Most only involve legal counsel after issues arise. When that happens, the lawyer mainly reacts, focusing on resolving disputes, managing investigations, or fixing problems. These things could often have been prevented with earlier input. This is not unique to any specific industry or type of client. Even clients with experience, resources, and sophistication to take a proactive approach tend to bring in legal guidance too late, usually at the end rather than at the beginning.
Lawyers are often perceived as troubleshooters. They are asked to resolve a problem quickly and quietly, then step aside. While problem-solving is a crucial part of any lawyer's role, it should not be their only function. This overlooks the wider value lawyers offer. Good lawyers do more than just reduce liability; they help clients position themselves better, avoid regulatory pitfalls, support governance, and lower long-term risks. In contrast, other professionals, such as accountants, management consultants, and investment advisors, are usually involved early on to help shape strategy. Legal advice is often seen more narrowly, as a constraint on business rather than a tool to support it. This perception limits the value a lawyer can provide.
Signs You May Be Underutilizing Counsel
Many clients understandably aim to control legal costs and focus lawyer time on critical matters. However, over time, certain habits can lead to inefficiencies or missed opportunities. These include signing an agreement before legal review instead of involving counsel in negotiating terms, seeking advice only during litigation or crises, requesting a "quick look" at documents with long-term business implications, treating legal spend as a loss rather than a strategic investment, or excluding counsel from important conversations about policy, governance, and operations. While none of these are uncommon, they can increase legal and reputational risks if left unexamined.
Several factors contribute to the pattern of reactive legal use.
- Narrow Views of Lawyer's Role: Some see lawyers mainly as defenders or rule interpreters. In this view, their input is valuable after a dispute has started or a regulatory issue has arisen. However, lawyers can provide significant value earlier in the process, especially when helping to structure transactions, review new policies, or evaluate strategic decisions through a risk perspective.
- Cost Sensitivity and Perceived Friction: Clients are justified in being cost-conscious. However, delaying legal input to cut costs can lead to greater expenses later. Clients might also worry that lawyers will slow progress or overcomplicate practical matters. The key is finding the right balance: engaging counsel early enough to influence the outcome without causing unnecessary delays.
- Legal Risk Feels Remote, Until It Doesn't: Unlike financial risk, which is visible, legal risk often seems abstract until it becomes urgent. This can lead to a belief that legal input is optional instead of essential. But once a dispute occurs or regulators step in, the legal costs (both financial and reputational) can escalate quickly.
- Entrepreneurial and Crisis-Oriented Culture: Decision-making often favors speed and confidence. This culture may minimize formal procedures in favor of quick results. Legal counsel might be viewed as a restraint rather than an aid. However, even in agile environments, legal advice can support intelligent risk-taking and ensure compliance while maintaining momentum with innovation.
The Cost of Waiting
Early legal advice is often much more cost-effective than trying to fix problems after they happen. Consider a few common examples. A startup founder signs a loosely drafted term sheet without legal review, only to face unexpected dilution or governance limits later. An executive terminates an employee without documenting the process, leading to claims of retaliation or discrimination. A product team rushes a launch without full regulatory review, resulting in fines or recalls. In each case, earlier legal involvement could have protected the client's interests. But once the issue turns into litigation, options become limited, and costs increase.
When legal counsel is brought in late, lawyers often lack the background and context needed to advise effectively. They may be reacting to facts they did not help shape. This limits their ability to preserve privilege, frame communications carefully, or help avoid increasing risk. Clients who develop ongoing relationships with counsel—especially those who view legal advisors as long-term partners—often see better legal outcomes and more consistent risk management.
The Value of Early Legal Involvement
Lawyers involved in the planning stage can do more than just identify problems. They can review transactions and pinpoint terms that need clarification, assist in shaping communications to preserve privilege and minimize liability, create internal policies that stand up to scrutiny, offer early regulatory guidance, design compensation or incentive plans that align with long-term goals, or help resolve emerging disputes before they escalate into litigation. The top lawyers are not just risk detectors; they are problem solvers and strategic partners. However, they can only provide this value if they are included early enough to influence the outcome.
Clients seeking to lower legal costs and avoid legal issues should adopt a more proactive strategy. Involve legal counsel early in strategic planning. Treat legal advice as a fundamental part of risk management, not just a reactive measure. Keep open and consistent communication with counsel, even when no active legal matters are ongoing. Build relationships that enable lawyers to understand your business well enough to identify issues before they escalate. This doesn’t mean you need a standing retainer or a full-time legal team, but it does mean integrating legal input into your core operations rather than viewing it as a last resort.
What Lawyers Should Do Differently
Lawyers also need to meet clients halfway. That includes avoiding jargon, offering flexible billing when possible, and showing genuine interest in the client's business. It involves helping clients see how early investment in legal advice can prevent much larger problems later. It also means emphasizing how legal counsel can support (rather than just limit) business goals. We should highlight our ability to solve problems before they turn into crises. Additionally, we should be clear about the costs of delay, not just the hourly rate.
Treating lawyers only as crisis responders misses out on their true value. Clients gain the most when lawyers act as partners, not just fixers. By fostering more collaborative relationships and involving legal counsel earlier, companies and individuals can better manage risks, prevent unnecessary disputes, and make more informed decisions. The most effective legal work often happens quietly in the background before any problems start.
