Friends Don't Sue Friends

Happy Friday Friends,

Let's go! I recommend inviting your Professional Liability Insurance carrier to your office once a year to present real-world examples of professional risk. It’s highly engaging, highly impactful, and good business.

Four big-picture stand-outs for leaders:

1.  Friends don’t sue friends. Suppose you employ someone who’s hard to like or, worse, easy to dislike. In that case, no matter how capable they are, every issue gets magnified, tolerance for minor errors evaporates, and the likelihood of claims or lawsuits increases. Take the temperature on your client relationships regularly. Even though you don't want to, inserting yourself to strengthen the relationship may be your most prudent risk mitigation strategy.

2.  Mismatched expectations fuel lawsuits. Clients tend to expect perfection. Why? First, " because we’re paying you, and we’re not paying for mistakes.” Ugh... Second, “because you claim to be experts...” Indeed, take a look at your own website, brochure, and proposals. If you infer your firm or team delivers better than the insurable Standard of Care, you’ve heightened client expectations, and your own words will become their Exhibit A.

3.  Clients need to be told in plain language that there’s no such thing as perfection, and they shouldn’t expect it. Remind them, “Engineering is an inherently imperfect creative process performed by human beings." Ask if they correctly answered every question on every test they took in college. Remind them that thousands of questions and decisions will go into making this a successful project, so "let’s work together to get at least 95% of them right.”

4.  The client's contract requires that you meet the industry Standard of Care. It absolutely does not require perfection—perfection is neither attainable nor insurable. If you agree to deliver something more than the insurable Standard of Care, your insurance carrier has no obligation to pay those claims. Your team should know that, and clients should know it, too. Get perfection off the table. Align expectations.

If you're a client, you aren't paying for a perfect, error-free project. Your contract doesn't expect a perfect, error-free project. If it did, no consultant could sign it. You're benefitting from a reasonable and insurable fee, so it’s highly unfair and unjustified to play the guilt card and demand perfection after the fact. Anything less than ~5% imperfections is the area of risk properly shared by the consultant and client. If you don't like it, start setting aside a realistic contingency fund to make final adjustments and stop hiring the cheapest engineer.

You can see why promoting a friendly, open, informed, and mutually beneficial relationship is the most reliable risk-reduction strategy for all parties. Despite all the ambiguities, emotions, CYA, and misinterpretations that drive conflict, statistically, friends still don’t sue friends.

Have a wonderful weekend,

Dave

Send me a topic you're wrestling with: dave@goodnewsfriday.com

All past issues are available at @goodnewsfriday.com

Written by me, not ChatGPT: valuable speed assist and blunder avoidance by Grammarly