If a partner wants a quick guide to how well a lawyer
is doing, she will look at his chargeable hours.
- Q. Is this a fair measure? A. Not
always.
- Q. Is it a quick and easy guide? A. Yes.
But what if that same partner wants to understand the
contribution her HR department is making, or perhaps the success of her marketing
team.
- Q. What's the "quick and dirty"
equivalent to chargeable hours that can be applied to these support
teams? A. ???? (It's difficult, isn't it?)
The fact that there's no easy answer is perhaps one of
the reasons that law firms are willing to cut support jobs in tough times,
without a corresponding reduction in responsibilities. Since the firm has
never had a clear measure of the success of the team, it's hard to produce
metrics that will convince the firm of the folly of redundancies.
Measuring Professionals
Professionals dislike being measured, and will cite
examples of the police force, teachers and the NHS as examples of places where
a target culture has become counter-productive. There is, however, a fine line
to be drawn between accountability via performance indicators & being
measured by specific goals.
For example, "staff turnover" could
be a useful measure of HR performance, but if it is a goal to keep it below 10%
we could end up keeping people we should have let go. A good marketing
indicator could be "% revenue from clients for whom we have worked for less than 24 months", but if this
becomes a goal we could be sacrificing supporting existing clients in favour of
bringing in new ones. Yet we do need some hard numbers for assessment.
The HR response
The HR & trg team's dilemma has been addressed by many
authors - three on my shelf are "Running Training Like a Business
",
"The HR Scorecard
" & "The Human Resources Scorecard
"
In the corporate world there has been a protracted battle for HR to be seen as
"strategic", and to get a place at the "top table".
Marketing's response
The marketing challenge has had less of an airing. This is because in the corporate world the link between marketing and revenues (which we can measure) is hard-wired
into most corporate cultures. There may be battles between marketing and
sales, and even marketing and operations, but the link between their activity and
revenue is not really questioned.
In a professional services firm - particularly law
firms, where there is a heavy emphasis of service over product, the linkage
between marketing and revenue is less clear. Partners get in the way. The
sales force own the business, and routinely remove the linkage between
marketing and revenue. Marketing are therefore forced to measure either
the completion of internally-driven projects (websites, brochures,
client-service interviews) or rely on internal perceptions ("Do we think
marketing are doing a good job?"). Usually a combination of the
two. Since the partner perception measure is almost entirely subjective, marketing’s
scorecard often relies upon the managing partner's personal view of the
marketing team. Once this relationship is strained there are few hard measures
to fall back on to justify the team's rationale.
A Possible Solution
In a professional services firm, therefore, both
HR and marketing have a similar challenge. How can we establish a fair basis for making a quick assessment.? For
without any agreed output measures, how can any performance be assessed?
There are 2 stages recommended:.
Agree the internal performance indicators that you as a team should be
using. They need to be balanced, so that you can answer "yes"
to the question "If these were the only results that we achieved as a
team this year, could we say that we have been successful?" There are
usually 6-8 performance indicators, usually a mix of soft and hard measures.
The second stage requires you to answer the question. "Which 3 of
these performance indicators are so crucial to our role, that it would be reasonable
for partners to form an initial judgement on them? " No 3 indicators
will be fair and complete measures, and if you go to 4 it wouldn't be disastrous.
The aim, however, is to provide a quick metric for partners, and enable you to
argue how reductions in your team will affect these goals. These metrics would
be published regularly (monthly?), and form the basis for performance reviews.
The resulting indicators will be far from perfect, but so are chargeable hours for lawyers. At least these measures are a fairer metric than whether the managing partner - and perhaps a few other senior people - like you or not.
In 2007 Tim Morris of Said Business School, Oxford University set out his research into "Developing New Practices: recipes for success." as a chapter in a book entitled "Managing the Modern Law Firm" (See Foot of Blog for details).
In researching forty examples of new practice development (50% of which failed), he identified the 3 ingredients that were always present in successful practice development:
Defensible Turf.
- Successful new practices removed barriers to acceptance of the new practice especially by key stakeholders
- Successful new practices used external sources, such as powerful clients, to legitimise the new activity
- Successful new practices used internal sources of persuasion to in order to carve out autonomous territory
Differentiated Expertise. Successful new practices displayed a body of knowledge that is both distinctive and shared an approach to structuring client work that was commonly understood within the firm. This depended upon the market conditions, and can be achieved by:
- Lateral hires.
- developing existing people, or
- grouping together existing resources geographically
Organisational Support. Successful new practices were offered both intangible and tangible support like:
- Trained associates
- Cross-selling the new practice by partners with long-standing clients relationships
- Political sponsorship
- "Breathing space" from normal client pressures,
Application to a Lateral Hire's Failure
Laterals are often brought in to a new practice development scenario. A typical hiring rationale would be:
- Turf. They will bring powerful clients, which will give credibility presence in this market.
- Expertise. They bring a new angle as an adjunct to our existing work, one where we can see real growth possibilities.
- Support. We have under-utilised associates who can provide initial support, and long-standing clients who could benefit from this service.
When the partner arrives, the scenario unwinds:
- Turf - Key clients don't come, or workload is far below expectations. Partner needs to be "fed" work by existing partners, who begin to resent the work not going to long-standing colleagues
- Expertise - Existing partners, failing to see a large client base or large projects, begin to believe that the expertise base wasn't perhaps that different to their own, and they could offer it themselves. The autonomous territory begins to be undermined.
- Support - Long-standing partners have reservations about cross-selling, partners question the laterals' ability, and budgets come under scrutiny. Pressure begins to fold the practice into an existing one. The lateral questions their own ability and security, and their own internal persuasive powers dissipate.
The three ingredients are distinct, yet intertwined. Turf relies on confidence, which comes from both belief in the expertise/distinctiveness of the budding department and support from the firm's big-hitters. Without a solid start, underpinned by existing clients who quickly give new instructions, a lateral is immediately at the top of the downward slide, whatever the warm words given by a firm's management committee.
Most partners are not good at giving feedback. If they were, this
is what an upfront partner would tell you that he or she is looking for in a junior lawyer:
- Honesty.
If you've screwed up, I need to be the first to know. If you say
something is true, it must be true. We all make mistakes - I did when I
was your age and I am not immune today. The problem is not making a
mistake, it is failing to acknowledge and learn from it.
- Time recording.
It's not your job to decide if someone should pay for what you've spent
your time on. I need to know how long things take, or else I can't work
out profitability.
- Curiosity. If you don't ask,
you won't know. So ask me how the work assigned fits into the wider
client brief. Ask me why things are structured the way they are. And
keep current with world and business affairs so you can ask good
questions, not just legal ones.
- Attitude. I need you
to learn how to do new things. You need to be pro-active. What area do
you need to develop in most? Find work that stretches you in these
areas, and get feedback on your efforts. I may also ask you do boring
mundane stuff - that's life when you're junior (and even when you're
not so junior). Do it cheerfully. Then the next time some interesting
work comes through, you will be top of the list.
- Attention to detail.
You can get a First Class Honours with 70% right. I expect 100%. It's
what you're supposed to be good at, so if it's not your natural
preference, you need to spend more time on it.
- Ability to listen to instructions.
When I give you a piece of work, and tell you what to do, I expect it
to be done the way I said. Ask if you don't understand something. But
make sure you are asking the right questions. Take the time to think it
through for yourself as far as you can, then ask about the bits you
really don't get.
- Tenacity. When I'm busy I can appear
distracted, off-hand or even rude. Sorry. But that's life. Get over it,
smile, and get back to work.
By the way, apart from
time recording, these are the same qualities that the client looks for
in a partner. So it's worth developing them now.
10 years ago, bandwidth of internal servers was considered the biggest barrier to widespread use of e-learning. The era was characterised by bespoke Learning Management Systems, with the e-learning consultancy ranks bolstered in 2000 by legions of Year2000 consultants who needed to redeployed once the anticipated digital meltdown failed to arrive.
But when technology both increased available bandwidth and decreased the digital resources required, there was still not a huge take-up. With the exception of discrete mandatory topics such as money laundering, the suites of digital courses are left largely untapped. The more senior the audience, the less the appetite.
Why?
1. Online learning is often billed as the opportunity to learn in your own time. Since a lawyer's office time is fully committed, it is a product designed for a different clientèle.
2. Online learning has no commitment associated with it. Nobody knows that you were intending to complete the online module, so it's easy to put it off.
3. Online learning is rubbish for skills training. It can cover the associated processes (delegation for example), but without the associated skills it is akin to teaching cricket without a bat or ball.
4. Online learning does not allow peer learning. However bespoke a module is (and few are), lawyers gain as much from discussing issues with fellow students as they do from material presented.
So What?
There is still a clear business case for leveraging
face-to-face trainer time by front-loading knowledge acquisition. At the junior level, where knowledge-rich, frequently-run programmes (new-joiner for example) lend themselves to online-transfer it might be possible to dispense with face-to-face entirely.
In an ideal world, however, training would be blended; lawyers undertaking pre-session reading, online learning of processes and perhaps a pre-session quiz to confirm understanding. In the real world, some do, most don't, and the subsequent session has to cater for the resultant knowledge levels, frustrating all camps.
If we can find a way of increasing this compliance with pre-course work, the savings could be considerable. It is possible. One head of learning and development pointed out that she has no difficulty in getting partners to prepare for case studies when Ashish Nanda is coming.
The only reason that you are offered partnership within a firm is to increase profit per equity partner.
That's the only reason.
Existing partners will therefore ask questions such as:
- How long will it take for your client base to grow to meet PEP expectations? (this year? three years hence?)
- Do you have the personal qualities that will make this more likely (team player, plays well with others etc)
- How will your current client base can grow, develop and link with others' to bring in the money
- If you're not offered partnership:
- Would you leave?
- How much work would go with you?
- How much work that we currently do would be affected, and for how long?
...And would profits go down?
This doesn't mean that the firm is just focused on PEP. The law firm is a business, however, whose duty to the shareholders (the equity partners) is to maximise profits.
The best way to do this is to create satified clients (Peter Ducker's Definition of the aim a Business). Profit is the way we keep the score.