Tag Archives: Lawyer

So you’re an equity partner – big deal!

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Last week I was given a business card by a lawyer I was talking to. On the card, underneath their name, was written “Equity Partner” in a fairly bold, not-to-be-missed font.

Tony showed the proof of his "Legal Jedi Master" card to the managing partner more in hope than expectation

It struck me, that were I ever to hit those heights in a law firm (I bailed out of private practice before putting those magic words in my email signature) I’d probably be pretty pleased with myself. And rightly so. It’s a position many people strive for and certainly for those in the upper tiers of the legal world, can be very lucrative and rewarding.

The title marks you out as an owner of the business and as a result conveys a certain status within the firm which undoubtedly provides very practical assistance in getting things done quickly through the firm’s support infrastructure.

But, the question that troubled me was the message that the title communicates to someone outside the firm.
I posed the question on Twitter, and got some fascinating comments back.

“adds pomposity and confuses clients”

“I think it’s wrong. Many clients don’t know what it means, in the real world.”

“It’s a badge of seniority but non-lawyer clients might not know what it means. Also = unlikely to do much of your actual work.”

” It would make me think, “Ah, so you’re the reason for my large bill” ”

The theme that stood out strongly for me was the internally-focused nature of the title.

Of course for fellow lawyers in private practice, and for in-house lawyers, the title and connotations will be understood. However, aside from the fact that there a huge number of purchasers and influencers who may not know what it really means, I wonder if there is an opportunity lost in not using a job title that is more aligned with the lawyer’s actual role.

There are a number of ways that could be approached. For a start, as I’ve discussed before, a market strategy that is structured around a client’s vertical industry sector is quite common. Would reference to specialism in a vertical sector as well as a practice area (or even instead of…) make sense? What about an alternative based on a description of the relationship with the client, so for example separating out relationship managers (I know the “s” word is maybe a step too far), technical specialists, project leads etc. For large scale project work this delineation of responsibility could also add credibility to the project management ethos espoused by many of the top firms.

Another driver that could force to revisit job titles is the changing career structures that have been emerging over the past five years or so. Many firms now have a senior designation for those lawyers who want to stay with the firm long term, but do not want the additional commitments (time, financial or management) that go with partnership. As the next generation of lawyers move through the ranks with their different cultural approach to work, life and career, will the old hierarchical, largely tenure-based titles still prove effective?

Perhaps the biggest opportunity for fresh thinking in this area (at least here in the UK) comes from the influx of new competitors into the market when the winds of deregulation blow through the profession over the coming months. Much has been written about the potential impact on law firms serving consumers, but make no mistake change is afoot in the world of commercial law too.

Aside from further consolidation, which I believe will be driven globally as well as in response to our own market conditions, the emergence of the LPO model and flexible resourcing models such as those from Axiom or BLP‘s lawyers on demand, will challenge incumbent firms to revisit their business models. This will invariably have implications for resources and career paths, and presents the perfect opportunity to revisit job titles.

While it may seem trivial, job titles do usually matter both to the holder, and in some contexts, to clients and prospects. A new entry to the law firm market will have the chance to think about this afresh, not restricted by history or tradition.
My sense is that these organisations will not default to titles like “Assistant”, “Associate” or “Equity Partner” and in using something a bit bolder and more relevant, will be able to send a signal to the market, both to potential clients and potential employees!

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Why timesheets rule but chargeable hours suck

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There was something deliciously ironic about me trying some new time recording software this week. It’s many years after I left life as a private practice lawyer but I can still remember that huge sense of freedom at escaping the tyranny of the timesheet. The feeling of being able to work on what mattered most and be judged on results rather than be measured purely on how much time I had spent working on client matters was incredibly liberating.

The IT director proudly unveiled the firm's latest timerecording application - robust, wireless and mobile, it represented the future of the firm's management information system

Subsequent conversations with other in-house lawyers validated that I was not alone in those feelings.

After I moved in-house a huge number of conversations with peers included the words  “….. and no-more timesheets”, with knowing glances being directed at any private practice lawyer in the room.

But within a few years, I was voluntarily tracking my time as an inhouse lawyer. Admittedly at the time it was a pretty crude mechanism – I tracked data in hour long blocks in an Excel spreadsheet over a period of months, but it did the job.

I’d been inspired to do this after reading Drucker’s book “The Effective Executive” (well worth a read) in which he makes the point that an individual can’t maximise their effectiveness unless they know where they spend their time.

In practice what it meant was that I could have much more informed discussions with my major stakeholders around how best to allocate my time to achieve organisational objectives. It allowed sensible and transparent choices to be made around different priorities (if I support this deal and this HR project, the position paper on IPR ownership will need to wait until next quarter, or we’ll need to resource things differently) which I believe kept me more aligned with the company and led to some very productive conversations.

On the other side of the fence, I’ve written a fair bit around what I believe the problems with charging by the hour are, not least the impact this has on the firms as well as how it affects the client relationship. My mind often turns to a partner I know who runs a management consultancy business, who almost immediately on taking over the department abolished time-based billing. Profitability increased along with client satisfaction and employee retention.

However, to my mind there’s a critical distinction between tracking time and charging purely based upon time. The most obvious point is that as knowledge workers, typically the cost of labour is one of the largest components of the cost of providing a legal service. Without knowing what the cost is, running a profitable firm (file, project,team, department etc) is nigh on impossible.

It’s also important to understand cost in other areas too. Law firms often talk about the challenges of calculating return on investment for marketing events such as seminars and events, but when looking at how business development budgets are prioritised and spent, much of the focus is just on the hard cash being spent on venues and collateral, rather than the cost of the people involved in preparing and administering the event.

For example, having a top partner at a City law firm prepare for, attend and follow-up at a seminar overseas which takes him or her out of the office for a couple of days is a significant cost which can be accurately measured but is often overlooked.

The other non-chargeable area that it’s important to track is product development. As law firms begin to think more about efficiency and identify some more standard, repeatable services (some firms have been doing this for years) which are nicely packaged for clients at a set price, they usually “get” the idea that the service becomes increasingly profitable as volume of sales increase. The documents needed for the service are all ready and the people involved get quicker and more skilled at providing the service as they get more experienced. But often any upfront development cost in creating the service (market research, pilot projects, legal research, designing template documents) is lost because it is recorded under a general non-chargeable code. This makes comparing the return on investment for the project challenging and without an idea of these sort of development costs for previous legal products, makes forecasting and budgeting for future product development more difficult.

So back to my current quest. I was inspired to revisit this after reading tweet from a contact saying he was trying a web-based package called timerescue. This was a million miles away from the clunky, manual time recording systems I’d used in law firms (when I first started practice it was a paper timesheet pad) – running in the background and capturing application use, automatically learning behaviour and applying tags. All in all, a fairly sophisticated tool, with some nice web-based analytics to use to understand the data.

However, while I’m a big user of many cloud services, I wasn’t entirely comfortable with sending some of this data (document names, email titles) to a company I knew little about, so after a very short trial, I binned it. I then installed a similar piece of software locally, called Manictime. I liked this a lot, but it led to stability issues, so now I’m back to a more traditional system called Grindstone2.

The application is, of course, irrelevant other than it needs to be quick and easy to use, and provide the data in a format that’s useful.

The key point I wanted to make is that while the market may be (thankfully) steadily moving away from time-based billing, there is much to be said for the discipline of recording your time.

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The International Man Of Mystery?

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Are you the law’s international man of mystery? The answer to the prayers of corporate counsel in global companies? Can you leap jurisdictions with a single bound? Effortlessly unravel the tangle of law, culture and procedure? Wrap your arms around a wriggling mass of seemingly conflicting regulations, and fearlessly work with them to make compliance a reality?

Toby, the firm's anti-trust specialist, was convinced he'd got the right look for the international project kick off meeting

No?

Well don’t worry, you’re not alone.

Conversations with in-house counsel about the difficulties supporting business overseas often have familiar themes (more on this later), but what’s becoming clear is that these challenges are becoming more acute.

Whether it’s the sheer volume of international business increases, the interest in emerging markets continuing to heighten as western markets stagnate or become saturated, or technology adoption increasing the ability to communicate effectively across the world, more and more in-house lawyers are being asked to operate in jurisdictions which are often way outside their comfort zones.

Bear in mind also, that many of the challenges described below might be experienced by those in a law firm that is supporting an inhouse client with an overseas project (and this applies even with a global firm working cross-office) almost to the same degree as an in-house lawyer.

The problems start with the ability to quickly identify what the relevant issues are. It may be that you have an idea of what they are – the big headline-grabbers like anti-trust, employee issues and anti-corruption legislation are obvious examples. However, it may be that there are a bunch of the infamous “unknown unknowns” which  might be substantive law, but they might also be difficulties around the legal process or simply understanding the legal system.

Some of them you might be able to get an overview from research or asking the right people, but others will require hands-on experience of the situation you are facing.

Which leads on to the next step in the journey – selecting and managing local counsel.

Given that the problems above (not knowing what the key issues might be) immediately cause difficulty in having productive, early-stage conversations with business colleagues, it’s not surprising that they can also make the relationship with local external counsel much more difficult to manage.

The first challenge is finding the right lawyers for the matter in hand. Existing contacts, referrals from trusted sources and directories (online, paper) are often the first port of call, but even then the answer might not be the right one.

When I was inhouse I had difficulties both with specific offices of global firms (delivering anything but a consistent global service) and local firms that were recommended at a firm level, but who had individuals that weren’t up to scratch.

The next step is of course instructing the local counsel, which is understandably more difficult than using external lawyers in your own jurisdiction. Lacking an understanding of the key issues means giving a tightly defined project scope is difficult, which has a knock-on impact on costs and timescales.

There may also be softer factors at play, ranging from the more obvious such as language and cultural barriers (“what do you mean he’s out for lunch and won’t be back for three hours, we close the deal this afternoon!”) to those that are more difficult to put your finger on such as differing views of risk and mismatched service expectations.

For multi-jurisdictional projects, this is the point at which project management skills come into play. Assuming those skills exist (which is not always the case), invariably the international element to a transaction adds a bigger administrative overhead to the project, and critically for the business, lengthens timescales.

Which leads nicely on to billing.

It’s horrible.

Managing billing on an international project, particularly one in multiple jurisdictions, is invariably a nightmare which would warrant its own post. I’ve found the best strategy is to close my eyes and wish really (really) hard that all the bills arrive in the right currency, on time and for the agreed (or a reasonable) amount. Admittedly it didn’t work that often.

So, there we are. A post full of problems this week. There are mitigating strategies at almost ever stage of course – getting contacts on the ground (folks in the business can be a mine of useful information) is a great start, as is developing your own network of trusted advisors in major jurisdictions. Getting a baseline understanding of different international cultures helps (have a look at Riding the Waves of Culture: Understanding Cultural Diversity in Business) as does up-front conversations about expectations on both sides of the table.

However, my point was really that as a profession, we need to crack this. To efficiently serve clients, whether internal or external, in a global business environment, we need to provide a seamless service. It’s difficult, but not insurmountable – don’t you think?

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Beware – Psycho Lawyers!

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One of the defining characteristics of a psychopath is apparently a lack of empathy. Now I’m not saying all lawyers are psychos (although I’ve certainly met some I wouldn’t want to meet in a dark alley!), or even that lawyers lack empathy, but I’ve got an interesting idea for you to play with, that might just improve your practice.

Alongside the obligatory Mt Blanc pen, Howard the senior litigation partner often brought a more unusual accessory to meetings

In the world of marketing, many of the leading professionals have long been creating “buyer personas”. The idea of a buyer personas is to create a model of a typical buyer in a market segment, and by making this model increasingly granular, the organisation creating the buyer persona can get a much deeper understanding of the clients in these segments.

So why is this important?

I’ve talked before about the tendency of many law firms to be quite introspective, and as a result they often focus much of their energy on their own firm and what they are doing, rather than externally on the marketplace (clients and competitors). With the marketplace becoming increasingly competitive, it’s a good time to really start thinking about clients and what they need, to ensure you protect the ones you currently serve, and are in with the best chance of winning new ones.

This is where the empathy comes in.

To share the love, you need to understand what your client needs.

The starting point is to create one or more buyer personas for your target market. Let’s say for example you are a large, National law firm and you are developing a campaign to target new clients in the technology sector (because as I’ve written before, many law firms segment their markets by vertical). You may have done some further segmentation analysis, and decided that your resources and experience best match up with the IT security software sub-sector, and in particular those companies who have a turnover of between £50m and £500m and are headquartered in the UK.

To create the buyer persona, I always suggest starting with a name for the persona to personalise the experience. At a very practical level, if a team is doing this exercise, the name makes the persona sticky, and people will often refer to him or her long after the exercise is concluded.

So, let’s say that our buyer from one of these software companies is Hilary, the general counsel. By answering key questions about this fictional (but typical) buyer, we build the persona. For example:

  • How old is she?
  • How long has she been practising law?
  • What technical areas of law does she know best?
  • How long has she worked at the company?
  • Where does she live?
  • What’s her family situation?

Ideally, if you are profiling a buyer from a segment that already buys your services, then these answers should be grounded in reality, and based on the experience you have with similar clients.

Once you have the buyer persona, it’s time to show some empathy.

Now it’s time for empathy mapping…..

This is a technique I’d seen before, but was reminded of by the awesome book Gamestorming (Brown, Gray and Macanufo). I revisited it last week with some colleagues as we did some empathy mapping around a particular segment of in-house lawyers.

Start by drawing a quick picture (don’t worry, it needn’t be the Mona Lisa) of the buyer persona on a flip chart, and label them with their name and job title. Then divide the white space into five.

Label the spaces: Thinking, feeling, seeing, hearing and doing.

This is the creative part, which if done correctly, can generate some really powerful insight into buyer behaviour.

Pick one of the categories – for example “thinking”. Ask yourself what the buyer persona will be thinking on a day to day basis? What’s taking up their head space in work? What are they dwelling on when they travel home in the evening?  What’s the first work-related thing that they think of in a morning?

It’s a great way to collaborate, particularly if you get members from different teams within a firm to participate. For example the corporate partner might assume that the buyer is 100% consumed by the M&A activity the company has just engaged with, yet the competition partner may offer the fact that recent activity in the industry suggests that the board may have some real concerns that need to be addressed as a matter of priority. The business development director may volunteer some insights based on recent pitches, and perhaps an associate from the commercial team might suggest that actually the GC is worried about how the hours she is putting in managing the day to day team activity are harming her family life.

As the ideas emerge, note key words and phrases on the flip chart, and then move round the other sections. The exercise needn’t take long – 30 minutes is plenty to get quite a rich picture built up, although building up a number of more detailed profiles can easily take a day.

Once the empathy map has been completed, the contributors should have a much greater understanding of buyer needs in their chosen sector, and can begin to consider what this means for their firm, its services and the way in which they interact with existing and prospective clients.

Most importantly though, it’s potentially a very small amount of time to invest, but forces the lawyers to focus on what matters most – the client.

If you like the sound of the exercise, why not try it out in your next team meeting? You can read a bit more on the gamestorming blog.

If you suggest it and one of your colleagues objects, perhaps check their desk drawer for sharp objects next time you are working late…..

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What’s your career ROI (return on investment)?

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A couple of interesting articles on the Careerist recently about law schools and their responsibility to law students. In particular there is a debate about the responsibility schools have to accept students (and their fees) when, in the current climate, job prospects can be slim.

Paying back the law school fees was never easy

Here in the UK, there is another dynamic that has come into play. With the advent of a serious hike in tuition fees, particularly at the top-end universities (that will undoubtedly attract a high percentage of aspiring lawyers), I think it is time to take another look at the cost of entering the profession, and see whether the end justifies the outlay.

The corporate world has shown me the value of pulling together a business case for any serious capital expenditure – the sums might not turn out to be 100% accurate, but the discipline of going through the process forces you to ask some sensible questions and can stop you wasting serious money.

But aside from my current struggles with the Spousal Budget Approval Committee (required in my house for gadget purchases), this rigour rarely makes an appearance in home life.

But should it?

While fees this side of the Atlantic remain below those in the U.S. a three year law degree will soon cost just shy of £30,000, with a year at law school costing £10,000, plus living costs, gives an overall investment of well North of £50,000.

In my book, that’s certainly the sort of money I’d want to stop and think about before spending.

In assessing the value of the education, there are many more factors than simply the straight forward ROI (return on investment), but the basic maths can’t be ignored. If you assume that you are going to come out and join a solid City firm, then chances are you’re on a salary of around £35,000, shifting to say £55,000 when you qualify two years later.

The traditional City law firm career sees salary then increasing every year (subject of course to the economy) with bonuses and perks thrown in, suggesting that it may take a while, but the debt for the not-insubstantial investment will be paid off in relatively short order (subject to any extravagant lifestyle choices!) and the investment then moves into the black and produces serious returns in the long term, especially if partnership in a profitable firm is achieved.

There is of course a “but”. These projections of profitability and a solid, predictable career path, a very much based on some assumptions about the legal market place. Assumptions which have been challenged over the last few years. Profitability at many firms has tanked and the annual salary rise was predicated not just on nice fat profit margins, but on a rise in the price of the lawyer based on higher levels of PQE (post-qualification experience). But if the hourly rate model is dying, and firms can no longer simply hike up fees because a lawyer has another year of experience (and arguably, it’s time served, rather than actual meaningful experience), then where does the annual rise come from? More chargeable hours anyone? In the efficiency-focussed law firm of the future, that might not be an option either.

Speaking of chargeable hours, the lifestyle is also something to factor into your decision. Lawyers in the firms that pay serious money work hard. Really hard. If you’re driven, motivated and enjoy the job, that might not be a problem. But while when my generation (qualified late 1990s) expected to clock serious hours in pursuit of partnership, conversations I’ve had with many partners these days suggest the current generation of trainees and newly qualified lawyers have very different expectations of work/life balance, which can lead to some firing the ejector seat early.

If that’s the case, then the return on investment is not looking quite so straightforward.

For time immemorial there has also been the question of what happens to those who don’t make it. Every year there are plenty who make the financial commitment, and either don’t make it through, or do get the qualifications and can’t find a training contract. Clearly this is particularly relevant in the current environment. If things take a while to pick up, and the graduates haven’t managed to build other experience and contacts in the meantime, then there is a real risk they’ll be passed over for fresher blood when the economy picks up again. Another situation when the initial investment is not looking so sound.

On the positive side, there are other ways of making a return which don’t involve the long game of partnership. As a lawyer, you’ll build up some great transferable skills. Because the profession can be quite insular, it can often be difficult for lawyers to identify these, but trust me, they are there and they are valued in many different arenas (one of the books I found most useful in assessing my skills when looking to career change 10 years after I qualified was “what colour is your parachute“). That said, it’s through the practice of law you will build these skills, rather than the academic training, so I don’t think it’s a question of a law degree opening a huge variety of doors, but in the medium term, other options become available.

Finally, the profession is changing. Big time. This will have implications for all of us in the profession, both the grey hair and the young blood. Given these changes, it also adds another angle to consider when assessing the law as a career. Some may see it as risky, others may see a wealth of opportunity. Much like any other investment, your tolerance for risk will play a part in your decisions, and is just one more component to factor in.

So, no answers, but hopefully some things to think about for both aspiring lawyers and any current or former lawyers feeling reflective. If you’ve just started on the path, I wish you all the best!

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Are lawyers impossible to coach?

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Having been in the corporate world for the majority of the last seven years, I’ve been exposed to some great examples of coaching to improve individual and team performance. I’ve seen first-hand how a twice-a-year coaching index that operates as part of the performance management system really works (read it hits your pay packet!) and how coaching training for all managers benefits not just their teams, but also themselves.

 

The partners of Crevice & Co were slightly disappointed that the executive coach they were promised was not what they expected

But in law firms, I’ve yet to see the coaching culture really take hold, despite the fact that there is a wealth of research from the corporate world that the benefits are significant and measurable, not just in terms of employee performance, but also in the areas of employee engagement, motivation and retention. In the war for legal talent, that must count for something.

So why is this? Why don’t lawyers coach each other?

The most obvious reason is that they’ve not been taught to do it. While in most larger firms, there has, over the past twenty years or so, been an increasing recognition of the need for management and leadership training, in many cases this training (of which coaching could be an important component) is much less extensive than in other businesses, often because the individuals continue to be revenue producing assets first, and managers second (often termed the “producer/manager dilemma” in management theory).

Perhaps a further reason is that there is confusion over what coaching actually is, and it is often confused with mentoring. In fact, the non-directive nature of true coaching, where the answers come from the client rather than the coach, is a great fir for lawyers who often don’t like to be given advice (for the reasons for this, including their training and common characteristics, see my most popular post in “You are wrong, I am right”).

Another explanation is that it might be that spending time coaching colleagues (as opposed to formal supervision or training) doesn’t get much credit in the eyes of the tyrannical god of chargeable hours, who still rules most law firms with a rod of iron.

But I came across another idea recently that hadn’t crossed my mind. Maybe it’s that the best lawyers love their work too much…..

I know – you’re thinking of the City partner working a 75 hour week, but let me explain.

I was reading a blog recently from Nick Mayhew, who heads up the management consultancy team at a firm of accountants. Many of Nick’s consulting engagements include some form of executive coaching for the senior management teams, and I was intrigued by his thoughts on why high-flyers are hard to coach.

Nick kindly gave me permission to quote from his post, so have a think about this:

“Common barriers affecting high flyers include fear of action, poor decision making and beliefs that do not support success. However, each of these is relatively easy to spot and there are good ways to work on them to get an impact.

Perhaps the hardest barrier to deal with is loving work too much. Here,  positive intentions collide and the appearance of success in every area distracts the executive from realising there is an even greater potential to reach.

What this means in practice is that personal success combines with a highly positive attitude leading the executive to focus only on what is achieved rather than what is not achieved (but could be with a different approach).

Who in the business is constantly challenging the executive to act with the greatest impact and focus?

Who is forcing them to take a step back and stay focused on a simple list of his or her greatest strengths?”

Now this really struck a chord with me for two reasons. Firstly, lawyers are often serial achievers, not least because the entry requirements for the profession typically require a high level of academic success before the would-be lawyer gets exposed to his first statutes and case law. The status of the profession (be it perceived or real!) reinforces this, and then to reach managerial level in the tough world of the modern law firm is another milestone to be ticked off. So the idea of high achievers concentrating on the success that they have achieved, rather than reflecting on what they could achieve really resonated with me.

Hell, I’ve done it.

More than once.

Secondly, the importance of peer challenge for senior lawyers interests me. Once a partner reaches the echelons of a firm, if the numbers are good, who will challenge that person and stretch them, both for the good of the individual and for the good of the firm?Arguably the firm management may do so if the person is acting in a way that is not consistent with overall goals, or being seen to underperform, but if it’s a question of ensuring a senior lawyer reaches their potential, that’s a different story.

So many possible reasons, but what’s the truth?

I suspect there’s no single answer, but I hope it gets you thinking. If you’ve not experienced coaching, take the time out to find out a bit more about it, even if it’s not part of the firm culture. I’ve certainly benefited from it, and if you’re a high achieving law firm partner who loves your job, maybe you could too…..

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The Specialist Generalist

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Participating in a panel event for in-house lawyers last week, I was struck by the versatility of the corporate counsel that were taking part.

 

Keen to demonstrate the depth of her specialism, Lisa the construction partner parked her new car carefully at the front of the firm car park

 

In-house lawyers are so much more accessible to their clients than lawyers in law firms, and this, coupled with the incredible range of business (and personal!) questions that can come across their desk in a day’s work, really does highlight the ability to answer a broad range of questions.  While larger in-house legal teams of course have specialists (employment law, M&A etc.) I suspect that even these lawyers  get called on to advise outside their niche more often than their private practice counterparts.

So the question that sprung to mind, was if many corporate counsel need generalist skills, what does this mean for their relationships with their advisors, particularly given most large law firms start lawyer specialisation so early in their careers?

Building on my observation that the variety and accessibility of in-house positions, and taking into account that many in-house lawyers have built up a degree of experience before they move into an organisation, it’s likely that generalist skills can be found in abundance in the legal team. Is it therefore the case that when corporate counsel instruct external lawyers, they are doing so because they need specialist advice? Given the pace of change and breadth of the law these days, particularly if the business is operating internationally, at first glance this would seem sensible, because no lawyer (however good) could hope to keep up-to-date across the board.

My instinct however is that there are no hard and fast rules here, as the client’s needs will  vary on the situation. Some clients will need specialist advice because they don’t have the skills in-house (or perhaps they do, but they don’t have the bandwidth to deal with the particular matter). Others may want a generalist “replica” of an in-house lawyer who can simply add capacity to the in-house team and interface directly with the business people. Some may just pick up the phone and “phone a friend”, and care less about who actually does the resulting work.

The choice of external counsel is however heightened on high-stakes matters. Does the client choose a top-drawer “name” specialist, ranked in directories from here to Timbuktu, or do they go for a more seasoned “trusted advisor” type who may require specialist support from elsewhere around the firm, but can provide much wider support around things like  stakeholder management and communication?

Personally, I believe both types of lawyer can add tremendous value and have their place. I do wonder though, to what extent the “trusted advisor” role will change as the next generation of senior lawyers are those who have spent their entire careers advising on fairly narrow areas of law.

One final observation I have is that there are relatively few true industry specialists. In reality, a specialist technology sector lawyer is really a specialist IT lawyer; a specialist entertainment lawyer maybe a licensing expert. Perhaps this is the way that the “trusted advisor” role could develop. Lawyers who have deep industry experience, acting for many different clients (perhaps at different stages of an industry value chain) in the sector, with this knowledge meaning that they advise on many different areas of law in addition to their core specialism.

So, why not take a look at who else your clients instruct? Are you the only firm or team in the game, or is there a panel (formal or informal)? Who, if anyone, gets the generalist work? Is specialisation getting you the instructions and clients you want? Can you do a gap analysis to show the skills & experience that you have compared to the profile you would like to develop?

And finally, what would you do if you were in-house and the C.E.O. walked into your office needing immediate advice on how he could save his dog, Beefcake, from the legal consequences of taking a bite out of the postman…..

The price is right?

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For a number of reasons, I’ve been thinking about price a lot this week.

The head of the dispute resolution team was unconvinced his business development director had got the price right on this bid

Firstly, the Holden Group’s excellent newsletter plopped through my virtual letter box with a leader on righting the wrongs of panic pricing. Next the Harvard Business Review had a very thought provoking article on adaptive pricing strategies, and finally, I went to an internal workshop with one of our group pricing specialists (looking at the link between product strategy and pricing).

Much is written about the death of the hourly rate and the new pricing models emerging in the legal profession, but there seems to be less material about the “why”, which to my mind is an important step before the “how”.

In the past, much law firm pricing often didn’t go much beyond volume based discount: If you spend £X (thousand/million – delete depending on size of account) with the firm in a year, we will discount our hourly rates by Y%.

The rationale presumably included a desire to make the pricing appear more competitive, to encourage a higher spend by the client, and to make the client feel “valued” (in reality of course, this strategy doesn’t do much to connect the firm’s activity to value delivered to the client at all, but that’s a subject for another post).

With law firm clients becoming more savvy purchasers these days, this type of model is likely to be met with questions about additional discounts for single sourcing, requests for further discounts coming from efficiency gains, and discussion about how the firm will provide an optimal team structure and resourcing model.

Now while it easy to find fault with what is a fairly unsophisticated model of discounts on hourly rates, I spoke to a general counsel of a listed company last year, who proudly told me how with one of his regular advisors, he regularly negotiates 50% discounts on his bills.

The idea of a notional discount (whether volume based or otherwise) clearly appealed to him, and he seemed genuinely surprised when I suggested that the law firm might be anticipating this conversation and factoring this into their pricing. I also made the point that negotiating bills every month might not be the best use of either his time or the partner at the (very well known!) law firm, but I began to wonder if he secretly enjoyed the process and the little victories it brought (I know, I know, I’m no Sigmund Freud).

When it comes to pricing strategies, the other other “old favourite” of the law firm tender is the “we’ll buy the work” approach – the idea that the firm will price very low (often at or even below cost) to win a significant piece of work, and then develop a relationship with a client which will allow the firm to secure an ongoing stream of more profitable work.

While of course penetration pricing is a proven strategy in plenty of other markets, my concern here is that many law firms don’t back this approach with the rigor needed to execute it successfully. Firstly, the scope of the project is often underestimated leading to higher costs than anticipated. Secondly, the price is set by reference to a figure that the law firm believes is needed to win the work. Rather than being based on real competitive intelligence, or with reference to a database of market prices, it is often just “gut feel” or based on informal signals from the client as to what will be needed. I’m a big believer in intuition in the right context (Blink by Malcolm Gladwell is well worth a read) but with a pricing decision, it should be one of many factors taken into account, rather than the only factor.

The post has meandered a little this week, but the key takeaway is before you start to build a pricing model, spend a few minutes to work out what you are trying to achieve. With that in mind you can then build a model that works, hopefully for you and the client, meaning that, as the game show says, everyone’s a winner…..

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Can you quit your job?

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I got an email from Linkedin last week, letting me know that 80+ people in my network had changed jobs last year. Now aside from the fact I love these type of analytics, the email made me stop and pause for a number of reasons, not least because I myself shifted jobs.

The revolving door at Thatchwick & Partners saw lots of action last year

The trend that most intrigued me when I looked more closely at the email, was that although lawyers are undoubtedly the biggest single group of contacts I have (having worked in the profession for almost 15 years), they represented a relatively small proportion of the 80 or so people that changed job.

Why is that?

I then started to mull over why people leave jobs and why they stay.

I’d love to find some attrition statistics for the legal profession, and find out if there is less mobility than within comparable industries.

Around ten years ago, I recall there was a huge demand for mid-qualified associates (with around 5 years of experience) because this group had been the target of much of the cost-cutting that had been a feature of the previous economic downturn. As the market picked up (particularly in corporate, driven by the dotcom boom) it seemed that wages shot upwards and opportunities for lawyers in this category were plentiful.

There was much talk about how the traditional law firm model of working your way up from trainee to partner was on its way out, and the market would never be the same again. Much has been said and written about the erosion of loyalty in the workplace and the changing nature of the “psychological contract” between employer and employee generally, and although lacking hard data, I’m sure lawyers do move around far more than they used to which seems to me to be following a basic social trend in the Western world.

But is this all relative? Compared to other industries, is the legal workforce still pretty stable?

It strikes me that there could be some sensible reasons why this might be the case. Firstly the partnership model, while constantly evolving, still maintains some fundamental differences from a corporate structure. With the owners of the business able to dictate who joins “the club”, assessing potential candidates in the workplace over a sustained period of time offers the partners a way of ensuring the culture and profitability of the firm are maintained, and provides an incentive for the senior assistants to stay at the firm.

If the assistant knows they are on the partnership track, the associated rewards (be that higher remuneration, the ability to have a say in decisions, or simple status and prestige) may provide a powerful incentive to see the process through. Moving firm could simply be a passport to start that process again, but at an earlier stage.

Moving also involves risks for all concerned. The lawyer may move firm and find the grass is not always greener and not settle in the new firm. The firm might find that a new lawyer is competent, but just doesn’t fit with the culture or values of the firm. While it is certainly an oversimplification to say that lawyers are risk averse, there’s no doubt that lawyers are often immersed in risk assessment and management (of a sort) as part of their job, and decisions like career changes will undoubtedly be well thought through before being finalised.

The other angle that I wondered about, was the degree to which specialisation in large law firms works against job mobility. My own personal experience (particularly the move from private practice to in-house) made me see how the transferable skills that lawyers develop can be used effectively in many different ways in a commercial environment.

However, in private practice, the trend to specialisation usually starts right after qualification (if not during the training contract) and I can certainly understand the reason for this. If for example you are an employment lawyer, the law is so broad and so fast moving, I for one would certainly have struggled to keep at the cutting edge of a practice if I was also trying to keep abreast of changes in other areas of law (like IT/IP for example).

A consequence of this is of course that when a lawyer has been doing one type of work for five years or more, they will tend to define themselves as a particular type of lawyer (rather than look at their skills and competencies) and look for similar roles. This doesn’t cause a problem if the lawyer is happy doing this type of job (and of course many have very fulfilling careers in a single specialism), but if not, I suspect it does hamper job mobility.

The credit crunch has led to firms showing much more flexibility in retraining staff to help retain and manage their workforces, which given the cost of recruitment and the investment in training lawyers, is understandable.  It will be interesting to see if this shift has any long term impact on lawyers moving firms – perhaps working in different areas will open up new career avenues for lawyers, both inside and outside their current workplace.

With the profession facing real change from deregulation, commoditsation and globalisation, law firms are going to change and new competitors will emerge. As a consequence, new legal roles will emerge and perhaps some existing ones will change or disappear.

For what it’s worth, I think that for most organisations, getting the right balance of stable, trusted employees, and new blood with new ideas is challenging. Too much of either causes problems. Mobility within a firm can help provide flexibility here, but will be more difficult for some organisations than others.

From an individual’s perspective, I’ve always taken the view that a person’s career is their own responsibility, and it is for them to find the roles that will both satisfy and grow them.

So with that in mind, what do you think you will be doing next year?

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You are wrong. I am right.

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I read a great book recently called “The World Cafe; Shaping The Future Through Conversations That Matter” (by Brown and Isaacs). It’s all about a new form of dialogue that allows people to access a group’s collective intelligence, and was a fascinating read. If it all sounds a bit woolly, the principles are all heavily grounded in research and case studies, and I plan to try the approach out soon, and will let you know how I get on.

Andrew smiled at the World Cafe, safe in the knowledge he was absolutely, hundred percent, right

Anyway, one of the points that really made me stop and think was a passage around people fighting to prove they are right, and in particular pointing out that you may well win the argument, but in doing so, what has been the cost?

This seemed to resonate with me in my capacity as (former!) lawyer. It might be a stereotype, but lord knows lawyers do like to prove themselves right. Maybe it’s the type of people who are attracted to the law, maybe it’s the training and experiences that lawyers have, but if you put five lawyers in a room, I bet at least two of the five would argue black was white if the other three had already asserted that white was, in fact, white.

I started to think about this from two different angles. Firstly, developing the ideas in the book around the impact on relationships and individuals resulting from a dogmatic and “robust” approach to an argument. How many people have notionally “lost” an argument, and then (a) sat and simmered, wishing ill on the victor; and (b) not been convinced that they were in fact wrong anyway?

Given the turbulent nature of the legal market today, there are of course an increasing number of challenges that law firms and lawyers face, and if many of these end up in arguments and disagreements, what does this do to the web of relationships that underpins the organisation (which are of course critical in a knowledge-based organisation), as well as the morale and energy of those working there?

Often when a person expresses a point of view, if it is attacked, they will dig their heels in and defend their position more passionately, rather than take on board an alternative perspective.

Many of the classic negotiating texts (like “Getting to Yes“) are based on ways round this problem, and there is a heap of  research from the psychology of influence that can help explain this (Cialdini is one of my favourite authors here) – in essence society likes people to behave predictably. As a result many countries encourage people to behave consistently, and consequently once a point of view is stated, people will fight to defend it (and appear consistent) rather than change their mind.

This brings me on to my second stream of consciousness, which is based on a lot of Edward De Bono’s work around how people think in Western society. He aims a lot of criticism around our preference for “socratic argument”, where a selection between two competing ideas is made through knocking down the opposing viewpoint, rather than constructively exploring the issue and looking for alternatives.

In a law firm, where colleagues are often competing for resources, would it be possible to examine these challenges more collaboratively, or is that niave?

What if the disagreement is with a client? Or another team? Is the issue resolved with one party “right” and the other “wrong”? The dynamic is undoubtedly different from being across a negotiating table, but often the behaviour is very similar, and not everyone is a collaborative negotiator.

When working as an in-house counsel, when problems arose I was much less interested in pointing fingers, and more interested in sorting out the consequences quickly and effectively, working out how the problem arose (the framework in the book “Difficult Conversations” calls this assessing “contribution”) and then making sure we (collectively) avoided a re-run. I found this productive, and the external counsel took a similar problem-solving approach to drive a deeper relationship and more effective service delivery. I don’t pretend it was perfect, but I do believe it was an improvement on the blame game, even though I didn’t get as many opportunities to demonstrate I was right (which of course I was!).

I hope that has provoked some thinking and would be interested in any comments you may have. Please note however, that if you express a different opinion to me, you will be wrong and I will be right………

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