For all the talk by law firms about collegiality and teamwork, I am constantly amazed at the level of distrust partners display for each other in the day-to-day operation of their firms.  Of all business organizations, law firms have the most clearly defined standards of ethical behavior.  One might conclude that such clearly enunciated ethical expectations would lead to trust among professionals.  Yet, I’m hard pressed to find a business where the owners are less trusting of one another.  This distrust sometimes produces some ridiculous results.  For example, the suspicion of partners that they will be underpaid is not one of the driving features of law firm rewards systems.  Instead, a driving feature of many law firm compensation systems is making sure someone else doesn’t get too much.

I recently worked with a firm that claimed to be completely satisfied with its compensation system.  The system was described as “subjective, but based on statistical performance.”  This turned out to be code for a formula system based on working lawyer collections, but tempered at the extremes for origination and management activity.  The reason we were brought in was to help them tweak the system to provide greater incentives for business origination and teamwork.  While everyone agreed that partners who brought in the business and worked to share it with others needed to be rewarded, there was a fear that if those people received recognition under the compensation system, they would suddenly stop working.  It turned out that most people would risk someone not being underpaid for their efforts so long as there was no risk that they would get more than they deserved.  Acting like lawyers, each partner feared that his or her fellow partners would find a loophole and be unduly rewarded.  This firm had no history of distrustful behavior; no circumstance of anyone being wrongfully enriched under the compensation plan.  It was simple distrust of one’s fellow man at its worst.

In the early 1960’s a psychologist by the name of Douglas McGregor noted two basic theories of management: theory X and theory Y.  Theory X assumes that all people are naturally indolent and seeking to get away with something for which they are not entitled.  Theory Y assumes the reverse — that all people are basically honest and hardworking and, if provided with reasonable expectations of satisfactory performance, they would strive to achieve it.  It probably comes as no shock to learn that law firms are overwhelmingly theory X organizations.

Unfortunately, expecting the worst of people is the stock and trade of lawyers.  While in school, accountants and engineers purposefully work in teams.  They are graded as teams and class ranks are rarely discussed.  The assumption that other members of their team can be trusted is basic to performing their work, and trust is given — unless there is experience that someone can’t be trusted.  Lawyers, on the other hand, are trained to be distrusting.  Law school is internally competitive and, with grading on the curve, a student’s success ensures another’s failure.  Lawyers are taught to be suspicious and cynical — that’s their job.

We have an exercise that we use in helping law firms identify their core values.  Partners are asked to rank the top ten values from a list in terms of their importance to the success of their firm and their enjoyment of their practice.  The most frequently chosen value is “Trust.”  So, if lawyers think that trust is essential for the successful operation of law firms as businesses, but are hardwired to be distrusting, how can managing partners reasonably do their jobs?

Creating a Culture of Trust
In fairness, distrust is not the exclusive province of lawyers.  People as a whole are more distrustful today because they have had more experience with the failure of institutions they have trusted.  From Watergate to Enron to clergy pedophilia, our experience with trust has not, as of late, been positive.  But this only serves to increase the level of distrust in law firms.  The following are some techniques we have seen work with some of our clients.

Create a safety net .  Distrust is often a symptom of lawyers’ professional desire to eliminate elements of risk.  If a firm can offer some form of safety net, even if its practical application is unrealistic, it can help build trust.  For example, some firms that are giving increased authority to practice group leaders find that providing group members the ability to appeal the leader’s decisions to the management committee removes some level of distrust.  Firms that have used such a technique have rarely seen it used, but it permits members of the group to experience the positive results of trust.

Under-promise and deliver.  My colleague and friend, Gerry Riskin talks about the Everest Syndrome in which people with responsibility in law firms make big promises, consistently fail to deliver and are routinely excused.  It builds an expectation that promises will be broken and expected results will be not achieved.  Law firm managing partners love giving their partners good news, so they tend to provide the most optimistic estimates of success, even when they don’t have to.  I know one managing partner who purposely runs any communications to the partnership past her husband before making them for a “reality test.”  He claims to have cut her promises by fifty percent and doubled her success rate.

Make processes transparent.  Lawyers are comforted by understanding the thought process involved in a decision.  Whatever a firm can do to enhance the transparency of decision-making builds trust.  Many firms keep bare bones minutes of partnership meetings, supposedly to maintain minimum discoverability in case of a law suit.  No one likes surprises and everyone wants to feel like an insider.  I know a firm that uses a former journalist who is on its marketing staff to turn the minutes into a readable article that they post on a password-protected, partner-only section of the firm’s intra-net.

Allow choices.  Another trait of good lawyers is the desire to preserve options.  When provided a single course of action, it is the natural tendency to create options.  If management can present partners with optional courses of action it can reduce resistance.  Of course, options involve consequences; therefore, any negative ramifications of the selection of an alternative to the suggested course of action must also be presented.

Don’t rush.  Time pressure increases distrust (“Decide in haste, repent in leisure.”).  Build a timeline that provides an unhurried appearance.  Not all partners, even those with equal levels of distrust, are comfortable making decisions at the same speed.  Be patient but understand that a fatal date must be established early on or some partners will use procrastination to eliminate the risk of accepting a decision.

Create back doors.  Make sure your partners are aware that there is a “Plan B” if a course of action doesn’t work.  Be honest about the likelihood of success and announce a method of correcting the situation if things don’t go as planned.  A firm we worked with had a run of extraordinarily bad experiences with lateral partners.  New partners rarely produced the expected portfolio of business, and the partnership’s distrust of the recruiting committees’ recommendations increased.  The recruiting committee began presenting a percentage estimate of the level of certainty and gave quarterly benchmarks for each lateral candidate.  Part of the proposal was a plan of action if the benchmarks were not reached.

Let’s face it, nothing succeeds like success.  People trust those who have a track record and don’t let them down.  In a managing partner’s tool chest, there is nothing more valuable than a relationship of trust with the partnership that is based on historically fulfilled expectations.  Making sure that occurs should be at the top of the agenda for everyone involved in law firm management.