May 09, 2012 Articles

Transitioning Client Relationships Within a Firm

How do you make sure client relationships are successfully transitioned from one lawyer to the next generation so the firm maintains the client?

By Teresa G. Minor

The lifeblood of any law firm is its clients. A firm can have lawyers with the highest credentials, stellar reputations, and track records of success but without strong, ongoing client relationships, the firm simply will not survive. This truism begs the question: How do you make sure those client relationships are successfully transitioned from one lawyer to the next generation so the firm maintains the client? A few points to consider:

Establish the Right Firm Culture One of the first, and perhaps most important, steps is to make sure your firm culture supports successful client transitions. In other words, make sure the firm has procedures in place to make the experience as positive as possible. All attorneys get anxious when they see their careers winding down. Perhaps they do not want to acknowledge that they are getting older, or perhaps they bristle that the firm is trying to push them out the door. On the other hand, younger partners want to know where they stand in the firm and need to feel that they have an important role with the firm’s clients. A stable transition process can help to allay these concerns. Consider requiring all partners, regardless of status (i.e., equity or non-equity), to draft a transition plan for all of their clients at a certain point. This point can be a specific age or some other milestone. The benefit to this is that no partner can reasonably believe that he or she is being singled out. Moreover, it will help the firm ensure that no clients fall through the cracks. Firms spend lots of resources engaging in succession planning for high-revenue clients, but the reality should be to have a transition plan for every client.

Select the Right Person(s) The decision as to whom the successor will be needs to be a joint decision between the firm and the retiring partner. Factors to consider in making this decision include legal expertise and practice area. Equally important is personality and other subjective factors. Is the successor already known to the client and if so, how does the client perceive the successor? Does the successor have the same hobbies and interests as the client contact? Depending on the situation and the needs of the particular client, it is possible that you may need more than one successor. Do not be afraid to be creative and do not be timid in soliciting input from the client in the appropriate circumstances.

Another pitfall to avoid is having a rigid “one-size-fits-all” succession plan. The firm may need different successors for different situations. For example, if the current relationship partner has a sudden illness or accident and is unable to return to practice, the successor obviously has to be someone who can immediately take the reins. Conversely, if the retiring partner has a sufficient length of time to bring along his or her successor, another lawyer who is still developing in his or her practice might be the right choice.

Consider Diversity Often, if the retiring partner—who is generally a white male—is permitted to make the decision on his own, his default will be to select someone like himself, another white male. Yet, most clients today embrace diversity in the workplace, and some clients may even insist during discussions regarding transition planning that a woman or a minority be named in the successor role. Make sure equal consideration is given to all partners who are qualified to assume the successor role.

Begin the Transition Early Once the successor has been identified, immediately begin to slowly integrate the successor into the legal work and any important client meetings. In addition, the successor should be included in any social functions or other outings with the client. Ideally, there should be a significant period of time for the successor to develop his or her own relationship with the client and to create his or her own successful track record of performance. This time also can be used by the retiring partner to observe the dynamics between the successor and the client to make certain that the right person has been selected. If friction exists, perhaps the selection of the successor needs to be revisited.

Provide Motivation and Structure It is vital that both the retiring partner and the successor work together and present a united front to the client. The transition will be in jeopardy and the likelihood of the client leaving the firm will increase if the retiring partner and the successor are at odds. One thing that might cause anxiety is concern by the retiring partner that his or her compensation will be adversely affected by transitioning clients. In fact, this anxiety could cause the partner to hold on more tightly and exclude the successor. Consider dealing with this anxiety by offering financial incentives to the retiring partner for reaching different transition goals. Similarly, the successor can be provided some type of financial protection during the transition if he or she demonstrates that certain goals in the transition process have been met.

Plan for Client Transitions As every law firm must plan for the transition of client relationships from one lawyer to the next, it is likewise necessary to plan for transitions in the client contact role. Today’s decision maker for legal services may not be the same person next year or five years down the road. Spend as much time learning about the client’s succession plans as you do on the law firm’s succession plans. Does the client have any upcoming retirements in key positions? Is there any reorganization or restructuring planned? The answers to these questions will have a tangible impact on who should be selected as the successor to the client relationship and how the transition process should be carried out.

Above all, do not delay and stay flexible so you can address the changes that are certain to come.

Keywords: woman advocate, litigation, law firm, transition, client relationship, succession planning