Friday, August 13, 2010

The Passenger’s Wheel

Long time ago I watched a very neat commercial in which a lady rides on the passenger seat and scares another driver when she purports to turn the wheel toward the driver’s direction, leading him off road. A couple of weeks ago I bumped into the commercial again.  You can see the commercial here: The funny situation made me think about a similar issue I have seen along the years.

For reasons that differ from one entrepreneur to another, many businessmen rely on unqualified professionals to deal with the needs of their business. Some would have a long term friend who has some knowledge of tax to do their tax return instead of using a licensed CPA or similar; others would have a CPA to incorporate a company and put together all the corporate documents; while others rely on their own instincts to negotiate a contract. The other day I heard from a lawyer specialized in personal injury litigation that he was negotiating a joint venture contract on behalf of one of his clients. Last week a trial lawyer told me he was going to do mergers and acquisitions deals because he had five or six previous experiences collecting fees for a business broker, who also was not even an attorney, and he felt qualified for this type of deals. I have even seen an entrepreneur who not only deals with his own legal needs without being a lawyer, but also gets calls from other people asking help with their own legal issues.

These entrepreneurs are no better off than the driver who was scared by the lady holding a wheel on the passenger’s seat. Without closely observing the situation, the driver was misled by someone purporting to be driving the passing car. Not making use of the qualified professional to deal with their needs will sooner or later lead them to the side of the road.

There is no doubt one can have some knowledge of negotiation techniques. It is also obvious that one can read a contract and understand what certain things mean. However, without the proper training, the risk of leaving something important outside the discussions or the document may backfire on the business and leave an unnecessary mark or loss.  And it happens more often than not.

If the use of adequate and qualified professionals was important before, the current harsh economy only boosted the need of limiting risks and reducing losses. People don’t go to the dentist to treat their back pain, or to the neurosurgeon to fix their house, nor do they fly a jet without the proper training. It still astonishes me when they do that to their legal needs.

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