In the essence, being a lawyer is a solitary profession. This is especially true where lawyers represent a client in court, but also if it comes to transactions or advice. The responsibility for the client is seen as a personal responsibility, not a collective one. Traditionally the relationship has always between an individual lawyer and the client.
Although over the past decades, with the emergence of professional law firms that are ran as businesses, this paradigm has certainly shifted, the relationship is still personal at the core. The high number of lateral partner hires that bring their book of business corroborates this.
Not just the lawyer-client relationship, also the pressure to perform is very much an individual one. Regardless the profit distribution system, partners see themselves pushed to create ever more revenue. In a merit-based system because it directly influences the income, in a lock-step because no-one wants to be in the bottom 10% and risk being kicked-out. If it comes to performance pressure, there is little safety or comfort in the collective. If it comes to creating revenue, each partner is pretty much on his (her) own.
Therefore lawyers demand a high level of autonomy to run their practice. At the same time, their firms want to have a firmwide strategy in order to manage its overall reputation and performance. This is where a tension arises: how to balance between control and autonomy?
Why control is necessary
Any law firm which operates merely as a group of individual lawyers that happen to be under one roof, will soon hit the ceiling as it comes to growth in (financial) performance and reputation. In order to grow, a firm needs its partners to be aligned on what type of mandates and clients the firm is looking for. One also needs a firmwide system that deals with formal and strategic conflicts of interest.
A partner accepting a position on a panel and agreeing on exclusivity, could end up costing the firm a multiple of that revenue in lost opportunity being unable to accept lucrative mandates from other companies operating in the same sector. The necessity to coordinate also arises as it comes to recruitment and training of associates, knowledge management, the use of firmwide standards and templates, and so on.
Management is at the core of tensions
Like governments or business leaders, law firm managing partners and their board have to manage and lead the firm to strengthen its position and financial performance. Unlike governments and business leaders, law firm leaders have little enforceable powers on the execution level. Having their hands tied while expected to lead the firm towards a better future, can leave law firm leaders frustrated.
Some law firm leaders resort to dictatorial behavior or to introducing strict rules and policies that every partner has to adhere to or, if not, face financial penalties. While ruling by ‘fear’ might seem like a solution, in reality it seldom is. In order to make things work, law firm leaders have to strike the right balance between control and autonomy.
Thomas Hobbes Leviathan
In Leviathan (1651), Thomas Hobbes argued that the absolute power of the sovereign was ultimately justified by the consent of the governed, who agreed, in a hypothetical social contract, to obey the sovereign in all matters in exchange for a guarantee of peace and security. In his introduction, Hobbes describes this commonwealth as an "artificial person" and as a body politic that mimics the human body. The cover of the first edition of Leviathan, which Hobbes helped design, portrays the commonwealth as a gigantic human form built out of the bodies of its citizens, the sovereign as its head.
One must keep in mind that it is almost 400 years ago, that Hobbes wrote his masterpiece. It is therefore not the ‘absolute power’ of his sovereign that I would like to highlight in the context of this article, but the theory that each individual needs to hand-over part of his autonomy in order for the state to function and flourish. By losing part of his autonomy, the individual will be better-off as it will result in a more stable and effective government. For modern day law firms this is no different.
As much autonomy as possible
Partners in a law firm cannot have unlimited autonomy and expect at the same time their firm to be successful and strong. One cannot have the cake and eat it. Part of the autonomy must be transferred to the leadership in order for it to be effective. Law firm leaders are tasked with looking after the long term interests of the firm as a whole, even if this would go against the individual interest of some of the partners. Law firm leadership must have the authority to unilaterally decide on the strategy and other topics that are fundamental to the firm’s reputation and financial success.
At the same time, within that strategy, it is the responsibility of the individual partner to decide how to accomplish the goals that are set. The firm decides on the ‘what’ and ‘when’, but the individual partner decides on the ‘how’. Unfortunately, it is not uncommon that law firm leadership wants to dictate the ‘how’. Inevitably this leads to failure, which in turn provokes even tighter control and micro-management from the leadership.
If you want your strategy to succeed, set a limited number of clear and realistic goals of which no partner may deviate, but grant your partners as much autonomy as possible on how to achieve them.
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