Articles Posted in Talent

Disadvantages when a company’s general counsel serves on some other company’s board have been covered here (See my post of May 11, 2011: conflicts, time, fees.). Those drawbacks notwithstanding, it is not uncommon to find general counsel who serve as a board member elsewhere.

The advantages that come to mind include these. (1) A general counsel rarely has a career path up or to the side in a company, so the opportunity to step into a somewhat different role with another company provides a form of mobility. (2) The most common driver is probably morale. If a general counsel has a passion for whales and wants to serve on the Save the Whale’s board, wonderful! (3) A broader understanding of business and making money comes about through exposure to board-level debates and decisions. For a general counsel, the view is farther and deeper from the board room. (4) Sometimes, like arranged marriages, it serves both businesses to have board-level linkages.

Rotman Mag., Spring 2011 at 84, describes research by Haygreeva Rao, a Stanford professor of organizational behavior. Rao places much importance on the number of statements bosses make in meetings versus the number of questions they ask. “He argues that letting others speak and asking questions – real questions, not statements dressed up as questions – are powerful ways to encourage collaboration and creativity in your employees.”

To grasp this personally, a general counsel might bring someone to meetings to count and calculate the ratio of the GCs questions asked to statements made, as well as the ratio of time spent talking to time spent listening. The article suggests that you guess the results before the data comes back as that will provide a nice test of the accuracy of your self-awareness (See my post of Feb. 1, 2006: how to reduce the chilling effect of a dominant personality or position; Dec. 8, 2006: a GC’s chilling effect; Jan. 9, 2009: ideas are suppressed around a general counsel; and May 25, 2010: sense of futility, not fear of reprisal, silences employees.).

Many in-house lawyers are frequent travelers. They fly for client meetings, for huddles with outside counsel, for team gatherings and conferences, CLE sessions.

The degradation to their health that results starts with weight gain and includes higher blood pressure, worse cholesterol, more stress, and poorer sleep patterns. All these maladies are described in the Wall St. J., Aug. 16, 2011 at D2. This blog too has diagnosed the toll of travel (See my post of May 27, 2007: with scattered lawyers, frequent flights; March 1, 2009: dispersed law department requires more travel for leaders; April 27, 2009: video conferencing saves travel wear and tear; July 16, 2009: frequent travel demands stamina; July 17, 2009: circuit-riding visits to remote offices; and Dec. 9, 2009: punishing peripatetic lawyers.).

Our times revere expertise. Lawyers with deep experience in an area of law, such that they write articles, publish books, speak on panels, head committees, and lead task forces, have mastered their domain and achieved recognition. Whether or not met with external acknowledgement, experienced inside lawyers build up incredible knowledge about specialized areas of law (See my post of Oct. 22, 2008: SMEs with 7 references.).

Expertise comes at some cost, however, so let’s consider several downsides. Expert lawyers may:

1. Use outside counsel more because they spot arcane issues and recognize (or welcome) where they want advice or a sounding board (See my post of Nov. 8, 2005: more use of outside counsel by specialists.).

In The Future of History (Yale 2011), John Lukacs traces the shift in historical scholarship over the past 250 years from aristocratic history – great men fighting great battles for great politics – to social history – a profoundly more democratic study of people of all walks and circumstances of life.

What gets written about law departments still concentrates narrowly on the top legal officer (the Kings and Queens) and their struggles with foes like costs and workload and technology (battles) amidst grand issues of scope and expectations and roles (politics). Rarely do we read anything but passing references to paralegals in-house, let alone secretaries. The foot soldiers of legal departments, the serfs and peasants it would seem to some that constitute half the population and keep the files tended and the documents supplied, figure not at all. We accept the aristocratic slit, uninterested in the wider window to the rest.

When the current general counsel of Mercedes-Benz (Charles Shady) took the wheel two years ago, the legal department ranked 29th out of 30 in an in-house survey, with just 68 percent of the group expressing job satisfaction. In 2010, the law group was the highest-rated department for employee satisfaction in the entire company, with 92 percent of its staffers reporting they are happy at work. Doesn’t this sound like an indictment of the former general counsel? I doubt pay or offices or work shot up in quality, so what else besides the management atmosphere could account for such soaring satisfaction?

This background comes from the New Jersey L.J, July 8, 2011 and can be found here.

In an interview, Helen Gillcrist, the veteran administrator of the Liberty Mutual law department, was asked “If you were recruiting to replace yourself, what sort of background would look for in the candidates?” The surprising answer comes online on June 27, 2011, from Legal Strategy Rev (CPA Global).

Gillcrist said she would seek “An MBA graduate with a background in Six-Sigma process improvement. We’ve been doing a fair amount of work in that field and that would be useful. And you need strong communication skills.” There is a substantial salary cost to hiring MBAs and Six Sigma applies mostly to very large law departments with enough process work to benefit from that toolbox of techniques. Her views, I believe, reflect the highly unusual circumstances of her company, not the typical needs of most law departments. Even so, no one can quarrel with “strong communication skills.”

Canadian Lawyer gathered salary data from 12 Canadian general counsel. The findings broke them into “director level” and “executive level.” The salary differential was large, as the median for the directors was $155,000 (Canadian dollars) versus $207,000 for the executives (30% higher).

The sample is very small, but the point might still be credible that Executive Vice Presidents – assuming that is partly what the “executives” correspond to – are paid much more than lower-ranking corporate officers who head a legal group.

Paragon Legal, started by Mae Tai O’Malley around 2007, places former in-house lawyers – usually women – inside companies on a project basis. According to Fortune, July 4, 2011 at 77, Paragon “has more than 60 lawyers, 85% of whom are women with school-age kids.” They are billing at close to $200 an hour. Paragon is doing well since its total billings this year will hit $8 million.

Here is yet another choice for general counsel: hire someone, retain a law firm, or rent a project lawyer. With the project-lawyer choice, it may be that you can hire that person after you have battle tested them (See my post of Feb. 27, 2008: fees owed to temp agencies when you hire someone they placed.). The news item also reminds us yet again of the difficulties women lawyers with small children have when they try to balance family and work. Paragon gives many of them a welcome choice, and one that benefits general counsel.

Canadian Lawyer gathered salary data from 87 Canadian in-house counsel. I looked at each year out of law school and their ranges, meaning the absolute difference between the lowest salary and the highest salary. They averaged $76,000 but they showed no pattern with increasing years of experience. I would have expected ranges to widen as medians (years of experience) rose. Over time, pay spreads, or so I thought, as people differentiate themselves.

I found likewise with the range divided by the median: no pattern except that years with wide ranges were higher than the average of .75. For this metric, it seems plausible that it would stay fairly stable, for the reason that as medians rise, so does the difference between lowest and highest (but see above).