In the fast and easy world of email communication (where over 80% of us consider email to be critical to our success and productivity and how most of us communicate) it is sometimes tempting to respond to an annoying partner or manager communication with a quick-fire email. Most of us have fallen into this trap.

Like horse’s hooves, partnerships have to deal with different conditions throughout a year. There is a well-known equestrian saying: ‘no foot, no horse‘ which means keep the hooves in order or you don’t have a fit, usable mount.

No foot, no horse – like horses’ hooves, partnerships need maintenance and the fundamental building blocks for success need to be carefully thought through and put in place. One of these is clear performance and contribution criteria.

Similarly, successful law firm partnerships need to get the basics in order and thereafter ensure that they are functioning well. It still surprises me how many firms adopt a fairly laissez faire approach to these things and don’t address some of the basics around key partnership functions. In some cases I suspect it is simply that leadership do not wish to ruffle partner feathers and so allow some of them to slip into the ‘too hard for now’ basket. In other cases the firm is doing well so some of these essentials fall off the radar.

One of these is setting partnership performance criteria. When asked to advise firms on performance and growth one of the first things I ask to see is the criteria or key performance indicators (‘KPIs’) that the partnership uses to guide, encourage and measure partner behaviour, thinking, contributions and performance.

Frequently there isn’t one or it is a hotch-potch of half finished lists which have never been fully debated, agreed and not implemented or communicated in any meaningful way. In other cases, there is a list, but that is all there is. Partners do not react to lists of things to do – it takes a lot more. Sometimes new partners come into a partnership blissfully unaware of their existence. As a result performance and contributions can be variable and overall, not delivering what the firm is after.

What then are some considerations to bear in mind when putting together performance criteria or KPIs?

  • ideally these criteria should not be determined in isolation, but in the context of the firm’s core purpose (vision, values, cultural attributes), strategy and guiding principles. This stands to reason as the criteria should be one of the key ways in which the vision and strategy is achieved;
  • you need to get all partners involved in the debate. Communicate and explain. Ask them for input. Encourage their involvement and thinking. Make a genuine effort to do this. Get to the bottom of what truly makes the partnership tick. Done well, you will find a number of the criteria and other strategic key objectives for the partnership drop out of this process. It will also be owned by the partners which will make implementation that much more effective;
  • you are going to come across some opposition, some of it very subtle, but if you don’t anticipate it and are not prepared it can undo all your good efforts;
  • you usually only get one good shot at this – make it count by getting it right first time – if necessary get experienced external counsel, especially to deal with any ‘curved ball’ queries you may encounter in meetings;
  • be patient. Introducing such processes means a lot of change for a lot of partners and thus can cause fear and demotivation;
  • don’t however be patient at the price of inaction or unnecessary vacillation and delay. It is important to commence the process and maintain momentum. Partners need to know leadership is determined to see this through to a successful conclusion for the long term benefit of the partnership. This is everything;
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As a law firm leader one of your best returns on investment can come from appointing the right support services manager. A good manager can easily make a partner-like contribution or more to a firm. They do need to be the right calibre, the right fit and possess good levels of emotional intelligence and initiative. They also need support from firm leadership – mentoring, an interest taken in them personally and professionally, responsibility, authority and accountability.

Most of us probably assume the managers we recruit are honest – however, a new report shows an alarmingly high percentage might embellish their attributes to get themselves recruited. The worry is, picking this, and will it stop there? (iPad graphic by Sharon Larkan 2012 ©)

One thing I always assumed was that people filling such roles would be honest, especially as they had often been through other law firms. I never doubted it. Maybe this view was a bit naive! The findings of a recent research report point to a startlingly high percentage of Australian managers who are apt to embellish their resumes and talk up past work experience.

SHL, a global talent assessment solutions consultancy, reported in a recent Australian Law Management Journal article, found that nearly 40% (24% in New Zealand) will lie on their resumes and are 3 times more likely to lie about their qualifications than other workers. The areas that are most often faked are work experience, referees, earnings and qualifications.  The key findings relevant to law firm leaders are:

  • 39 per cent of managers have lied on their resume
  • 18 per cent of managers made up or exaggerated their work experience
  • 13 per cent of managers changed information about how much they earned at their last job
  • 10 per cent of managers made up references
  • 18 per cent of managers lied about their age.

Obviously this is a wake-up call to everyone who employs senior managers. If they are prepared to be dishonest about something as obvious as their personal achievements and attributes, with a real risk this could be found out, what else are they going to fabricate during the course of their employment? Also, this is tricky from a practical perspective – how do you test for honesty?

What are some things we can do to protect ourselves?
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Despite the attractive laid-back hippy, flower power and surfing cultures which were around when I was young, our fairly conservative coastal-rural upbringing meant we thought more or less everything there was to learn would come through our parents. As one ‘matured’ one was tempted to think the youth of today had it easier and was not as committed or hard working as we were and so on. Then there was all the grumbling about ‘Gen X’, ‘Y’ and more recently, ‘Z’ and how each group supposedly expected different kinds of special treatment. Fortunately this talk seems to have died down.

Nearing the final day of a gruelling 1300km charity cycle ride for the two young men, James Larkan and Steve Richards – in two rides in two years they raised A$80 000 for Youth Focus, a charity dedicated to helping young people struggling with depression and potential suicide in Western Australia

I found this thinking changing for me as my own three children grew into young adulthood and as I took on managing partner roles in law firms and witnessed the talented, hard-working, articulate, confident young kids coming through our interview processes. More and more I found myself thinking the opposite was true – we had as much if not more to learn and admire from ‘them’ as they ever did from ‘us’. In fact, since then, I have never stopped learning from observing them.

30km headwinds on the penultimate day, after 7 days in the saddle, proved tough-going!

A recent example, very close to home, brought this firmly back to me. My son James, busy with final year university in Perth, West Australia and a full-day part-time job running a warehouse, joined his best mate Steve Richards in tackling a 1300 km cycle ride from Exmouth to Perth over 8 days to raise funds for the Youth Focus charity which counsels and support kids struggling with depression and potential suicide. This backed up on their 600km mountain bike ride along the famous Munda Biddi mountain bike trail the year before from the south western corner of West Australia to Perth, also over about 8 days. They raised $80000 doing these two rides. Tragically Steve lost his brother Mark to suicide 3 years ago and the rides were dedicated to Mark.  A nice touch was that James’ two sisters, Kerry and Jess, also quietly weighed in and supported the boys, organising a very successful raffle and contributing and arranging some fantastic prizes for it.

Steve’s Mum, Anne, former Australian squash representative, who with her amazing Mum, Pat, and partner Dave, remarkable people all, spent every minute of every day with the boys, said it best when the boys arrived in Perth:

I’m not going to say too much today, most of you have read the couple of updates I sent so I think you can visualise a little of the picture of this amazing journey. There have been so many stories within stories during this trip, just too many to talk about today and nearly all these stories are touching or emotional in some way.
The boys passed through some amazing countryside – the Pinnacles desert-scapes near Cervantes

It is a huge relief for me to have Steve and James here safely today!

I think I need to keep it simple. This all began because Mark died. He was living in incredible pain and took his own life, exactly three years ago today at about 7.30 tonight. It is a day to celebrate but to me, to Steve, our family and everyone who knew Mark it is terribly sad, we lost someone special.
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It is always fascinating to hear partners talk about firm finances – usually it involves a focus on fee income, very selected expenses and 100% equity partner profit. The expense focus usually hones in on areas where they feel management is wasting money, maybe on marketing, the library, IT or support staff.

Not managing the utilisation of your fee earners, or having individual partners do this, is akin to burning a pile of dollars when you open the office each morning.(Sean Larkan graphic © 2012)

Mysteriously, there is seldom mention of the firm’s biggest opportunity cost, and one which individual partners directly control – the cost incurred by not fully utilising one of the largest recurring expenses in any law firm – the direct and indirect cost of fee earners. Remember when considering this expense item that you are not just looking at direct staff costs but also overhead costs associated with that expense.

A quick rough and ready calculation brings home the seriousness of the issue! For instance one partner with 3 lawyers (say earning $100k p.a.each and whose overhead allocation is say $110k p.a. each) utilised on average to a level of 75%, will be burning nearly $160k p.a. It is even more if one also takes into a account the opportunity cost of the fees they would otherwise have earned.

It is the one expense item which all partners should be responsible for managing, almost to the exclusion of all else on the financial side. Many decades ago David Maister highlighted the importance of this variable in his well-known profit formula (Profit per Equity Partner=margin x rate x utilisation x leverage) including utilisation as a key variable.

Again and again I come across firms who are bemoaning one or more rising expenses (including payments to external consultants!) or firms which have undertaken wide-spread analyses of expenses, sometimes with the help of their financial advisers, but seldom given proper attention to this crucial item. If there is, it is merely listed and no real steps are put in place to manage it and get results around it.
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My wife and I bought a small farm three years ago. As the grazing was leased out to a beef farmer the quality of the boundary fencing was paramount. The lady we purchased from told me up-front (and has reminded me ever since!) – ‘now Sean, remember to walk your fence-lines‘.  She was essentially saying check them regularly for breaks, leaning or weak posts, or other issues, but also to see what was really going on around the farm – ‘you never know what you may pick up‘.

This advice reminded me of my days helping to run large law firms – I happened to enjoy walking around, at least weekly, talking to staff and partners in various sections of the firm – apart from being enjoyable, it was amazing how much one picked up and could convey in those informal interactions.

Remember to walk the fence-lines of your firm – talking to partners and staff – you will pick up on issues, identify achievements and be showing an interest in those who make the wheels go round (Sean Larkan image ©: Austral Eden region, NSW)

I did notice though as I got busy, or we had to deal with one or other crisis, this practice somehow seemed to slip into the background, priority-wise. Sometimes too, one may be tied up with a merger – ‘important stuff‘, and it always got priority. It always took time to get back to the walking around ritual, each time reminding myself – ‘can’t let that drift’.

I had this message brought home to me again last week when the editor from the publisher of my upcoming book on law firm branding arranged a new time-table for me. I had fallen behind my schedule – she said with my consent she would ‘walk my fence-line’ i.e. keep closer tabs on me. What a nice way to say ‘listen, I am keeping an eye on you – time to start delivering‘!

There are a number of benefits flowing from walking the fence-line:
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You can be the brightest spark in the office but if people can never get hold of you, or after they do you take ages to respond or are simply unreliable, no-one is ever sure you will do the job, professionally you are going to do yourself in.

Nothing beats being accessible, responsive and reliable. You can be the sharpest tool in the workshop, but if you can't be found, don't respond well when used or don't do the job you are called on to do, people will eventually tire of using you. The same applies to professionals. (Sean Larkan image - Old Dairy Gerringong - ©2012)
Nothing beats being accessible, responsive and reliable. You can be the sharpest tool in the shed, but if you can't be found, don't respond well when used or don't do the job you are called on to do, people will eventually tire of using you. The same applies to professionals. (Sean Larkan image – Old Dairy Gerringong – ©2012)

I know of one professional who is highly sought after due to his niche practice and ability. As a consequence he is very busy and time-poor. So busy in fact that he has an automated message responding to his emails, always, saying ‘sorry tied up doing x, y or z. Your enquiry is important, I will revert etc’ – unfortunately, you usually don’t get a response from him, not even later. You soon get the message, his work is more important than your enquiry or message. He has made himself inaccessible, is unresponsive and in your mind will probably not be reliable to deal with. In fact he also appears to be discourteous.

On the other hand we all know professionals who are busier than most, but who still manage to be remarkably accessible, courteous, responsive and reliable – some come to mind for me – Michael Katz, chairman of Edward Nathan Sonnenbergs, Rob Otty, Managing Director of Norton Rose RSA, Jordan Furlong my partner in Edge International, Giam Swiegers, National CEO of Deloitte, Australia, John Poulsen managing partner of Squire Sanders (formerly Minter Ellison, Perth), Roger Collins Chairman of Grant Thornton Australia and Derek Colenbrander CEO of CareFlight Australia.

One of the most enjoyable responsibilities I had as a former managing partner of large firms was to do a short introductory talk to new recently-joined lawyers. The discussion, which we tried to make interactive, commenced by asking what they felt they would need to do or be to succeed in a large firm environment. As one would expect coming from the brightest law school graduates, the responses were varied and fascinating. However, not many picked up on these seemingly obvious attributes: accessibility, responsiveness and reliability. It was possible to emphasise these, providing examples, without names, of lawyers who did not have the best university pass or who were not regarded as the best technical lawyers in their practice area, but who rose to greatness and built substantial practices, at least in part due to these characteristics. I also emphasised that a big part of their early success would depend on their courtesy to staff, mainly support staff.

Your personal brand:
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Partner boards, chairpersons or managing partners can be heard to grumble quietly that their senior non-partner GM, CEO or COO are struggling to realise their potential, and do not seem to be able to make headway with the partners, particularly on tricky issues. They go on to hint that it may be a failing on the part of the manager. They can’t understand this as ‘he/she is such a good person‘.

Managing partners who complain that their GMs, CEOs or COOs are not making headway with the partners should first look in the mirror before looking out the window to find the solution. It is often to do with the support they are or not providing. (Sean Larkan image 2012 ©)

I remember back to when I was first appointed a senior manager of a large corporate law firm. I was in my early 30s, new to the city, the ‘big smoke’, new to the firm and had a great deal to learn about both leadership and management. The senior partner/chairman invited me to put on hobnailed boots and “knock them into shape“. I quickly appraised him that this simply would not happen; I had a lot to learn and had to earn the trust and respect of the partner group. I did say that with his and the board’s guidance and support I would have a fair chance of achieving that.

I was fortunate. The support was there, there was plenty of space to move in, to experiment and even make some mistakes. In the end it seemed to work out quite well. Looking back, I realise that any early success achieved was due largely to the support I got and the trust put in me by the senior partner and the board. This is crucial.

Some will not agree with this approach – they will feel that senior managers need to ‘stand up and be counted‘ and should be expected to cope on their own. This is short-sighted; partnerships are tricky entities and partners themselves can be a handful. It takes a lot more than this. It is not so much a case of providing a crutch or making up for inadequacies, but senior leaders need to truly support these roles and the incumbents and make it very clear that they do.

Most law firms of 10 partners and more have learned the benefit of appointing specialist managers to lead and manage support service portfolios. Many firms have also taken the next leap and appointed senior GM’s, CEOs or COOs to oversee all support functions. Many of these are highly experienced, talented people.

Why then do we still hear managing partners and chairs of firms complaining that their manager is not coping, cannot deal with certain issues or that when the going gets tough, the partners simply ignore him or her. It is often suggested that this is ‘because they are not a partner‘ i.e. one of us. It is invariably subtly or directly asserted that it is the manager who is not coping or adjusting. This is particularly the case where it happens to be an internal appointment.

On the contrary, the real issue is that the chair, managing partner or board have not vested the senior manager with requisite authority and not openly and strongly supported them to succeed. It is at this time that they need to look in the mirror for the solution and not out the window. It takes time to get used to these roles, and it is imperative that they get this support. Of course it is a given that the GM/CEO/COO have the credentials, and through their personal demeanour, also earn trust and respect.

What are some of the things a managing partner, chair and board can do to ensure the GM/CEO/COO role succeeds?

So far we have considered some 18 leadership lessons from Steve Jobs from Parts ONE, TWO and THREE of this series and how they may be relevant for legal leaders – all based on the Walter Isaacson article it the HBR. There are some things however I wouldn’t recommned for legal leaders.

He was feisty, scary, tough on people, very often unreasonable and downright rude – people at Apple didn't want to get in the lift with him! But he did have another side. . . . . ..

So what are the personal style and leadership characteristics of Jobs one would not recommend for legal leaders?

  1. being more about me than about you
  2. not caring about others’ feelings
  3. aggression and anger openly used in discussions with others
  4. out and out rejection of ideas – ‘that is crap
  5. strong language
  6. expecting/demanding the impossible
  7. being devious in demanding things from others
  8. being more selfish than selfless
  9. not taking a genuine interest in the personal and professional well-being of others
  10. simply expecting others to be able to handle his style and approach

and so on, you get the drift, but he, unlike most of us, could pull this off because of who he was and what he had achieved. He could afford to hire highly paid, highly capable, tough people who could handle it all and it worked, brilliantly. In my experience many senior leaders like managing partners don’t exhibit these tendencies, and I don’t think it would go down too well or be swallowed in a legal environment.However, pause and look around the office and there are usually some leaders who do – they need to be addressed on this as it can be a deadener to your employment brand if it is not.

And now, one last thing. . . . many of you will know Steve Jobs often ended off his renowned presentations – many of them quite long – with a pause, raised his finger, turned to the audience and said ‘ah, just one more thing . . . ‘ and then launched into discussion about a key development. This was the item that usually stuck in everyone’s mind.
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Many support service groups in law firms do a fair job of delivering their services and work hard at doing it, but beyond that, do not ‘add value’. That is a fairly common observation we have when we undertake firm reviews for clients and my own experience having run large law firms in three jurisdictions. This is a missed opportunity. Support service groups potentially can provide distinct strength and even competitive advantage and differentiation.

Sometimes support service areas do not realise their full potential due to inherent problems in the way they are established, viewed, structured or supported. It is worth straightening this out and turning them into strategically powerful elements within your firm. (Sean Larkan image ©)

Why don’t support service groups provide that added value?

  • it is not easy – for instance, it is hard to show in any meaningful way that their services are superior to another firm’s offerings or that they are providing value relative to their cost;
  • often their roles are ill-defined, as are expectations and criteria for performance;
  • as a result, they are treated purely as a cost centre, and their performance is based in part on whether they are costing more or less, as say a % of gross fees , than other firms’ support groups, i.e. they are not an area that is expected to deliver added value;
  • inadequate budget or recognition by partners as to the value they can offer and that the firm is missing – in the eyes of some they are an expensive, ‘necessary evil‘ of modern law firm structure. In many firms practice groups simply ignore support services and try to go it alone;
  • inadequate leadership of support services;
  • lack of support for support services leadership i.e. in backing up their decisions and work and helping to grow the stature and role of the leader;
  • they don’t have a separate vision, strategy and implementation plan geared to support the main firm strategy;
  • if they do have a strategy, it is not aligned with the firm strategy or other strategies. As a result they often operate in splendid isolation, touching others only when they use their services;
  • the person or persons to whom support service leaders report, don’t understand these principles, which sadly, is frequently the case. The overall leader’s role is critically important, in fact I would say definitive, in determining whether that added value is created. Too often, it is left entirely up to the support services groups and/or their leader.

How can you start to get that added value? Here are a few ideas to start with:
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