan, which might include intellectual property, privacy, and cyberlaw issues, or potential litigation down the road. As a result, the legal team will either nix the entire project or force marketing to substantially revise the plan.

But marketing complains that in-house counsel does not understand the business objectives of the plan, or that in-house counsel is too risk averse. The consequence is that marketing wastes time and money. Further, the legal team might force the wholesale revision of a plan whose purpose they don't fully comprehend. The effectiveness of the original plan is unnecessarily diluted.

This is precisely what marketing thinks, causing unnecessary tension between marketing and legal. Legal is shaping marketing's activities when the direction of influence should run in the opposite direction. At the least, legal should be facilitating marketing's objectives. In order to do that, the attorneys need to understand marketing's goals and marketing's role in promoting the company's success.

Too often, both within a company, and between a client and outside counsel, business and law are unfortunately treated as separate silos. This is largely because lawyers are limited in their ability to integrate business strategy and organizational management concerns into their legal advice. Thus, business people think like business people, and lawyers think like lawyers.

See Breaking Down The Silos That Separate Business People And Lawyers

Some attorneys and CPAs get it, including the attorney in this video: Palo Alto Business Attorney: Why Lawyers Should Understand Business Strategy.

Becoming a Strategic Advisor

Being an excellent legal technician is essential, but that is just the start. By knowing how to apply your legal knowledge to advise a company in the context of reaching its goals, you become a strategic partner and your value increases by multiples.

Where do you start? Check out my list of Books Every CEO, Leader & Business Owner Should Read.

About the Author: Aaron Hall is a business attorney at Thompson Hall, a Minneapolis law firm exclusively designed to serve the needs of business owners and CEOs, helping them strategize, get their companies healthy, and grow.