With startup culture becoming a pervasive part of society, the question nearly everyone asks is: How do you start a business? To Laura Lee Norris, assistant clinical professor at Santa Clara University School of Law’s Entrepreneurs’ Law Clinic, the answer is clear: “With a solid business plan, of course!”
But business plans can be used for more than just starting a business. They can be used for any great professional undertaking. In fact, prior to joining the faculty at Santa Clara Law, Norris was the first vice president of Legal Affairs at Cypress Semiconductor Corporation. She achieved the unprecedented position by creating a compelling business plan to bring the CEO and senior leadership on board with her vision.
Norris’ plan covered many of the traditional topics found in a business plan, but tailored it to apply to a legal “business” operating within the larger company.
Executive summary
An executive summary informs the reader about the goals of the author at the outset, in no uncertain terms. Similarly, Norris was unequivocal about her general counsel goals. In 2002, Norris was working for the highest-ranking attorney at Cypress, the director of Intellectual Property (IP).
At the time, Cypress had never had an in-house general counsel. When the director of IP left, Norris began her plan. “I decided I wanted to propose a path to becoming general counsel. To get the CEO to agree, I knew I needed to make a business case as to why that would be a good decision,” explains Norris, then she got busy.
A business or proposal description
A business description contains a short description of the present and future states of the industry, including changes to the various markets, products, or industry developments. Norris’ plan also described what types of services the department would provide — such as corporate/securities, employment, intellectual property, commercial contracts, etc.
Norris’ plan also explained that the legal department would be the first responder on all legal issues, and only engage outside counsel when required for complex or specialized legal matters. To justify creating a general counsel position and a larger, more comprehensive legal department, Norris needed to understand the company’s legal spending and needs.
While traditional business plans look at financials associated with sales revenue, Norris’ plan demonstrated how much money she could save the company based on the strategic investments and implementation of her plan. As Norris explains, “It was incredibly hard to even understand how much money the company was spending on legal matters.”
Consequently, she spent months gathering information about the company’s legal vendors and historical billing data. “Ultimately, I could collect, analyze, and report on what the company was spending and got a clear picture of the opportunities that a general counsel could bring to Cypress,” Norris notes. By identifying areas where Cypress was spending money on outside counsel, she could show Cypress how much they could save by hiring a general counsel.
Market strategies
A careful market analysis defines the target market and describes how the company can be positioned to penetrate it. Norris’ marketing plan dealt with how to satisfy her customers, her engineers, and her business partners.
“The engineering and business teams were not accustomed to collaborating with lawyers,” Norris explains. “Part of the market strategies involved ensuring the legal department attorneys were problem-solvers rather than roadblocks. We wanted to be seen as collaborators who added value to our internal customers, and worked closely with business executives who had signing authority to make sure they understood legal risks and how to minimize them.”
Competitive analysis
A competitive analysis outlines the strengths and weaknesses of competitors, barriers to enter your market, and any weaknesses that can be exploited. Norris had to market not just a new general counsel position, but an entirely new legal system for Cypress. “My business plan also included a ‘marketing’ plan, because for me to be able to pull this off, the legal department needed to gain trust and visibility within the company with our internal clients,” Norris reveals.
To do this, she had to reach out and get multiple corporate leaders on board with her plan. “Because the VPs of the product groups were used to running their own legal issues with their own outside counsel, I needed to get them brought into the plan to consolidate legal into one group,” Norris explains.
Design and development plan
A design and development plan describes the product's design, outlines its development, and creates a development budget. Norris knew that a new legal department for Cypress couldn’t happen overnight. “I wrote a business plan that contemplated a five-year hiring plan for lawyers and legal personnel, showing how each hire would strategically save the company money,” Norris says.
Another mechanism Norris suggested and later implemented was a “legal operations review” process. This helped the legal department obtain more trust from the CEO and senior leadership, and bring the department more in line with the company’s core value to measure performance and then “make our numbers.”
“I noticed that the other product, manufacturing, and design groups held quarterly operations reviews with senior management where they reported on key metrics that applied to their organizations,” Norris explains. “I realized that if the legal department did the same, then it would give greater visibility into the legal department’s operations”
This strategy also helped build trust outside the company. She acknowledges, “Setting and measuring key metrics for the legal department would give us more credibility with our clients, who are mostly engineers.”
Operations and management plan
An operations and management plan describes how the business functions daily — its logistics, organization, assigned tasks within the company, and capital and expense requirements. To further solidify her case for the general counsel position, Norris proposed the creation of formal legal processes.
“Because Cypress was a manufacturing company, we implemented written procedures (“specs”) to comply with ISO standards. It was a core company value that all employees ‘follow the spec or change it,’” Norris explains. “The legal department started to identify and document key processes within our function, and create formal written specifications.”
At the time, this groundbreaking plan bolstered the leadership’s confidence in her. “This seems rather intuitive now, because I think that documenting formal legal procedures is something that many companies do, but at the time it was not so common in technology companies in the valley and greatly appealed to the Cypress CEO and management.”
Financials
Of course, financial data is the backbone of any business plan, especially in the planning stage. Through her research and data analysis Norris successfully demonstrated to the Cypress CEO and management that she would be able to control Cypress’ spending and decrease the risk of non-compliance.
Norris’ business plan was a success. With the CEO’s approval, Norris was eventually promoted to vice president of Legal Affairs and appointed secretary of the board of directors. She hired two direct reports to oversee the company’s most critical areas, IP and corporate securities.
Norris observes, “Going through the exercise of writing a business plan proved to be very useful. Not only did I get a greater understanding of Cypress’ business and needs, but doing so also allowed me to be more effective in my roles with the company and the board of directors.” Norris’ success is a great example of how business plans can be used for more than just starting a business. Creating a business plan for your next big career move can help both you and your target company understand how you would be a valuable, impactful addition.
Going through the seven steps of developing a business plan can also help you evaluate and understand how the change will impact your own life. Take it from Laura Lee Norris — whether you’re starting a new business or trying to make a huge career move, a solid business plan is the answer.
