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The Business Guide to Legal Literacy : What Every Manager Should Know About the Law

Title: The Business Guide to Legal Literacy : What Every Manager Should Know About the Law
Author: Hanna Hasl-Kelchner
Hardcover: 384 pages
Publisher: Jossey-Bass (March 31, 2006)
Language: English
ISBN: 078798255
I won this book on http://inbubblewrap.com/ , which is a great web site (its a give-away site for 800ceoread.com, which is a great on-line bookstore for business books).

This book was quick and easy to read and full of useful materials. I also think that understanding legal risk is not common in the business world – we tend to learn the lessons either when senior management complains that a contract wasn’t reviewed well or that there’s a liability or patent risk in what’s going on – this is because they’ve seen it before, often from their senior management years ago.

One important message I’ve been delivering lately is to limit negligence; if we do what’s common in the industry, and if we consider our options rationally, then we may still be liable but not negligent, and negligence can ramp up the cost for legal problems greatly. In addition, such due dilligence is a good thing normally, as long as its not taken to extreme. The goal is to manage the legal risk within the risk that’s reasonable for the organization and in this case.

Hasl-Kelchner mentions the concept of mindfulness of organizations, based on research from Managing the Unexpected by Weick and Sutcliffe; generally speaking, the these organizations were:

  • “More preoccupied with failures than with successes. They appreciated that achieving strategic goals is as much about knowing what mistakes to avoid as it is about knowing what you want to achieve.
  • Reluctant to oversimplify. They preferred to reconcile interdisciplinary perspectives without sacrificing important nuances.
  • Sensitive to operations and relationships within the value chain. They were particularly alert to the risk associated with latent failures.
  • Committed to resilience. They bounced back from past errors by learning from past mistakes and developing knowledge.
  • Deferential to expertise.”

The book makes a strong case for helping attorneys understand the risks a business accepts in general, and also in how to communicate risks back to the business. Business is all about accepting some forms of risk, but lawyers typically try to minimize risks.

I liked this simple quadrant approach to looking at risk based on reason to take action vs. the merits of a case. It is possible, and a goal, to move items from higher risks to lower risks – the book suggests approaches that have worked in the past to do this.


This diagram shows a “formula” for calculating the possible negative impact on a business of a legal action.

As an aside, this book as some really interesting items related to communication – this isn’t surprising, since communication is a big aspect of gaining literacy in almost anything. Below is a table showing communications channels and their strengths and weaknesses:

Later on in the book, there’s a discussion about communication attributes that are important to affecting legal
literacy:
“Expanding employees’ safety zones requires steering clear of misunderstandings and creating a community of joint interest. Special attention must be paid to the elements of communication-the who, what, when, where, why, and how. Applying these elements to our goal of improved legal literacy, compliance, and leverage means looking
at points like these:

  • Who communicates: Are they credible? Do they have authority? Do they know what they are talking about?What is being said: Is it consistent? Is it appropriate? Is it serious?
  • When it is being said: How often is the message sent? Is the timing appropriate? Why now?
  • Where it is being said: Is it being whispered in the hallway? Or posted on the company intranet?
  • Why it is being said: What’s really going on? What are the consequences for the employees? Is there a hidden agenda?
  • How it is being said: Does the message make sense? Can it be taken at face value or is there more between the lines? Is it likely to be misinterpreted and misunderstood? How loud is the message? What kind of resources are behind it?

“Another way to vet corporate communications is to evaluate them on the basis of whether they are constant, clear,
consistent, correct, and
convincing:

  • Constant: Is the message repeated often enough?
  • Clear: Is the message understandable?
  • Consistent: Do different editions of the message agree with one another?
  • Correct: Is it the right message? Right time? Right place? Can the audience understand it?
  • Convincing: Is the messenger credible? Is the content persuasive? Is the timing correct? What resources are being devoted to it? How important is it?”

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