By Jim Hassett and Natasha Chetty, LegalBizDev Effective project management starts by asking the right questions. While there are hundreds of questions managers can ask, this list summarizes the most critical ones. It is organized in terms of the eight...

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The latest post from Jim Hassett’s blog Legal Business Development.


Key questions project managers should ask

By Jim Hassett and Natasha Chetty, LegalBizDev

Effective project management starts by asking the right questions. While there are hundreds of questions managers can ask, this list summarizes the most critical ones. It is organized in terms of the eight key issues discussed in our Legal Project Management Quick Reference Guide.

Set objectives and define scope

  • What business problem does the client want to solve?
  • How does this affect the client’s organizational goals and reputation?
  • Are several outcomes acceptable?
  • What deadlines matter to the client?
  • Are there strict budget limits?
  • Who is the ultimate decision maker?
  • How does the client define success?
  • How will you know when you are done?

Identify and schedule activities

  • How can large matters be subdivided into smaller discrete tasks?
  • Which tasks are on the critical path? That is, which tasks must be completed before others can start?
  • What deadlines will best align the client’s needs with the firm’s interests?
  • What external and internal scheduling constraints do we need to be aware of?

Assign tasks and manage the team

  • Who will be responsible for each task?
  • How long do they think the tasks will take?
  • What help, resources, or support will they need to finish on time, within budget?

Plan and manage the budget

  • How much should be budgeted to complete each milestone in the project?
  • How much was actually spent?
  • If at any point actual spending exceeds the planned budget, what can be done to get back on track?
  • Can savings on one activity be applied to compensate for overspending on another, within the overall budget total(s)?
  • Who are the relevant contacts regarding budget at the client’s organization and what are their needs or priorities?

Assess risks to the budget and schedule

  • What could possibly go wrong that would increase the cost, delay the project, or decrease client satisfaction?
  • How likely is this to happen?
  • How serious would the impact be if it did happen?
  • Which risks should I plan for in advance?

Manage quality

  • Does the client have any concerns about the quality of the work?
  • How should I monitor the quality of work performed by other team members?

Manage client communication and expectations

  • Who is responsible for communicating with the client decision maker?
  • What does the decision maker care most about?
  • Does the decision maker prefer formal reports, informal email, regular phone calls, face-to-face meetings, or another type of communication?
  • Should brief standard reports be submitted every week or month?
  • Which stakeholders does the decision maker need to communicate with in general or on this matter?

Negotiate changes of scope

  • How should I track changes to the work required and their implications for schedule and budget?
  • What criteria should I use to decide when a change in requirements should lead to a client negotiation for additional funding?

 

This post was adapted from the recently published fourth edition of The Legal Project Management Quick Reference Guide.

      


Sample litigation statement of work: Early case assessment

By Mike Egnatchik, LegalBizDev, in collaboration with several clients

 

Hypothetical Facts

ClientCo acquired the assets of a company Carpart which manufactures high performance parts for cars. One product line was a battery that goes into fuel cells, which are sold and incorporated into engines of electric vehicles. The asset acquisition agreement (“agreement”) shows the acquisition was of assets only, and the liabilities were expressly not assumed. The agreement also contained representations and warranties that there were no warranty claims against the business. ClientCo paid $50,000,000 for Carpart’s assets, which has been distributed to Carpart’s shareholders.

After the sale, ClientCo also hired the bulk of Carpart’s employees. A customer of Carpart had been complaining to Carpart employees about failures in the fuel cells shortly before the sale. The employees continued to deal with Customer to help determine whether there was a defect in the batteries. Soon after the purchase, ClientCo discarded the battery business, preferring to focus on parts for gas and diesel engines. Nevertheless, some of the employees continued to work with Customer and discovered that the batteries were not compatible with the design of the fuel cells. The fuel cells are beginning to suffer catastrophic failures.

Customer has made warranty claims against Carpart and ClientCo. ClientCo never sold any of these batteries after acquiring the assets of the company. However, Customer had previously sold over 20,000 fuel cells to an electric car company, GreenCar, which installed the fuel cells in all of its 2010 models. When advised of the problem, GreenCar had already produced and sold 20,000 cars. The cost to recall vehicles and install a new fuel cell is $5,000 per vehicle.

 

Legal action

A complaint has been filed by GreenCar against Customer, ClientCo, and Carpart. The lawsuit seeks: (i) direct and consequential damages; and (ii) indemnity from car owner complaints.

ClientCo has asked you for a proposal to undertake this entire representation on a fixed fee basis to defeat all claims. All parties will file cross-claims against each other. While there are many different cross-claims, they will all be adjudicated in one proceeding.

You have explained to ClientCo that it is not possible to provide a meaningfully accurate fixed fee for the entire case at this time, but you have agreed on a fixed fee to perform an early case assessment.

 

Statement of work for early case assessment

In the early case assessment, we will prepare a written report to ClientCo covering:

  • Determination whether the case has merit
  • A cost/benefit analysis of possible legal strategies with likelihood of success for each
  • Cost estimates for recommended options and other phases of the case including:
    • Pleadings and motions
    • Court-mandated conferences
    • Discovery
    • Settlement/ADR options
    • Summary judgment
    • Trial
    • Post-trial motions

This statement of work will include fact investigation and development, review of key transactional documents, interview of key players, legal research regarding potential liability of all parties, initial review of warranty, and contract issues.

This phase will conclude with one or more meetings with ClientCo to review findings and recommended options contained in the report and decide on next steps.

 

Assumptions and exclusions

  • The representation will be limited to the complaint filed by GreenCar and related cross-claims of all parties
  • Specifically excluded are litigation holds for evidence preservation and insurance investigation and tender, which have already been performed
  • No more than 10 hours of interview will be required with key players
  • No more than 20 hours of legal research will be required
  • ClientCo will provide individuals with expertise who will orally summarize technical fact

 

Reproduced with permission. This post was adapted from the recently published fourth edition of The Legal Project Management Quick Reference Guide.

      


How to write a statement of work

By Mike Egnatchik and Jim Hassett, LegalBizDev

Legal cases and transactions can have unpredictable aspects, sometimes beyond the control of the best managers and planners. Therefore, flexibility is key. Legal project management is all about tradeoffs, and efficient project managers must be ready to adjust scope, time, and budget as the case or matter evolves. This factor underscores the importance of the primary task at the start of any project: setting your objectives and carefully defining the project scope with the client. Doing so will align mutual expectations and prepare the stage for developing an activity schedule and budget.

A statement of work must fix the boundaries of what is within the reasonably expected scope for the matter and what is not. This is particularly critical if the work is to be performed for a fixed price. The details of contents and format will vary depending on the circumstances, but could include:

  • The client’s objectives
  • Detailed deliverables such as the number of depositions
  • Deadlines or expected timelines
  • Teams and roles, if relevant
  • Assumptions and exclusions
  • Risks
  • Budget or fee as well as payment terms

The first draft of the SOW should be shared with both the client and the anticipated team members for their review and input. You need to understand the client’s goals and expectations and align them with the team’s approach, focusing on the business problem or dispute from which the matter arises and on acceptable outcomes and deadlines for the client.

As the team comes to an understanding of your client’s wants and needs, team members should keep in mind how much each want or need will cost, and whether there is any waste or excess in these expectations. These budgetary considerations may eventually affect the steps and actions taken to complete the matter. Of course the budget is extremely important, so you must be sure to carefully define in writing the anticipated assumptions of your budget and any “carve-outs,” that is, work that will not be included within the fixed price for the agreed scope. And, obviously, the SOW is simply a draft until the client approves it.

Some other helpful steps at this stage are common-sense items such as ensuring that every member of your team is familiar with the final project objective. It can be posted prominently on a bulletin board or online. Also, it does not hurt to remind team members of the client’s objective in regular memos and meetings.

The better your initial statement of work, the more likely you are to meet the client’s objectives. And if things change, the approved SOW will provide a solid basis for negotiating with key client decision-makers before performing work that may require additional funding.

However, remember that the SOW should be as short and simple as possible for managing the process. According to Michael Roster, steering committee co-chair of ACC’s Value Challenge, “When I was general counsel at Stanford, our multi-million dollar arrangements with law firms were covered by a two-page business letter combined with a one-page exhibit describing the carve-outs.”

The SOW is not a deposition or an adverse negotiation, so make sure you don’t over-lawyer it.

 

This post was adapted from the recently published fourth edition of The Legal Project Management Quick Reference Guide.

      


Tip of the month: Be sure to define the primary decision maker for each matter

In complex matters, especially with large organizations, there are few things that can waste more time and money than trying to satisfy multiple client stakeholders. In a large legal matter, the general counsel, staff attorney, senior corporate management, line manager, and others may have conflicting opinions and needs. It is tempting to try to keep them all happy, but that is sometimes impossible. It may take effort to pin clients down on who is the ultimate decision maker, especially regarding cost, since multiple parties may have differing agendas. But if you are able to establish a single point of contact as the primary decision maker, it will reduce cost and increase client satisfaction.

 

The first Wednesday of every month is devoted to a short and simple reminder like this to help lawyers increase efficiency, provide greater value to their clients and/or develop new business. This tip was adapted from the fourth edition of our Legal Project Management Quick Reference Guide.

      


Engagement letters and statements of work

At the beginning of a new matter, lawyers often specify its scope and fees in an engagement letter. The engagement letter is designed to clarify exactly what work and services are included, and excluded, from a particular matter.

Some states have specific requirements for what must be included in an engagement letter, and many firms have their own requirements as well. For example, in New York State, Part 1215 of the Joint Rules of the Appellate Division requires a letter of engagement in most matters, except for certain exceptions listed in the rule (i.e., an engagement letter is not required if the fee is expected to be $3,000 or less).

From a project management point of view, there is considerable room for improvement in many engagement letters. Consider, for example, this language from the sample letter of engagement published by New York State:

Scope of representation

A claim, dispute or dealings with relating to ______________.

All of our services in this matter will end, unless otherwise agreed upon in a writing signed by us, when there is a final agreement, settlement, decision or judgment by the court. Not included within the scope of our representation are appeals from any judgments or orders of the court. Appeals are subject to separate discussion and negotiation between our firm and you. Also not included in the scope of this agreement are services you may request of us in connection with any other matter, action, or proceeding.

The rest of New York’s two-page sample focuses on fees and client rights. Fee options for the sample include a flat fee, a contingency, or hourly rates.

If a law firm copied the New York State sample exactly and negotiated a fixed fee, they might end up being very sorry when the matter spiraled out of control. They would be better protected if the engagement letter specified timelines and deliverables, such as the maximum number of interviews, pleadings, interrogatories, opinions, and reports, the anticipated scope of travel and research, the use of outside consultants, and so on.

Could a lawyer possibly know in advance how many depositions would be required to settle or plead a particular case? Of course not. But he or she could specify the maximum number of depositions they expected and exactly what would be included within the fixed price.

This failure to provide sufficient detail is quite common. As the executive director of one AmLaw firm recently put it, “The scope of work often contained in our engagement letters is generally no more than one or two lines. Lawyers are missing an opportunity to clearly specify the scope of what is included in each matter and what is not.”

From the client perspective, better specifying the work up front could lead to more predictable costs and a more sophisticated understanding of what they are paying for. From the law firm’s point of view, it could reduce fee disputes, write-downs, and write-offs.

Entire textbooks have been written on how to develop what project managers call a statement of work (SOW), which specifies what a particular project includes and excludes. Lawyers may wish to adapt some of these ideas and write an SOW which could either be included in the engagement letter or be a separate document, depending on the nature of the matter, the lawyer-client relationship, and joint expectations.

 

This post was adapted from the recently published fourth edition of The Legal Project Management Quick Reference Guide.

      



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