09 Feb February 10, 2020 – I Resign Steven Manchel and Supplier Diversity Jamie Crump
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Steven Manchel – Founding Partner of Manchel & Brennan, P.C – Author of “I HEREBY RESIGN”: Job Transitioning: How Individuals Properly Prepare, Resign and Move to the Competition, and How Companies Best Manage That Process
When you go to resign, you are flipping the table. You are resigning
to a manager that is used to being in control of the moment. You are
taking him or her out of control.
Steven Manchel possesses the highest possible attorney rating and has extensive national experience in recruiting matters, broker-dealer litigation, securities litigation, and complex civil litigation. In the employee departure arena, Steven to handles matters ranging from single employee transitions to the types of retention and attraction issues arising from mergers and acquisitions involving Fortune 500 Corporations. Steven also has a long history of representing broker-dealers, insurance companies and financial advisors and agents in customer complaint cases. He is a member of the Bar Register of Preeminent Lawyers and also received an AV Peer Review Rating by Martindale Hubbell. An AV Peer Review Rating reflects the fact that a lawyer has reached the height of professional excellence and is recognized for the highest levels of skill and integrity. For every year since 2005, Steven has been named a Massachusetts Super Lawyer by Boston Magazine and Law & Politics. Before forming Manchel & Brennan, P.C., Steven was a partner in the Litigation Department of Choate, Hall & Stewart. After graduating from law school, he clerked at the United States Court of Appeals for the Eighth Circuit.
Jamie Crump – President of the Richwell Group
Entrepreneurs tend to spend a lot of energy on the product, because
that is the business they are in. They sometimes leave money
on the table with all the infrastructure. They don’t pay enough
attention to what they are paying for needed goods and services.
Jamie Crump has focused her career in strategic sourcing and supplier diversity across a variety of industries including: banking, catastrophic insurance, heavy equipment rental, IT, pharmaceuticals, telecommunications, and welding and medical supply. A frequent speaker at sourcing and supplier diversity events across the U.S. and Canada, Jamie has also been responsible for strategic sourcing, business services and operations, software development, capacity provisioning, and supplier diversity over the course of her career. She has also served on a number of boards and in industry/trade associations. Currently, she is an advisory board member to Diversity Professional, ProcureCon and Spend Matters. She is a member of Association for Luxury Suite Directors (ALSD), Global Business Travel Association (GBTA), Institute for Supply Management (ISM), and National Small Business Association (NSBA).
Highlights from Steven’s Interview
Both of the situations; you as an entrepreneur quitting, or your employees quitting and taking all of your intellectual property, I think they’re both pretty equal, and for two different reasons. If you take the first situation, you as an entrepreneur, one of the things we run across a lot are people who are leaving an established business to start their own. And they get very nervous about things like: what can I keep, what can I take, what can I use, who can I go talk to that I talked to before, because by definition, they’re starting from scratch. So that’s a very big topic in this arena. And then the flip of it is, once you do get started and once you help people along the way in your business, if they leave and go to a competitor or go to start their own, you’re very vulnerable. So, this kind of the ends of the spectrum.
I don’t think you should steal the idea from the person who’s paying you. The way I look at it is, there is a fine line between bettering something and taking something. And I think what skews the analysis is, where are you at the moment you’re stealing. If you’re out on your own and you’re looking at what’s out there in the world and you can tweak it and make it better, that’s fine. If for example, you’re a shoe designer for a major company, and you think you can design a shoe that’s better than the one coming out in a year and you know what’s coming out, then you start getting in a real gray area, because your knowledge; both, of the product and of what the future holds, comes from the getting into the room that’s supposed to be secret. I think the real question is, where are you at the moment you come up with an idea, and how much of that idea got into your head while you were being paid by someone to do it? And so, the ink magazine example is a perfect example. I don’t even care if you’re working for an employer when you see that, you can leave your employer and go make better of what you read.
Jim Beach:
So, here’s a scenario from my real life. So, I was approached by a guy who said, I would like you to buy a franchise in my business and it will be $100,000. And I said, I think what you’re offering, I could go do it by myself for free almost. All you are offering is the inclusion of your name. And he said, that’s basically right, you go do it for free. I used to work for this guy when I was a teenager. He made me this offer when I was 23, I declined his offer. I started a business that did basically the exact same thing that he did, but better.
From my perspective, if you weren’t given any franchise documents to look at that might have had some bells and whistles you didn’t know about; all you knew about was the end result and you learned about the end result when you were much younger, and turned towards it when you decided that you could make a better widget, then I don’t see any problem with that at all.
Friday afternoon is the best day to resign, because fundamental thing you want to see happen is emotions calm down. Leaving a job in a way is akin to a divorce. Is it going to be an angry one or is it going to be a manageable one? Resignations during the week cause simmering everywhere; there’s simmering at your old company, there’s simmering at your new company. If you’re going out on your own, you might get some nasty letter from your old competitor. So, you need time for everybody to say, “He left, he didn’t do anything wrong. He’s got the right to leave”. I’ve found after 30 years of doing this, and I’ve done thousands of transitions directly and indirectly, that you need those few days to let things calm down. So, it’s Friday afternoon, and the reason is to make sure things calm.
Jim Beach:
So, here’s another scenario. Guy is working for his best friend and they are not equal partners. The best friend is clearly the owner and the other guy is clearly the employee; Bob is the employee. And at one of their kid’s birthday parties, Bob is told that he’s no longer going to be needed, that he’s just too expensive. He made a couple of mistakes that cost the business half million dollars, and so he’s no longer needed. We’re asking you to leave but we’re going to give you three months before we tell anybody. And during those three months, we’re going to ask you to not poach. But I think that Bob is poaching. There’s no NDA in place.
So, in this scenario, Bob has an interest in the company; doesn’t matter if it’s a minority interest or equal interest. If in fact he is an owner, that changes a lot of things in terms of what he can and can’t do, at least until he leaves. Once he’s gone, if he doesn’t have an NDA and he’s not using confidential information to make better business, then he’s free to do what he wants. What people sometimes miss out on is, if you possess confidential information from a company, when you leave that company, you still have a duty to keep it confidential. It’s a very important concept for people to understand. So if Bob leaves to start a company and he knows the two clients that are doing the most amount of business in the old company, who are vulnerable because they’re angry and because they’re not getting the service they want, and he uses that to go poach them, that could create real problems for Bob.
So, if it’s in the public that the company’s making is awful, then that fact is no longer confidential. But for example, if it’s not in the market at the moment that one of the customers is really upset because it’s not getting enough and it wants more, and Bob goes out and targets that customer because he knows he can deliver more, he’s using confidential information. The kind of Reader’s Digest version of confidential information is; it’s not public, and would your competitor want to know it; would it be of value to your competitor? And that comes in all forms. It can be negative information, it can be sales information, it can intellectual property. But the hub of it is, is it non-public, and would it help a competitor and give value to a competitor? That’s a very important concept for people to keep in mind.
The correct resignation period and the story is a letter that says, “I hereby resign” and it has your new contact information. There’s no discussion about providing any time or providing any notice because it’s very hard to pick what notice is proper or not, so I like people to stay away from that. “I had a great time here”. “You made me into what I was, I’m grateful”. The issue with that is, if you’re doing anything where you think there’s any risk that your old company is not going to be happy, then what you’ve done is you’ve created a moment at resigning, as they say in the movies, which can be used against you.
I think resigning and not speaking is quality. I say this to people all the time, and I talk to upwards of four to six people a week who are leaving their job, and what I say to them is, you can’t fix the moment. People speak when they resign because they think it’s going to make it better or they think it’s honorable. And I will tell you that if you’re leaving to go start up a business that competes, you can’t fix the moment. So, I always say it’s not a group hug time. I think, being professional and brief, and leaving, is the proper way to do it. And I always say to folks, if you really do have a relationship with the company, if you say, “Look, let me just settle in, and I promise once I settle in, I’ll reach back. But I want folks to understand, that if by definition, you’re going to compete, you’re going to create a problem for the person to whom you’re resigning. They’re going to lose revenue, they could lose customers, they could lose employees to you. So, you’re looking at it as, “I’m moving forward”, and they’re looking at it like, “I could be screwed”. And I can’t overemphasize the notion, that “as good as your heart may be in the moment, it can’t sit the moment”. So, the best way to get everybody to calm down is, just be quiet.
And one of the other things for people to appreciate is, when you go to resign, you’re flipping the tables. So, you’re resigning to a manager who’s used to being in control the moment. When you go in and resign, you’re taking him out of control, so they’re going to get naturally agitated. And they’re also going to be looking to see if they need to find out anything to help protect the company. Using the marriage analogy, you’re leaving your wife to go to another woman. So, you’re breaking the marriage, and maybe even had an affair before you left to go to the other woman. So, it’s double injury to the person left behind. You’re not only leaving his or her company. You’ve been working side-by-side, day and night, but you’re going to go somewhere else to do the same thing.
So, here’s one of my favorite cases ever. I was in a state in the south which I leave unnamed, I’m back in Boston, and I get a call from someone at my client’s company. And I said, what happened? He said, “An entire team left the business”. I said, “Well, tell me who left, and then get out there and take a look at what records might be missing”. He says, “I’m out here. I can’t tell you what’s missing”. I said, why not? He said, “Because they took the name plates off the door, I don’t know whose office is whose”. So, I go out to the hearing and I set $1 with my local counselor. I said, “All I got to do is tell the judge they took the name plate, I’m getting the injunction”. And the first thing the judge says to me is, “Mr. Manchel, what did they take? What’s missing? Why is this so important?” I said, “Your Honor, I can’t tell you”. He said, “You came all the way out to this court and you can’t tell me what documents are missing. What am I supposed to do?” I said, “Your Honor, I don’t know what documents are missing because they took the name plates off the door”. And as God is my witness, he turned right to the other lawyer and he said, “Did they take the name plates off the door?” And he said, yes. And that was it.
So, Amazon is the easiest place to get the book “I hereby resign”. I am on LinkedIn as well; Steven Manchel, and my firm is Manchel Brennan.