Diversity - Call To Action (CTA) Summit
General Mills' Roderick Palmore
According to Roderick Palmore, executive vice president, general counsel and chief compliance and risk management officer at General Mills Inc:
"The statistics speak for themselves. They say our progress in the profession has been disappointing."
Attention Managing Partners:
More than 100 general counsel executives of Fortune 500 companies and managing partners of U.S. law firms are convening next month in an effort to come up with specific ways to improve diversity in the legal profession Managing Partners
The 100 GC’s (in addition to Palmore from general Mills), will include the likes of
General Mills Inc.
The Boeing Co.
Prudential Financial Inc.
Microsoft Corp.
Johnson & Johnson
Tyson Foods Inc.
The Coca-Cola Co.
Bank of America Corp.
See the full story at Law.com in Amanda Bronstad’s piece today called GCs and Law Firm Managing Partners to Convene Over Diversity (also the source of Palmore's photo in this post)
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Don't let your "winning streak" become a "losing streak"
Is your “winning streak” about to become a “losing streak”? I believe it is likely unless you prepare for the test you didn’t ask for but are about to take. Let's be honest, most law firms have had a pretty good run and your partners are well accustomed to it. Will your partners understand what a decrease is? Will your firm maintain the winning attitude that brought you this far? If you don’t think the next few miles of road are bumpier than you're used to then the following may be of little interest (except perhaps for the reference to “denying the facts”).
I Irecommend that you visit (or revisit) Confidence - How Winning Streaks and Losing Streaks Begin and End by Harvard’s Rosabeth Moss Kanter.
Rosabeth Moss Kanter's biography for those interested
Confidence is a road map that helps you react more constructively than you might otherwise have to the challenges you will face (like this deteriorating economy). The losing streak is fraught with a disease whose symptoms will infect your people - they include::
- Stop communicating
- Criticize and blame
- Disrespect others
- Become isolated
- Focus inward
- Let inequalities develop and persist
- Lose initiative
- Forget goals and aspirations
- Spread negativity
- Deny Facts
- Accountability
- Collaboration
- Initiative
Check out Soundview Summaries and getAbstract. If there are others, let me know.
PUNCHLINE: Put Rosabeth Moss Kanter on your informal advisory team by buying the book or subscribing to one of the summary services above. You cannot prevent the legal profession from having a losing streak here – but you can prevent your firm from having one.
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Recession-Proof your Law Firm
The worst market crisis in 60 years: "recession or worse"? Says who? The 80th richest man in the world, George Soros, (estimated net worth of 8.5 Billion according to Forbes). Is Mr. Soros toying with the "D" word: "Depression" when he says "recession or worse"?
I recommend that you read the entire Financial Times (FT) article dated January 22, 2008: The worst market crisis in 60 years.
This is not a new subject for me - see my August 3, 2007 post Doom and Gloom for the legal profession - it's coming with respect to which Valorem Law founder, Patrick Lamb, kindly called me "an awfully good soothsayer" in his January 19, 2008 post Will The Perfect Storm Fundamentally Alter The Foundation Of The Profession?
Citibank’s Law Group Head and friend, Dan DiPietro, seems to be singing in harmony with Mr. Soros. Dan believes that US law firms may soon be battling unprecedented economic pressures.
As a law firm leader, you need to ask yourself some hard questions. My Edge International partner, Rob Millard, and I believe you need to: Recession-Proof your Law Firm and that Law firms must immediately prepare by reassessing their strategies in order to:
- minimize the potentially firm-threatening impact and
- capitalize on competitive opportunities
- Strong Leadership ?? In ancient times, the Cherokee Nation had one chief who would rule during times of peace; another during war. The need for hard, courageous decisions, even sacrifice, is common to both recessions and wars. In both, strong leadership is critical if hard decisions are to be taken and actually executed.
- Ramp Up the Frequency of Financial Data Reporting ??Things can change fast in a recession. Clients, under financial pressure themselves, terminate engagements. Revenues may contract. Debtor payment periods and write offs may deteriorate, putting pressure on liquidity. The firm’s key financial metrics must be monitored far more frequently than in boom times.
- Make the Hard Decisions Humanely and Fast ??Layoffs, if required, must be quick and humane not only to preserve capital, but also to get the firm past this trauma quickly and focused on working forward again. Continued employment of underperformers must be carefully assessed. Where the market is no longer buying specific services there are two choices: retool (quickly) or separate. (Do not misinterpret this as a suggestion to rush to lay off people though. Long-term considerations suggest this is a last resort option for all personnel except those who ought to have been asked to leave years ago.)
- Get Practice Leaders and Client Team Leaders focused on short-term action plans ??Actions must be executed more quickly than in “good times” and therefore designed for rapid implementation. Plans must be focused, systematic and disciplined. Those that will actually drive plans must be integrally involved in crafting them and managing their execution. Feedback and accountability measures are critical to ensure that the plans are executed, especially when they relate to the hard, courageous decisions (point 1.) Non-billable time becomes a valuable asset and must be actively managed to ensure that key tasks receive priority.
- Involve Your Clients ??In recessions, client mobility increases. Client needs evolve more quickly as new threats and opportunities emerge. Firms need to go beyond simply expressing empathy and assuring continuing loyalty. They need to actively position themselves to meet emerging key client needs. This cannot be done without actively discussing business (not just legal) issues with clients. If you don’t have client teams in place for your key clients, now would be a good time to start!
- Manage Internal Expectations Business as Usual Could Be Lethal??Remember the tale of the two frogs? The first is dropped into a bowl of hot water. It jumps out. The second is dropped into a bowl of cold water and slowly heated up. It doesn’t jump out and eventually dies. Similar procrastination has been the death of too many good firms. You need to explain internally what is being done to weather the recession and the likely impact on the financial positions of your people. This knowledge will motivate your people to do what is expected of them rather than default to “business as usual.”
- This Too Shall Pass Keep a Balance With Your Long Term Strategy??Think strategically about whether and where to cut short-term resources. Retaining some temporarily unprofitable practice areas and individuals may be advisable if they are important to your long-term goals. On the other hand, a recession is an excellent time to re-engineer or sever areas that have become less profitable but have been tolerated to avoid conflict.
The Chinese character for “crisis” consists of two symbols. One means “danger,” the other “opportunity.” While strategy may be more challenging during recessions, if you grasp the nettle, opportunities will arise to enhance your client mix and your talent base.
Thanks again to Robert Millard for his collaboration on this.
As always I appreciate your feedback.
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Some Lawyers Get Perks for Health and Happiness
The New York Times Business section included an article yesterday called: For Lawyers, Perks to Fit a Lifestyle.
The article alluded to a variety of perks including money, candied apples, milkshakes, car discounts, valet services, wine, office parties, in-office gourmet meals on silver platters, nap rooms, child care, emergency nanny services, sabbaticals and even an occasional masseuse.
Perhaps this was the most important perk mentioned:
Fried, Frank, Harris, Shriver & Jacobson, a 600-lawyer firm based in New York, offers employees a service akin to a personal issues coach and psychotherapist through a deal with Corporate Counseling Associates of Manhattan. The consulting firm has a battery of staff psychologists and social workers to provide advice on issues including stress, anxiety, depression and divorce.While many companies have offered employee assistance programs over the years, few have Ph.D. psychologists on staff.
A spokeswoman for Fried, Frank, Paula Zirinsky, said, “We want employees to be successful in their personal as well as their work lives.”
PUNCHLINE: Some of my law-firm clients have very serious challenges dealing with individuals for whom "psychological intervention" should be mandatory. In these severe cases, ostensibly productive members of the firm are causing harm to client relationships and firm personnel with long term costs that are hugely underestimated by their firms. Perhaps offering such perks is a way to make it just a little easier to address these firm-threatening challenges.
Read the entire article... perhaps your firm can offer many of the perks mentioned - most are not that expensive and I'll bet the return on investment would be healthy indeed (pun intended).
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Leaders: Genuine Inspiration from Sir Richard Branson
Is the UK's wealthiest man also its wisest? If you have about 1/2 hour to sit in on a fascinating conversation with Sir Richard, head over to Adventures in Strategy, my Edge colleague and friend, Robert Millard's blog post: Richard Branson on Life, Succeeding in Business and Everything
(Recorded March 2007 in Monterey, California. Duration: 30:44.)
I am very biased - Richard Branson is one of my heroes - nevertheless I will risk exclaiming that there is no Managing Partner who could experience this discussion and not be inspired.
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A Great Law Firm "Driven to [Self-] Destruction"?
Recipe for disaster: secrecy, unfair competition, deteriorating culture and even a partnership agreement that did not foresee that it was too generous to departing partners if more than a handful left at a time…
Joanna Pachner of Canada’s highly respected publication, Financial Post Business, writes in detail today about how and why the highly respected and profitable Canadian law firm of Goodman & Carr met its demise.
Punchline: If you are on the senior management team of your law firm, this may be a beacon of what to avoid in your own firm’s future. And, integrity drives me to day this, based on my own experience working with law firms globally, many firms have some of these destructive elements already in place. Perhaps the question is: when the tipping point is reached (that leads to a firm’s ultimate demise). If you care about your own firm, read this article: Driven to [Self-] Destruction Financial Post Business, October 2, 2007.
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Robert Millard's America's Two Legal Professions
Supplemental to my post "Sharp Pin Approaching Associate Salary Balloon", my friend and Edge colleague Robert Millard has created a post which may impacts the context for discussing associate salaries. He explains his title: America's Two Legal Professions with the graphic above. Read his post for a detailed explanation. Sometimes critical change is too subtle to notice - I think Robert has illuminated it for us. (Click on image to increase size - here or in Robert's post)
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Sharp Pin Approaching Associate Salary Balloon
Today's front page Wall Street Journal Online article is compulsory reading for all law firm Managing Partners and H.R. professionals:
Hard Case: Job Market ?Wanes for U.S. Lawyers - Growth of Legal Sector Lags Broader Economy; Law Schools Proliferate
By AMIR EFRATI, September 24, 2007; Page A1
While the article admittedly says:
“For graduates of elite law schools, prospects have never been better. Big law firms this year boosted their starting salaries to as high as $160,000.”
It goes on to say:
“But the majority of law-school graduates are suffering from a supply-and-demand imbalance that's suppressing pay and job growth. The result: Graduates who don't score at the top of their class are struggling to find well-paying jobs to make payments on law-school debts that can exceed $100,000. Some are taking temporary contract work, reviewing documents for as little as $20 an hour, without benefits. And many are blaming their law schools for failing to warn them about the dark side of the job market.”
PUNCHLINE: My pre-law was comprised of a business degree which included a healthy dose of economics – it doesn't mean I am right but here are my views (you decide what they are worth):
1) The balloon of increasing salaries at top firms (and "top firm wannabees") is going to SHRINK if not BURST. Fewer firms will compete with the top tier starting salaries and therefore average starting salaries will fall (in real terms - adjusted for inflation).2) Mainstream firms (including many if not most of the AMLAW 200 and other major firms around the world) will find their appetite for enormous associate salaries waning in favor of dipping slightly deeper into the pool of candidates and offering top-third students in good schools much more than they might otherwise make (but less than recruits at the firms who continue to compete in the perceived feeding frenzy).
3) It’s not just the money! It’s the student loan! Students want respect, training, good work, a chance to know the names of their children, future prospects and a way to service their enormous public and private debt. So pay well (but not like you are trying to hire Angelina Jolie for the lead in your next movie), find a creative way to “help them with their student loan” and return your focus to where it has always belonged – making your firm a great place to practice law. (The following illustration relating to student loans is one of nine very useful illustrations included in the article - click on image to enlarge):
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Footnote: How quickly things change: A three-month economic history on this blog site:
New Lawyer Jobs (US) Up by Largest Percentage since 2000 Posted July 17, 2007
Excerpt: "90 percent of 2006 law school graduates found jobs by February, 2007"
Doom and Gloom for the legal profession - it's coming Posted August 3rd, 2007
Excerpt: "How much longer can the legal profession remain insulated from the market realities?"
And today this post Sharp Pin Approaching Associate Salary Balloon
Time is flying! Stay tuned.
(I've got a song lyrics stuck in my head "What goes up must come down" from Spinning Wheel by David Clayton Thomas of Blood Sweat and Tears (click for full original lyrics and you can get it stuck in your head too)
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First Law Firm Goes Public - shares up 40% on first day of trading
The Wall Street Journal posts: Slater & Gordon: The World’s First Publicly Traded Law Firm
Managing Partners and other members of law firm C suites had better look at Slater & Gordon’s prospectus – it’s a gold mine, (pun intended).
Have a look at how risks are described – the Wall Street Journal post quotes the passage balancing professional responsibility and shareholder profits.
"Lawyers have a primary duty to the courts and a secondary duty to their clients. These duties are paramount given the nature of the Company’s business as an Incorporated Legal Practice. There could be circumstances in which the lawyers of Slater & Gordon are required to act in accordance with these duties and contrary to other corporate responsibilities and against the interests of Shareholders or the short-term profitability of the Company."
I adored the "Key Risks" page (click on it to download pdf of this page):
PUNCHLINE: If this does not fascinate you, you should resign from your leadership position. I am not saying you should follow suit – I want you to know what your options are and what your competitors might be up to way sooner than you would like to think.
Science fiction movies adore time travel and ripples in the primordial fabric. We are witnessing a collision - the future has just exploded into the present. With Clemente in the UK just over the horizon, please fasten your seatbelts - this is a pivotal moment for the legal profession and for the Managing Partners within it. Like Dennis Hopper's famous line in the movie Speed, "what are you going to do, Jack"
You may want to reference my earlier post: The end of the legal profession as you knew it...
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