Monday, June 26, 2017

Budgeting 101

The first time I was asked to prepare the legal department budget I had no idea what I was doing.  I’d inherited a budget made by business people with little to no experience in managing legal matters.  I’d only started a few weeks prior, so had absolutely no insight into the priorities, strategies or cadence of the business. I really could have used a Budgeting 101 crash course.

This isn’t unusual when you’re taking over (or starting) a legal team.  But it is a challenge.  The budget you inherit may or may not be reasonable; if it was created by business people it most likely leaves out operational costs they’re not used to having, and will almost always under-estimate outside counsel spend. Unfortunately, you won’t be in a position to determine any issues with your budget until you’ve lived with it for a few months.  By then you’re having to justify deviations from the budget, getting approval to add expenses that weren’t complicated, and if you’re really lucky you may even save on some line items.

The real fun begins when you enter the next budget cycle (this is especially true if it’s your first time creating a legal budget.)  You’ll rack your brain to think of everything that should be included and how to value the contingencies that you should reserve for – and those that you shouldn’t reserve.  Depending on the size and maturity of your organization and the industry that you’re in, the average legal budget ranges anywhere from 1-5% of the company’s revenue. So if you’re a small to mid-size private company in a reasonably regulated area with $50MM in revenue, you should expect your budget to be around $500k.  Larger companies, more regulated industries, or companies with a history of complicated litigation or major intellectual property issues, you’ll be closer to the 5% mark.  If you’re a startup just out of stealth mode, expect your budget to border on non-existent and ‘I can barely pay you, please don’t spend anything else.’ 

Now you know what your ceiling is expected to be, don’t forget the important things.  Salaries go into the budget – marked up with the fully loaded cost. That’s usually your biggest cost. Legal software like contract management, matter management or IP docketing also need to be included.  Although depending on the use and integration you may be able to allocate some of this cost to other departments. For example the cost of a contract management software that plugs in to SalesForce may be shared with sales if they use it to process all sales contracts.  Registration fees for IP or other licenses are generally going to be allocated to legal.  Immigration costs may fall under legal, HR, or may be allocated to the hiring department.  And don’t forget professional development – your bar dues, CLE expenses, conferences, etc.  If they’re not in the budget, they're coming out of your pocket.

The harder part of the budget it’s the contingent expenses.  No matter how good of a lawyer you are, you will need outside counsel or other outside advice.  The trick is budgeting for it.  If you know you’re involved in litigation, that’s easy.  But how do you plan for potential litigation, the patent registration fee for the idea that hasn’t been disclosed yet, or that tricky corporate matter that only comes up because of something a board member says or does?  There is no right answer to this one.  If you ask ten GC’s how the account for this, you’ll get ten answers.

Because I work in technology companies, IP has always been important.  I work with the engineering, marketing, and finance leads to come up with an estimate of how many applications we can reasonably expect to file in the year.  As a startup, that is generally in some type of fundraising all the time, I always add a small amount for the random corporate question.  And my CFO and I typically agree to treat new litigation as extraordinary expense that doesn’t get budgeted until it’s reasonably likely to happen. 

Even with all of that planning, you’re likely to need to make mid-year adjustments.  This is why it’s important to know the business side of your business. Knowing the cycles, the priorities, the business risks, and the company strategy will help you to more accurately predict the costs of the legal services it will need.  Knowing the personalities in charge of the departments most likely to generate legal work is also critical.  Maybe most importantly, being on good terms with your CFO and finance team will help you to navigate those unbudgeted matters in a way that best protects the business.  

Monday, June 19, 2017

The Things We Say

Five years ago when I started this blog, I made a short post about words uttered in the work place that I never imagined when I graduated from law school.  While I can’t believe I’m still fooling around on this blog, I can’t resist the opportunity to update this list (with a little help from some other legal type friends):

“What is the justification for seeking reimbursement for the beef jerky and condoms as a business expense?”

“No, stupid isn’t a disability. I’m not even sure how you would reasonably accommodate stupidity if it were.”

“Sorry, but dependent benefits does not cover doggy day care.”

“Canada is a different country (from the US).  Alaska, however, is not.”

“Bob, why are you wearing a football helmet to our staff meeting?”

“No, a patient cannot redline the notice of privacy practices.”

“No, just because someone put it on the internet doesn’t mean that you can freely use the code in proprietary software… Please don’t make me explain ‘proprietary’ again.”

“Putting in a pool isn’t a valid business expense, even if you invite everyone over for a party.”

“Should someone go in there and break that up?  Oh hell, do I need to in there and break it up?”

“Don’t get stressed, they’re just like toddlers but not as malicious” – when talking to a young paralegal nervous about dealing with engineering.

“No, you don’t have to reasonably accommodate a millennial by allowing her mom to come to work with her.”

To the infosec guy in the office below – “knock three times on the ceiling if you want me.”

To the board while explaining how targeted behavioral ads work, “ever wonder why you keep getting ads on Viagra?”

“I’m sorry about her cat, but you are within your rights to deny the bereavement leave request on that one.”

“How long has he been standing on top of the file cabinet?”

“Joe, do you know where I can get a piñata?”

“No, use the plastic mini-liquor bottles in the piñata, not the glass ones – they’re a hazard.”

“I don’t want to call your mother, but I will if I have to.”

“Yes, marijuana at work is still a drug issue.”

“No, you can’t not hire her because you have a ‘deal’ with your wife not to be alone in the room with another woman.  Seriously, you do that not every woman wants to have sex with you – right?”

“Our department motto has become, ‘I need a drink’.  I don’t think that’s healthy.”

“Sure, you can put ‘Master of the Universe’ as your title on your business cards – but you still won’t have signing authority.”

 Although sometimes you get to say something like this – “We aided in saving the lives of 19 girls out of sex trafficking today.” (Courtesy of Christine Jones). 

Monday, April 3, 2017

1 in 68

It’s that time of year again.  April is Autism Awareness month.  I’m sad to say that even though we’re at 1 in 68 kids being diagnosed with some form of Autism there is still a lot of misconceptions about it.  So, I do my small part and share some of how Autism has effected myself through my professional life.  I’ve previously written uplifting lists of how my autistic son has influenced the way I see the world.  And all of those things are still very true.  Learning how to navigate the world with LG has broadened my perspective on a lot of the day to day interactions in the workplace.  Just like relearning the golden rule when your kid goes to kinder, there’s something to be said about taking a step back and re-evaluating how you respond to your environment.

However, there is another impact to my professional life that doesn’t get mentioned as much. As the parent of a special needs kid, my career choices tend to be more conservative than they may otherwise be.  When interviewing with a potential employer I have to ask about things like benefits, and what type of coverage for autism services are included.  I have to explore the flexibility of office hours. I have to reserve a few of my PTO days each year to deal with ARDs, neuro appointments, and pre-visits to new places he’s going to be required to attend in the next few months.  I have turned down job offers because it would require me to move to an area that didn’t have enough therapists within a 30-mile radius.  And I let another opportunity go because the insurance benefits didn’t cover ABA therapy. 

I am extremely lucky.  I work in a field where I am well compensated and typically receive good benefits. I am senior enough that I can require flexibility as a part of negotiating a new position.  For the most part a contract doesn’t care if it’s reviewed at 3 pm or 3 am, and execs often exchange texts or phone calls late at night or early in the morning depending on their work style - so my work product isn’t materially impacted because of my need for flexibility.  In house lawyers are generally on call 24/7 anyway, so having my butt in a seat from 9-5 doesn’t impact my earning potential. 

Unfortunately, autism doesn’t just effect the children of highly paid professionals.  And as much as we protest as employers that we’d never hold it against an employee, if you’re working in a call center it’s a lot harder to be flexible when your kid has a 2-hour meltdown and refuses to get in the car. (Sure you could force him, but he’s almost as big as you now and is really hard to physically pick up - even if that was a healthy way to deal with a meltdown.)  It’s harder to demand great insurance benefits from the minimum wage job you had to take so that you could shuttle him to the several therapy sessions a week that he needs - for which you now rely on grants and Medicaid to pay.  And if your employer only allows 5 PTO days a year, you reserve all of them to deal with the kid and his needs.  All the while, you pray that you never get sick or need a day for anything else. 

None of this addresses what the child goes through himself, which is exponentially harder than the administrative stress that parents go through.  So while we thank you for the sentiment of “I don’t know how you do it,” please don't start comparing us to real martyrs. Instead, please take a moment to think of how you could support the autism community.  Maybe it’s just a supporting look when a kid is having a meltdown in the middle of the school hallway instead of the judging of parental skills because he’s shouting some choice words that shouldn’t be in a second grader’s vocabulary.  Maybe it’s donating money or time to one of the many organizations that are working to make life easier for the community – Autism Society of Austin is one of my favorites. Maybe it’s cutting one of your employees some slack for coming in late when their kid has a bad day, or if you’re senior enough fighting for policies that make life just a little easier.  Maybe your company can employ someone with autism, giving that person a chance to make a living and the rest of your employees some exposure to and hopefully empathy for a real autistic person, not some cute kid on a poster.  If nothing else, go learn something about autism and share what you’ve learned (unless you’re going to say it’s caused by vaccines, then just shut up.)


Light It Up Blue, or Tone It Down Taupe – either way spread awareness so that instead of forcing these amazing people to conform to our rigid society, we start thinking of how our society can be more accommodating and accepting of them. 

Friday, November 25, 2016

18 Donuts and Attention to Detail

I hope everyone had a great Thanksgiving holiday.  I'm full of turkey, done with my black Friday shopping and was ready to get back to work.  Working for a small start up that is open most days of the year, we take turns playing the 'grown up' on site during slow times like the Friday after Thanksgiving.

Since I wasn't leaving town or hosting family, and being one of the newest members of the team, I volunteered to be the adult today.  I woke up early and got an extra long walk in, getting my 10,000 steps by 6:30 am.  Got ready and hit every green light on the way in.  I was in such a good mood, I even stopped to buy donuts for the few of us that were on the black Friday shift.  As I rolled into the parking lot around 9, I noticed there were only about 6 cars in the entire lot of the multi-tenant building.  Thinking it would be a really quiet day, I pulled out my donuts, balanced my tea as I tugged on the building door.  Locked.  I went around the other side - also locked.  I went to the front entrance, and it was also locked.

I had never thought to ask if the building would be closed for the day. I don't typically work in the building after hours so building access had never been an issue.  I have access to our offices within the building and VPN access for working from home when I need to pull a late night or get an early start.  The company is limited to the number of building access cards we're allowed to have, so we're particular about who gets them.  It's one of the obvious details that often get overlooked, because it's so obvious.  We think it a given and don't pay attention.  Focusing on the big stuff, the stuff that matters - the indemnification clause, the proper reps and warranties, the timing of the patent application or the marketing material disclosures.  We assume that the little things are taken care of by the process, by the administrators, or are the natural state of things.  Until we get locked out of the building juggling our tea and 18 donuts.

Because of my commute I had an understanding with my boss upon being hired that I wouldn't be working after hours at the office. It never occurred to the office manager that I would need one to work on the unofficial 'holidays' when the building is closed but the office is open.  So this morning, I stood at the door for a few minutes laughing at myself. And then I took my donuts home to the kids - giving some away to a panhandler on the way, because no one needs 18 donuts at home.

Wednesday, November 9, 2016

Thanksgiving 2016

It’s that time of year again, time to contemplate the things in our lives for which we are thankful.    Every year the family creates a list of things that we’re grateful for – given the youth of some family members, toys and candy usually make the top of the list.  Given my fondness for champagne, so does bubbles.  But the thing we’re most thankful for are the members of our family – mom, dad, brothers, Nana, Papa, cousins, and the many friends with whom we share a bond stronger than blood.
  
This year has been one of ups and down and I’m more grateful than ever for the wonderful people in my life.  For old friends and new, I have been more than blessed with the love, mentorship, support, laughter, and encouragement from so many.  And for that I am truly thankful. 

As a legal blogger (of sorts), I also have to attest to my absolute dependence on technology and provide proper gratitude for the tools that make my job easier.  From my smartphone that keeps me connected 24/7 and allows me some semblance of balance in my life to the software that automates once manual processes that allows my team to shine, technology has had a major positive impact on my practice. 

I am also more than thankful that this election season is over.  I hope that my social media feeds become a friendlier place and I can go into the office without worrying about a fist fight breaking out over the latest twitter war or email leak. 

And because it’s my list, I’m thankful for bubbles.  What are you thankful for?

Thursday, November 3, 2016

Head up or head down?


Every couple of months you’ll see an article, presentation or infographic trying to define the line between a leader and a manager.  Often they’re full of platitudes like leaders listen more than they talk and surround themselves with “A” people.  One of my favorite useless platitudes is that leaders have their heads up while managers have their head down – meaning that a true leader will come up with ideas and delegate the execution to people more capable of pulling it off.  While those who have ‘only’ reached the manager level, will still keep their heads down focusing on the work right in front of them instead of thinking the big thoughts.

For many of us in small departments, it really isn’t a choice.  There’s just no one there to delegate to, or if there is, they are so far in the weeds that it’s not fair to pile more on them.  Of course that doesn’t relieve you of the obligation to think outside of the box and come up with innovative solutions to the problems your company is facing. 

So does that mean that we’re not leaders? Or all hope to developing leadership skills is lost?  Of course not.  Everyday leaders of all stripes are able to inspire others while getting their own jobs done well.  The trick is to know when to put your head down and when to look up.  Every day there is real work to be done.  And that’s what our company’s pay us to do.  Sure, they love the great ideas that increase efficiency or improve the bottom line, but they expect us to do our day jobs too. 

The first thing you lift your head up for is increasing the efficiency in your day job - contract management, process development, alternative fee arrangements, etc.  This gives some breathing room so that your ‘heads up’ time doesn’t just occur between the hours of midnight and 5 am. 

Once you’ve established that, you use what you’re learning from your ‘heads down’ time to inspire and innovate.  Your day job gives you unique insight into the challenges of multiple areas of the business.  For example, knowing what contracts are in the queue gives you a unique view into the direction the company is actually heading regardless of what is being said at the quarterly all hands.  Being able to raise your hand to call attention to a department entering into outsourcing agreements because they can’t meet unrealistic project deadlines can highlight the issues with the project.  It also gives you the opportunity to identify synergies between departments – IT has just contracted for a ticketing system that has a lot of the features that marketing is looking for in project management, have the teams talked?  Dealing with employment claims allows you insight into areas of the company culture that need improvement. 

The list goes on and on.  There’s a reason why a good general counsel is worth their weight in gold, and you don’t have to suck at your day job to get there.

Wednesday, October 26, 2016

Team Player or Team Doormat

I’ve recently been back in the market for a new job and one of the common questions I ask in the interview process is what happened to the last guy.  While there will always be spin on the part of an employer it sometimes be hard to discern if the reason he left was because he wasn’t a team player or because he refused to be the team doormat.  This becomes even more complicated in smaller companies where everyone wears multiple hats and does grunt work regardless of their status.  And it becomes even harder to self-identify if you are the said poor team player or doormat. 

So I’ve come up with a checklist to help a would be doormat out:
  1. If you’re asked to cover for an employee while they are out, even if it’s not purely legal in nature, you’re being asked to be a team player.  Frequently this will come from HR or other executive functions where sensitivity to the potential issues reduces the options and makes you the next best choice.
  2. If you’re asked to permanently handle routine non-legal matters that are heavily administrative or otherwise burdensome and your legal experience adds little or no value to the process, you may be a doormat.
  3. If you’re told budgets are tight so you’ll have to make your own copies and type up your own letters – suck it up and be a good team player.
  4. If you’re told budgets are tight so you can’t have a raise for the third time in three years yet co-workers are bragging about 5-6 figure bonuses or going on lavish "retreat" work trips, you might just be a doormat.
  5.  If the workload is increasing but in a haphazard manner, i.e. some additional contract work, some additional employment matters, a litigation matter once a year, etc.  You may be asked to step up and take on additional responsibility, which may translate into a few more hours per week.  This is what good team players do, until…
  6. If the workload has increased consistently over a decent period of time so that there is easily enough coherent work for another head (or two) to be added and you’re being asked to work double time, it may be time to find a better team to play for.


Obviously, this isn’t an exhaustive list – but hey, it’s my first post back.  As always, feel free to leave your own doormat examples in the comments.

Tuesday, October 25, 2016

MIA

You might have noticed that things have been a bit slow on this blog.  And while it’s very un-like me to ever shut up for long, this page has been silent for far too long.  It’s been a crazy 18 months, both professionally and personally.  Mergers, integration, new jobs, kids starting school, buying a new house, health scares (everyone is fine), and just day to day life got in the way of sharing my multitude of unsolicited thoughts on all things in-house.  But, things are starting to die down, so I’ll be back to my prolific self in no time.  So for the one or two faithful readers still hanging on – stay tuned, and feel free to entertain yourselves in the comment section.

Wednesday, April 13, 2016

Public or Private?

Yesterday I participated in a panel at UT Law School with the intent to give the eager students a peek at a life of practicing in house.  One thing that came up a couple times in the discussion and a few more times after the discussion was officially over was the difference between practicing for a public vs a private company - and whether that difference was material.  And the determination? Well, as most answers in law go - it depends.

There's been a definite increase in regulations governing public companies in the past few years.  Counsel for a public company needs to be at least familiar with the rules even if they don't specialize in corporate work. And they're not alone; the responsibilities for compliance fall on legal, finance, and executive roles.  Many companies are even developing compliance departments with the sole purpose to marshal it all and keep everyone on point.  Which gives a little breathing room to the non-corporate in house counsel, but doesn't completely remove the added complexity of working for a public company.

There's also an increasing perception that practicing in a private company relieves an attorney of all burdens of knowing and following the required regulations for public companies; and consequently, completely unprepared to work for a public company.  I've seen it most predominately when a company is searching for a new (or first) GC.  Since I've never met a founder or a VC that doesn't dream of the huge IPO, even private companies want someone with public company experience for fear that one can't gain the necessary experience in a private company.

Of course most founders and VCs dreams of an IPO or big exit, so if you're working for a funded company you have to at least think about putting the controls in place that would ease that process. Additionally, in a funded company the investors will require many of the same type of controls be in place so they feel comfortable giving more money.  Moreover, the diligence process for selling a company in lieu of an IPO is often more in depth and a lot more time consuming than the diligence process for conducting an IPO. So an attorney can gain valuable experience even working at a private company.

That said, not all founders have big exit dreams.  Some dream of growing a company to a respectable size and serving their customer base for generations.  They want nothing more than to live a good life and leave a legacy to their families.  Those closely held companies don't usually take outside funding.  And they don't really care about following pointless process that don't add real value in at the moment.  They're often not interested in acquiring any other businesses and care more about the day to day transactions than corporate transactions.  A lawyer coming out of this environment won't be prepared to work for a public company without a good mentor to show them the way.

So all this goes to say, whether working in a public vs private company makes a material difference in either the day to day or your chances of getting that promotion often depend on the companies involved, the leadership requirements and whether or not you've got a good mentor.

Monday, April 4, 2016

Autism Awareness Month: The Lessons Continue

It's April. That means it's once again Autism Awareness month. I've made no secret of how Autism has affected my family and my career (I've written about it here and here); and once a year I try to do my part in raising awareness for those around me.  A part of that awareness is realizing that instead of attempting to get an autistic individual to conform to society, there are so many things we can learn from their unique perspective.  And since everyone seems to love a list, here's my top 3 things my son has taught me in the last year:

1. We all need a break sometimes. Kids that are diagnosed with autism (whose parents have decent insurance) get a ton of therapy.  My son has had between 10 and 30 hours of therapy a week since he was almost three.  This is in addition to school - he's in a special ed class which he attends for a little over 7 hours a day. That's a lot of demands to put on a kid. Hell, it's a lot of demands to put on an adult.  And at least once a year he starts having a lot of breakdowns and tears flow when he's asked to go to a therapy session or to school where before he was having fun.  He needs a break, so we take a week off.  He gets a week with no demands but to just be him.  It revives and refreshes him and he almost always has a big movement forward in his development shortly after he resumes.

Transfer that to the land of lawyers and see what kind of jumps in productivity you get if you take a break before you're totally burnt out.  Even in house where we're supposed to have this mythological "work-life-balance", we work 50-60 hours in a good week and routinely average 70-80 stressful hours.  Unlike many in private practice, a boon isn't often followed by a short break while we have to find the next project or client.  We can finish up that big transaction only to fall into the pile of work that was only being triaged and has now turned into a volcano about to explode.  There's always a reason to put off that vacation because there's so much to do.  Combine that with the fact that many of us with families don't do true vacations - we do 'be-responsible-for-everyone-in-a-location-other-than-home'.  Which is often even more stressful.  It's okay to need a real break.  Take a day and let the kids go to school.  Sit and read a trashy book.  Binge watch a show on Netflix you've never heard of before.  Let yourself actually relax and see how a refreshed brain can boost your productivity.

2. Celebrate the small stuff.  Yesterday LG told me about a dream he had about his favorite video game.  It seems silly to celebrate such a mundane conversation, but it was a milestone for us.  See, his autism makes it difficult for him to communicate things that aren't literal.  He's actually still struggling with communicating even those things.  But when he enthusiastically told me about a dream he had where there were the monsters and levels of his game and he was the hero it was like I was seeing a new kid.  We also celebrate when he names an emotion instead of having a meltdown.  "He makes me sad." is enough for a party in my house.  On the surface these seem like small things, but they add up to a very big picture.  And thinking of the little wins renews our faith that we'll get those big ones.

The same is true in the workplace.  Regardless of your department, celebrating that little win can make a big difference in the morale and the engagement of your team.  We don't win big cases everyday, but getting that customer to finally sign the agreement without gutting all the protections is a win.  Getting 90% of the employees to complete that required compliance training on time is a win.  Talking the head of whatever department out of that stupid thing is a win.  Celebrate them.  Realize that the small things matter as much, if not more than, the big things.  They add up to make your team a team of winners.  Or if you ignore them and only celebrate the big wins, you'll have a team of nobodies with one or two 'producers' who get all the credit.

3.  Nothing beats hard work.  Not everyone is born with the natural ability to hit a ball out of the park, perfectly play Mozart or write the perfect blog post.  There are those who just holding a conversation is difficult.  One of the things I have learned from my son and his classmates is that those kids work so hard at things we take for granted.  And to a one, they are achieving things we weren't sure was possible in August.

The same is true for lawyers.  We're not all born superstars.  Most of us are of above average intelligence, which served us well to get into and graduate from law school.  But when you're in the board room with a couple of serial entrepreneurs, your founder who was smarter at 12 than you are now, and whatever other financial gurus the investors send to represent them, you don't always feel so smart.  Numbers may not come naturally to you.  Communicating in business speak may not come naturally to you.  Thinking of the business as a business and not a series of legal issues may not come naturally to you.  But all of these things can be mastered with a little hard work.  I've seen very talented lawyers get their butts handed to them my mediocre lawyers who spent time learning the business and digging into the issues.  Don't be afraid to work hard and don't be intimidated by those ivy league degrees at fortune 100 legal departments.  Odds are they haven't worked as hard as you have to understand your business.  So when they try to rely on their size or revenue and you push back with the truths of your industry, you can get more wins than you think.  And that's worth celebrating.