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Copyright 1995 New York Law Publishing
Company
New York Law Journal
August 8, 1995, Tuesday
SECTION:
MANAGEMENT & TECHNOLOGY; Law Office Management; Pg. 5
LENGTH: 1822 words
HEADLINE:
The Changing Nature of the Firm's Culture
BYLINE: JOEL A. ROSE; Joel a. Rose
is a certified management consultant and president of Joel A. Rose &
Associates Inc., of Cherry Hill, N.J. consultant to the legal profession
ED, TOM and George founded their AV-rated mid-size practice 18 years ago.
They formed a partnership when they resigned from a major firm because of
dissatisfaction with life in a large firm setting. Their firm is governed by a
management committee comprised of the three senior partners. The committee
determines policy, make major decisions New York Law Journal, August 8, 1995
affecting the firm and sets partner compensation. Partner meetings are held
monthly. An agenda and summaries of financial reports are distributed to
partners at the meetings.
During the past three years, the firm has
acquired two smaller firms. These acquisitions have been successful from an
economic standpoint. However, dissatisfaction with the firm's governance has
been noted among the acquired partners and a few of the firm's mid-level and
junior partners. Such issues and concerns often draw to a head when a firm
discovers that is original purpose and cohesiveness have fallen to the wayside.
The firm must chart a new direction, in order to rally its lawyers, build an
identity and nurture the allegiance to provide the framework for a successful
practice.
The Questionnaire
The firm is about to announce the
particulars of a retreat that is scheduled later in the month. The committee has
decided that, for the first time, the retreat will be conducted by an outside
consultant. For planning purposes, the attorneys have completed a questionnaire,
and in answering a question about their dissatisfaction with the way things are
done at the firm, they have enumerated the following item:
1. Not being
kept informed of firm activities that involve staffing or termination of
attorney including matters that may affect particular partners or their areas of
practice, lateral hires, etc.
2. Feeling that they are being
quot;managed quot; or quot;manipulatedquot; by a senior partner or a committee
of dominant partners.
3. Being assigned responsibility for performing
certain administrative or professional tasks without being granted adequate
authority to accomplish these objectives. One relatively new partner, Fred, had
tried to develop the real estate area, but did not have the clout to garner
support for his idea and strategies.
4. Unwillingness of the more
influential partners to share in the decision making process for the firm.
5.
The sense that decisions are made by a select few and that the partner meetings
are essentially eyewash, major decisions are made prior to the meeting and
partners are being "played with."
6. Lack of open
communication between more influential partners and the rest of the attorneys.
While it would appear that Ed Baxter, Tom and George talk among themselves, it
seems that the rest her things via the ubiquitous grapevine.
7. Senior
partners consider the firm as for granted.
8. Lack of concern about the
status or feelings of other partners by some of the more influential partners,
i.e., embarrassing younger partners or others before clients, yelling and
screaming at them, ridiculing them, limiting their responsibility or
participation in various client situations, etc.
9. Insensitivity to
the personal and professional needs of partners, i.e., handing them projects at
the last minute and demanding work be performed immediately, even though the
matters may have rested on the originating partners' desk for some time.
10.
Unfair compensation system whereby the more influential partners are greedy and
manipulate compensation plans to suit their own purposes. For all intents and
purposes the executive committee is also the compensation committee.
11.
Lack of adequate planning for transfer of client responsibility from the more
senior partners to other mid-level partners; a fall-off in business due to
client departure that the firm did not anticipate or plan for and no plans exist
for replacement of that work.
12. The more senior partners reducing
their activities involvement in producing work, business origination or firm
management, yet still expecting to receive a significant portion of profits. It
has been noted that Baxter's production is beginning to slow. George's board
meetings take up a lot of time and don't meeting take up a lot of time and don't
necessarily add to the firm's profits . . . there is a lot of speculation about
whether these things are reflected in the year-end distributions.
13.
Unwillingness of partners to bring in outside law office consultants who might
be able to provide objective recommendations on firm governance and other
sensitive issues. General opinion is the management fears losing control, etc.
While
agreeing in principle to the benefits of using an outside expert for this
retreat, management has expressed grave reservations about stirring the tempest
and creating more serious problems. Firm management is obliquely sidestepping
the issue when it expresses concern about interference from the outside. It
would appear that the outsider could do little harm here. These are not the type
of problems that have suddenly mushroom overnight. They have been built into the
system layer by layer, The firm must delve within and undo the chain of events
issue by issue.
Need for participation
If this firm is to
cultivate the allegiance of its attorneys, it must provide them with an
opportunity to participate in their own destiny. Case in point is Fred's effort
in his own behalf. If the firm will not do it, Fred can and will. Both the firm
and Fred know that he is a superstar. Once Fred gains a vantage point, the firm
will have to acquiesce and listen. While the final results will conceivably
benefit both Fred and the firm, the process of achieving the success and
building an alliance would have been better served by a few critical differences
in the firm's relationship with Fred and by extension of all its attorneys.
The
firm is at a crossroad and must chart a new direction. It is no longer the firm
that was founded by Baxter et al. Things have been changing for some time. While
the overall client base would appear to be solid, more active plans must be put
in place for a smoother transition when some of the older partners step down by
dint of age, health and other reasons.
The younger partners do not
share the older partners' degree of loyalty for some of the firm's long-standing
clients. This is not unreasonable from the younger firm members' point of view.
They have not necessarily received the benefit of these long-term relationships
and, more to the point, have not been invited to participate in the cultivation
and growth. While these factors might appear to indicate that the crisis falls
upon the issue of age, this is not necessarily the crux of the actual problem.
The firm has been successful and aggressive enough to attract the ability and
talent of the Freds that it so vitally needs to prosper. However, it has
neglected to provide the means for its attorneys to marshall their abilities to
a unified end. The firm must take stock of itself, determine who it is and what
kind of firm it wants to be and then proceed to make that entity palatable to
all its members.
The work must be done from within. Management must
take particular care to assess the needs and requirements of all its lawyers and
give them the opportunity to use their skills and abilities. The main point that
must be recognized by management is that all the lawyers must be able to
participate in the activities that determine their future from the beginning of
their relationship.
What the attorneys want firm management to do is to
recognize their need for:
1. the opportunity to work with clients s
early in their careers as possible. The attorneys want to step into the fray
from the beginning;
2. responsibility for client matters at the onset,
at an early stage in their careers;
3. opportunity for professional
growth. This can be one by attending CLE seminars, or meeting sponsored by
outside groups. Regularly scheduled in-house training provided by partners to
develop the skills and techniques that are required to succeed in such things as
the substantive areas of practice, methods of business development and
management techniques;
4. opportunities to train and supervise
attorneys and paralegals to provide support on specific client projects, or in
substantive areas in which the attorneys are involved;
5. opportunities
to build a reputation by participating in CLE programs, sponsored by the bar
association, writing articles on substantive areas of practice in bar
association or professional publications;
6. opportunities to build a
reputation by participating in programs sponsored by the firm and other
associations i.e., accounting firms for clients and prospective clients;
7.
encouragement to participate in a certain number or type of pro bono activities
in which the attorneys have a particular skill or interest;
8. methods
for in calculating a positive level of respect and caring for the clients;
9.
opportunities to participate in discussion concerning client matters, i.e.,
strategies, reporting on findings as the result of research, provide input on
decision that may affect matters they are working on.
Administratively
speaking, the attorneys would ask the firm to provide them with the opportunity
to be able to:
1. participate in firm governance and administration,
i.e., participation and input on various committees;
2. participate in
policy determination and other important administration decisions and issue,
i.e., office assignments, benefit programs, automation decisions, space planning
decision;
3. meet with all partners and associates on an ongoing basis,
to review and discuss various issues, exchange ideas;
4. build a sense
of caring and camaraderie that conveys concern about the professional and
personal welfare of their fellow partners and associates;
5. enhance
their skills through the commitment of more senior partners who are willing to
take the time to train and accommodate the needs of younger attorneys and other
partners;
6. show sensitivity to the possible burnout of attorneys as
the result of their workloads and client and firm pressures;
7. speak
out on various issues of a policy nature, without fear of retribution;
8.
develop business, and get credit for origination including the enhancement of
client relationships;
9. become involved in significant expenditures of
firm funds or new system, i.e., word and data processing, new space
acquisitions;
10. have some voice on issues that involve the firm's
incurring of substantial debts, or changes in the firm's capital structure or
governance;
11. insure that the firm has a fair compensation system
that rewards all its lawyers for their total contribution;
12.
establish a sense of security whereby the partners know that they will have a
viable retirement program as part of their overall benefits.
GRAPHIC:
Picture 1 and 2, no caption; Picture 1, By JOHN MacDONALD
LANGUAGE:
ENGLISH/P PLOAD-DATE: August 15, 1995
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