Venice, CA

Wednesday, March 11, 2009

Not every player on a basketball team is expected to be a star; should every lawyer in a law firm expected to be a rainmaker? The question arose when I recently was engaged to facilitate a roundtable discussion among estate planning attorneys. One of the questions asked pertained to the issue of how we motivate associates to engage in developing new work. My response was that not every associate can do this. If the associate is doing good work, if the law firm understands, sets, and monitors the metrics (whether by number of hours, matters or revenue) the associates need to reach, and if the associate reaches the metrics...and both sides accept the compensation being paid to the associate for this effort...then what is the problem? The associate is satisfied with the compensation, the law firm is getting quality work performed at a profit to the firm, and the clients are being well served. What's wrong with this picture?

The problem, of course, is the law firm model itself. When hard times hit - and today's economy epitomizes hard times - such lawyers are seen as "clogging up the middle" They are good lawyers but not great rainmakers. They were originally brought into the firm to serve the principle of leverage, doing work at much lower cost than the partners who billed out that work at the higher cost partner rate. The associates remain, their compensation rises, then after the eighth or ninth year, they are either invited to join the partnership, or are asked to find employment elsewhere. Today they often are let go even before the partnership decision time.

One might argue that the associates know what they're letting themselves in for when they join a large firm. But most human beings are optimists (until they conclude otherwise), and I suspect most young associates believe that continuing to show up and do good work will prove to be worth it - right up until the moment that they are shown the door.

When firms terminate these experienced associates that they presumably had good reason to hire in the first place, it not only is costly, it undermines the loyalty of the remaining associates. Is there enough work to justify keeping the associate? The answer must be "yes" since, despite firing experienced associates, law firms continue to hire new law school graduates. And, if the answer is yes, the next question becomes, does the associate's combination of skill and attitude demonstrate potential to continue contributing to the firm? Skills are teachable, attitude isn't.

Leverage always has been, and will continue to be, a motor for profit in law firms. Experience is important, but it is also teachable. Why can't these lawyers be transferred from their current practices to other practice areas that are still growing? After all, they are trained in the culture of the firm and should be capable of learning new technical skills. Perhaps the more progressive law firms will wake up to learn how they can benefit from rejecting the "chew 'em up and spit 'em out" model and emulate a more sensible approach that treats lawyers as a resource and not as a fungible cost.

Ed Poll

Principal

LawBiz Management Company

Venice, CA

800-837-5880

310-578-1769