An inappropriate lateral hiring decision for a large firm can be awkward for all parties involved. For the small firm, however, a mismatch can be devastating.
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Author: Dr. Laurence J. Stybel and Maryanne Peabody
Source: Stybel Peabody
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| Balancing competence, Client development,and culture in selecting partners |
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An inappropriate lateral hiring decision for a large firm can be awkward for all parties involved. For the small firm, however, a mismatch can be devastating.
When hiring attorneys laterally, there are three general expectations: (1) professional competence (2) ability to develop new clients or bring in an existing book of clients and (3) good fit with the existing or proposed firm culture. The ideal is to optimize all three variables. The worst case is to force yourself into thinking you have to make trade-offs. A middle ground is to work with all parties in achieving a reasonable balance between the variables.
While the case below is not a law firm, the problem is not unknown to managing partners.
One of our clients is a $100 Million a year family business. To achieve its goal of $200 Million a year in sales, the CEO/father has decided to hire a non-family executive who would serve as chief of operations. CFO/mother objects to the person on the grounds that his aggressive, structured personality would "spoil" the unique culture that is the foundation of employee and customer loyalty. The CEO/father responded to the objections by noting that he has spoken out publicly about the lack of caring for the whole person among physicians. "But when I had my heart attack, I selected on the basis of competence. And to hell with a caring, warm human being!"
The danger with our client's thinking is that he assumes that owners must tradeoff on one factor. He would be better thinking in terms of balance.
A more typical case is when a hiring partner becomes so entranced with a prospective lateral's book of business, the partner is willing to make a "tradeoff" on the lack of cultural fit with the existing firm.
The enclosed letter is taken from an actual case, with names disguised. We call it the "Working Together Letter" because it is an attempt to clearly set forth expectations in all three areas so important to law firms----competence, client development, and culture. It invites the person to respond and to focus on these critical issues.
Our client was the one who received this letter. Her initial response was one of anger. "How dare they write this to me!" We explained that this "Working Together Letter" was a tremendous gift to her because it put on the table all the key issues and allowed her to confront them before she took the job. It also allowed her to clearly see their values as a firm.
She responded to the Letter with a "Working Together Letter" of her own and the deal was consummated. She joined the firm as a partner two years ago and both parties are still pleased.
"Working Together Letters" work for our clients. We hope they work for your firm and for your clients.
EXHIBIT 1
Martha Smith
123 Main Street
Boston, MA 12345
Dear Martha:
Confidential
SUBJECT: Working Together
All of us at Mullin Smith & Dale are enthusiastic about the possibility of you joining us. At this advanced stage of our discussions, I think it is important that both sides put on the table all issues--both positive and negative. My purpose in writing is to frame these issues under the categories of competence, client development, and culture.
I would appreciate your responding in writing or over the phone. In return, I hope that you put together a "Working Together" document for me, outlining where we stand on these three factors.
Competence
We have the greatest respect for your reputation within the Boston legal community. At some point, we would like to be able to speak with two or three of your clients. I view this request as appropriate "due diligence" on our part.
Client Development
For the sake of the record, I want to be explicit about client development issues. You mentioned that you are looking for a compensation of $X. It is our hope and expectation that under our compensation system you could make that and more! If you do not have reasonable expectations of generating 3.5 times $X in billable work and referral credits within eighteen months, both you and I will be disappointed.
Please note that I am using the word "expectation." It would be ideal to see money in the bank, but I will settle on a trend line that is moving in the direction of $A per year. I think eighteen months is adequate time to evaluate if there is a trend and in what direction it is moving. What do you think?
I also want to be clear about our expectation in referral work. We think that you will be in a good position to refer work to us. We want to refer work to you as well. One of the first things we would do upon your arrival is to work out how together we can accomplish this mission. We want to make sure our client development plans are coordinated.
Culture
Martha, this is the area where I have the most concern. Most of our great strengths are also great weaknesses. I don't believe you are an exception to this general rule. Your great strength is your outstanding reputation as a tough, take-no-prisoners litigator. Your reputation also is that you bring that tough quality in your dealings within the firm.
We would like to think that our reputation is that of being collegial, caring, and sensitive to the needs of attorneys and nonattorneys who work with us and for us. We are excited about having you with us. But we are not going to change a professional environment we have spent years developing. Many of us left large Boston firms for the purposes of finding exactly the kind of culture we have at Mullin Smith & Dale.
Is this type of firm you want? If so, we can offer it to you. If it is not, you will find yourself frustrated with us. And we will be frustrated with you.
As I said at the beginning of this letter, I wanted to put on the table all the issues that both sides need to look at. Competence, Clients, and Culture is a useful framework to discuss these issues. I welcome your response and how we measure on these three important variables.
Sincerely,
David Mullin
Mullin, Smith & Dal
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