Legal ego vs Client need

Posted on 7th July, 2011

I met with a senior VP of a global company a few days ago.  As with most global companies, this one was heavily dependent on technology.  Our conversation centred on the paper I wrote recently (with my good friend Kimball Bailey) on “Due Diligence vs Due Negligence”.

Perhaps a rather laboured play on words, but the title is meant to indicate that understanding what you are getting into when you outsource is pretty important – as is making sure you have an ongoing flow of relevant information for the life of the relationship and especially as you approach re-tendering and exit.

I was challenged to produce a checklist of all the points a user contemplating the renegotiation of business critical technology services contracts should take into account.  I rattled off a good (I think!) dozen or so key points immediately, but of course the real answer is the lawyer’s stand-by: “it depends”…  It isn’t just that not every issue (for example, the assignability of third party software licences) is relevant to every situation, but that their relative weight differs.  This is where the art of the experienced advisor who has seen it all before comes in (as opposed to the checklist of the fresh graduate…).   Put simply, clients expect their advisors to advise them about what matters and what doesn’t, rather than simply to report on the factors to take into account.

This raises the issue of what can be turned into a product – such as a “due diligence” checklist, perhaps? – and what is part of the valuable expertise of the technology lawyer.  And at what point is the lawyer simply being precious…

Anyway, I think in this case that it would never be possible – or helpful – to produce an exhaustive checklist of what to take into account when thinking about renegotiating an existing services deal, but I have tried to indicate the broad areas to consider in my podcast on the subject – please have a listen and let me know what you think!

Cheers

Rory