The profession that many of today’s firm leaders entered decades ago stands in stark contrast to the modern demands of private practice. They started their careers seeing carbon copies give way to mag cards and fax machines. Many (and in an increasing number of small practices, all) secretaries have been replaced by technology. Fewer firms have receptionists to answer calls because most calls are made to direct dial numbers or cell phones. And no matter how hard they worked when they entered the profession, young lawyers decades ago could go to bed without fear of being interrupted in the middle of the night by e-mails and texts.
This is far different from the present day, where it is estimated that people check their smartphones every nine minutes. The pressures experienced by professionals at all levels today feel unrelenting.
In addition, lawyers who began their careers in the 1960s, 1970s, and even the 1980s likely knew most of their law firm partners by name, as well as many of their partners’ family members. Today, the notion of taking time away from one’s own family to get to know one’s partners feels like an unaffordable luxury.
As large law firms struggle with seemingly endless possibilities for expansion around the world and boutique firms compete with global behemoths, all clients search for lower rates and creative fee arrangements. And many clients resist paying legal bills they consider to be too large, further pressuring firms of all sizes to contain costs.
Lawyers struggling with a changing legal profession do so along with their clients, who are also facing unprecedented changes around them, leading to myriad complex questions. In a world where Uber and Airbnb have upended traditional taxi and hotel service industries, to what extent are Internet alternatives such as LegalZoom a competitive threat to the legal profession? As alternative models for the delivery of certain legal services gain traction, are there any long-held truisms of the profession that we can count on to remain unaffected by change? How is a law practice supposed to differentiate itself when there seems to be more competition than ever before? How do you choose among a baffling array of traditional and social media options to best define your brand? How do you keep up with breathtakingly fast technology changes and the corresponding security challenges they raise? The list of questions is long and grows daily.
Most lawyers in charge of addressing the growing list of professional challenges do so in a law firm model that historically has placed limited value on the exercise of leadership. Lawyer compensation has long been based on various combinations of hours billed and rainmaking skills. Leadership abilities, management skills, committee engagement, internal mentoring, and other behaviors focused on talent management are not highly prioritized in most law firm compensation systems.
Larger firms are not yet providing the leadership needed to generate answers to the vexing questions facing our profession. Many continue to feel pressure to attract star laterals, notwithstanding data that suggests that growth by laterals may not be an economically wise option. The confluence of a vastly changing landscape and compensation models that pay scant attention to the leadership and management skills needed to navigate law firms through these complexities presents a growing crisis for the legal profession. More than ever before, law firms of all sizes need strong, guiding hands to steer through rolling waves of change.
Yet, too many law firms continue down the same path they have long traveled, relying on various systems that reward large producers and insufficiently value those who contribute to functions that allow those producers—and others—to flourish.
Ignoring Law Firm Leadership
Indications that talent management and leadership development remain too low on the priority list of law firm executive committees are found not only internally in behaviors that are rewarded, but externally, in the conversations that are found in articles that focus on the business of law. A recent article in a leading legal magazine demonstrates this point. The article reported on an annual survey of managing partners that seeks both their views on legal industry trends and their thoughts about what’s ahead for their own firms. The issues highlighted could have been part of an article written decades ago, rather than the last month of 2015. The article noted, for example, that few respondents expected to raise billing rates significantly, owing to growing competitive pressures. It further reported that many firms expected to be “thinning the herd” of partners, even as they are likely to modestly increase their overall “head count.” The article reported managing partners’ anxiety about partners not billing enough and staying on too long. There was also a discussion about anticipated modest or flat increases in profits per partner, perhaps owing to continued pressure on hourly rates.
Here are some of the issues not addressed by the discussion with managing partners that was reported in the article. How are firms using technology to improve the delivery of legal services? What systems are firms using to track and monitor internal patterns to better develop alternative fee options for clients and to ensure quality? What are firms learning from their clients and other leading businesses to develop a stronger infrastructure for talent development? What models are being created to facilitate knowledge transfer between senior and junior lawyers as demographic shifts take hold? What mechanisms can firms put in place to eliminate the scramble for client credit for new work, a problem that depletes morale and drives attrition? How can firms institutionalize approaches to the inheritance of work from long-standing clients after a partner retires or leaves a firm to ensure that credit is distributed equitably?
The list of missed opportunities in that article continues. What other measures are firms undertaking to ensure that generational shifts proceed smoothly, keeping in mind the underlying data about Millennials, indicating that they are less likely to spend their careers working in the existing law firm model? What is being done to inculcate diversity and inclusion into all aspects of law firm systems, recognizing both the business and the moral case for doing so? At a time when technology allows enormous flexibility in where and when work is conducted, how are firms addressing the growing demand for flexible alternatives? And what steps are firms taking to learn from their corporate counterparts in strategic planning, including the identification and development of future leadership?
These are just some of the critical issues that should be reported in a survey of law firm leaders. Moreover, each of these issues leads directly to the key question of whether law firm compensation models value internal leadership and management skills, separate and apart from client stewardship and external roles. And if they are doing so, what are the metrics and accountability measures that are built into the process?
Distinguishing Leadership from Management
As all law practices, large and small, struggle to develop ways to adapt to the rapidity of change, it is critical to seek systems to recognize that law practice leadership and management involve different roles—and sometimes different skills—than those involved in client stewardship. Firms should not conflate them when rewarding behaviors.
Moreover, in a discussion of leadership, it can be easy to give short shrift to the role of managers. For example, a leader and a manager can describe someone who has achieved higher levels in an organization, and both titles can refer to those with some degree of supervisory roles over others. Often, however, the manager is relegated to a lower status, seen as a person who is responsible for specific functions while the more important people go about the actual job of leading.
Lawyers often see themselves as natural leaders but not necessarily managers. They lead client teams, helping to solve complex business and personal problems for others. They are sought out by community organizations to serve on boards, to speak, and to chair important events. And they frequently participate in local, state, and national bar associations, helping to teach others through CLE involvement, serving on committees, and undertaking other key leadership functions. In very few of these leadership roles, however, are the lawyers also serving as managers.
Once management skills are called upon in the realm of law firm governance, however, the terms share blurred lines. Those in charge of various firm functions—chairs of practice groups, members of key committees, and heads of local offices—often have the word “leader” embedded in their title. They are Practice Group Leaders, Office Leaders, and Committee Chairs. At some law firms, lawyers occupying these roles may have a management structure reporting to them that can carry out administrative functions, but in many firms there are too few resources dedicated to the full panoply of leadership and management functions required to nurture and develop tomorrow’s leaders, rainmakers, and sophisticated practitioners.
The practical reality is that many law firm practitioners who are imbued with the title of leader are also expected to carry out managerial functions in these roles. Law firm leaders are called on both to lead and to manage, requiring an understanding of both roles and an appreciation of their importance.
Fostering Law Firm Leadership
There is one big problem, however. Law firm leadership is selected based on criteria that have little correlation with the skills that got lawyers appointed or elected to those roles. This is a challenge that has been recognized and written about for years and is based on a long-held, albeit untested, assumption: Lawyers would not accept having someone in a leadership role who was not also an accomplished lawyer.
As a result, in most law firms today, the busiest and most productive lawyers are rewarded with titles that add further status. But with these titles come challenging tasks that tend to fall lower on the priority list when a busy lawyer is choosing among multiple demands. It is impossible to give appropriate time and attention to nurturing young talent, solving billing disputes, assigning work equitably, identifying new markets and potential clients, and ensuring that practice group development needs are met in the face of looming client demands and deadlines.
To succeed, law practices of all sizes must give appropriate time and attention to these and other functions. If, as most firms insist, they are businesses, then investments are required in the resources needed to nurture that business. The act of reviewing time and realization records will not, alone, make an entity into a business—at least not one with hope for long-term sustainability.
A business that strives for excellence values leaders. In the law firm context, this would mean selecting individuals for internal roles who exhibit leadership qualities and an institutional focus. It means valuing participation in committees through compensation and bonuses, and not relegating functions that promote the future of the organization—such as mentoring, associate hiring and training, and diversity and inclusion committees—to office housework that often carries an economic penalty rather than a reward.
Law firm leadership also means engaging all generations in creating strategic visions, across each area of practice, that promote retention and increase engagement among all lawyers and support staff. As young lawyers seek to influence their work environment, all law practices would benefit from teaming the skills and perspective of Millennials with the wisdom, experience, and perspective of Gen X and Boomer lawyers. Such multigenerational engagement can break down internal barriers to business development and succession and offer ideas for a workplace that will retain young lawyers for the long term.
Leadership also requires an entirely different approach to diversity and inclusion. For too long, these functions have been relegated to committees that are provided limited resources and are outside the traditional law firm leadership hierarchy. If the profession is ever going to move beyond the weak and decades-old data showing that women and people of color are paid less, promoted less, and leave more often, then diversity and inclusion will need to be fully integrated into the strategic goals and cultural values expressed by firm leaders.
Strong leadership also requires self-awareness. Those who assume leadership roles in law firms should be taught to understand the many cognitive biases that stand in the way of effective stewardship. Are attribution biases resulting in a tendency to take responsibility for success while blaming failure on external factors? Are decisions being based on information that confirms preexisting beliefs and excludes contradictory evidence, thereby promoting confirmatory biases? And are unconscious biases impacting the way those who are different are being assigned work and evaluated? These are critical areas that warrant individual and firm attention and resources.
Amid all the change, the demands, the conflict, and the challenges, being a lawyer remains a privilege. Lawyers have the opportunity to spend each day helping other people solve their problems. What the profession needs is for lawyers to take the same advice they would give their clients who ask how they could run their businesses more effectively.
All law practices, large and small, must exercise for themselves, and nurture in others, the leadership and management skills needed to ensure the institutions they have devotedly developed can remain vibrant and healthy for the next generation of lawyers. This should be our legacy as lawyers and our imperative for ourselves.