Building a Strong Culture—And a Profitable Firm

Volume 40 Number 1

By

About the Author

Karen MacKay is president of the consultancy Phoenix Legal Inc., focusing her work on leadership and strategy execution for law firms. 

Law Practice Magazine | January/February 2014 | The Management IssueOUR VALUES GUIDE our individual behavior; collective behavior creates the culture of your firm. Whenever a firm is looking at its strategic options, practice focus, growth, laterals or perhaps even a merger, it often expresses concern over the impact such a change will have on the firm’s culture. Yet when we describe our firm to prospective lateral partners or to summer associates at a law school recruit, we talk about culture with a very limited vocabulary. So what is culture?

Culture is the way that

  • the firm relates to its people,
  • people in the firm relate to each other,
  • the firm adapts to the changing environment, and
  • how work gets done.

Does a strong culture mean a more profitable firm? Can leaders influence culture? Let’s explore these questions briefly.

CLARITY OF PURPOSE

Firms where there is a shared view of the future provide an environment where the leader can balance long-term orientation with short-term decisions, and medium-term planning and budgeting. Leaders have a framework for making choices, for expressing expectations, measuring performance and holding people accountable. Clarity of purpose and vision can anchor firm-first management conversations. Here’s a question to test the clarity of what’s important. Task various working groups in the firm—the executive committee, the recruiting committee, administrative managers, etc.—with the following: If we were to create a table of contents for our annual report for the next calendar year, what should the headings be? If you have clearly communicated the vision and strategic objectives of the firm, the responses from these groups should be similar. If you haven’t, then they won’t be, and you have some work to do.

HOW WORK GETS DONE

Firms with a strong culture are predictable and consistent in terms of their approach to doing business and getting work done. While individual strengths and work styles will vary, members have strong and shared values, and organizational boundaries. Also, egos don’t get in the way of client service, and members share a relatively consistent approach to doing business. Partners are often proud, feeling that they have created a strong culture. In one firm, when asked the two most important values that drive how work gets done, the partners touted their client service and excellence. When the firm’s associates were asked, however, client service and excellence didn’t make it to the top five. It is the job of leadership to articulate what’s important—and to ensure that work standards are communicated clearly and often.

ADAPTING TO CHANGE

Do members of your firm know what is happening in your marketplace? Do members at all levels know and understand the changes that may impact the firm’s future, or are they toiling away with their heads down, seemingly unaware? Do your partners understand the changing needs of your clients? I am constantly astonished at a law firm leader’s fear of asking clients anything, while at the same time telling me that the firm’s clients are absolutely delighted with the service they receive. How do you know? What are you afraid of? Visiting clients is important. Do it often—not to sell but to listen. Here’s another question for your colleagues—this time for lawyers in your various practice areas—and not just your partners but all lawyers at all levels, so you can gather a variety of perspectives. The question: What are the three most important questions we might ask clients at such a visit? This should create a lively debate.

ENGAGING AND ALIGNING YOUR PEOPLE

Leadership is in large part about sharing a vision, engaging people emotionally and intellectually, and inspiring them to row in the same direction at the same speed. Your people bring motivation, initiative and energy to the firm, and you can either foster those traits or erode them by how the firm treats its people. Leaders who communicate effectively create environments where people feel a sense of purpose and a sense of pride—that being a member of your firm means something. Leaders can create a sense of teamwork, where participation replaces apathy, collaboration replaces selfishness, and mutual accountability raises the game of the group and profitability of the firm. Leaders who feel they are too busy to communicate might simply ask what people need. What information would help associates better understand the firm’s business? What is the most efficient and effective format? How might associates provide ideas and input?

Culture is more than the “soft stuff.” When culture is shifting, as it is now in many firms with the aging of the partnership, gaps in culture are reflected in changing financial performance. Go ahead—take the lead in building a strong, durable and profitable firm.

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