A lonely law firm leader
Keith Mayfield, the chairman of an AmLaw 100 firm, is doing some long-range planning one Sunday morning in his home office. It's the only time he can really think. As he considers various strategies to maintain profitability – and even improve it – in the face of increasing competition and client fee pressures, he realizes how alone he is. As a lateral partner who's been at the firm over 20 years, he is close, both professionally and
personally, to many of his partners. Some are members of his management committee. Yet often he feels he's the only person who thinks about the firm as a business; the only one who thinks about all the external forces affecting the firm. He can see so clearly the changes the firm needs to make; why can't the others?
To be sure, some of his partners do look at what's going on outside the firm. But they generally focus only on new business issues, such as what a competing firm is doing to win one of their valued clients; how to win a new client from another firm; or a new practice area to enter. Many of his partners are truly brilliant. All are hard-working. Yet they are focused – almost to the exclusion of all else – on getting the client work done. After that, they may think about getting new work. They don't think about business models, organizational issues, the trend towards commoditization of legal work, client perceptions of value and other basic management concepts.
Keith is fortunate to have first-class administrators supporting the firm's infrastructure. But their focus is limited as well. His executive director thinks about keeping the trains running and controlling costs. His chief marketing officer has the best perspective of all his colleagues (even his partners) on external competitive forces. yet even she doesn't get what makes lawyers tick, doesn't know how they actually do their work and isn't in a position to think about the interpersonal issues that are key to running the firm.
Turning back to his strategic planning, Keith realizes more than ever that responsibility for guiding his firm in uncertain times falls entirely on him.
Why I'm writing this blog
Did Keith's story resonate with you? I'm writing this blog in support of Keith and other law firm leaders. Whether the firm has 100 lawyers or over 1,000, the principles are pretty much the same. Law firm leaders want more advice about their firm as a business. An area where advice is particularly lacking is a practice management technique called knowledge strategy. External advisors focus on big-picture strategy, or on specific subjects, such as legal project management, how to run a practice group or getting new business.
Knowledge strategy is a back-to-basics initiative that cuts across most aspects of practice. Importantly, it can help law firm leaders implement their firms' strategies. This practice management technique is widely overlooked in US law firms today, even in firms that profess to have “knowledge management” departments. I base my view on 30 years as a senior partner at an AmLaw 20 firm in New York and my more recent work consulting with law firms about knowledge strategy. (See About Us for my biography.)
Of course, the firm's overall strategy comes first. That strategy may involve:
- growth, such as expanding overseas or building up promising practice areas, pursued through acquisitions or lateral hiring;
- concentration, such as getting more work from existing clients or shedding unprofitable practice areas and clients; or
- a commitment to project management and fixed fees or other alternative fee arrangements.
Whatever the overall strategy, true knowledge strategy techniques should be part of the execution plan.
- If the firm's strategy is growth, how will you integrate those new offices, those new lateral lawyers and those new practice areas into the firm?
- If it's concentration, how will you convince existing clients to increase their work with your firm?
- If the goal is fixed fees, how will you establish those fees and manage your matters to leave a profit margin?
Knowledge strategy addresses all these issues, but requires commitment and senior resources to be successful. It is the rare law firm that has mastered this area of practice management – even those with Knowledge Departments and Chief Knowledge Officers. Mastery eludes so many firms because senior management does not maintain steady and visible involvement in knowledge strategy. That's the key ingredient in overcoming the special lawyer personality traits that will be discussed in Part 2, which make it so difficult to “manage” lawyers.
My hope for this blog is to shed light on this under-appreciated area of practice management, and to demonstrate the power of successful knowledge strategy initiatives. My posts will discuss specific practical projects that can really benefit the firm in a variety of areas, including those listed above. Posts will also discuss strategies and organizational approaches that can make these projects succeed. Along the way, we'll hear more about how Keith is managing, as well.
In the next post
My next post will discuss what knowledge strategy is, describe the lawyer personality traits that are key to all law firm practice management initiatives, discuss the ways knowledge strategy can benefit a firm, explain why most law firm knowledge efforts founder and describe the approach that has worked for the few successful firms.
[Photo credit: Image Source / Getty Images]
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