The culture-driven law firm

The era of the free-agent lawyer, and the law firm lateral hiring frenzy that it spawned, is drawing to a close. The rise of the culture-driven law firm is at hand.

It’s going to take me a while to explain how I got here. I’ll try to do this in two parts.

1. Followership in law firms

This all started when I came across a provocative article called “Leaders need followers: tips for team performance“ by Australasian legal consultancy FMRC Legal. The thrust of the article is that successful law firm management hinges on followership — lawyers’ ability and willingness to align their personal values and goals with those of the firm. I first came across “followership” in the law firm context in a 2005 blog post by Gerry Riskin, which was in turn expanded upon by Patrick J. Lamb shortly thereafter.

Here are some excerpts from these three insightful articles that I think sum up what they’re saying. Continue Reading

Preparing for the storm

The “About” entry in the column over on the right there states my belief that the practice of law is heading into “uncharted territory.” If you’re skeptical about that, or if you’re unconvinced of the reality of imminent upheaval in this profession, here are two items you might want to look at.

The first is the Legal Transformation Study, a co-production of Decision Strategies International (DSI) and Legal Research Center that’s sponsored by, among others, Altman Weil, Jomati Consultants, and Dupont’s Legal Department. Subtitled Your 2020 Vision of the Future, the report makes plain the intensity of the shockwave heading towards the industry and discusses four potential scenarios that could play out in the near future. An executive summary is available for free; the report itself costs rather more. Here’s an excerpt from the preface:

The truth is, we dare not take any aspect of the future for granted. Paradigms shift, and age-old truisms will be reversed. Prudent and prepared legal leaders will be those who extend their minds beyond traditional thinking and anticipate a variety of outcomes and possibilities. …

During the next decade, operating discipline alone (e.g., “how” we work) will not be enough to meet the challenges our corporate clients face. In the more global, volatile, and uncertain future, “what” we work on with our corporate clients will increasingly define the client’s success (or failure). This is not just repositioning Legal’s relationship with our business colleagues. It is a fundamental shift in the nature of our work.

To truly engage our businesses differently — and better — we need to radically rethink our approach to risk, uncertainty and value creation. As our future unfolds, being absolutely right will be far less important than being nimble and adaptive. Studying every aspect of an issue will yield to a new, more rapid style of decision-making where the predominant belief is that even a decision that proves to be wrong is likely to provoke more useful information than could be learned by delaying decisions pending further study. …

Legal must learn to adapt to the speed of business at the speed of business, while continuing to adhere to our company’s core values and our own professional ethical obligations. Continue Reading

Leading by asking

“There go my people,” said 19th-century radical French politician Alexandre Auguste Ledru-Rollin, supposedly on seeing a mob pass by the café where he was seated. “I must find out where they are going, so I can lead them.” You won’t find a more succinct summary of the paradoxical nature of leadership than that: how can you lead people if you don’t know where they want to go? And if all you’re doing is ascertaining the crowd’s direction, how are you leading, exactly?

I thought of M. Ledru-Rollin upon reading an article in today’s edition of the National Law Journal about law firms sending their lawyers on leadership training programs. One of the points it raises is that “leadership” is an elastic concept into which firms like to insert things like team-building or strategy buy-in exercises. I’m not really in favour of that, because leadership is too important a concept to be diluted: the more meaning you pack into that term, the less effective it’s going to be. That, in turn, raises the question of what law firm leadership is fundamentally about.

Well, I sure don’t have the answer. David Maister has said: “I think more rubbish has been written about ‘leadership’ than almost any other business topic. A lot of it is patently false, and even more of it is dangerous,” and I won’t add to the pile. But I will suggest that the collaborative aspects of leadership deserve more attention.

Strength, decisiveness and vision are often wrongly regarded as attributes of a lone, rugged, heroic persona — the brave individual who rallies the troops through the sheer force of being right. That works great in movies but rather less well in complex professional businesses, especially law firms of autonomous partners who will not be dragged anywhere they don’t want to go. Continue Reading

Something’s actually happening

There’s a lot of buzz building about an article in today’s New York Times with the rather odd title “Who’s Cuddly Now? Law Firms.” It summarizes a recent rash of new business models in American law firms, from flextime for lawyers to flat-fee bills for clients to alternative billable-hour schemes and more. It’s the second article the Times has run recently about lawyers seeking satisfaction, and it prompted its rivals at the WSJ’s Law Blog to ask: is there really something happening here?

The WSJ blog’s readers are providing their usual snarky responses: “This new ‘movement’ will dovetail nicely into the massive layoffs that will be coming in the coming months,” says one. “So, you want more time with your family or to pursue your passion for flamenco guitar? Here is 3 months severance.” Nice. So, here’s my answer to the blog’s question: yes. As Judith shouted at Reg in The Life of Brian, “Something’s actually happening!”

I can refer to you any number of articles and links about law firms that are making changes to the way they manage their employees and their work — see the Financial Times‘ law firm innovation report and the Innovaction Awards, for starters. In addition to the firms identified in the Times article, there are others making changes to how they operate in terms of compensation, of partnership, of billable hours, of women in law firms, and even of the entire firm itself. And these are just a few of the ones we hear about — other changes are occurring, quietly and beneath the radar, in areas such as recruitment, retention, training, parental leave, and evaluation.

Law firms are under pressure. They’ve gotten used to a comfortable world where they could set the tone and pace of operations. That comfort zone is evaporating from two directions: externally from clients and internally from lawyers. Clients really are more sophisticated and more demanding, and they’re looking for more than their firms have traditionally been willing to give them. And lawyers really are more inclined to walk away from (or try to change) work conditions that don’t satisfy a wide range of personal needs.

But even that’s not really new — both clients and lawyers are longstanding complainers, and pressure has been brought before, which law firms have ignored. And keep in mind that many, many law firms are continuing to ignore these pressures. What’s really new this time, I think, is not just that law firms are changing the way they do business, but why. I think they’re doing it, voluntarily, to gain a competitive advantage. Continue Reading

Is stewardship dead?

Maybe not quite, but in the context of most professional law firms with more than just a handful of partners, it’s on life support and the priest has been called in.

I honestly don’t know of any midsize or larger law firms, at least, that operate other than “to maximize the wealth of the current shareholders.” Talking about stewardship — propounding the idea that you’ve inherited something special and precious from those who came before you, that you don’t “own” it the way you own your car or your jacket, and that you’re compelled to pass on that legacy intact and improved to those who follow — that would be speaking a foreign language in most current partnership meetings. Certainly there are exceptional firms out there, but they likely operate so differently from the competition as to be exceptions that prove the rule.

I don’t think this is because of rampant employee turnover and lateral departures — they’re symptoms of stewardship’s absence, not a cause. I do think that, among law firms anyway, aggressive growth — “national” and “global” strategies meant to maximize business intake — have stretched the traditional model of a law firm beyond any coherent meaning. I mean, come on — an 800-member “partnership”? Can you seriously contend that the hundreds of lawyers nationwide or worldwide whom you’ve never met — who share only a letterhead and a remuneration plan with you — are your “partners” in any but the most formalistic sense of the word?

True “partnership” implies elements like trust, shared values, common commitments — it involves a conscious recognition that you and I hold the same approaches to professionalism and client service, and a decision to proceed together towards our shared goals. Receiving an e-mail in Montreal announcing that the Calgary office has admitted a new litigation partner whom you’ve never met and likely never will, that doesn’t cut it. Law firms that grow beyond a certain size and jurisdiction inherently can’t be much more than a loose affiliation of constantly revolving outside counsel. In this context, “stewardship” simply can’t apply.

The recent deals whereby major law firms have become the single source for a multinational’s outside legal work — Tyco and Evershed’s, Linde and DLA Piper — look more and more to me like the future of large law firms: really, really big corporate legal departments, half-inside, half-outside. That’s fine for them, but I look forward to the day when these firms no longer burn so brightly in the profession’s imagination that they set the tone and expectations for how other law partnerships are expected to define and conduct themselves.

I always tell law students to remember that large law firms are the exception, not the rule. Hopefully, stewardship still runs silent and deep among smaller firms, and will stage a major comeback as the nature of lawyers’ business associations continues to evolve in the years to come.

This post originally appeared as a comment to a post at David Maister’s blog on March 22, 2007.

A to Z: 26 trends for the legal profession

This article was co-authored with Mélanie Raymond, then-Senior Editor of National, and appeared as the cover story in the April/May 2006 edition of the magazine.

The legal profession is turning upside down, and many of the familiar landmarks are disappearing or bring replaced by brand-new structures. There are so many changes afoot that National’s editorial team could match each letter of the alphabet to a development that presents a threat — or an opportunity — for lawyers. Twenty-six trends, 26 letters: which ones matter the most to you?

Associé (Partnership)

It’s always been the Holy Grail, the ultimate goal for lawyers starting out in private practice It has been considered the final step in a lawyer’s transition from simply an employee to a partner. But this is all changing, thanks to systematic and generational change.

Equity partnerships (partnership without capital investments or draws), salaried associate, permanent or advisory associate — new forms of quasi-partnership are born every year. The journey to the associate level is accelerated in some firms, delayed in others. Methods vary from one firm to another, from one individual to another.

And increasingly, there are lawyers who choose to not aspire to partner status at all — for whom client development, firm management, and the additional responsibilities that go along with being a partner hold little or no appeal. Will partnership become obsolete? No, but flexibility, rather than tradition, will rule this ancient institution from now on.

Runners-up: Asia, Latin America Continue Reading

Looking for leaders

These days, young lawyers are often said to be joining firms and immediately expecting exciting work, handsome paycheques, flexible hours and endless compliments. Their attitude, apparently, is that they can bypass all the hard work put in by their elders and head straight for the reward, while bolting to a higher bidder on a moment’s notice. The phrase “entitlement mentality” gets thrown around a lot.

Rather than criticizing their newest recruits, firms might instead try learning to maximize what this generation has to offer: intelligence, creativity, technology skills and, yes, a solid work ethic. Today’s new lawyers are quite willing to put in the hours — but many need a good reason, one more compelling than “increasing firm profits.”

Today’s new lawyers also understand that associates are a fungible commodity in this marketplace. And when these associates read in the newspaper about senior partners switching firms for more money and more “challenges,” is it any wonder they feel inclined to follow suit?

And this brings us to the heart of this generational rift: leadership.  Today’s new lawyers — and their whole generation, incidentally — are starved for leadership. They’re seeking an actual vision for what a lawyer and a law firm could be, and they will respond enthusiastically to the keynotes of leadership: mentoring, coaching, feedback, vision, and a sense of higher purpose.

If a law firm chose to truly prize leadership, and dedicated the resources to prove it, that firm would have its choice of the very best and brightest young lawyers. It would have to turn them away at the door.

This post originally appeared as the editorial in the October/November 2005 issue of National magazine.