Welcome to LegalTech Matters, a Litera podcast dedicated to creating conversations about trends, technology and innovation for modern law firms and companies big and small.
00;00;14;21 - 00;00;26;15
Adrian
Well, I want to welcome everyone to this webinar. I thought we would take a moment for quick introductions. My name is Adrian Prolific and vice president of Cochran Client Development. I will be your moderator today, Jim.
00;00;27;00 - 00;00;46;26
Jim
Thank you, Adrian. Appreciate the invitation and the moderation Jim Cochran. I'm a former practicing attorney present and founder of Cochran Client Development. Also, as general counsel for three AMS Telecommunications Group, our company does consulting, training and implementation of collaborative business development for specifically law firms globally.
00;00;47;29 - 00;00;48;09
Adrian
Ray
00;00;49;12 - 00;01;15;24
Ray
Thank you, Adrian. Yeah. I'm Ray Oldfield. I'm the former CEO and founder of a software company called Objective Manager. And we provided law firms with software to help them build their strategic plans and get all their people engaged with those strategic plans, with the idea that people have a much better view of what the organization was trying to achieve in-house, hence helping them think about what they can do to grow their careers.
00;01;17;00 - 00;01;45;02
Adrian
Outstanding. Thank you both. Well, let's start here. Every year, thought leaders, surveyors and all the people that are in our industry talk about what are the strategic initiatives that law firms are facing every year and year after year. And the top five – the battle for talent or the retention of talent is right there, front and center. And recently, I would say in the past few years, it's in the top one or two.
So today we're going to dove in a little bit and talk about retaining talent. But before we do that, I would like to kind of open up the conversation around the whole concept of talent, not specifically any kind of solutions, but more like what are you hearing from your clients? What's the word from a general perspective?
And I'll start with Ray.
00;02;07;24 - 00;02;31;18
Ray
Thank you, Adrian. Yeah. So again, just to put it into context, I've spent the past ten years talking to the leadership teams of law firms about what their big strategic issues are. And those law firms start with. They think that that big issue is that they don't have a clear enough strategy, which everybody's bought into. And the reason that they worry about that is, is because when people leave the organization, it doesn't tend to be about money.
It often sometimes is. But obviously, and especially in today's environment, you can't keep competing just on money. The biggest reason that they have presented to them when they do interviews is that people just don't feel connected to the organization anymore. And hence, as a result of that, we were often speaking to them about, well, how can we use strategic planning to solve that problem and get them connected back into what the business is trying to do?
And it usually came down to one simple, very simple problem, which is people just said, we don't know what this law firm strategy is, and hence I don't know what my future in this firm is. And that was one of the key drivers for people leaving. Now, obviously, there's lots of issues that span out of that, but we can talk about those during the course of the webinar.
00;03;19;07 - 00;03;21;13
Adrian
Of course. Jim, general thoughts?
00;03;22;21 - 00;03;53;01
Jim
Well, I find it very interesting, having worked with law firms and it's our title of our company, Cochran Client Development says all about organic growth. And you can't grow your law firm without talent and I'm actually on site with a client now and this week. And the conversation is all about and about talent, acquiring talent, integrating talent, and growing the clients not only of their recently hired lawyers, but of the firm as well.
And so, it's a very challenging time. We hear stories within law firms, small, medium, and large with our clients in the United States, that there's been a significant turnover in talent. And where in the previous five, ten, 20 years a lot of the conversation coming to the United States has been about mergers and acquisitions. Now it's about one to three small groups left out trying to replace talent they've lost.
Why is that happened primarily as a result of the pandemic? The economics around that. People are paying for flexibility in working remote. They're offering higher compensation with inflation. And there is a significant turnover of lawyers coming in and lawyers going out. And it's costing law firms at the same time trying to retain their clients.
00;04;45;28 - 00;05;21;04
Adrian
Absolutely correct. Okay. So, this concept of planning is really ubiquitous in law firms. Everybody needs to have a plan. But if you don't have a plan, you're really planning to fail. And so, we all agree to that. But for some reason, it's a big challenge. And so, let's talk about that specifically as it relates to retaining talent You would consider that lawyers would be very unhappy if they didn't have that kind of direction in their day-to-day work.
I mean, the strategic plan for the firm and a plan for the lawyer, and they have this roadmap, but it is still it's a challenge. So, let's talk about how important that is first of all, and how you both look at that in the work that you do. I'll start with Ray
00;05;39;11 - 00;06;03;27
Ray
Okay. So again, to put it into context, you know, attorneys, lawyers, nonpartners are obviously, you know, some of the busiest people in the world. You know, they're doing 2000 hours a year chargeable probably a lot more as well at the moment. So, they tend what the feedback we get is, is that people just get lost in that kind of vortex of busyness and so actually they forget to plan.
Or if there is a planning process in the firm, they just don't feel like they have time to do it. But also, as well that the biggest barrier that we see is, is that I can't write my plan until the firm has written their plan. And the problem is that law firms tend to take too long. It's an annual planning process.
And in a lot of firms, you know, not every law firm will take a year to write the plan. So, by the time the plan is written and communicated, it's kind of out of date. So, the work we've been doing is to encourage law firms to have very, very simple six-point strategic plans around. For example, as you've said, you know, how do we want to grow people?
How do we want to develop clients? How do we want to build diversity as an example? Well, just have a simple framework, which then makes it very easy for every attorney to hang their plan off that so that they feel connected to what the firm is trying to do. And what we do then is and then what we see is, is that it goes back to what we started with.
If the attorney has a plan and they feel connected to that. They don't just kind of drift off. And it's that drift which we think is the biggest challenge to retention, because once somebody started drifting from the firm, then things like pay and conditions and some of the, you know, the hygiene factors start to irritate them a lot more.
Whereas if they're well connected and they're happy and they're engaged with the firm in the first place, those things don't come into play. So that's what we always do. So, what we're saying is let's make that planning process a lot simpler so that somebody's got a six-point plan about developing their own career in line with what the firm wants them to do.
And it's really simple, isn't it? The concept is really simple, but the execution of it is, is where the real challenge comes in.
00;07;57;16 - 00;08;10;23
Adrian
And Jim, how often do you see planning as a conversation point and whereas it's either being done or not done or not done effectively. And tell me how you address that in the work that you do.
00;08;11;24 - 00;08;36;07
Jim
Well, right. And I see eye to eye on this. And our plans are primarily focused at the individual partner level. Though we now see robust planning for associates beginning very early as part of the professional development process. But if you're looking at partners, either service or contract partners on the way to equity, plans are really important to get to that point and understand how to do it.
I always ask in our programs, once you've identified an opportunity, prospect, existing client or referral source, how do you get that to engagement? And without a plan, it's very difficult to even identify what the opportunities are. So, I completely agree with Ray that the planning at the individual partner level and we see lots of practice group planning in the United States but that doesn't necessarily mean that there are plans at the individual partner level.
And of course, with laterals talking with a firm this week, they do not have plans for laterals that come in which impact the ability to integrate them very quickly, both working on firm clients and working on the lateral's clients. So, I think planning is critical. What I found most fascinating is the larger the law firm in the United States, in many cases like plans compared to our smaller clients.
Just five, ten years ago, I walked into an AM law American lawyer, ten client and they had no plans with 2000 lawyers I mean I was stunned and then I walked into a 200, 250-person law firm and they wrote the best plans I've ever seen. And so, you never know. There is a huge variety within the firm.
But in either program where we're working with partners in organically growing their existing clients prospects and referrals is we have a plan and I agree with Ray. The more simple, the better focusing on those type of opportunities. And that allows them to collaborate and integrate laterals. It's just really important. And everything you do in a law firm.
00;10;15;03 - 00;10;35;27
Ray
I think that's the key point because most lawyers, most attorneys, lawyers are very cynical about any form of planning process because they're very busy and they see it as just a compliance exercise. So, what we always say to the leadership team is use planning as one of your primary internal communication tools to tell people what the firm's doing and do that once a quarter, like normal businesses do, you know, major public companies have to report to their shareholders and their teams on a quarterly basis. But what most law firm leaders the reason that they fail is they often think they've got nothing to say. So, they won't, they won't bother saying it. Whereas if they can just hang a lot of their internal comms off a six-point plan, that actually satisfies a lot of people in terms of how much information they need about where the firm is going.
And then the flipside is, is that if every individual has a plan, it's a really good excuse just to sit down at least once a quarter and talk about the plan. So even if all you're doing is having a fireside chat in a coffee shop or on a zoom call, at least you've got a framework. And that comes back to the whole retention piece is that you're stopping that drift before they've drifted off.
If you're speaking to somebody at least once a quarter, it's very rare that any problems that exist won't be on during those conversations.
00;11;38;17 - 00;12;11;05
Adrian
Yeah, totally agree. Jim, you mentioned something about organic growth, and I think this ties into retention and talent. And we see it all and we see it all the time in the market. When we talk to the firms. And it would make sense that people would agree that investing in your talent is a strategy for growth. And I want to kind of peel that apart a little bit and see what you're hearing and what your perspective is on that, on growth strategies and as it relates to the retention of talent or investing in talent, that's really what we're talking about.
00;12;12;19 - 00;12;37;20
Jim
Well, a lot of the investment historically has been large at the acquisition and merger stage over the last ten or 20 years. And some of that has been completed. Maybe a significant portion of it. So, you don't see as much of that now in the United States. So now there's a focus specifically on organic growth, which law firms have not necessarily invested in, in the past.
And there are three ways to grow. Law firms, the United States, through hiring out of law school, hiring laterals, or acquiring other lawyers or law firms and organic growth. The challenge is, is that the partners, number one, do not have the necessary skills to do what we call collaborative client development, where we're really working in cross practice, cross office course cross border teams to understand the needs of a client, develop solutions and present them for the highest value and complex legal needs.
They just do not go to law school to do that. They don't have those skills and to be competitive in today's global economy. It's critical that they have those skills. So that's what we work with partners on is, number one, how do you understand the client's needs and prepare for them? Anticipate what's going to happen in the future?
And that requires ongoing and consistent dialog with your clients and to be able to understand where those needs are outside your own practice area. And in many cases, the needs are so complex that it crosses multiple practice areas to even have a conversation with a client I wanted to just follow up on what Ray says as well. Having a plan, how can you collaborate and have conversations other than just hello and here's a quick status report, here's what I'm working on rather than strategically going to pursue existing client opportunities and understand those needs and be able to be a high value service provider with them.
And so, the plan really is a framework to have those conversations among lawyers and certainly across practice groups. It is not unusual for us to be working with a large law firm. I know. Right. Sees this all the time is where lawyers are working on the same client and different practice groups or different offices, and they don't even know it.
And there's no coordination. And large and complex organizations are requiring and demanding that law firms collaborate better. And it's very difficult to do that without a planning process in place.
00;14;53;22 - 00;15;14;29
Ray
And Jim, that kind of builds on my other point about if the attorneys start pointing services, just planning for planning's sake, they won't do it anyway, engage with it. But if we start saying to them, one of the other benefits is, for example, that you do work again. So, if we think about why people leave, they'll say, well, I work in the corporate team.
I actually work in Team B of the corporate team in New York. So, the only people I ever talk to, a lot of people who sit immediately around me and I'm on some of the happiest partners and people we see within law firms are those that spend more time outside of their home practice group. Actually, collaborating with other people, building a bigger network than the firm, and that big a network ties them into the organization.
So, if you imagine you are just a lone wolf superstar within a firm, it's very easy when you get bored or distracted or don't think you're paid enough just to leave. But actually, what we tend to see is that people who stay within a firm are those that have the biggest networks, and those networks are the things that actually just make them happier.
Having a wider group of people with broader, more diverse thoughts, experience, skills is what keeps people entertained and happy. So again, just coming back to this point of the plan, isn't there just to keep somebody happy? I mean, ticking the box, it's actually does spin out lots of opportunities to just build your career and ultimately from the firm's perspective, you know, retain the talent, basically.
00;16;27;01 - 00;17;00;09
Adrian
Yeah. You know, we were talking a little bit about the laterals came up in one of the previous comments, and I was thinking about how Dr. Gardner talks about investing in the lateral and the lateral immigration process. They spend a ton of money and resources in the hiring process in the interviewing process, but they don't integrate. And I think there's a parallel between that and the incumbents as well, is that every firm is spending plenty or investing plenty in different tools and different programs.
But sometimes those are just not either the right ones or they're in wrong proportions. And I think that that's a, you know, that's an important thing to think about as you go forward. And so, any comments specifically on that, Jim, as far as proportional investing or investing correctly?
00;17;18;11 - 00;17;43;17
Jim
Well, Dr. Heidi, Gardner, who I suspect many on this call have not heard or read her books and articles around this, is that the bulk of the investment made by firms is around the recruiting process. Very little is done on the planning and how that ties to the strategic plan. They do what we call often opportunistic hiring when somebody shows up in the market who's available.
So, there's not a lot of planning around that piece of it either. And that would all fit in with Ray's comments about talent and do we need talent? Why and where is it and how do we bring it in? And then there's very little investment. So, 5% on the front end trying to decide whether we need to hire people and why.
And typically you find, which I always find interesting, that the firms will hire when there's demand. They're short on capacity or capability. They're behind the curve with the client. So, they're missing out on those opportunities, trying to catch up rather than strategically bringing it in as it relates to their six points. And then also looking at what's happening at the client level industry and market level.
So, I think I think that's exactly right that the work really needs to be there needs to be a more significant investment to increase it on tying it together with the plans both at the client industry level and strategic, it's not that difficult to do. I think Ray is really right. Everybody gets caught up as lawyers.
And I appreciate that being a lawyer in the elegance of the plan and the more simple, the better, because as lawyers will tend to complicate it. And so, I really do agree with that part. And then also the back end. So we recently, we're working with a leadership team of 35, which include office managing partners, practice group leaders, board members, management committee members.
And the whole conversation was around where should they invest in integration and what does that look like? How do we retain talent? So, part of the battle for talent is keeping it, because if you don't keep it, there's an incredible cost to replace it, both hard cost and soft cost, and there's a cultural impact to it. So, the investment of integration really is not only what you're doing internally, your process is what we might call onboarding, but that doesn't necessarily focus at the client level.
In other words, are we bringing the right team members within the firm and why the laterals come to support that? And then also getting the laterals, the capacity and the capabilities and subject matter expertise to work on firm clients. And you need both. And Dr. Gardner has been very clear about that. And so there needs to be investment internally on the integration process.
And I've yet to work with more than one or a handful of firms that understand that are doing it in the United States. And it's a huge opportunity not only an organic growth, but because they're bringing partners with books of business for a reason, their clients, but they're not effectively positioning the lawyers do if they don't have the skills, they don't have the plans, they don't have the investments internally to do that.
And it's an incredible opportunity and it has a massive cost if there's turnover and the turnover post-pandemic is the highest, I've ever seen in the United States.
00;20;40;12 - 00;20;40;29
Adrian
Absolutely.
00;20;41;24 - 00;21;01;25
Ray
Well, and Jim, just to kind of put a bit of context again to that. So, prior to setting up the software company that we built, I spent ten years working within a law firm with the leadership team and one of my primary roles was to basically help recruit lateral hires to go into the market to help us build the business.
And there was one partner in particular who was actually my inspiration for setting up the business. So, at the time, we hired three at once into the corporate team, and one of them came in and he had a let's call it a six-point plan. And he emailed it to every single partner in the firm to basically introduce himself and say, these are the clients I'm looking to grow.
These are the clients I'm looking to win. These are my skills that in-house, how can I help you and how can you help me? And have a guess as to who was the most successful partner of the three of them in the long term.
And actually, interestingly, most people in the firm thought that was a bit odd. They thought that was a little bit to the open, a bit transparent, not what we do. But that partner went on to grow a very substantial practice outside of the corporate team by working with real estate and litigation and banking and finance. And again, this is the point.
It's a very simple principle just to use the plan to share what you're looking to achieve. And then at least one other person will help you do that, guaranteed.
00;22;12;01 - 00;22;36;25
Jim
And I find it fascinating. I'll ask managing partners two questions. What is your attrition rate? And they'll give me a number for a year, but you start adding up that number over the year, say 10% a year, which is average turnover in the United States for lawyers and that up over five years at 50%. And so, they tend to think about it a lot.
And just doing 10% a year, that's okay. It's not there's a huge cost to that on both sides of the equation. And so that's one question I'll ask them is what? And then I'll ask them, how do you account for that? Where is that in your profit and loss statement? And basically, we assume it's just a cost of doing business.
And so, I don't find that United States law firms are looking at that very simple import and export of talent and the cost associated with it. But the flip side of the opportunity is huge and just and everybody thinks it's very complicated it's not. It's just that we're a little bit I hate to use the word lazy around that, but I think perhaps you can is there's a little bit of discipline and understanding.
It's not a cost of doing business. And the other thing that we'll say is, well, we need to hire better, and my theory is, well, if we need to hire better, why haven't we been doing it? And so, I don't think that's the answer either. And so, it's very simple in how you're allocating your investments, both in the planning that you're six points and where you're bringing in talent and why and there's real discipline around that on the front end and bringing them in and really being what we call client facing and focused around the two points.
One - are we building a team around that lateral? I love your example, right? Because it's that simple. You can even be more targeted and identify with your marketing business development team who are the top ten or 20 people that that person needs to send that email to and actually meet with them in person and show them their plan.
Instead, we show we send them around on meetings in every different office and we want them to meet everybody. And there's no plan, there is no focus. And it's an incredible waste of time and energy, both hard and soft cost. And so, it's just a little bit of a focus. And frankly, the plan drives that. And whether you have a lateral partner questionnaire or you create a business plan of integration or whatever it is, it can be very simple, focusing on their most important client relationships.
And then also we really need to bring in the laterals into working on firm clients. And law firms are finally starting to institutionalize those relationships across the firm in a much better way. But we have a long way to go.
00;25;02;04 - 00;25;29;00
Adrian
I very much agreed. And as everyone can tell, we spend a lot of time thinking about laterals. They're a very important part of our conversations with firms, and I'm sure they're integral in every conversation you have as well. So, let's dove a little deeper. Let's talk specifically about strategic planning and skills development. Those are what I would consider to be long term perspectives and or investments that you have to make.
We talk about the ease of doing it, but then, you know, there's always this, you know, can we fix it quickly? Right. So, I believe there are two answers to that question. But I want to get your perspectives on how firms this, has to be the start point. And then there's just a long-term perspective of, okay, can we change?
Can we become a better firm if we institutionalize certain practices? So, I'll throw that first over to Ray give us your viewpoint on that being a concerted effort.
00;26;04;07 - 00;26;26;11
Ray
Well, so one of the things which we did a lot was to try and use the planning process to do two things. One, it's asked two questions. What can I do strategically to help grow this firm? And that's what gets people excited and connected to firms accelerating forward people like that. They want to be part of a successful business.
But then we say, and we want within the same plan, but separately, what can you do to grow yourself strategically? But think about your growth opportunities in the context of your plan. And this is where we see a lot of organizations fail because they'll have one process for what they call client development planning, and then they'll have another run by another team for like let's call it training and personal development.
And those two things are completely connected, but they often get almost purposely disconnected by law firms. So, it's treated as personal development is over here. And then your business plan is over there. So, what we encourage is start with your strategic goals. Then underneath it, think about what you need to do to develop yourself to achieve the goals.
And that actually makes it a bit more interesting, as opposed to just kind of trying to find a few courses on the firm's learning management system or a few seminars or webinars you can attend. Just do it in the context of your own personal growth, even be slightly selfish about it. There's nothing wrong with that. As long as you're doing it in the context of what the firm is looking to achieve.
And just to repeat the point, because I can't emphasize how important it is, the personal development plan in the context of the strategic plan is what gets people more engaged out of context it's just another tick box compliance exercise. We've got a focus on Jim, Jim, you'll have a lot more experience of that.
00;27;57;03 - 00;28;21;27
Jim
Well, what I see in many cases if there are plans, it's specific around compensation. In other words, you have to write something, a partner memorandum or something that says what you did in the past. It's past looking rather than forward looking. It's a historical document to get compensated that year. So that might be a check the box type thing you're talking about Ray.
Right? And we'll roll out always really emphasizing as well. What is your plan going forward? I find interesting lawyers because of the hourly billing rates in the United States are very short term oriented. It's rare that you find a lawyer that looks out past a year. They're really a month to month viewpoint and we really talk to lawyers about where do you want your practice to be in the next two to three years in business and corporations, the three and we're doing five year plans, you might get a five year strategic plan, but we certainly wouldn't get a lawyer thinking about where they want their practice in five years.
You know, we start with what type of client relationship do you want to have with this particular client or this industry? So, they're very short term focused and it's really helpful to work with them on actually looking farther out I think what we've seen in the United States is when we began this business 15 years ago, Ray is the client I'm going to tie into what you just said.
If it was business development related and there was any planning as part of it, it was on the business development side. Then we've had the rise of the professional development department and starting to coordinate both associate and partner development. And sometimes we work with professional development partners, sometimes the business development department. But we're really seeing, and this is a big, big focus obviously from Dr. Gardner's work, who were a licensee and provide all the implementation work and smart collaboration for North America is that it's a true collaboration among the professional development department, the Business Development Department, and your external provider.
Instead, what we see is a lot of law firms, either through professional development or otherwise we'll do a training program, and they'll say, well, well, the lawyers want and I think we find this consistently, the lawyers want to develop their skills here The pressure is on. It is a highly competitive market with the rise of the national and global law firms.
If you're a regional law firm, highly competitive, even if you are the very top or fighting for the best clients in the world and the lawyers just do not have the skills necessary to do that, certainly not collaboratively. So, we find that that's the most effective way to begin looking at this, planning the foundation, and understanding client's legal needs.
And how do you do that in an effective manner with multiple lawyers and practice groups and offices and different borders? And how do you begin having a conversation about the value that the law firm can bring, the type of solutions needed for highly complex problems, whether it's a cybersecurity breach, whether it's a large acquisition across different borders, whether it's litigation that requires both civil white collar crime, class action, and extends into the UK and the U.S. and Canada in a very complex and high value and requires millions of dollars of legal fees.
And what we found is that lawyers need more sophisticated training in development in that area. And frankly, the investments need to be much higher. Running just a quick training program about developing your network will not get you there. You will not be competitive. And so, there are three things, and I'll just close real quickly with this so I don't go too far.
I'll Let you comment on this Ray You could do training programs. We see the rise of individual coaching, or you can take an approach that you need to train and implement with the lawyers, apply it to real life opportunities. The training by itself - the research from ForHills shows that you have at most a 20% adoption rate. So, training by and of itself, I could do the very best training program you'd hire me for. And you have a very low adoption rate. Individual coaching, obviously, on individual plans has some value, but it doesn't cross practices, borders and offices. And it certainly is not necessarily aligned with the strategic plan of the law firm. The only way you get true impact on organic growth at the client level is to grow out multiple practice areas, offices and across borders on sophisticated work is to train them in teams and to put support behind them, consulting, coaching, to implement their plan and to allow them.
What we found is the biggest barriers. They don't know the firm capabilities to even do that. I know you know this, Ray? Is that they don't know who to contact or even who to have a conversation with. And certainly, without a plan, they could go to their practice leader, they could go to somebody they worked with the foreign litigation department and their transactional lawyer.
All of that is invisible. It's not transparent. It's not tangible. And it makes it incredibly difficult for them to compete at the highest levels for the best work with the best clients. Right? What are your thoughts on that?
00;33;36;05 - 00;33;58;04
Ray
Yeah, absolutely. When, again, it comes back to why should I bother writing this plan in the first place? When I was at Arthur Andersen and all of the personal development training had to be done on a cross functional cross in that case and to their cross office and cross jurisdiction basis. So, you could never go and do training with just people from your own practice group.
If that's not how it was panning out it would be canceled. So, I was in corporate recovery. All my training would be with auditors, with corporate finance, with tax, with pensions of the specialists. And again, it comes back to that point of, you know, if you have a plan, you can say, unless, for example, I'm looking to build my business within real estate investment trusts.
Well, there's going to be five or six other people as part of that personal development training who can provide opportunities to or knowledge or skills or contacts. So, it just comes back to again, I don't sound like a broken record. You don't plan just the planning's sake. You plan the concept There was always a context, which is every time you turn up to an internal personal development event, just talk to other people about how you're looking to build your business.
Share the plan, even print the copy off. What we did is we built software which enabled thousands of people very quickly to share those plans and find out what other people were looking to do. But if you haven't got that, just take a paper copy of it and distribute it. People might think you're a bit crazy or a bit of a class swat. It pays dividends.
00;35;06;08 - 00;35;13;03
Jim
A little part of it on what Ray says is you can say, well, yes, our attendees can be saying, yes, chairman. Right. We agree we should have plans, but we just can't get the lawyers to do it. And so, my question is, do you have a strategic plan? Well, most law firms do in some form or fashion, they may have practiced group plans in the United States and or they may not.
But imagine if you have a strategic plan and say, by the way, now lawyers, you need to write plans that are in alignment with that. That's probably not going to happen. Right? I would suspect you'd agree. Well, let's say you have practice group plans. Well, then what happens? The lawyers say, well, I don't need a plan because I'm just kind of doing what the practice group is doing.
And so, you don't get it there either. So, the two options are top down requirement, right? Ray. You have true leadership like in and maybe a corporate model where this is what we do. This is the process. And by the way, you don't get paid unless you do it. And it has to be in alignment with the practice group and the strategic plan.
That doesn't happen in the United States very much. Ray. It may happen in other parts of the world or Europe otherwise but doesn't happen in the United States that way. What I find fascinating is we will go in and run a program. And let me give you an example in the firm that I'm sitting in right now is they have no planning process.
They have a strategic plan, and then they have nothing else. And what happens is through running, we've put 36 of their partners are about to have 50 of their partners, of their 200 partners, through training at that point of 20% of the partners of the firm have plans. And where that came from was bottom up. And what happens is once we require to be in this training and implementation program which the lawyers really value, and they learn to do a plan because it's required and they're, and they're working just as you said Ray with other lawyers in the program cross office, cross practice, diverse as you can be.
And they're sharing that that becomes culturally what happens and then the law firm says, well, if all these people in this program are doing it, why aren't we doing all the other lawyers? And it happens. And I've said this on more than one occasion with our clients and it's not we don't go in and tell the law firms, you need to do plans.
We would like for you to work with Objective Manager. We'd much rather have a group of lawyers with plans to work with, but if not, they will be doing plans with us.
00;37;47;12 - 00;37;47;21
Adrian
Yeah.
00;37;48;09 - 00;38;09;14
Ray
Well, I mean, implementation of any program, especially if it involves software and it involves a law firm, is a challenge, isn't that? We all know that. And what we found was the big, you know, the first question the leadership team would say is we don't have a culture of planning in this firm. We would say, well, you know, the software won't change that.
The software can only enable what you currently do. It can make it better. It can make it smarter, quicker, more efficient, but it won't change the culture of the firm. Well, the first thing we would often ask them to do is goes to show us some of your, let's say, practice group plans. And the problem is one of them would be 76 pages long and only intelligible by the person who wrote it.
And then four departments wouldn't have one at all. So, there was this huge inconsistency, and it was because nobody knew how to write a plan. So, the first thing we would always say is just get every head of group to write down the six things that are most important for that group this year. And if they're not prepared to do that, they shouldn't be the head of the group. A fundamental role of leadership is to try to explain to people what's on.
And you wouldn't be surprised that many heads in groups didn't think that was their job. And so, what we would say is, you know, find people who just, you know, who are prepared to do that. They may not be the biggest, you know, the client holders or the biggest fee earners. And that often they tend not to be the people who are actually quite good at communicating with people and put them in charge of the group, get them to write the plan and keep it simple because as we say, without that, it's really and it comes back to your point.
We always thought we always call it the meet in the middle strategy. So top-down cascading works in large corporations where there's a small board of directors and there's 20,000 employees. Yeah, you haven't got the luxury that they've got to set the tone, and everyone's got to follow. Law firms don't work like that. So, what we say is you sketch out very high-level plans at a group level and then let people meet you in the middle.
So, bottom up and they kind of meet somewhere in the middle. Whereas we've had some law firms who've tried to use a strict cascading approach to say, this is our plan, you will do this. And of course, what's the first thing a lawyer does when they're told to do something? You know, they do the opposite. So, and this is why planning gets a really bad reputation in law firms because it's always been something which has been forced upon people or not very well organized or just a compliance exercise.
And so, again, just in the spirit of simplicity, you know, the objective is to retain people. Yeah, we know happy people don't leave. What drives happiness is feeling connected, engaged, motivated. They're still learning. They're still stretching and all of that can be documented and kind of prepared for a very simple plan and just make it four, five-to-six-point plan.
00;40;48;23 - 00;41;29;11
Adrian
Yes. So, let's talk about the individual a little bit. I'm sure everyone believes that they're excellent performers when they're lawyers because they're lawyers, however. How do you measure that? And alternatively, how do you improve performance? How so taking your two kinds of perspectives on that, it's very, very critical that law firms can measure and also have a methodology to improve performance because we know what happens when performance goes up, right?
Everybody, you know, you're lifting all the boats. There's you're driving towards equity. You know, everyone is winning. The firm wins, the lawyers win. So, let's talk individually. How do you individually look at that and how do you solve for that? As far as improving performance. You first Jim.
00;41;48;10 - 00;42;14;15
Jim
Oh, good. Yeah. Well, it's very interesting. And in we talk about return on investment. Right. And I'm sure that's talked about in the UK as well in Europe, right. You have more experience in that market than I do and so getting law firms to invest in their talent, they want to know what's my return. Otherwise, we might as well distribute it to the shareholders.
So, one of the things is you've got to prove that. So, what we look for obviously is and it can be set in different terms in the United States revenue or billings, maybe in the Europe or fees and then profitability or as we say, realization and then those but those are lagging indicators. There are certain number of things that have to happen before you can measure lawyers on revenue in realization.
If you're trying to grow it, we can do a snapshot in time, go in and look at the books and get a snapshot in time. But how do you grow that number? And what I find fascinating, my experience over the years is if you ask a lawyer to grow his book or her book for 10% they say, I could do that.
If you get to 20%, they start getting a little bit nervous. If you go over 30%, they just in the United States, they're concerned that if they don't make that number, not that we ask them to, but they're risk adverse by definition, and they don't want to fail. And in failure to hit their number, they're not as resilient so they won't go there.
But if we really talk about just growing your client relationship that's called practice group utilization and that the more numbers of practice groups you can use the higher the loyalty price sensitivity flattens as Ray knows as well. And over time the value of that relationship increases and very difficult to be displaced to be, as we say consolidated out in the United States.
If you're only doing one or two practice areas, you're at risk if a client goes to a consolidation strategy where they're using a lot of law firms and now, they want to use a primary panel. So, we really focus on what we call leading indicators, what are the behaviors? And everybody would love to change the behaviors of lawyers in certain areas.
I know everybody on this call would probably say that. And one of the things is and we've talked a lot about it, so I'm not going to talk about that anymore. But yes, you have to have a plan. That's one of the behaviors that we want you to. Right. The reason why is because we want you to focus on what is your internal network, because you need to know certain firm capabilities as it relates to your clients and your industries.
So, you need to know that are you going to work with this as Ray says? And that's part of your plan. And many, many lawyers don't have a robust enough internal network, and they need to learn how to build that network one by one with very important people rather than just blast out their plan to the entire firm. So, we work with them on that skill and then they need to be talking to their clients.
And I know, Adrian, with your background in sales at Dell, is the lawyers don't talk to their clients enough and they can't possibly understand their needs. At 3M we changed the business every 18 months. It was that dynamic of market in telecommunications and so what lawyers don't necessarily appreciate that if you're not talking to your client during the year after a year, that becomes in many cases a client risk.
So, we have to take them through that skills development and change behaviors and so plans one talking to your client around their business and their industry just not your matter or your or your practice area. You have to have a holistic conversation about what their business objectives are there opportunities and challenges? You know, as a former general counsel only hire lawyers for two reasons.
One, to manage risk and to reach a business objective. And lawyers don't know what those are. In many cases, having those conversations are highly valuable, but whether it's a businessperson or a general counsel. And so those are the behaviors we work with. But then ultimately, we want to make a decision on hiring counsel to help us on our business objectives and the opportunities and challenges around that.
So, in many cases, we need a proposal in some format. We need some additional information. I like to talk about you're not going to remodel your kitchen, at least not most of us, unless we're a lawyer, because we don't need it, but because we're lawyers. But what we really do need is we need some type of proposal around our needs.
What are the solutions, the creative options you have for us? Do we need to take action or not? What's the benefit of hiring making that decision now and why you and so those are behavior and skills that lawyers need to be able to go from opportunity, identification, prospect, existing client referral source, even internal network to get to a decision.
And what we found is and Ray this where goes back to playing again, there's not common terminology about what that is and if you're hiring laterals, if with the turnover we have in the United States, all these laterals are coming with different skills, different mental models around what business development is, different terminology. And to be able to collaborate and go after high value opportunities is really challenging.
So, if you're just looking at revenue and realization or fees and profitability, what are the behaviors that get you there and allow you to go after those high value opportunities? That's where we're making investments now in the United States. And our ROI is significant, and Dr. Gardner has measured it. And so organic growth is where we're really focused on.
The opportunities are huge, and the risk is so low, it's almost like buying an insurance policy for the lawyers you want to keep in the law firm and to what Ray said, to have a practice that you're excited about. You're working with people that you enjoy working with. If you ask every lawyer, I can put 100 lawyers in room and I ask, who wants to have high value and interesting legal work, all 100 of them will raise their hands.
But they don't necessarily have the skills or the plan to get there.
00;48;09;12 - 00;48;22;00
Adrian
And Ray how can you help on the performance side what can be done not only in setting the goals but also during the course of the year? How do you keep people on track?
00;48;23;19 - 00;48;56;17
Ray
Well, again, kind of inspiration as to why I set my own company up. What I used to do on average about 60 to 80 partner annual performance reviews a year, mainly for the transactional corporate partners. And as you can imagine, that was a massive investment in times I would do that with the managing partner. So again, senior leadership time and resource and whenever we encountered a partner who was unhappy, it usually came down to one thing, which is I don't feel valued in this firm.
And then unfortunately if nothing was done about that, that partner would leave. And as Jim said, that very, very expensive it upsets staff, it upsets clients. It's just not a good place to be. But if we go back to that point of, I don't feel valued in the firm, it comes back to what Jim was saying is that what law firms tend to do is they'll take things like strategic planning and they'll just try and apply a corporate process to a partnership model.
And we see the same, for example, with a balanced scorecard. It's a brilliant idea. You know, people have a balanced scorecard of goals within that plan. But again, within a law firm, what we say is that you've got to allow people to really play to their strengths. So, we would have to go through the balance scorecard and say to Partner X, well, you're not very good at managing people.
And the partner would said, I've never been very good at managing people, and I doubt I ever will be. So, stop judging me on those. We have focused on my strengths. Focus on what I'm good at. Don't put me in charge of personal development for the associates because I've got to because I've got to have a balanced scorecard.
And so, what we tended to see was, again, as part of the planning processes, work and play to your strengths. And obviously if there are areas where you can improve and absolutely need to, then fine. But actually, do those things when it comes back to what you were saying, Jim. So, one of the most successful players in the English Premier League at the moment, this will mean nothing to the American population.
Is a chap called Kevin De Bruyne, and the reason he's the most successful footballer in the Premier League is because he's got the highest number of assists in the Premiership. He's the guy who makes all the goals. Now he just happened to score them as well, but that's where his real value is. And a lot of the partners that we've worked with say that's that which nobody ever recognizes.
I'm assisting lots of other partners to make the win, to score, to win the client, but it doesn't get recognized and that's what I'm really good at. But the firm is trying to put me on a win client, you know, be more client facing type development course. So, it just comes back to this point of if you have a plan, it gives people the opportunity to say this is where they can make a contribution and then from a performance perspective, judge them on that.
Don't judge him on what they've not done because they were never going to do it in the first place. And again, I'll just say this again, all of this is extremely simple, isn't it? Why isn't every firm just, you know, play just strengths, have a clear plan, get people connected to the firm's strategy, and it all comes down to the same thing, which is they over, they overengineered the process.
Just make it attend any individual, any one of those on this call could write a plan in 10 minutes. If all you were doing was writing down five or six things that you want to focus on this year.
00;52;00;09 - 00;52;00;19
Jim
I'd like.
00;52;00;29 - 00;52;01;27
Adrian
To first of all, build.
00;52;01;27 - 00;52;34;15
Jim
On that if I could, Adrian. So, I'd like to take the football team example, and I want to translate that into the law firm environment. So, in the United States we talk about client teams or client service teams. And so, what's interesting about that is I tell law firms and Ray you'll appreciate that I said there is no client team without a plan so how do you go from individual plans to a client service team?
And so that requires a separate collaborative process among a core group of planning leadership within the key relationships of that team. And what I find is that we have lots of failed client service initiatives around teaming because they haven't created a plan. Take the top six lawyers that have the relationships and real estate tax, M&A, corporate governance, and they need to get in a room and create a simple plan and they need to measure these things revenue.
So, let's talk about measurements and they need to make revenue. They need to measure realization of profitability, practice, group utilization, client service and depth and breadth of relationships. Let's see if you can just keep, so Ray and I are completely in alignment on this is simple. It's better for lawyers. They tend to complicate things. And you can do first of all, we asked lawyers to do as part of the planning process one hour.
That's all they need. And a client team, we can do that in 4 hours. And be done with it. And the reason why is there's no new process and there's no framework agreed-upon framework in which that's done. And sometimes you have to bring in people that don't reside within the law firm. The expertise and knowledge for that resides outside the law firm.
And so sometimes you do have to bring in people to help you help you do that. So, I just want to comment on the on the team concept since you brought that up, right?
00;54;02;18 - 00;54;32;28
Adrian
Yeah. And I want to thank you both for bringing soccer into football into this conversation as well done. And I want to end on my favorite question, and that is the whole concept and the divide between thought leadership and implementation. And this is the conversation that we have had collectively as a group. But I think that the people that are listening today, there's always this problem of these are all really good ideas, but why isn't the execution there.
Next year we should be able to talk about this because everybody knew that they had to address it. But we will. So, the question is to you, the panelists, what happens at the law firm level that keeps them from actually executing on the implementation side? Start with you, Jim.
00;54;52;08 - 00;55;16;29
Jim
Well, it's all about implementation. So as much as Ray and I both have worked with Dr. Gardner over the past five years and beyond and all the research to supports doing everything we've been talking about today it is all about, in many cases, being a change agent and implementing some of these very simple concepts. And so, No. One, you've got to get some buy in from leadership to make some investments and
Number two, you've got to get, and people talk about get the willing work with the willing those and get little successes and start small. You know, as we said, we will get a group of 12 or 16 partners next year. We've got 16 plants. We didn't try to get implementation across 500 lawyers within the firm or you invest in Objective Manager and you, and you have robust leadership that understands and incorporates ideally the most powerful thing you can do is do both, right?
In other words, we love Ray's product and the company that he developed and to be able to go in where we have plans, otherwise we have to anecdotally develop that information when lawyer at a time. But if you can come to us with plans already built all we have to do is train you provide juice implementation consulting and coaching support and the plans in place and all we do is prioritize focus and put discipline and accountability around it because a lot of those resources don't exist using former general counsel and professional service sales professionals providing just a monthly coaching or consulting session and working with internal resources, we move the needle very quickly, almost immediately within the first few months but otherwise that's very challenging to get done otherwise, right?
00;56;38;17 - 00;56;56;19
Ray
Yeah. And I think for me it just goes back to what the first thing we say to a law firm is throw everything away that you've done before, throw away all those complex strategic plans, which nobody reads. That's quite hard for the leadership team because I've invested a lot of time and energy in them and we say just right that, you know what?
Just give us the six things, the framework for the six things that you think are really important for this firm. This year. Don't flesh them out. Just do them in. We often ask them to write them in less than 140 characters, which may sound familiar as a rule, but because if they can't and they can't express it quickly, then nobody else will bother reading it.
So, keep it really simple and give people the opportunity to say where they can contribute in the same format. And as Jim has already said, you'll get a lot more traction and people don't feel like that planning. They just feel like they're doing something quite useful.
00;57;33;10 - 00;57;45;22
Adrian
I want to thank everyone for attending, and we'll certainly be available to anyone that has any follow up questions. Again, thank you for your attention and your time. We were very appreciative.
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