Frequent readers are aware that I often begin with a story about recent travel. In fact, just days before writing this column, I returned from a spectacular “Sydney to Singapore” cruise. This column will not, however, begin with a story about an actual physical trip, but rather a virtual one. Many readers will recall my recent travails in do-it-yourself treadmill repair. I still have that treadmill, but due to plantar fasciitis, I’ve added a stationary bike. Each virtual ride takes me to some distant location, hosted by one of those unbelievably fit trainers. Recently, I logged into a new bike series of 30-minute rides through a place I knew little about: Bhutan, a small country bordering India and China. In this series, I discovered that, in many ways, some of the thoughts about law firm leadership I stressed to my partners years ago are quite similar to the foundational ideas of the Bhutanese government.
I recall a difficult conversation years ago, with a now former partner. He had a rigid and antiquated view about compensation, expecting his pay to be a very specific percentage (or more) of his collections. He didn’t care, or recognize, that “his” clients had been handed to him by others. He seldom involved himself in any type of planning or business development. Someone along the way had given him the idea that “all of those nonbillable endeavors are fine, so long as the firm satisfies my personal financial goals first.” I tried to convince him that his compensation, as well as that of all the other members of the firm “team,” was a result or product of collective efforts to satisfy clients and achieve organizational success. These efforts include not only grinding (which he did well), but finding and minding as it relates to clients, and leadership, management and business continuity as they regard the organization. Unfortunately, incorrect thinking had created expectations, and the failure to achieve expectations (based on faulty assumptions regarding the relation between collections and compensation), resulted in unhappiness.
So . . . what does all that have to do with Bhutan? What I learned while riding my bike, and through subsequent research, is that Bhutan does not track gross domestic product (GDP) like most other countries. Instead, it tracks what is refers to as GNH, or Gross National Happiness, which has four pillars:
Beneath these pillars, or as a component of each, there are domains or measurements in support. As I consider my former role as managing partner, what I eventually came to believe as the key to organizational success (and it took me a long time to get there) was a set of four pillars very similar to the pillars of GNH. Rather than the very rigid and objective compensation formula I had inherited (where the highest number on an Excel spreadsheet was the sole gauge of one’s success), these pillars seemed to be the key to success (or “firm happiness”):
After assuming the position of managing partner, I discovered the role was about much more than management. Management was the floor of service. Good leadership (which I knew little about at first), was the key to success in my new role. Eventually, I realized that within this pillar of law firm happiness, were several elements: management, leadership and business continuity. Management alone might be enough to handle the day to day and keep short-term, internal peace, but leadership (the self-serving kind), and a solid plan or strategy for growth and development were the keys to long-term success, or “happiness” in practice. Management means being proficient in things like employee benefits, policies, facilities and accounting/billing. Leadership and business continuity, however, are about strategic and succession planning, professional development, relationship management; not only being at the helm of the ship but having a plan and vision of where it is headed and the ability to get others to ride along.
Upon passing the bar, I began my career working on tobacco litigation discovery for a large law firm. Unhappy with that work, I left for a two-person firm located in a small, rural North Carolina town. After another two years, I took a position in Asheville, North Carolina, for a firm that was not quite as small, and not quite as large, as these other two firms. I am still with this firm 35 years later. Looking back, I never considered culture in my job searches. I feel certain that all these firms had the exact same idea about who lawyers are, and what a law firm is all about. At least back then, none of the leaders at these firms considered culture; what was desired, how to achieve it or if I fit into it.
I’ve written about culture in recent columns, so I will not go into all the details of achieving it again. I was interested to find, however, that to the Bhutanese one of the four pillars focuses on culture, the ability to maintain and develop culture identity, achieve desired culture in practice and overcome the challenges faced in maintaining culture. For a law firm, culture may not, in theory, be required to achieve financial success. There are many ways one can be rich and unhappy in life. However, if the goal is to achieve more than dollars, understanding that financial returns flow from a larger ideal, significant consideration must be given to law firm strategy - the mission changing from maximizing GFP (gross firm profit) to maximizing GFH, defining desired culture and a strategy to achieve it.
Understanding that profitability is no longer the sole mission, it is instead put into proper focus as one of four key pillars to firm happiness. A law firm is, after all, a business, and those who serve the organization each have individual needs that must be considered. Many law firms have developed extensive ways to look at numbers––not just balance sheet and income statements, but billings, origination, delegation and collections and some consideration of profitability of individual lawyers and practice groups. The key to this pillar is not about knowing numbers solely for the purpose of cutting up the pie, but about analyzing the numbers, how they were created, and finding ways to sustain or increase them while balancing results against the other pillars. This means that if “happiness” is to be achieved, a law firm must understand that it is possible that increases in revenue, at the expense of the other pillars, will be counterproductive. To put these numbers in perspective and achieve GFH, compensation systems will need to change if they have not already. As I mentioned to my former firm partner, personal income is a product of success, not the goal in and of itself. If a firm defines happiness as I suggest, lockstep and formulaic compensation systems will need to be discarded in favor of alternates that focus on how each member of the firm has selflessly contributed to each of the four pillars.
Bhutan refers to this pillar with respect to environmental conservation––protecting the land and natural resources. For law firms, this is best defined as being good citizens or participants in all the communities in which we serve. This pillar is not achieved by simply taking positions on boards and committees to build up one’s ego or résumé. Instead, it requires an understanding that that the communities in which we live (whether geographic or professional) such as membership and participation in community organizations or the organized bar, are not just avenues to business development. Each supports and serves our needs, and therefore we should support and serve others through real and active participation.
The four pillars seemed to have worked for Bhutan. Though it has taken many years, the pillars have worked for my own firm as well––not only to achieve financial success, but the satisfaction that comes to the members of an organization that really works and grows as a team. My recommendation is you might want to consider a new way of thinking about, and defining, success.
