Many law firms’ strategies to increase revenues and strengthen practice areas are dependent upon a program of laterals. For some firms, the strategy is incredibly successful in its ability to provide work for under-performing lawyers and rapidly increase capability in targeted practice areas. Unfortunately, for a large number of law firms, the lateral hiring strategy [...]
It is amazing that the legal media continues to actively discuss whether lateral hiring is a good idea. The gist of the argument appears to be that law firms seeking to expand their revenue base or enter a new practice area have no real alternative but to actively seek lawyers with portable business to join [...]
As one result of the cost-cutting that law firms pursued in response to the recession, many firms have filled a number of their managerial and administrative functions with partners discharging those functions on either a part- or full-time basis. If nothing else, it raises some interesting compensation issues for the equity partners who now serve [...]
Some law firms are consistently less successful than their peers. In any industry, success is typically more a comparison with peers than an objective standard. Of course, there are all sorts of definitions of success and one would assume that the comparisons would be with the most successful firms fitting their definition. But, we consistently [...]
A lawyer recently said to me, “If I found out that I only had two days left to live, I’d want to spend it at my law firm’s partner retreat. It’s always the longest 48 hours of my life.” Unfortunately law firms spend hundreds of thousands of dollars on retreats that many partners find to [...]
Performance problems are difficult. Dealing with under-performing partners, associates who are not meeting the firm’s standards, or people who are “culturally challenged” is awkward, embarrassing, unprofessional and messy. It is often easier to look the other way and ignore the problem with the hope that it will somehow go away – the law firm equivalent [...]
An increasing number of law firm leaders find themselves functioning as full-time managers. Unfortunately, in doing so, they may be getting themselves too far from the action to recognize changes in the capabilities their clients are expecting from their lawyers. Worse, managing partners may have lost an accurate assessment of their own partners’ actual capabilities. [...]
For the past decade, law firms have taken the easy way out with personnel decisions. To avoid making hard choices and delivering uncomfortable messages, U.S. law firms have gone on a staffing spree with non-equity partner positions. As a result, firms find themselves massively overstaffed at the partner level. While there are no quick fixes [...]
Law firm leaders often describe running a law firm as being like “herding cats” because lawyers are so fiercely independent. Despite being accustomed to operating in a structured legal environment, for some reason lawyers seem to take pleasure in rebelling against organizational rules and procedures. Yet, a few firms seem to be able to enforce [...]
Most law firms have great difficulty implementing change or enforcing any form of rules or discipline among their partners. Even trying to get lawyers to get their time in and their bills out is a battle that management frequently loses. In fact, the problem is often as much with a firm’s leadership as it is [...]
It’s a shame that we tend to make New Year’s resolutions on January 1st. For law firm managing partners, this time of year is so busy with closing the books and compensation meetings that we barely have time to focus on anything beyond what went right and wrong in 2010. Let me give you a [...]
The recession brought about some rapid changes for law firms, most of which involved temporary cost cutting. Then, almost as if the cost cutting exercise was designed to simply demonstrate what was possible, firms began returning to their free spending ways. It makes one wonder how much could be added to partner earnings if law [...]
One of the interesting features of managing large professional partnerships in the United States is that, apart from the tax code, there are no standards for financial reporting. This flexibility can be a powerful tool for law firm managing partners and I suspect 2009 was a banner year for the careful management of financial statistics [...]
While there are continuing differences between compensation practices between U.S. and Canadian firms, and law firms in the rest of the world, findings from the latest Kerma Partners’ survey reveal that global harmonization of performance and compensation management may be more likely than ever. The basis and process used to compensate partners is becoming increasingly [...]
A simple question: should a law firm design its business model to best serve the clients it already has or should it select a business model and then go out and find clients who benefit from it? It’s sort of the old “chicken and egg” question because one can argue either side. Since it is [...]
As the global economy moves toward an eventual recovery, there will be some huge opportunities for law firms, as well as some minefields. How firms deal with these issues may determine their short and long term success. There are all sorts of possible scenarios but the five issues discussed below certainly appear to be the [...]
Communication Problems in Law Firms It does not much help that in good times and bad there are some significant structural barriers to good communication, even in firms that try hard to be transparent and open in their information sharing. The use (or misuse) of email, and stilted discussions at formal meetings become a poor [...]
The economic downturn has caused many businesses to reconsider the viability of their strategic direction. This is especially true for law firms that primarily deal with business clients and are impacted by both the global decline in business transactions and clients’ overall desire to reduce costs by using less legal services. For many law firms, [...]
Technology is a huge part of all of our lives. One common feature of almost every technological gadget we own is that when it hiccups, the first thing we have to do is hit the reset button. Whether it’s an iPhone, Windows Vista, or your TV cable box, it seems the answer to every problem [...]
Occasionally firms are presented with a unique opportunity to attract a senior in-house lawyer or governmental official as a lateral partner. If such a person becomes successful, the rewards to the firm can be staggering. But the failure rate of lawyers who intend to build a practice from scratch, regardless of their credentials, is high. [...]
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