May/June 2019

Taking the Lead

Better Decision Making Through Systems Thinking

Linda Klein and John Hinton IV

As a law firm leader you identified a pressing issue in your firm. Perhaps the issue is “How do we deliver more value to our clients?” You carefully analyze the issue, obtain input and develop and implement your plan. However, the anticipated results don’t materialize. Sometimes that great plan makes matters worse.

This shouldn’t happen, right? Lawyers are problem solvers. Identifying cause and effect is an important part of our stock-in-trade. So, why then do these skills not always transfer to solving the challenges facing our law firms?

Author Donella Meadows would say the problem is “linear thinking”—trying to identify discrete causes and effects for solving a problem when most subject matters are much more complex. Meadows’ book, Thinking in Systems: A Primer, challenges us to think of our world as a series of interconnected systems and demonstrates how doing so enables us to better identify the multiple causes and effects that impact matters. This way we can make better decisions. The starting point is recognizing that your law firm is both a single system and a system of systems.

Finding Multiple Solutions to Simple Problems

Meadows illustrates many of her points using the bathtub as an example. It holds a “stock,” which is something of value—water, in this case. It has an inflow for that stock (the faucet) and an outflow for that stock (the drain). You adjust the stock of water by adjusting the faucet and the drain.

Simple systems often offer more solutions than we recognize. If you need 10 gallons of water in the bathtub, most people would close the drain and fill the tub with 10 gallons and not give the matter much thought. Of course, that is not the only way to maintain the 10 gallons of water. For example, another approach is to maintain those 10 gallons through a series of adjustments to the amount of water coming through the faucet and the amount of water draining out of the drain. The second option uses more water, but if you are washing your dog in that tub or you want to keep the temperature hot, the constant cycling of fresh water into the tub is likely the best solution.

As there is more than one way to fill a bathtub, consider that there is more complexity (and therefore more options) in how you craft solutions to issues that appear to offer only one path forward. For example, you need to replace your firm’s office receptionist. The obvious solution—hiring a replacement—may not be the best solution. Perhaps in your market the pool of talented full-time replacements is limited, but the pool of talented part-time replacements is plentiful. Each solution has its benefits, and splitting the position may not suit your firm’s needs. However, by hiring two (or more) part-time receptionists, you may better achieve your goals for that position.

Seeing the Interconnectivity of Your Firm's Systems

Most systems are much more complex than a bathtub. Your law firm is both a single system (the law firm) and system of systems (e.g., lawyers, support staff, IT, marketing) that are interconnected with one another and other outside systems (e.g., the overall economy, the families of your employees). Where you draw the lines in defining the scope of a system can be both beneficial and misleading in firm management and problem solving.

If lawyer profitability falls below expectations, it can be useful to focus on the workflow of lawyers to diagnose the issue and develop solutions. However, there are many more subsystems at work that can also impact lawyer profitability. If you miss them, your proposed solutions could fail or even exacerbate the problem.

For example, you may determine that the dominant reason that profitability is low is that many lawyers are not working hard enough. That may be true, and it may need to change. However, lawyers working more hours affect other firm systems. Perhaps you have already reduced your support staff to cut costs, thereby leaving them little margin to handle the additional work that busier lawyers will generate. If the support staff is already stretched thin, their increased workload resulting from additional lawyer hours can generate resentment among the staff, which can decrease their productivity (or cause marketable staff to leave), which impacts the lawyers’ ability to be more profitable. There are ways to facilitate your support staff to be part of the solution rather than the problem. However, if you are only considering what the lawyers need to do rather than accounting for their impact on the rest of the firm, your plan may not generate the desired results or may even exacerbate the original problem.

As you consider problem solving within your firm, consider how changes in one area impact other areas of your firm. Consider also how those impacts may adversely or positively impact the original changes that you seek to implement.

Making Systems Work for Us

Although we are never able to make decisions based on perfect information, by using the systems paradigm suggested by Meadows, our decisions can be better modeled on the actual connectivity of various systems within our firms. Happy systems thinking!

Linda Klein

Linda Klein is a past president of the ABA and senior managing shareholder at Baker Donelson. She is a frequent speaker on law practice, construction and higher education law. lklein@bakerdonelson.com

John Hinton IV

John Hinton IV is a shareholder in Baker Donelson's Atlanta office. His practice focuses on commercial litigation and construction law. jhinton@bakerdonelson.com