May 23, 2008

Does A Cult Of Personality Dictate Your Firm Strategy?

12:00 am

David Maister wrote an article in 2007 related to the conditions that confront firms who face strategic changes (Are We In This Together? The Preconditions For Strategy). In it he wrote of four types of personalities:

Type 1 is the solo operator who values independence, wants to make little investment in the future, but is willing to bet on his (or her) ability to catch fresh meat each and every day. I call this the Mountain Lion approach. “Pay me for what I do today (or this year.)”
Type 2 is the individual who prefers to act in coordination with others, but doesn’t like to invest (or defer gratification) too much. I call these people (collectively) the Wolf-Pack. “If we act together we can kill bigger animals, but it had better pay off soon or I’m joining another Pack!”
Type 3 is the individual who wants to be independent, but is interested in building for the future by investing time and resources to get somewhere new. Such people remind me of Beavers building dams to provide a home for their (own) family.
Type 4 are individuals who want to be part of something bigger than they can accomplish alone, and have the patience, the ambition and the will to help the collective organization invest in that future (He references humankind, Ants and Bees as possible personifiers - I'll stick with Ants).

One of the things that draws me to this article is that I can identify people in the firm in which I worked in all the above types. The Mountain Lions were the highest producers and top originators; the Wolf-Pack were those who lived off the fat of the Lion's spoils and could churn out work; the Beavers were those who just did the work and quietly practiced law; the Ants were those who just went along with what was decided and never had much input or care into the direction of the firm.

The dynamics led Lions and wolves to form alliances and complain of the ants. In spite of the work ethic of the ants, they lost clients, had poor billing practices, and always ended up being the worst performers in the firm.

Thus, most initiatives failed in our firm. When decisions needed to be made, lions and wolves teamed up against ants. The lack of unified purpose left a conference room thick with self-preservation and under-the-breath animosity. Maister summed it up nicely:

It is hard to identify and create buy-in for what “we” (i.e., the firm) should do if there is no strong sense of “we” — a mutual commitment and sense of group loyalty and cohesiveness. Similarly, it can be meaningless if the members of the firm are not committed to go on a journey together into the future.

Problems result when a cult of personality forms around some in the firm (typically the lions). Left unchecked, the lions gain an air of invincibility and management becomes practically impossible. On the other hand, poor performers are a drag on the firm and lack of accountability can tear apart a firm. The only impetus to change can end up being a a dip in profits and/or a lion or wolf going to another firm. Both of these events are bad times to begin a discussion of change.

It would be unwise to deny that changes need to be made to adapt to the changing economy. There is little reason to expect the economic down cycle to end soon. The real estate boom is being replaced by the volatile commodities boom (energy and food). Globally, businesses are transitioning into "defense mode"; ie, shrinking investment, laying off employees not directly related to long-term strategic goals, hoarding money. Law firm cash flows lag, on average, 160 days. You may not feel it today, but soon your cash flow will be affected.

How will your firm adapt? There are many blogs talking marketing and business development ideas. This month alone there are several who have discussed marketing and client development:

Bruce Marcus, May 17th: NO PAIN, NO GAIN (Is The Marketing Return Worth The Risk?)
Kevin O'Keefe, May 22nd: Effective presence marketing via blogs and social media
Bruce MacEwen, May 12th: Who's On Your "Red Team?"
Tom Kane, May 20th: Full-Time Client Feedback Person - The Next Trend?

Though counterintuitive to some, maintaining or even increasing spending on business development during market downturns can lead to more profitability (RVs, Bananas and Recession-Proofing the Law Firm, Marketing Advice for Lawyers During Economic Down Cycles). One thing should be certain: maintaining the status quo should be off the table.

Anthony Cerminaro (BizzBangBuzz) wrote of a top ten list of obstacles to making changes in his post Overcoming Resistance To Change:

Procrastination;
Well-meaning naysayers and apologists;
Fear of failure (defeatism);
Impatience;
Waiting for the whole plan to be in place;
Lack of self-confidence or cultural intimidation;
Inflexibility or lack of adaptability;
Trying to do it all yourself;
Lack of forethought or concentration;
Lack of necessary skills or talents.

His post also provides suggestions to overcome the above.

To effectively create positive change in your firm, you must first determine what changes need to be made. This requires a thorough understanding of your current position and requires some forethought into what should be your firms strengths and weaknesses going into the next few years. Then a plan needs to be devised that will address the weaknesses and take advantage of the strengths based on the opportunities showing up in the marketplace. Measurable performance indicators need to be established that further your plan. Then the difficult part: gaining consensus.

The dynamics of your firm will dictate the direction you go and the ability to form a consensus to act. The degree of success in getting the lions and wolves on board will determine whether the plan will ever gain favor. The degree of accountability placed upon everyone may end up being the deciding factor.

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Filed under Firm Culture, Management, Planning by Brian J. Ritchey

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May 23, 2008