The typical law firm business model and lawyer hubris often stymie effective succession planning.
Not that long ago, there was a plethora of articles and consultants focused on succession planning for law firms. You couldn’t attend a legal conference without seeing numerous presentations by well-heeled so-called experts on the subject. Of late, though, the craze seems to have died down. Propose a presentation on the issue now, and you probably won’t be invited to speak. It will be met with heh….old topic, already covered.
That’s why I was surprised to hear Laura Leopard, founder, and CEO of the consulting firm Leopard Solutions, being interviewed on the podcast, The Geek in Review, on just this subject. I must admit; I almost didn’t listen because I thought the topic had been beaten to death, and because I thought it had nothing to do with tech or innovation.
But after listening, I concluded just the opposite. Leopard talked about the results of a Study conducted by her company on the quality and existence of succession plans in law firms. The result: unfortunately, the prevalence of comprehensive succession planning in law firms is relatively low. In fact, succession planning in many law firms, by and large, doesn’t exist.
Ok, so what. Old lawyers hanging on to power. What else is new? But this failure reflects what is so wrong about our profession. A profession too often controlled by lawyer hubris and self-interest. A business model designed to not only permit self-interest and a focus on the here and now but encourages it.
Leadership of Long-Term Institutions Should Make Room for Others, Right?
Years ago, I was on the board of a nonprofit with several hundred members. At one particular meeting, we spent hours lamenting the need for more involvement of many members in leadership and the work of the organization. The prevailing view was that the ingrates don’t care. That the new generation is all about themselves. They are too lazy. The same people always have to do the work, or it won’t get done.
After all the griping, we turned to the next agenda item: our upcoming fundraiser and who would staff the various booths. The most popular booth was, as you might guess, the beer booth. When I suggested that we give someone different a chance at running the booth, I was immediately shouted down. Joe has always run that booth. We can’t take it away from him. We don’t do things like that here.
So much for making room for others.
The point is if you want future leadership and member participation in an organization, you have to make room for others to be involved and lead. I see all too often people in leadership roles in all sorts of organizations hanging on for 25 or more years. They simply like being a leader and don’t want to give it up. But that doesn’t help the organization. That doesn’t get the next generation of leaders ready. It doesn’t encourage others to participate.
Law Firms Are Even Worse
It’s essential to recognize the broader implications this attitude holds for the legal profession. This is a reminder of how professional dynamics, characterized by a focus on the present and individual achievements, can sometimes hinder the nurturing of future leaders.
When you turn to law firms, this phenomenon is even more pronounced. Why? Leopard opines that one reason is that older lawyers see the younger lawyers as lazy and not willing to sacrifice like the older layers did. Ergo, the young lawyers aren’t qualified to lead, and the older ones must stay in place “to protect the firm.”
Since when have most lawyers been interested in their firms as an institution?
Please. Since when have most lawyers been interested in their firms as an institution? Most law firms’ business model isn’t built for that. In most firms, profits are divided up at the end of the year. There’s rarely any investment in those profits in the future. For many lawyers, it’s all about getting what you can now.
Clout and riches in law firms depend on origination credit. In too many firms, origination credit rules are designed to aid those who have origination and help them keep it. When profits are divided up at the end of every year based chiefly on origination, why would I want someone to take over a role with my files and clients? It could mean less origination credit at the end of the year for me.
Keep in mind that partner competition in most law firms is a zero-sum game. When one person gets a more significant percentage of the profit, another party has to get less. In that kind of environment, it’s easy to conclude that there’s not much future in long-range planning.
Origination credit in most firms also determines leadership. And clout and leadership in law firms means a lot. Who gets what. Who keeps what. Who gets the best office. Who has the best perks. Who gets marketing dollars to wine and dine clients.
The model breeds a lack of interest in long-range planning. It’s all about here and now. This year. My credits. My clout. My clients. And when I’m gone? Who cares.
There’s something else at play. It’s all about ego. Years ago, I knew of a managing partner who decided to retire early. He had no interest in helping the firm transition. He made it known that he was sure that without him leading it, the firm would simply fold. Of course, to his dismay, the firm didn’t.
But many lawyers have that same attitude about themselves. They think they are indispensable. That no one else can do what they do. You see this in an unwillingness to change how they do things or adopt new technology: their attitude is that may work for others but not for me. My practice is unique. I am a special snowflake.
Special snowflakes believe no one else is as valuable as they are. They can’t make room for others to serve their clients because the clients would not be served. And where compensation and clout hinge on a zero-sum game, it’s all that harder to give up responsibility.
It’s easy to see why lots of lawyers regard their law firms as a glorified office-sharing arrangement
Put all this together, and it’s easy to see why lots of lawyers regard their law firms as a glorified office-sharing arrangement. Instead of an institution that will exist long after they are gone.
It’s not that we have beaten the topic of succession planning to death. It’s that too few are motivated to change. Or at least few in leadership are. And these attitudes are emblematic of many problems with our profession today. Problems from abysmally low diversity to a lack of interest in efficiencies and clients’ best interests.
What About the Future?
Leopard thinks that, for various reasons, law firms are at an inflection point. She firmly believes firms will have to change to survive, attract the talent they need, and meet client demands. And that change in attitude will affect succession planning. It will generate a willingness of lawyers to embrace or at least engage in long-range planning.
I’m not so sure. Lots of law firms have ignored succession planning for years and survived. That’s partly due to the ingenuity of lawyers and the hunter mentality of a few lawyers. Let’s face it, the eat-what-you-kill mentality still exists when it comes to competition in many law firms. Want to make more money in a law firm and have more clout? Get more business. The more entrepreneurial lawyers understand this and take advantage of it. As they age up, they develop their own book of business. And the book of business of older lawyers gradually shrinks as clients and their goals and directions change. So the cycle begins anew.
Yes, some firms are better at long-range and succession planning. But it’s hard to effect change across the profession as long as law firms are managed in a consensus system, with lawyers having the biggest origination having the most clout. Especially these days when a dissatisfied lawyer with a big book of business can simply pull up stakes and move to another firm. And make no mistake, there are plenty of firms that will accommodate lawyers with significant books of business.
This is why we haven’t seen more emphasis on succession planning in most law firms. And perhaps sadly, why we never will.