Over 20 years ago, I co-authored with Michael Hudkins (a CPA, and former COO of my firm) an ABA publication titled The Lawyer’s Guide to Strategic Planning. This publication was a basic, entry-level guide that discussed firm strategic planning, explaining the process that was commonly used to produce five- to seven-year strategic plans in organizations, including law firms. It contained the basics for developing a mission, vision and the process of creating objectives, achieved through strategies and tactics. Of course, no publication of strategic planning would be complete without a section on conducting a SWOT (strengths, weaknesses, opportunities and threats) analysis––and it did. Though proud of the book I had co-authored in 2004, it was not very many years thereafter that I began to realize that the world was changing so fast that this traditional process of strategic planning took too long, and a plan created through it was out of date by the time it was agreed to, and finalized, by firm stakeholders. I have alluded to this realization from time to time over the past few years in this column. In fact, the leadership of my own firm has come to realize: 1. the need for strategic planning, but 2. the importance of finding new and more nimble means of both conducting, and executing, a process. In developing new ways to plan, our firm leaders also discovered missing aspects of honesty and commitment that hold law firms back from achieving strategic success.
One area of planning that was seldom used but has risen in prominence in recent years in planning, is the expression of organizational values, sometimes stated as “goals.” These values are usually stated in terms that are less likely to be benchmarks to achieve, than ideals of which to aspire. At our firm we have a single “Value Standard” known as “Excellence in the Practice of Law,” which is defined by specific characteristics. Frankly, the Value Standard is really the mission or penultimate goal, and the characteristics are values to which we are committed that help us achieve it. Though we have done well in implementing this plan for about 10 years, two factors are an impediment to consistent success in achieving the mission.
Researching what law firms state as their values or goals is not that difficult. Many firms use stated values as part of firm website marketing. They are often lofty values that are stated in broad areas such as excellence, integrity, shared commitment and teamwork. In some cases, specific areas such as wellbeing, corporate social responsibility and diversity and inclusion are stated. Though these stated values tend to impress prospective team members and clients, and make leaders feel good about the organization they are giving the most significant portion of their waking hours to, team members continue to jump ship for greener pastures, clients still depart and Above the Law seems to have an abundant amount of material to write about.
Values are supposed to be nonnegotiable principles that define an organization. Many organizations state values on their website, but do not have structures in place to assure these values are true, and that team members are held accountable when they act in a manner that makes them seem less true of the organization. Law firm owners should be honest about the values they state and recognize that all values are not equal. If conduct does not match the statements, team members will know very quickly, and clients will come to realize it as well.
Even for law firms that have stated values and truly try to live up to them, there is one major impediment to success that I have witnessed firsthand. The functioning of a law firm, which has so many service objectives and practice areas, experiences values conflicts. When conflicts arise, the people who work for the firm need to know which value takes precedence. For example, the Disney Corporation has four values established for its theme park operations: courtesy, the show, efficiency, and safety. Most people, when they think about Disney, probably list courtesy as a number one value, followed by efficiency because of the fact it is in business to make a profit, safety third and then “the show.” However, safety is, in fact, the first priority, ahead of all the others. Walt Disney knew that he must put safety ahead of courtesy, the show, and efficiency because if a guest leaves a Disney theme park on a stretcher, there certainly would not be a smile on the guest’s face upon leaving the park (which is what Disney strives for). So, if a character cast member sees an accident occurring while performing for guests, attention is immediately focused on the number one value––safety. Safety is therefore not only espoused as a value on a website but it is instilled in everything done at Disney. Safety is first, and the other values, though they are important, are subordinate when a safety issue arises.
It is my belief that most law firms do not rank their values. When I managed the firm, I knew that we had not done a good job doing so. For example, many law firms primarily bill by the hour. A law firm can legitimately have a value that supports team member satisfaction, including healthy compensation. At the same time, the same law firm may value responsiveness, urgency and exceeding expectations when it comes to client work. Given the standard billing systems, these values may conflict with each other if not prioritized. The failure to prioritize causes confusion as firm members seek to maximize profit, serve clients, and do both professionally and ethically. This is just one example, however based on the many conversations I have had with other lawyer leaders; it is more likely than not that a lack of values prioritization at law firms is common.
Even if a business organization like a law firm prioritizes its stated values, an additional impediment to planning success, mostly unspoken, exists the “super-priority.” Many years past, when I had the pleasure of holding the position of managing partner, I was approached by one of my unsatisfied, now former, partners––one who could always be expected to record the highest number of billable hours but could also be expected to not pitch in when it came to non-billable activities for the betterment of the firm’s future. As we developed a strategy to propel the firm to a sustainable future, much time and expense was spent on non-billable, but nonetheless valuable, activities. Firm leaders recognized and encouraged these activities as important to the future of the organization. I distinctly recall this former partner stating to me that these activities were acceptable in his view so long as he “first achieved his compensation goals.” He then went on to indicate that he expected to be paid a very specific percentage of his collections as base compensation for the following year. My law partners, who have experienced both the satisfaction of achieving mission and vision by living up to agreed-upon values, as well as the real collective and individual financial achievement that comes as a result, look back on the attitude of this former partner and shake their heads in bewilderment. However, I do not believe his attitude is unique. Many firms that espouse values such as the ones I noted above and that are listed on many law firm websites truly prioritize “shareholder value” or “return” over and above all of the values listed. I would never presuppose that it is wrong for a lawyer or law firm to prioritize lawyer, partner, or shareholder value above the other values it prioritizes. It is up to the owners of the firm to decide what they collectively value. What I would state, however, is that it does seem wrong to leave this value off the top of the list if the publicly stated values always take a back seat. Law firm leaders who fail to recognize this as the most important value, when their actions and attitudes prove it is, may fool themselves with their lofty value lists, but I dare say they will not fool either those who work for the firm or those clients for whom they work.
