Making It, Baking It, Taking It
Office Depot’s Elisa D. Garcia C. makes it her business to know the business
Published in Business Edition Super Lawyers 2013 Magazine — September 2013 on November 12, 2013
Editor’s note: Elisa D. Garcia C., as per the Spanish tradition, uses the second initial to honor her maternal roots (Canedo).
Office Depot’s Elisa D. Garcia C. has impersonated Elvis on a Las Vegas stage, can prep a pepperoni pizza in 44 seconds flat, and started college wanting to see dead people.
Not the background you normally find on a general counsel providing legal direction for a global corporation that boasted about $11 billion in sales for 2012. Did we mention she also happens to be turning the traditional fee structure for outsourced legal services on its head?
She’s both modest and confident about the magnitude of the challenges, and about the changes she has wrought. As she discusses them, she barely contains her intensity. Her hands flutter, her brown eyes sparkle, they crinkle when she smiles. She’s careful with her words and quick with her laughter. And she seems never to forget the lesson she learned in the job just before this one: “We have to be able to laugh at ourselves.”
Case in point: The Elvis act is memorialized in a photograph on the wall of her office overlooking a lush green golf course at Office Depot’s headquarters in Boca Raton, Fla. The photo, displayed four times in a colorful quad imitation of Andy Warhol’s work, shows her onstage in Vegas at a Domino’s Pizza franchisees meeting. She wears a sequined white jumpsuit, thick black sideburns and hair styled in a ducktail. It represents more than a memorable moment; it signifies a mind-shift.
“That was definitely outside her comfort zone,” says former Domino’s Pizza Inc. chairman and CEO David Brandon. Garcia C. was the company’s first general counsel. But Brandon wanted more than an attorney, “more than a one-ball juggler,” as he puts it. “You want them to be able to go into meetings and talk about legal issues from the perspective of the operators, and how does the business work and how do we create success.”
It was a tectonic shift for the Brooklyn-born Garcia C., but hardly her first. As the daughter of a hardworking boiler-room engineer who had to drop out of school to help support his six siblings, she grew up believing in the value of education, and set a high bar for herself.
When it came time for college, she says, “My father said I could go anywhere I wanted, as long as I slept under his roof at night.”
She picked SUNY Stony Brook.
“I wanted to be a pathologist, a coroner,” she says. “... I really loved the intrigue of what disease or what knife was used or whatever. I thought that would be fascinating. I love the lab work more than the people work.”
Organic and inorganic chemistry changed her mind. “I just wasn’t excelling in the manner in which I was accustomed to excelling.”
Instead she went into a five-year program to earn, simultaneously, her bachelor’s in political science and master’s degree in policy analysis and planning—and wound up doing research on energy policy in developing countries. When she graduated, she went to work full time for the Institute for Energy Research as a developing country energy analyst.
It was a perfect opportunity for an inquisitive and adventurous young woman who wanted to get to know Mexico and the Caribbean. The job allowed her to use the Spanish she had learned from her grandparents, and spend three to four months at a time overseas examining ways government policies could help decrease consumption or increase efficiency to save energy.
She loved it.
Then her life’s direction changed again.
After three years of working in the Caribbean, she faced a new assignment to the other side of the Atlantic. To Somalia. For two years.
“I started saying, ‘Wow! I’m 23 years old. Do I really want to go to Somalia for two years?’”
At the same time, she was nominated to run for state assembly by local Republican leaders.
Only 23, she already had a decade of experience in Long Island politics. She started in a teenage Republicans club at 13. She stood out. They groomed her.
Still, running for office—at 23—was not something she had considered, and she sat down with the party chairman and told him, “I don’t think I’m ready to run. I still live with my mother!” she says. “He assured me that I wasn’t expected to win. ... They just wanted me to get some experience.”
They saw her as a politician with potential. So Garcia C. decided to prepare herself better, with a J.D.
“I went to law school with every expectation that I was going to come back and run at some point and get involved politically.”
In her second summer of law school at St. John’s University, that changed. She interned at Willkie Farr & Gallagher. “A whole new world opened up and I never looked back.”
She spent five years there as an associate, got to work on several companies’ public offerings and realized two things: She never wanted to be a partner, and “really learning the business of the client through writing their disclosure documents was what I enjoyed the most.”
From then on, she says, “My life is a story of headhunters.”
One headhunter’s call took her to roofing manufacturer GAF as a corporate associate working on public securities filings and international corporate matters. Five years later, another headhunter’s call took her to Philip Morris International as its regional counsel for Latin America, overseeing a team of corporate and outside counsel in Mexico, Central America, the Caribbean and the Andean Pact. The job called upon her to use her Spanish language skills, and appealed to her love for developing countries and counseling clients. At the time, it was her dream job.
It meant lots of travel. Her husband, then an attorney in Manhattan, held down the home front with au pairs helping with their preschool daughter, and, in the midst of all the travel, a newborn son.
After five years, another headhunter called, with a question: “Do you want to become a general counsel?”
The company was Domino’s. Brandon changed her perspective, and her life.
“I love him for what he saw in me that I didn’t even know existed,” she says. “He taught me that I wasn’t just a lawyer; that my opinion in every area was not only valued, but expected. He told me many times, ‘I can pay for a lawyer by the hour. That’s not what I’m looking for.’ My opinion on our new advertising campaign, on our new pizza—all of that was an important part of the business. And while I always said I loved counseling businesses, Dave made me learn the business.”
Including how to make pizza. She spent four days in a Las Vegas store wearing a Domino’s uniform and doing every job, even deliveries.
“Everybody at Domino’s knows how to make it, bake it and take it,” she says.
The lesson taught her much more than how to take an order and whip up a pepperoni pie.
“The delivery person is the corporation’s face. It’s who the customer sees,” she says. “He’s the most important person in the company.”
She helped guide Domino’s through its IPO in 2004 and, later, a major recapitalization. Then Garcia C. got yet another headhunter’s call. In 2007, she became Office Depot’s executive vice president, general counsel and corporate secretary.
She brought what she learned with her. The Elvis suit, too.
“I put the outfit on for Halloween one year here,” she says. “I think people were a little surprised. They’re not used to seeing their general counsel like that.”
She laughs now. But there was little to laugh about when she started.
Her second day on the job at Office Depot the company received a letter from the SEC saying it had commenced an investigation about a possible violation of Fair Disclosure regulations.
“So,” she says, “I was faced with having to organize an internal investigation at the highest levels of the company. Not because there was any wrongdoing, but just to understand what had happened. And that makes it very difficult to start your job as a general counsel, counsel to the executive team, when you’re sitting there trying to figure out whether they’ve done something wrong.”
It was “very tense,” she says. “I called my husband and I said, ‘You know what, don’t sell the house.’”
On the upside, she says, “Investigating the business is a good way to learn how things are done. ... It’s a much more comprehensive way of learning.”
How comprehensive? “It was like drinking from a fire hose,” she says.
She quickly learned that Office Depot’s familiar storefronts are merely a fraction of the company’s enterprise. The retail stores make up a third of its business. The rest is business-to-business and e-commerce, including catalog and online sales. Contract business—supplying school systems, universities and corporations such as Microsoft—accounts for another third. Then there’s direct sourcing. Office Depot contracts with factories in Asia to produce its own line of products, everything from pens and paper to scanners and office equipment. Altogether, the company operates in 60 countries, with about 38,000 employees and approximate sales last year of $11 billion.
“It was a big step,” she says. “I didn’t even know how complex it was when I came to work here.”
Garcia C. oversees a team of 23 attorneys, including lawyers in the Netherlands and the United Kingdom, as well as the corporate compliance officer, who reports to her on internal audit, loss prevention, risk management, compliance, and social compliance.
“Elisa is more than just a lawyer or general counsel,” says Neil Austrian, Office Depot’s chairman and CEO. “She has extraordinary common sense, an ability to see every side of an argument and an ability to think out of the box.”
One change she has brought to the company is the adoption of fixed-fee and alternative-fee agreements with outside counsel. It’s a form of business sweeping through the legal industry, and Garcia C. is one of its prime advocates.
“I believe the billable hour makes no sense,” she says. “Would you pay somebody to build a house by the hour? I’m paying for an outcome. I’m not paying for the time it takes you to get to that. That’s ridiculous. Because if you’re not very good, it could take you a very long time to get an outcome.”
Office Depot now does 60 to 75 percent of its outside legal work on a fixed- or alternative-fee basis. That includes its securities counsel and patent troll cases. “We do one fixed fee for all of our single plaintiff employment litigation. No matter how many cases we have a year. We have one fixed fee for all of our class actions, no matter how many we have a year. So if we have none, the law firm gets a lot of money. If we have a lot, we do better. It’s a risk-sharing kind of arrangement.”
The result: “We’ve cut our costs by 30 percent.”
Naturally, there has been some resistance from larger law firms. But that’s changing, she says.
“I’m not looking for folks not to make money,” she says. “I want the law firms to make a ton of money. But I want them to do their work more efficiently and to train lawyers better.”
She also demands a dedication to diversity.
“I have never worked with a general counsel who demanded diversity on the outside counsel team. And that’s impressive,” says Darlene Quashie Henry, senior managing counsel, corporate and securities at Office Depot. “There’s nothing cookie-cutter about what we do. And the fact that she demands that people of color, people of various walks of life, have an opportunity. That speaks volumes.”
Giving back has always been one of Garcia C.’s passions. In her first associate job, she would take long lunch hours so she could go and do recordings for the blind. Then she got Philip Morris involved in Practicing Attorneys for Law Students (PALS). That’s where she met Henry, when Henry was a first-year law student at Pace University. Over the years, Garcia C. continued to mentor her. Almost two decades later, Henry now works in Garcia C.’s legal department.
“No matter how busy she is, if you reach out to her for help, she will be there to help you and provide her guidance and her thoughts on what you should do,” says Henry.
Ahead of Garcia C. is what she calls “probably the biggest legal matter of my career.”
That’s the proposed merger with OfficeMax. The Federal Trade Commission blocked the merger of Office Depot and Staples in 1997, deeming it potentially anticompetitive.
“Here we are in 2013 merging number two and three in the business, and we’re going to get the FTC to understand that the world has changed,” she says. “The competition is no longer office supply superstores. Our competition is throughout the Web, as well as Wal-Mart and Costco, Target and Amazon.”
It’s a gargantuan merger in the office supply world. Garcia C. seems, typically, undaunted.
“We’re hoping we’ll close the deal by the end of the year.”