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Welcome To The LAB 
The NEW Managing Partner's Leadership Advisory Board
There is a dearth of good advice and mentoring available to new managing partners. It is staggering to think that corporate CEO's and other C-level people in the corporate world train their entire careers in order to be prepared when it is their turns to take the helm, but law firms put people at the helm of an enterprise whose revenue numbers have two commas in them with little or no formal training and almost no mentoring.
New firm leaders often face challenges that require a mix of luck, skill and the support of experienced peers to guide their efforts. The LAB has been formed to address and inform the burning issues at the top of the managing partner agenda . . . issues like strategy, governance, performance, and profitability. We launch this initiative in tandem with a small group of highly distinguished and long-serving law firm leaders, all of whom have been recognized for their contributions to advancing and leading their own firms.
Whether you are new to the role of law firm leadership, are aspiring to spend more time or simply trying to be more effective in your role, we want to hear from you. You may pose your questions, challenges, or issues to tap the collective expertise of the LAB. Your inquiry will be circulated to all members of the LAB, asking for individual guidance, views, and examples.
Service Aims To Help New Managing Partners 
The LAB Members include:
• Angelo Arcadipane (Dickstein Shapiro LLP)
• John Bouma (Snell & Wilmer LLP)
• Brian K. Burke - LAB Co-Chairman (Baker & Daniels LLP)
• Ben F. Johnson, III (Alston & Bird LLP)
• Robert M. Granatstein (Blake Cassels and Graydon)
• Keith B. Simmons (Bass Berry & Sims PLC)
• R. Thomas Stanton (Squire Sanders)
• William J. Strickland (McGuire Woods LLP)
• Harry P. Trueheart, III (Nixon Peabody LLP)
Your inquiries to The LAB will be directed to Patrick McKenna and Brian Burke to coordinate an appropriate answer. These Board co-Chairs will gather and synthesize the group's feedback, and
draft a cogent response to the individual presenting the inquiry.
All questions will be treated confidential -
neither the name of the inquiring firm or the individual
will be made known to the board members or the public.
You may submit your question today
to me directly.
 LAB notes:
The Question of Whether To Focus on Core Practices
(An excerpt of this article, entitled "Support System" appears in the February 2010 issue of American Lawyer magazine.)
As managing partner I believe that this is an important time for our firm to assess our strengths and strategically choose those practices for which we want to be known. There are three practice groups that I’ve identified as our best prospects for the future – for our competitive market position and for the firm’s profitable growth. These would be the core practices in which I would envision that we invest the majority of our time and resources to build in 2010. The question (that I would sincerely appreciate the LAB’s advice on) then becomes how do I sell this internally without causing certain partners (and staff) to feel that they are second-class citizens or incite a palace revolt?
Managing Partner Compensation and Reentry
As I am about to assume the position as our firms new managing partner at the end of this year, I have a couple of inter-related questions about compensation and practice reentry: Firstly, what is the optimal approach to compensating the firm's leader? Secondly, what understanding about compensation during the managing partner's service should the firm reach with its soon-to-be managing partner before he/she takes office? I would also welcome your groups counsel on what understanding should the firm reach with its managing partner about his/her reentry to practice at the end of his/her tenure as the firm's leader, and what understanding about compensation should there be for the transition period during which the former managing partner is reentering the practice?
Measuring Practice Group Performance
As a relatively new managing shareholder I am attempting to assess the various practice groups we currently have throughout our firm. My question to the group is: What specific metrics do you use and find to be worthwhile in assessing or measuring the performance of your practice groups? And, is there any difference in the metrics that you would use for a practice that is pretty much only in one office versus a more regional or national group?
In The Footsteps Of A Successful Predecessor
I was elected as the new managing partner of our 80-lawyer, one office firm effective at the beginning of April. My predecessor had been the firm's leader for some 15 years. I was naturally thrilled with the confidence my partners seemed to have in me. I've become dismayed to now discover that many of those same partners continually tell me about how great my predecessor was. At first, I brushed it aside as just me felling a bit insecure. But it has now been a month and I'm starting to wonder what I should be doing to counter having such a tough act to follow. I would be most grateful to hear your group's suggestions and ideas.
Keeping Morale Up In A Downturn
The current economic climate is proving exceptionally challenging. Our firm went through two different layoff announcements last year, albeit both were rather small compared to what we are all seeing now. We were hoping for a turnaround this year, but in the event that things continued to deteriorate we put contingency plans in place for further cuts at the end of the first quarter. It appears that we now have to implement that plan. This will be our largest round of personnel cuts. Meanwhile, on one of those notorious web sites I read this note following our last layoffs in December: 'Well, I have to say, this is no surprise. The associates and the support staff bear the brunt of the cuts to continue to support the lavish lifestyles of the partners. Expect more cuts soon . . . ' Under such market duress how in the world does one go about keeping up the morale of your people, both lawyers and staff members?
When The Urgent Displaces The Important
I've just taken on the leadership of our firm (what great timing I have); and indeed that is at the heart of my question as I am also desperately trying to maintain a bit of a legal practice over the next four years (my term in office). I am not sure whether it is simply a result of the economic doldrums we are all in, but I have been just overwhelmed by the office drop-bys, the desire my partners have to chat, the requests for one-on-one meetings, and the sheer demands on my time. I am sincerely hoping that this will taper off over the next few months, but conscious that I need to set a rhythm and manage peoples expectations, if that is possible. Please tell me that you have some valuable tips for me; techniques that you have used and that I could employ to better get a handle on the time I need to spend managing this place.
Reflecting Upon The Impacts Of Economic Adversity
Managing a sophisticated law firm is not a quarter-by-quarter exercise, but here is what we know after three quarters into 2008: revenue growth has reversed; there is immense profit margin compression (largely due to associate costs); and this slowdown is hitting the most profitable firms the hardest. Will this economic trough alter the long-term demand for legal services? Some claim that the players may be re-shuffled, but the intrinsic demand will remain the same no matter what happens electorally in November. I am not so sure! And will this economic adversity accelerate the consolidation of our profession? Faced with making severe talent cuts, some firms may find their attractiveness to laterals and law students compromised, and their viability as independent going concerns in question. I would be interested in hearing from your group on what strategic decisions law firms should be considering in light of the challenges in the U.S. and international economies.
Clarifying Role and Communications With Office Managing Partners
I am the relatively new managing partner at a regional firm of about 400 attorneys. We have seven decent-sized offices, each with their own Office Managing Shareholder, each spending about 25% of their time on office issues. Over half of these folks were appointed by my predecessor and have been OMSs for less than two years. As with many firms we have been shifting the locus of our operations to a practice group configuration. Embarrassingly, we seem to have ignored this group such that we have never had a separate meeting of our OMSs for the past ten years. I am looking to change that and plan a one-day session next month for these folks, but want to make it a "business day" with meaningful activity. Any ideas you can offer for agenda topics? What have the various firm leaders in your group done that has worked effectively for gatherings of this nature?
Handling Boomers Approaching Retirement
Over the past 20 years, most of our attorneys (between the ages of, say, 57-63) begin to slow down somewhat, their total compensation begins to slide downward with their production / hours, and eventually they decide to go Of Counsel (which is close to semi-retirement here). Our Of Counsel arrangements generally include two years of regular firm benefits (including firm contribution for health, dental, life insurance). The initial compensation portion of the Of Counsel arrangement has varied considerably, depending upon the senior attorney's timing and ongoing value to the firm, e.g., does the attorney have many loyal clients whom we hope to transition to others? Will the attorney cease all billable work or merely reduce time over a 2-4 year period? Thus, some attorneys receive a predetermined salary (generally a portion of the prior base salary, but usually with no expectation of a bonus), others receive pay based on a formula, and others receive nothing (but with a possibility of a discretionary bonus if they in fact produce some revenues--either by billable work or client billings). The Firm obviously would like to capture the senior attorney's good will and client base, if possible, and to assist the senior attorney into retirement. Do you have any suggestions for ways in which law firms can promote the various interests / goals in a fair manner?
Evaluating and Compensating Firm Leaders
My question is how to evaluate and compensate partners for their leadership work - - from the Managing Partner to Practice Group Leader to the Office Managing Partner, etc. As our firms have grown, the era of titular but ineffective and unaccountable leadership has passed and the jobs have become very time-consuming and demanding. Some practice groups can be the size that whole firms used to be. At the same time most leaders are also producing lawyers. Balancing these two roles and compensating them is a challenge.
Deciding To Downsize
Over the past three months we have responded to this economic downturn by taking action on our collections, ratcheting-up our marketing efforts, and shifting various of our underemployed attorneys to different practice areas. Nevertheless by the end of May, with billings down dramatically and our juniors costing us $160,000 in salaries alone, we have decided that we cannot passively ride out these difficulties and need to make some hard decisions. Therefore, later in June, we will be quietly de-equitizing some of our underproductive partners and reluctantly announcing layoffs, of both associates and staff. We are a firm that has never had to take this kind of painful action in the past, and I fully expect it to take its toll on firm morale and productivity. How can I help people adjust to these new realities and get things back on track?
Having Performance Standards
We're considering adopting performance standards (including billable hours, effective rates, billings / business development contributions) for shareholders. While we have fairly precise standards for an associate to become a shareholder, and we really only have one class of shareholders, we don't have standards to remain a shareholder.
I'm wondering if:
• you have a feel for the percentage of firms our size (say, 100-300 or so) which have performance standards; and
• you have any advice for me on this subject.
Assuming we adopt written standards, I'd think the next two key items are:
- implementing them, including dealing with shareholders who consistently under-perform and perhaps creating certain exceptions; and
- deciding if there will be specific means to deal with those who don't meet the standards (e.g., not eligible for bonus, must give up equity and go to Of Counsel, or other status.)
Dealing With A Chronic Complainer
It seems that one particular partner has been in my office every week complaining about something. It is either about how I should be exercising more management authority over some other partner or the way certain things are being done. What do you do with partners like this?
Preparing For The Worst
As
a relatively new managing partner I have not been involved in the
management of our firm at any time that experienced a downturn in the
economy. Do you have some advice for those of us who are going through
this for the very first time? How do we manage our partners
expectations given the ever-increasing compensation that they have all
been enjoying over the past ten years and what are some prudent actions
to consider in preparing for the worst-case economic scenario?
Double Team At The Top
It
would seem that many firms have a firm Chair and a managing partner.
While this division of labor may make sense, I suspect that the skills
involved are quite distinct. Should firms have both a chairman and a
managing partner? Should what appears to be a common policy of
automatically promoting the managing partner to firm chair at the end
of the managing term, be the best way to go? What is your group's view
on the right division of responsibilities between a firm chair and a
managing partner?
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Ashridge House 
