Rules of the Road

When it comes to claims and litigation management, the specific “rules of the road” likely depend on the individualized experience of the claims or litigation manager. However, there are several general rules we can examine that are critical to success:

1. Write your claims notes like you may get abducted by aliens on the way to your deposition. We all take notes in a way that speaks to us, which makes sense. From grade school, we are told to take notes so that we will be able to reference and recall the information later. The notes act as an external hard drive for what should be in our brain, or central processing unit (CPU), and we format them in a way that speaks to our internal hard drive.

However, claims notes are multifunctional. First, the notes should reflect a picture or snapshot—the proverbial who, what, when, where, and why. Second, they should provide sufficient detail so that the picture can be gleaned by multiple people, including co-workers and potential third parties. It is not enough that the notes conjure the picture in your head because you may not be available when the notes are consulted, analyzed, or critiqued. Lastly, the notes should be written in a way that would be sufficient and appropriate to use if you were to read them aloud to provide someone—a co-worker or third party—with the picture or snapshot.

To pull these functions together into a succinct image, claims notes should be written with the assumption that someone other than you is going to be reading and explaining them to a third party while a stenographer dutifully takes notes. If you keep this in mind, then the multiple functions of the claims notes will be present in your brain or CPU.

2. No surprises, please. When it comes to birthdays and holidays, surprises are great. In the litigation or claims management arena, though, surprises evoke vastly different emotions for the recipient, including consternation and dismay that may be directed at the situation, the messenger, or both.

To understand these emotions, consider where they come from. The first belief is that someone was not tracking or watching what was unfolding. Second, even if someone was keeping track, the belief may be that he did not take the time to communicate effectively and efficiently. Third, the belief is there are now fewer options on the table than there would have been had this surprise not sprung forth. Fourth, the recipient is going to need as much information as possible regarding how this surprise arose, because now he will have to be the messenger of the surprise up the chain of command. Lastly, and perhaps most importantly, there will be the belief that other surprises are right around the corner.

3. Manage expectations. Effective communication can provide an accurate depiction of a claim or litigation’s status so that appropriate expectations can be made, maintained, and managed. For example, if the claim or litigation appears from the outset to have a certain trajectory, then it is important to communicate it in a timely and effective manner. This will set the expectation moving forward, thus establishing the baseline. If there is a change that affects the trajectory, then it is important to communicate how the trajectory changed in order to manage expectations moving forward.

To be clear, the management of expectations comes down to communication, since effective communication helps avoid dissatisfaction with the result. Expectations are formulated based on what has happened in the past and the impact those events may have on the future. The more timely and accurate the communication, the quicker the expectation can be managed.

4. Don’t kid yourself. Whether in stocks, businesses, or real estate, we all are susceptible to showing a high level of fondness for things we invest in. Additionally, it often seems like the more we invest, the more the fondness grows.

This dynamic has certain benefits, including a desire to persevere and a passion for both the work and the desired goal. In litigation and claims management, this feeling may manifest itself in the amount of time someone is willing to put into the claim or litigation. Additionally, there may be a certain amount of creativity someone is willing to exercise in order to be effective. Lastly, the amount of positivity and optimism toward reaching the goal or outcome may allow you to recognize the strength of certain arguments, facts, or issues and to remain steadfast in the face of opposition.

But the investment in a claim or litigation can also cause an inability to see or appreciate certain weaknesses, as well as a loss of objectivity. In economics, there is something called the “sunk cost fallacy,” which supposes that people will sometimes continue with an endeavor only because they have already invested so much. Recognizing and appreciating a claim’s strengths and weaknesses is paramount. It is appropriate to be positive and passionate, but emotions need to be tempered with educated assessments and practicality.

5. There is no “I” in team, but there is one in “myopic.” We all receive and appreciate information in different ways. One person might feel that a particular piece of art evokes happy emotions for them, while the another person perceives sad ones. In other words, we bring our individual experiences and viewpoints to everything we interpret. It should come as no surprise, then, that different individuals may view a claim or litigation in completely different ways.

With that in mind, if there is only one person analyzing a claim or litigation, there is going to be a singular, narrow focus. If this situation persists, then the claim or litigation management may continue in a myopic fashion. The lack of diverse viewpoints in analysis can foreclose potential strategies, expectations, and potential resolutions. Therefore, it is important to have multiple eyes on a claim or litigation.

Another reason for allowing diverse viewpoints is to allow the possibility for ideas to be challenged and, perhaps, heightened by a collaborative process. There is an old saying that “iron sharpens iron”—individuals can make each other better. It is through a diverse and collaborative process that not only can the management of claims and litigation be maximized, but also the managers themselves.

The above rules are by no means exhaustive. Every claim or litigation manager has their own set of rules or suggestions. The hope is that these rules are helpful and will lead to a successful claims or litigation management practice.