Does having a "Vision" make more profit?
Does having a “Vision” make more profit?
Are Vision statements a complete waste of time for law firms? What do they actually contribute to the bottom line? Do they have their place in advertising agencies, management consultancies and similar places where fluffy people gather, but not in practical places like law firms?
Certainly law firms are different. Lawyers “own the business, run the business and are the business”. This is underpinned by a cultural legacy of old-fashioned partnership, where all partners sat down together around the boardroom table every morning to open the post and profit was shared equally – or as equally as senior shares would allow.
The ongoing culture is therefore one where all partners expect to be consulted, and where decisions are consensus-based. The sanctions for non-compliance are limited and largely based on peer pressure. There is nothing wrong with this process where the firm is small, the market static and the workforce both loyal and contented. Today, however, this is rarely true.
In a dynamic market decisions need to be taken quickly, firms need to be larger and the market for lateral hires means dissatisfaction has a practical outlet. At more junior levels the culture is also markedly changed. The credit crunch means that the escalator to partnership has become an occasional elevator, and Gen Y’s desire for being valued as people isn’t what a law firm is designed to deliver.
So what? What has this got to do with “the Vision thing?”
Within law firms “Vision” has been debased. It has accrued new-age connotations; vaporous words destined for a website. Vision is seen as part of the brand consultant’s kitbag; used when the marketing team have been let loose on the firm, but quickly consigned to the associated PowerPoint presentation. Instead law firms have used a financial target as a Vision. A goal of 15% revenue increase was sufficient. They took a number and presented it as a Vision/Mission/Strategy melange. In a rising market nobody commented that the King had no clothes on. In a static market this visual trick is not possible. The Vision question needs to be answered, or the partners’ individual preference is as equally valid as any other partners. As the Cheshire cat pointed out, “unless you know where you are going, any direction will do”. So the partners must decide:
“What does a successful firm look like to the partners? Without being allowed to talk about finance numbers – which form part of the results of the Vision - what would be happening in Success & Co? What firms would you be working for? What types of lawyers would you have? Where would you have offices? How many lawyers would you have? How many partners and support staff? How would IT be helping? What would people who work at your firm be saying to others about your firm? “
These are big, wide-open questions that require more than a 30 minute slot on a committee meeting or after lunch at a partners’ conference. Unless this question is asked, answered and agreed it is not possible to create strategy and plans. Fundamental disagreements cannot be papered over by clever wording and all-encompassing sector plans. The Vision is literally fundamental. Strategy is designed to focus resources to achieve the Vision. Plans are how we organised to execute the strategy. The cornerstone is Vision. As Ecclesiastes points out “without vision the people perish”.
Vision is designed to give the long term destination. It is the promised land. How we get there will change, but where we’re going shouldn’t. In a dynamic market the How will change. The Why musn’t, because it’s the reason that we’re working together.
Once the Vision is established a true strategy can be crafted and plans made. Your managing partner can be given a clear mandate and the partners have a reference framework against which to gauge results. They can “be the business” as lawyers, “run the business” with reference to clear goals (including financial ones) and “own the business” by seeing the vision become reality.
So Vision is not for the fluffy people. It’s for firms who see the need to anchor plans into something bigger, something against which the firm’s long term journey can be measured. The firms who understand the need to engage the workforce, not just employ lawyers. The firms who can see ABS, merger or even growth as a means, not an end. The law firms who will succeed.