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Firm Leadership

Rants, Raves, Rebuttals, Reflections, Revelations & Ruminations


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Post #685 – Sunday, November 3, 2013

Law Firm Strategies For The 21st Century

I am delighted to have been asked and contributed to a new book, due to be released later this month, exploring the complexities of law firm strategy.  Published in association with the Law Firm Management Committee of the International Bar Association (IBA), this practical title is the first in a Globe Law and Business series on the business of law dedicated to exploring strategic development in law firms.  

Law firm partners have long resisted the notion that they need a strategy.  However, markets change and the landscape has become increasingly competitive.  Law firms that want to remain competitive need to think about and engage in strategy development; those firms which have done so are now undeniably in a better position than those which have not. 

This book is organized around the market and the resource side of law firm management, and offers new ways to think about strategy and how to discuss it in the context of a partnership.  Whether you are a managing partner of a small, large or international law firm, this book offers points of views which have never before been aggregated in a single volume.  This volume addresses, in a most practical manner, those questions that are of relevance to today’s law firm management

To download and read a sample chapter, have a look - here.



Post #684 – Thursday, October 24, 2013

Attributes That Distinguish CEOs From Other Leaders          


For those who occupy elected law firm boards or executive committees who need to effectively identify and prepare firm leadership successors – knowing which skills and abilities matter most is essential.  In my latest research, conducted at the beginning of 2013, (“Inside The Corridors of Firm Leadership”) leaders from over 100 law firms (all in excess of 100 lawyers in size) confidentially reported to me that when it came to leadership succession, they really had no particular process or desired attributes in mind for their next firm leader.

Today, Russell Reynolds Associates (leading firm noted for helping boards make better CEO succession decisions from 31 offices world-wide) released results from in-depth analysis they conducted of their database of 4000 executive assessments, specifically including 130 CEOs.  They examined test scores measuring a number of leadership competencies including relationship skills, communications skills and decision-making approaches to determine what CEOs have that other leaders don’t.

Their findings: Of the 60 common attributes used to assess leaders, CEOs differ from others in nine (9) of them.  In fact, CEOs differ the most from other leaders in terms of their:
• willingness to take calculated risks
• bias toward action
• ability to efficiently ‘read’ people    

The total of these 9 key attributes fall into three categories:

1.  Forward thinking (a category of one attribute) is simply the ability to plan for the future while focusing on the present.

2.  Intrepid is the ability to perform effectively in complex and difficult environments – and includes such attributes as “Calculated risk taking” (being comfortable with taking calculated but not careless risks); “Biased toward thoughtful action” (focus on execution but not too impulsively); “Optimistic” (actively pursuing new opportunities); and “Constructively tough minded” (thick-skinned and perservering but not insensitive).

3.  Team building is the ability to achieve success through others – and includes being an “Effective reader of people” (understanding different perspectives but not overanalyzing); “Measured emotion” (one who displays intensity but maintains control); “Pragmatically inclusive” (involving others in decisions but also is an independent decision maker); and “Willingness to trust” (comfortable with a variety of people but not too trusting).

Analysis of the nine attributes reveals a number of interesting CEO profile paradoxes, according to Russell Reynolds.  CEOs are strategic yet tactical, tough yet emotionally sensitive; decisive yet inclusive.  Much of this parallels research and a subsequent article that I authored some years ago identifying five different leadership tensions (“The Tensions of Leadership") that all new firm leaders face.

This Russell Reynolds research strongly recommends that boards incorporate these attributes into their success profile and assess future leadership candidates across the nine important attributes.



Post #683 – Tuesday, October 22, 2013

Technique For Making Meetings More Effective

Here is one technique I encountered to help you make your meetings more effective.  It involved creating shared visuals.  The practice group had anointed one individual to flip open their laptop and take notes . . . that then appeared for all to see on a projected screen. Taking and projecting notes serves a couple of purposes.  

First, it refocuses everyone on what they can see before them - which could be a list of questions or brainstormed ideas; a list of options to be considered and decisions to be made; or whatever happens to be the key issue on your meeting agenda.  

Second, you can use the documentation to drive problem solving.  Framing the discussion with a simple outline, such as “Problem, Objectives, Facts, Questions, Action Items, Next Steps,” can help move your group from issue to action steps.  

Conclude your meeting by identifying specific members, the particular project that they have each agreed to work on and expected deliverables for the next meeting, to the document.  Now, given your efforts, your group has a working document that serves as your agenda for the next group meeting. 



Post #682 - Saturday, October 12, 2013

Is Law Firm Pedigree A Thing Of The Past?

Here is an interesting HBR blog post written by Dina Wang and Firoz Dattu

Have you ever heard the saying: “You never get fired for buying IBM”?  Every industry loves to co-opt it; for example, in consulting, you’ll hear: “You never get fired for hiring McKinsey.”  In law, it’s often: “You never get fired for hiring Cravath”.  But one general counsel we spoke with put a twist on the old saying, in a way that reflects the turmoil and change that the legal industry is undergoing.  Here’s what he said: “I would absolutely fire anyone on my team who hired Cravath.”  While tongue in cheek, and surely subject to exceptions, it reflects the reality that there is a growing body of legal work that simply won’t be sent to the most pedigreed law firms, most typically because GCsl are laser focused on value, namely quality and efficiency.

A recent survey of General Counsel at 88 major companies conducted by AdvanceLaw (an organization founded by Firoz) - The results suggest that GCs are increasingly willing to move high-stakes work away from the most pedigreed law firms (think the Cravaths and Skaddens of the world)… if the value equation is right. (Firms surveyed included companies like Lenovo, Vanguard, Shell, Google, NIKE, Walgreens, Dell, eBay, RBC, Panasonic, Nestle, Progressive, Starwood, Intel, and Deutsche Bank.) The results of the two questions the survey asked are below.

That 74% of GCs preferred the less pedigreed firm under the circumstances described in question 1 reaffirms that clients are becoming more and more comfortable with using a wider range of firms.  Moreover, in the U.S., the current cost premium for an AmLaw 20 firm relative to, say, an AmLaw 150 or 200 firm is typically far more than 30%.  Factoring in lower hourly rates as well as the greater efficiency most clients say the other firms deliver, we are likely talking about an overall cost premium in the 60+% range.

What can also seem non-intuitive is that only 11% of GCs surveyed felt that pedigreed firms, despite the price premium, actually were more responsive (a key element of client service).  However, this actually mirrors Firoz’s experience at AdvanceLaw, where firms of varying sizes and pedigree are successfully unseating AmLaw 20 and Magic Circle incumbents on high stakes work (e.g., a recent M&A deal valued at $500 million; national trial counsel for a significant multi-state class action).  These firms have been receiving impressive evaluations from GCs and in-house counsel on responsiveness, expertise, quality and efficiency.   One reason for this is that top talent is increasingly dispersed, not residing solely at the most pedigreed of firms. 

This AdvanceLaw survey suggests that clients are serious about moving high-stakes work away from the most pedigreed (and expensive) law firms.  So, are white shoe firms feeling the impact of this mindset change?  When we examined revenue per lawyer (a proxy for a law firm’s ability to command a price premium) across a sample of firms, we found that growth was highest among non-pedigreed firms.  Our sample of 15 especially highly reputed firms (including the likes of Cravath, Skadden, and Sullivan) experienced an average increase of only 2.9% in revenue per lawyer over the 5-year period from 2007-12.  In comparison, a sample of 15 smaller, comparatively less known firms posted average growth in revenue per lawyer of 12.7% in the same period.

Surprisingly, many (though not all) pedigreed firms are choosing to not yet compete on value, arguing that this would diminish their future ability to compete for the shrinking pool of high-stakes / high-margin work.  However, as the survey and financial analysis reveal, this ends up opening the door for other law firms (as well as non-traditional providers) to slip in and chip away at what we all once assumed were unassailable relationships between the most pedigreed law firms and their clients.

Make no mistake: the competition for market share in the legal space is tough and getting tougher.

What do you think?



Post #681 – Saturday, September 21, 2013

Fall 2013 Issue of International Review Is Now Available

Here’s my newest issue of International Review – an issue that I hope contains a balanced blend of thoughtful insight and practical contributions on law firm strategy and leadership.

I believe that my colleague Ed Reeser and I were amongst the very first to start cautioning firms about the overuse of lateral hiring, efficiency - at producing commodity work, and excessive compensation spreads.  These articles have been intended to warn good firms among the AmLaw 100, 200 and below of the dangers that may lie ahead if they pursue some of these same strategies and we are gratified by the supportive responses we’ve received from many firm leaders.  In this issue we continue on that same theme with two articles, Efficiency Is Not The Competitive Advantage and Are You Developing A Star Culture?  Our piece on Star Cultures received a lot of attention throughout July and August in Texas Lawyer, the ABA, The Legal Intelligencer, Law Technology News, and American Lawyer – where it ranked among the top five “most viewed stories” on multiple web sites.

In our First 100 Days program (see: first100daysmasterclass.com) we introduce new firm leaders to the same personality assessment taken by Fortune 500 CEOs and designed to identify their 'Dark Side' - a personalized assessment of those strengths you possess that, when under extreme pressure or stress, can turn into vulnerabilities.  I am delighted to include an article, Exploring The Dark Side: When Firm Leaders Overuse Their Strenghts that emanates from research conducted over the past five years.

Finally, Competitive Plagiarism warns us of what can happen if we consciously or inadvertently replicate the strategies that others may be pursuing; The Hurdles To Initiating Change offers a view on what might be holding back some firms from being more innovative; and Conducting Client Interviews draws upon the wisdom of some insightful clients as to their expectations when law firms come looking for feedback.

As always, I sincerely hope that you find some practical ideas, tips and techniques here that you can put to use immediately.  Please send me your observations, critiques, comments and suggestions with respect to any of these articles.

Click on the Cover to download your e-magazine copy.



Post #680 – Thursday, September 5, 2013

Your 4 Leadership Feedback Questions

One particular firm leader I know makes it a regular habit to ask his fellow partners for feebdack on how he is leading.  He tells me that it only involves his asking four questions:

1.         What do you need more of from me?

2.         What do you need less of from me?

3.         What is it that I’m doing that you would like me to stop doing . . . completely?

4.         And what is it that I’m not doing at all, that you would like me to start doing?

It’s really that simple!  How sad it is that more leaders don’t engage in this kind of feedback process.



Post #679 – Monday, August 19, 2013

Is This What Some In BigLaw Firms Have Evolved Into?

One of my colleagues had a talk with a former BigLaw partner.  He told of bully boy leadership, with a managing partner taking $17 million a year in compensation (about 60 times the lowest paid partners at $285k) and surrounding himself with people who get paid far more than they contribute, but will do anything he asks to keep their rich sinecure.  Those who squeak, or even have the temerity to ask questions, are quickly eliminated.  Withdrawn / ejected partners wait interminably for the capital return.  (After several years this partner has only received about 20% of his capital back). 

Meanwhile, verein members do not cooperate with one another but instead are run as independent fiefdoms that actually compete against each other.  The stuff going on as reported makes Dewey look like a much nicer place to work.  Heaven only knows if the verein component is being manipulated only to pull more admin money for 'leader' compensation. 

But that's not all . . . people who are 'invited' to be partners are given a signature page, but no copy of the actual partnership agreement.  "Pending" partners, those who go through a mandatory two to three year vetting or prove up, are required to put up a deposit of capital during that period, which amount will then be credited towards the capital obligation when and if they are made equity partner.  (If you don't put it up, you are told to leave).  So equity from non-equity people, but characterized not as equity and just a 'prepay deposit' towards partnership capital.  It would be interesting to know how that is treated on the financials. 

Is this merely the malicious ranting of some malcontent, former BigLaw partner or the signs of a slow simmering problem moving towards full boil?



Post #678 – Friday, August 9, 2013

Are You Daring To Fail?

“So what new initiatives did you tackle, during the past twelve months, that didn’t exactly prove to be as fruitful as you might have wished?”  And if your answer is, “none.”  Then what does that tell you?  It may suggest that it is better to dare to fail than to fail to dare!

Many firms profess to be entrepreneurial and make some kind of claim to that effect on their websites, but many struggle with the notion that in the pursuit of entrepreneurial ventures there are no right answers; nothing is perfect, and there are no guarantees.

Waiting for clear confirmation that your decision to pursue some new idea is exactly right and congratulating yourself for not making a mistake is almost a guarantee of eventual failure.  You will learn from being decisive.  By being decisive, you allow yourself to get clear, immediate market feedback as a response to your actions.  And you are then in a far better position to change course and also defeat any indecisive competitors who are too mired in their analysis and desire to be perfect.

By way of an interesting example, Engineers Without Borders Canada, a nonprofit that specializes in international development, has for the past five years, published a “Failure Report” (http://www.ewb.ca/reports) alongside its regular Annual Report.  According to a Foreword written by William H. Gates, Sr. retired attorney (Preston Gates & Ellis) and the Co-Chair of the Bill & Melinda Gates Foundation:

“Live and learn” is a familiar saying, but its importance stems largely from what goes unmentioned: failure. In fact, the primary use of this saying is to acknowledge that everyone makes mistakes and encounters failure. The important thing is to learn and improve from these experiences.  Indeed, learning and failing are both lifelong experiences. But whereas most institutions and individuals strive to be continuous learners, they strive equally hard to avoid failure and rarely acknowledge when it occurs. This approach is wrong and problematic. The lessons learned from failure and mistakes are often the most important, and they commonly have relevance and value to others.

The most well-known tale of establishing a dare-to-fail culture comes from Facebook COO Sheryl Sandberg’s days as a vice president at Google.  After she apologized to cofounder Larry Page for making a multimillion-dollar mistake, Page famously told her, “I’m so glad you made this mistake. . . . If we don’t have any of these mistakes, we’re just not taking enough risk.”

Perhaps all of us would benefit from writing an annual failure report.  It could help us learn from our mistakes and mobilize us to take more decisive initiatives.


Post #677 – Thursday, August 1, 2013

What Are Lawyers Reading About?

Last week, Ed Reeser and I released our piece on ‘Star Cultures,’ the fifth in a series of articles that we had written together.  I believe we were amongst the very first to start cautioning firms about the overuse of lateral hiring, efficiency - at producing commodity work, and excessive compensation spreads.  These articles have been intended to warn good firms among the AmLaw 100, 200 and below of the dangers that may lie ahead if they pursue some of these same strategies and we are gratified by the supportive responses we’ve received from many firm leaders.

We are extremely grateful to have this particular article featured in AmericanLawyer.com, ABAjournal.com, Law.com, and The Legal Intelligencer and to see it ranked among the Top 5 "most viewed stories" on both AmLaw Daily and Law Technology News for the past week.

While we don’t know what that really means in terms of the number of attorneys that have read the article, we do have some interesting numbers attributable to Ed posting these pieces on JD Supra.  And, according to a current review, there were 650 downloads directly from JD Supra archives just in the month of July 2013.  Here are the download stats on the five articles that Ed and I have co-authored:

• Is Your Law Firm Creating a Star Culture? [238]

• Sliced Too Thin-The Danger of Wide Partner Compensation Spreads [227]

• Crazy Like A Fox - Why Non Equity Partners are More Valuable Than Associates  [98]

• Efficiency is Not The Competitive Advantage [54]

• The Limitations of Money as a Management Tool  [33]

These inquiries may be driven by some attorneys’ personal interests or by professional involvement of the firms in issues touched on by these articles.  In any event, when we examine the totality of all of the topics that people find of interest, what they are not reading about is associates, mentoring, pro-bono, alternative fees, or what is in the client's best interest.  However, what they are reading about is swiss vereins, partner capital, lateral hire pricing, withdrawal agreements, and de-equitization.  One might conclude that the general interest does not appear to be focused on saving the world, improving the profession, serving client needs, or helping others in the firm.  Ouch!



Post #676 - Thursday, August 1, 2013

One Cost of Lateral Hiring

According to court papers filed in New York, thirty-six (36) law firms are among those facing legal action over the hire of partners from collapsed firm Dewey & LeBoeuf – after filing for Chapter 11 bankruptcy in May of last year.  A Texas-based litigation firm representing the defunct firm’s liquidating trust, have requested authority to issue subpoenas to 36 law firms over so-called unfinished business claims against ex-Dewey partners. 

Some of these firms include Baker & Hostetler, Drinker Biddle, Goodwin Procter, Holland & Knight, Mayer Brown, Orrick Herrington, Patton Boggs, Sutherland Asbill, Venable

Lawyers for the trust are seeking information concerning the transfer of work which former Dewey partners took to their new firms. “These former partners were working on active matters on behalf of clients at the time the former partners left Dewey & LeBoeuf and transitioned to the Firms,” read the application.  ”For these reasons, the Trust has a good faith basis for believing that the Firms are providing and have provided legal services to these former DL clients on matters originated while the Former Partners were at DL.” 

This could prove expensive for the 36 firms involved!


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