Printer Friendly

Commanding Respect as a Practice Group Leader

As a team leader, you should take a cue from firms’ best practices: never take on a new responsibility without a signed letter that sets forth the responsibilities of each party to make the engagement a success.

By Ed Poll
 
As large law firms have developed into “corporate” organizations to better serve corporate clients, the practice group structure has become an accepted organizational model. Of course, such groups can also be called departments, teams or some other designation, but the concept behind them is fundamentally the same. Practice groups organize and focus the firm’s resources in a given area of legal discipline to improve client service quality, marketing performance, lawyer training and development, and competitive effectiveness.

Even today, however, nearly 20 years after practice groups became an accepted part of law firm governance, some lawyers regard working as part of a team as contrary to their individual self-interest.

The idea of a practice group is to reinforce to the client that service is provided by the entire firm and not just one lawyer. Ultimately, clients belong to the firm and not to the lawyer, and that benefits firm, lawyer and client alike.

Lawyers who hold themselves apart from the firms in which they work are actually putting themselves at a disadvantage. If clients place primary reliance on the firm, as represented by its practice groups, each lawyer benefits as the groups maintain client relationships and generate new ones.

Fundamental Problem

However, practice group leaders are lawyers too, and they must deal with the fundamental problem that faces all law firm leaders in governance positions: the need to maintain their individual practices while leading the group effort.

Practice group leaders are still expected to maintain their own books of client business, while devoting considerable time (which would otherwise be billable) to managing their practice group’s business plans and overseeing group performance.

Ironically, firms understand the need to pay for physical assets, to secure capital for operating expenses, and to pay for lawyer and staff time as competitive conditions warrant. But in a business where the highest use of individual time is considered to be serving clients and thereby producing revenue, management is viewed as a sideline.

Partner compensation from hours billed will be governed by those metrics that define how the firm views itself and how work is done for clients. Typically there is a base compensation figure for all partners with a bonus decided from various other factors, such as contribution to firm governance, profitability of work brought in, and realization rate (per cent of billable hours actually collected).

Additional metrics could emphasize origination (per cent of new business that the partner brings in), total hours worked, or hours assigned to other lawyers in the firm. The problem is that the whole process is too often subjective and peer-based.

The peer factor is especially significant. No law firm would tolerate the astronomical gap that exists at other types of companies between CEO pay and the rest of the organization. Even rainmaker compensation must make a nod to the firm’s “collegial” nature.

‘Professional Responsibility’

In law firms with compensation systems that reward individual performance, most of the lawyers do not pay attention to management issues. They focus on rainmaking and their own billable hours. However, a lawyer’s responsibility for his or her own firm is magnified by professional ethics rules that may extend well beyond the basics of individual ethical practice.
 
If firm leaders still have a major focus on rainmaking and their own billable hours, they may not be paying proper attention to catching the errors of others. It opens up a range of issues on how the firm allocates new work.

Who makes the assignments and why – on the basis of skill, availability or favouritism? Does the firm work to ensure that lawyers, especially younger ones, are adequately trained for the work they receive?

If there are ego-generated conflicts among lawyers based on work assignments, practice groups and the firm can only have chaos and difficulty. Law firm leaders, like leaders in any organization, must connect effectively with every member of the organization.

Practice group leaders also face another leadership problem. For the overall firm, there may be a chief operating officer or firm administrator (usually a non-lawyer), a CEO/managing partner and chair of the management committee, and then sometimes a chair of the board (usually a former CEO/managing partner). 

None of these positions, with the exception of the COO/administrator, is compensated at market rates. Yet if there is the expectation that the CEO is the primary leader while there is another ego-bound lawyer acting in a leadership role as chairman who conflicts with the CEO, the practice group heads again reap chaos and difficulty.

Written Statement

That is why practice group leaders should take a cue from firms’ best practices: never take on a new responsibility without a signed letter that sets forth the responsibilities of each party to make the engagement a success.

The group leader can learn and benefit from this example when accepting the leadership position. In addition to requesting a job description, group leaders should demand that the CEO/managing partner provide the group leader with a written statement of his or her responsibilities.

Such a statement could include the following requirements:
- The CEO/MP will respond to an inquiry from the group within 24 hours.
- The CEO/MP will meet with the group leader for no less than one hour a week.
- The CEO/MP will be clear and direct with requests and directives to the group leader.

The idea of a written statement of responsibilities is definitely a two-way street. The practice group leader’s document must spell out not only the specifics of what the firm and its senior executive must do, but also what the practice group leader must do in order to reach the necessary measurements for success in his or her position.

Measurements for success must be clearly defined in the agreement so that the practice group leader understands the criteria by which the firm will make its evaluation of the group. The following elements can shape the understanding. 

If there are certain organizational criteria for success – profits per partner, revenue growth, number of clients – it must be clear which ones are considered to be within the practice group leader’s control, and which ones are not.

The group leader must be told specifically what he or she must do, and how performance of those responsibilities will be evaluated.

There should also be precise definition of the leader’s base level of compensation, and precise definition of the extent to which the practice group leader is expected to maintain a personal book of business and client responsibilities.

Other Half

Creating the written statement of responsibilities for a practice group leader is only half of the job. The other half is to have continuing dialogue and evaluation that allows for reinforcement, modification or expansion of responsibilities as the firm’s circumstances, performance and expectations evolve. 

The most important function of all law firm leadership is to facilitate continuous communication to ensure that individual agendas continue to be attuned to one another. Law firm leadership and practice group leadership are subject to the same need to keep the communication process open, candid and frequent. Firm and group management all must be in concert, and all members of the group must buy in.

Law firm partnerships cannot succeed without a sense of personal responsibility that begins with the firm’s leaders. This should not be a foreign concept in firms; when lawyers join a partnership, irrespective of what their earnings from the firm may be, they become jointly and severally liable for the debts of the law firm in the event of the firm’s collapse.

That discipline alone should emphasize the stake that all lawyers have in the quality of their firm’s management. And it should be the clearest reason why practice group leaders command respect for their jobs.   

Edward Poll is a certified management consultant and coach in Los Angeles who coaches attorneys and law firms on how to deliver their services more profitably. He is the author of Attorney and Law Firm Guide to the Business of Law: Planning and Operating for Survival and Growth, 2nd ed. (ABA, 2002), Collecting Your Fee: Getting Paid from Intake to Invoice (ABA, 2003), Selling Your Law Practice: The Profitable Exit Strategy (LawBiz, 2005) and, most recently, Growing Your Law Practice in Tough Times (West Pub. 2010). 

Comment on this article