I know that a managing partner is appointed to lead and run a law firm and should do just that – get on with the job. However, there are many things that a firm must in turn do, ideally up-front, to assist their newly appointed managing partner and to give him or her a fair shot at making a go of a very challenging and sometimes trying role. Leaders, particularly new ones, are real people and need real help and support. Wise firms put this in place.

A new managing partner and no doubt his or her partners will be raring for him or her to take up the role and ‘make a difference’. It is worth spending some time however  thinking about how to make it easier for him or her and to provide proper support – upfront.

The problem is that due to the strange animal that is the law firm partnership or equivalent, most firms don’t really get involved to implement just a few basic steps that can serve to make or break a managing partner, or at least increase the chances of success and his or her maintaining some semblance of normal life. The right steps taken up-front, and a few carefully thought-through foundation-stones laid, can make his or her life so much easier and get a much better outcome for all concerned.

Partnerships have this strange view that because they have chosen someone from their ranks who they believe has the credentials to lead (and usually does) that this is the end of the matter – the new incumbent can and will sort out any teething snags or issues arising in relation to the role and will simply work out work and time pressures and so on. The problem is that most new incumbents believe this as well. They don’t want to undermine the partners’ confidence in them or give any indication that they are struggling and need help.

It is not a good combination and can quite unnecessarily lead to a bad outcome, and be tough on the managing partner. It is fair to say that the root causes of many managing partner roles not panning out can be traced back to what is or is not done in these early stages.

What are some of the challenges faced when a new managing partner is appointed?

  1. a fear by the managing partner he or she will, over time, lose a highly successful practice;
  2. a fear (by the incumbent and the firm) that the managing partner may never re-build a practice after the role and may be left high and dry. This can cause all manner of defensive behaviours which can work counter to making a success of a leadership role;
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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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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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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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A notable Indian law firm merger came into operation on 1 April 2012. The merger was facilitated by my Edge International colleague Bithika Anand  between one of the oldest law firms in India, “Udwadia & Udeshi” and one of the most dynamic young law firms “Argus Partners”. This merger is interesting

Lex Africa, the first and largest network of African law firms, is holding it’s annual general meeting in April 2012 in Maputo, Mozambique. I thought I would mention Lex Africa in case readers ever need assistance in Africa and want a referral to a reputable firm. I am also delighted to be attending the

Strategies which have been developed by professional service firms for areas such as finance, people, marketing, brand or innovation must align with and support a firm’s overall strategy. This alignment is important for both internal (partner and staff) and external (client and other stakeholder) consumption.

Small firms might say this is only for the larger firms, who have separate marketing and HR departments and the like. I disagree. I think every firm should and can develop a strategy around each of these key areas of practice – in many cases it only needs to be a one- or two-pager. The trick then is to align them.

Ensuring that firm, people, marketing and brand strategy aligns and does not conflict is one of the biggest challenges of strategic planning. You must achieve fusion and make sure you don't end up with a strategy gap ((c) Sean Larkan image)

What do I mean by align? It is really just about ensuring:

  • other strategies and their key objectives support firm strategy and do not conflict with the main strategy – in fact they should actively support it;
  • reality must match the key objectives – are they realistic or pie-in-the-sky? (for instance it is not uncommon for firm strategies or vica versa, people strategies, to make promises in regard to people management which are clearly not supported by the other strategy);
  • it should be clear that both strategies are firmly based around the firm’s core values;
  • what you promise you will do or will deliver must be seen to happen in practice; (e.g. what you promise about people in your firm strategy must be supported by the people strategy);
  • that resources are committed to support each of the strategies;
  • as far as possible that all strategies are seen as part of the firm’s overall strategic intent, not as separate unconnected items; and
  • that leadership is committed to all strategies and has played a role, if not in formulating/settling each, at least in signing off and checking on the implementation of each.

This alignment is easier said than done:
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The challenging future legal and business environment which is widely anticipated will demand a lot more from law firms than providing quality legal advice. This is the view of Ian Robertson, long-standing managing partner of Holding Redlich’s Sydney office, writing in The Australian (apologies; link requires subscription or log-in) recently.

Whether it be around service offerings, fee levels, management of fee-related activities or developing individual brands and thought leadership around industry sector knowledge, law firms will want to work out what they will bring to the client table in future. Simply basing decisions on past experiences is not likely to be enough.

This advice backs up on the findings of a recent survey of Australian managing partners and chief executive officers indicating tighter times ahead – with recruitment levels and profit margins expected to be down over the next five years based on deteriorating business confidence.

For Australasian law firms the writing is on the wall for some or more of the following:

  1. Better service at lower fees: this is simply because clients have more choices, are more canny and have realised it is increasingly a buyer’s market. Even more challenging is that given market conditions this will be coupled with fewer and smaller transactions and disputes. The only possible exceptions will be in resource–rich states such as Western Australia.
  2. Fee estimates, fee capping and fixed fees will be the order of the day: on top of this clients will look for real value and will carefully analyse all charges to ensure they are justified.
  3. Quantitative leverage will be rejected: clients will accept leverage, but only qualitative leverage, in the sense of high calibre, suitable staffing on a team where work is pushed down to the lowest (highly)competent level and charge-out rate.
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The world’s first listed legal practice, Australia’s Slater & Gordon (S&G), announced its agreement to buy national UK firm Russell Jones & Walker (RJW) for £53.8 million on the 30 January 2012.  My UK-based Edge International Partner Chris Bull joins me in this post as we consider some of the implications of this transaction and how the respective markets are viewing the development.

The S&G acquisition of RJ&W in the UK is a good example of successful law firms implementing carefully thought-through strategy and vision using merger or acquisition.

The S&G and RJ&W joinder is significant:

  • an acquisition as such, not a merger, by an Australian law firm of a significant UK firm.
  • the fact that the parties operate largely in the personal legal services space rather than the corporate market.
  • it will establish, when ratified, a foreign and publicly owned ABS (alternative business structure) in terms of the new UK Legal Services Act.
  • the amount involved.
  • the exclusion of outside parties such as insurers and investment companies.

This is a positive and exciting development for the legal profession generally but particularly the UK and Australia:

  1. Merger and acquisition as an outflow of carefully thought-through strategy: as recently stated we see this as affirmation that many law firms see acquisition and merger as simply one possible strategy in achieving their vision and carefully thought through strategic key objectives. It is not a knee-jerk reaction to client or market pressure.
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