Book Review: Legal Blacksmith: How to Avoid and Defend Supply Chain Disputes

“Supply chain legal disputes don’t start out as legal disputes. They typically start out as badly written contracts, poor communication with supply chain partners, and an inability to resolve conflicts.” (Authors’ Foreward)

Legal Blacksmith, by Rosemary Coates and Sarah Rathke, is an interesting mix of two perspectives the procurement community is all too familiar with: supply chain and legal. They combine their experience – Coates on the supply chain side and Rathke on the legal side – to provide a view that seems better suited to supply chain professionals looking for an improved legal understanding than vice versa. Interestingly, they met during a court case where a manufacturer was sued by a customer.

Readers from the field of procurement will enjoy (and maybe even ‘puff’ a little in response to?) the positive, progressive view they take of procurement. Just to give you an idea, they describe procurement as usually reporting to a VP of Supply Chain or Operations with only a dotted line relationship to finance. Clearly their experience has been with large scale, strategic procurement organizations rather than more administratively constrained tactical ones. And yet, even given this elevated view of procurement, Coates and Rathke are spot on when they observe that it is during the pre-contract planning phase that procurement is most likely to think beyond cost to value, only to lose sight of it in the minutia of sourcing and negotiation.

I love real-world connections in a book, and so the legal case examples and case studies had me hooked from the outset. You won’t know the names of all of the companies featured, but many are familiar: Apple, Hershey, Toyota, etc. I particularly enjoyed the case studies about what happens when you don’t specify a quantity term in a contract (see pages 69-72). And in the midst of all the operational gravitas, I appreciated the simple humor of actual photo-documented ‘ducks in a row’ on p. 239.

All joking aside, the authors somehow manage to balance opinion and perspective with factual background and straightforward how-to’s. I suppose it shouldn’t be a surprise, but even a discipline as straight laced as legal allows for some leeway on what the right thing is to do. A valuable tie in to this idea is the advice to prize flexibility in a supply partner without trying to bank on it in a contract.

If there is anything I came away with having a completely different view of after reading the book, it is the notion that supply chain vulnerabilities are less about complete surprises (volcanoes, tsunamis) than professionals and organizations not being more worried about known issues when they should be. This is both comforting and intimidating as it puts supply chain teams firmly in the driver’s seat while also handing them a set of responsibilities not to be taken lightly.