So I thought we'd try something different this time with a new series of blogs.
Commercial awareness - the well-trodden buzzword for any aspiring solicitor. Employers want to see it and know that young lawyers have it, but the concept of it isn't always clear.
People have described commercial awareness as:
Simple common sense ...... not helpul, still too vague.
That you should read news headlines. Great to get a snapshot, but what are you actually looking for? And what can you get from just a headline?
That you should be aware of different financial instruments. For those of us who didn't study a business- or finance-related course at Uni or who don't have any existing knowledge in these areas, it wouldn't be surprising if this flummoxes you. It did me!
Essentially it means an understanding of how businesses and industries work. Its about knowing what is going on in the world and how it will impact a particular company or sector.
We aspiring lawyers need to know how the legal sector operates, who the major players are, what recent economic, political or regulatory changes might have impacted the industry and what emerging challenges or opportunities for the industry may be.
Even an understanding of basic challenges that businesses and industries face is a good start. Such as understanding that a company needs to remain profitable and be aware of any changes in the industry, positive and negative, so that it can cover expenses such as:
staff salaries
rent and service charge payments
professional indemnity insurance
subscriptions to services like databases
IT
stationary
marketing
catering
maintenance
Whilst there is an element of forecasting involved when we are learning and applying commercial awareness, we're not expected to be prophets! Ok? So don't expect that you'll be able to do this:
(If you know, you know!)
I have been working on improving my commercial awareness as best I can for a number of reasons:
1) I can be more aware of the world and understand it much better.
2) it is not enough for aspiring solicitors to be trusted legal advisors; we are also expected to be trusted business advisors too.
3) In being able to gain a competency in the skill, I'll be able to provide a much better service to clients.
As part of my journey, I came acrosss a method that has been able to provide a good roadmap to gaining a greater understanding of the world from a business and social sense.
The method that I'll be using has been replicated with the very kind permission of Idin Sabahipour, founder of the company LittleLaw, a website staffed by talented editors and reporters with the aim of making commercial awareness a much less daunting a concept for aspiring lawyers by offering reports condensed down a 3-minute reads that can fit around your day and feel much less like swimming through treacle.
This has worked well for me, and so this is the method I'll use:
Step 1 - Look out. Look at what external factors are indicated in a news article you are reading? It might be at this point that you can look at doing a PESTLE analysis (see further below)
Step 2 - Look in. Consider what internal decision making a business has had to make. What factors made those decision makers make the decision that they did?
Step 3 - Law firm involvement. Where would a firm come in? What work might they be expected to do?
When applying to a law firm, they will assess that you understand what they do in context. It shows more commercial awareness if you can show you know where a law firm would get involved, eg due diligence in an M&A, including competition lawyers.
So when you are, say, listening to a podcast, reading a newspaper article, or reading another article from another source such as The Business Update (another very good provider of short snappy commercial awareness content), go through the above 3 steps and appl them to what you are hearing/reading.
Though don't worry if you find you sometimes encounter some difficulty applying step 3 (Law firm involvement) because it is not always clear what this might be. To help, have a look at firm websites - pretty much every firm will have a news and insights section on their site. They love to big up the work they do and have done
Something else that can also help, but will require a bit more work is to do a PESTLE analysis. This means:
POLITICAL
What are the potential political factors at play in a given scenario?
Are these limited to just one jurisdiction, country or continent?
How might solutions proposed by either side of the political spectrum impact a given situation?
Are there any new potential policy implementations of significance?
ECONOMIC
How is the financial health of the markets in which the company operates?
How does this reflect in the company’s historical stock pricing? eg are stocks fluctuating in response to the above? What impact will this have on that company's revenue and the faith its clients have in that business?
SOCIO-CULTURAL
How is the company perceived by its consumers?
What role does the company play in driving our collective culture and social framework? eg sites such as Facebook and Instagram, which used to be where we could simply connect with each other, now have an undeniable part to play in cultural and social interactions with each other, including features such as marketplaces and shops featured solely on these sites
TECHNOLOGICAL
How is the company currently developing its technological capabilities? Think about things like chat features on law firm websites, chatbots on other websites for other companies where you get a response based on a keyword search that you put into the chatbot when you ask it a question (hey, legaltech!)
Will this change in future? How?
LEGAL
Are there any significant legal principles that a company should know about? eg Facebook and recent data breaches, meaning monetary and trust ramifications
Does the company consistently require one type of legal transaction or assistance? Why?
ENVIRONMENTAL
How ‘green’ is the company? Is it a big part of their values and brand?
How will the company’s actions be incentivised or cracked down on with taxation policy? Can they foresee this and work it to their advantage?
You might be able to cover everything, but then again you might not. It might not always be the case that you can tick every box, but do what you can using this method.
Also, try not to feel too daunted by this. Commercial awareness is a learned skill; like training a muscle. You can't just walk into a gym and expect yourself to perfor a perfect pull-up after just one try. Its not fair to hold yourself to that high expectation right off the bat, so recognise this and know that you can train yourself here. Take it one step at a time. The world will keep spinning whilst you work through this
To put this into practice, I'm going to apply this to a previous blog I wrote. I'll use my blog about the group litigation claim against big supermarkets where they are alleged to have discriminated against disabled shoppers with the shopper safety measures put in place as a result of the movel coronavirus pandemic.
For a reminder, click here to read my post on this.
Headline: Coronavirus: Supermarkets face ‘biggest class action of its kind’ over discrimination claims
Source: https://www.disabilitynewsservice.com/coronavirus-supermarkets-face-biggest-class-action-of-its-kind-over-discrimination-claims (dated 23 April 2020)
Look out:
The COVID-19 pandemic has forced supermarkets to make changes to its user experience to prioritise shopper safety during the pandemic.
This includes physical distancing between shoppers and a limit on the number of shoppers inside at any one time which may result in some having to queue outside, cleaning stations in store, paying by card only, one-way systems, and a limited range of products available or a limit on quantity available to purchase at any one time.
Over 300 disabled people claim that this move discriminates against them as they are not considered, according to criteria laid out by the UK government, “extremely clinically vulnerable” to COVID-19
Look in:
Internal decision-makers, taking note of the UK government’s guidance and regulations regarding physical distancing, would have taken the decision to change the in-store shopping experience to prioritise shopper safety.
Pre-pandemic, supermarkets had “autism-friendly hours” to allow shoppers with autism or other sensory difficulties to shop with fewer sensory stimuli. This included dimmer lights, no announcements being made over tannoy, no music being played, turning TV screens off, and information about the difficulty being shared with staff and customers (https://www.bbc.co.uk/news/uk-41482019).
Supermarkets prioritised online delivery slots to shielding customers who were advised not to leave their home for at least 12 weeks. However, this move put shoppers who find the experience of shopping overwhelming at a detriment as the lack of home delivery slots forced them to shop in-store instead.
Law firm involvement:
Law firms instructed by the big supermarkets should advise and remind of the requirement to make reasonable adjustments to make the shopping experience accessible for disabled shoppers, pandemic or no pandemic, per the Equality Act 2010.
Law firms instructed by the big supermarkets should work with them to agree amendments to any policies in place regarding the supermarkets’ decision which has put disabled shoppers at a detriment
Fry Law (https://www.frylaw.co.uk/) specialises in Equality and Human Rights work for people treated badly by service providers because of protected characteristics (disability, age, race, gender, sexual orientation and religious beliefs). The firm has now been instructed by over 300 people who want to bring a legal case for discrimination against the big supermarkets for failing to make reasonable adjustments necessary to allow them to shop safely during the pandemic.
My plan is to make this a regular series where I'll use this method and cover a range of stories. The goal is that this will help anyone reading this with a way in which you can improve your own commercial awareness, and it will also help me to get some practice in as well.
I'll also try not to overload you all with a lot of information. I want to provide as much as possible as I feel it can help, but there is such a thing as too much!
I am certainly no expert here either! So anything I may get wrong, please do flag up and I'll get it sorted out. We're all learning together, remember? The profession is big enough for all of us and we get no benefit from stepping on anyone just to try and get ahead!
Regardless of the area of law you want to get into, being able to show good commercial awareness may very well be the different between a job offer and rejection.
I hate to make it sound like life and death here, but look at it from a recruiter's point of view - hiring a new employee carries with it a financial risk in that the company has to spend money inducting them, training them, supporting them and making sure there is adequate training available for them at every stage.
Lawyers are risk-averse by nature, so it makes sense to make the choice with the least possible risk attached. If you can show competency in a skill that is needed in all young aspiring lawyers anyway, it means the employer won't have to spend as much time and money on you as they might have to someone else who isn't as commercially aware as you. Employers will see this as a chance to save money and time, and take someone one who is that bit less of a risk. Its cold, but its true!
Be safe and be well! :)
P
Credit: Cover image photo by Kyle Glenn on Unsplash
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