BDO Stoy Hayward and International Survey Research (ISR) teamed up to measure the relationship between core values and performance. The study is still ongoing according to an article in Managing Partner by Rupert Merson. Merson (rupert.merson@bdo.co.uk) is a partner in BDO and a Fellow of the London Business School.

While the project is still ongoing, Merson reports that the evidence indicates that firms who emphasize organization values, any values, outperform others. The stronger the emphasis, the better the firm performs and the more income partners take home.

The lesson to learn here is that it pays to invest time and effort in understanding the organization’s values that have developed over time. When making that determination, some leaders may not like what they find. Having determined the values that are currently influencing behavior within the organization, they are then in a position to support those in synch with the leadership and to change those that are not desirable. The objective should then be aligning the entire team behind a single set of core beliefs or values. That alignment is accomplished by continuous frequent communication and thorough training.

Morepartnerincome previously put it this way: “Firm partners need to get together and agree on what they are in agreement about." See the prior post What Law Firm Partners Need to Agree About or check out other posts in the folder Culture & Core Beliefs.

How significant is it for an organization to place emphasis on its core values? It’s big:

62 percent higher growth in fee income

Margin percentage is double

Partner income is 54 percent higher

Merson says, “All this naturally requires an investment in time and energy. Unsurprisingly, research also shows that the firms investing the most in core values also have training and development expense per employee, some 81 percent higher than firms less concerned with core values.”….”The results of this investment might also be startling—making it very difficult for another firm to copy and reinforce the competitive advantage.”

The study will go on to determine which values are more important than others. But from my view, the most important finding is that it is those law firms who have defined themselves internally and externally in terms of their collective values (core beliefs) that succeed best. It is the belief system that keeps an organization together in the best times and during disappointing times.

Morepartnerincome.com is sponsored by Juris, Inc. For information about Juris® products and services for increasing law firm performance and partner income contact Juris National Sales Center at 877/377-3740, e-mail info@juris.com or go to www.Juris.com.
 

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There is a difference between new fee revenue and new client fee revenue. A law firm has to work harder for the opportunity to earn each dollar of new client revenue. New client revenue is prized all the more because of the difficulty of winning the business and because of the intuitive understanding that without new clients, the law firm will wither and die on the vine.

Nevertheless, we can never forget that for most law firms, each year’s fees will come largely from its existing clients. Existing clients are often taken for granted. New client development and existing client retention each require planning, and for each, the firm must adopt strategies, develop programs, delegate responsibility, set goals, measure performance and hold people accountable.

Here are a few worthy questions important to existing client retention:

• Are the firm players involved with key clients and keeping up with business and industry trends?
• Have we set expectations or set specific goals for spending non-charge time talking with key clients about their goals and concerns?
• Do we plan personnel changes involving key clients and involve those clients to assure the changes are valued rather than viewed as disruptive and costly?
• Do we ask how we are doing and then do something about it when clients tell us?
• Do we have a client bill of rights to set firm-wide expectations concerning customer care?
• Have we as partners gotten together and “agreed on what we agree about” –i.e.—reached a consensus as to our core beliefs?
• Do we communicate our core beliefs continuously and frequently?
• Do we hold people accountable for the quality of their work and for how they treat others?

Have you walked through your office and inventoried the smiles you encounter or looked at the appearance of the office and observed the interaction between team members as a client might see those things?

It is worth knowing that most professional liability claims against midsized firms arise due to lapses in administrative and management systems and not because of the actions of the lawyer. That should bring home how important it is to have the entire law firm team on board when it comes to care and treatment of the firm’s clients. Make them part of the planning and action teams charged with the goal of continuing to improve law firm practices and procedures to better service the law firm clients—to earn excellence in the customer’s eyes.

Morepartnerincome.com is sponsored by Juris, Inc. For information about Juris® products and services for increasing law firm performance and partner income, go to www.Juris.com.

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Law firms that set objectives, measure performance, and hold people accountable outperform others. And the difference is big. Partners in the top performing 25 percent of midsized law firms earn twice as much as those in the next highest 25 percent.

That was one of the points Stephen Collins, Juris, Inc. CEO, made in his opening remarks before the 300 attendees at the 21st annual educational conference of Juris Users International Group on October 27, 2006.

There are two ways to be successful—by accident or on purpose. Accidents do happen, but accidental success seldom lasts. You lose at life’s lottery just as quickly as you win. What is the old saying—“Easy come, easy go.”

Lasting success is achieved through purposeful determination. The steps for building long-term success as a law firm are the same as those followed by other well run businesses:

• Engage in structured Strategic Planning
• Have leaders agree on core beliefs
• Practice budgeting and goal setting
• Engage in benchmarking and competitive intelligence
• Measure performance against budgets, goals, and benchmarks
• Lead through constant communication
• Hold people accountable:
  • Recognition
  • Compensation
  • Promotions
  • Terminations

Magic happens when people pursue a common set of goals bound together by a core set of beliefs—but it doesn’t happen by accident.

Morepartnerincome.com is sponsored by Juris, Inc. For information about Juris® products and services for increasing law firm performance and partner income, go to www.Juris.com.
 

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Courage is defined as the quality of mind or spirit that enables a person to face difficulty, danger, pain, etc., without fear. It would be far more appropriate to say “the act of facing difficulty, danger, pain, etc, in the face of fear.” And there isn’t enough of it around. But it is an essential quality of leadership.

When advising a young lady who had just been promoted to an important management position several years ago, I told her that she needed to pick three to five principles to which she should unwaveringly adhere. The second piece of advice was more important. I told her, the minute those principles were understood by others, some people would began an all-out effort to get her to compromise those principles. For some, it is merely their way of testing you. Are your principles really entrenched, or are they like the Pirate’s code, more guidelines than actual code? There will be others with lesser minds who nevertheless consider themselves intellectually superior. For those, the concept of absolutes, standards, and right and wrong are an anathema. Against such an onslaught, it takes courage to stick to what is right—your beliefs.

Davis Maister talks about Passion, People, and Principles. Passion, people, and principles are the ingredients that make a successful law firm. Numbers and metrics are simply the measuring stick. It takes people with a passion (a common sense of direction) guided by a common set of principles (core beliefs and culture) to make something great.

It takes courage to maintain those principles against the efforts of those who don’t want absolutes. For them, each situation, each event, and each decision can be dealt with intellectually without the constraints of principles or the absolutes of right and wrong. Such relativism can show an absence of courage—a way of subconsciously or consciously rationalizing our actions and inactions to avoid dangers that we fear. In business, those dangers can be the possible loss of clients or the fear of confronting others about their unacceptable behavior or performance. In both our personal and professional lives, peer pressure can lead to compromised principles. Going along with the crowd—doing what is politically correct, intellectually in, what the cool people do, what smart people think, etc.—is motivated by the fear of not being accepted. Without ample courage, we compromise our principles a little here and a little there. With enough compromise, the moral compass is lost altogether.

Even greater courage is required on the world stage. The dangers can be deadly, and thus, fears are far more real. Sometimes courage is all that stands between civilization and madness. It takes courage to say that some things are not acceptable. Consider the recent reaction to the Pope’s remarks about Islam or the similar reaction to cartoons offensive to Muslims. Those reactions are not acceptable, period. There is no gray area here. It doesn’t matter if you are Christian, Jew, or Muslim. It doesn’t matter if you are a young black man or an angry white man. It is not acceptable to riot, destroy property, and murder people because you are offended.It isn’t acceptable. It makes no difference what was said or what was drawn. Why don’t we hear more people saying that? Where is courage?

Morepartnerincome.com is sponsored by Juris, Inc. For information about Juris® products and services for increasing law firm performance and partner income, go to www.Juris.com.
 

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Among the discussions during the June ALM Law Firm Business Forum was the emphasis on branding.  

 

The topic crept into presentation after presentation, including those that would otherwise appear completely unrelated. It arose time and again as essential to law firm continuity—long-term success. It also arose as an expression that law firms can no longer depend solely on ineffective attorney rainmaking. And finally, it appeared as a strategy to entrench the firm’s culture and core beliefs. I was impressed by the faculty's understanding that “who we are” makes a difference.

 

Angelo A. Paparelli of Paparelli & Partners said it this way: “Branding can become a self-fulfilling phenomenon. The more a firm succeeds in establishing a distinctive brand, the more probable it is that like-minded attorneys will apply for employment with the firm, and that clients who want or need a particular type of branded legal services will search out the firm for help.”

 

I was also intrigued by a case study reported by the faculty that illustrates how slippery the branding slope can be. A particular law firm was undergoing a branding program to make sure that the brand clearly communicates the firm’s value proposition. The firm’s current website emphasizes the firm’s courtroom successes. But when targeted prospects were surveyed, those prospects indicated that winding up in court was considered a failure. Potential clients valued quick resolution of issues over successful court trials.

 

The reported case is an example of what Peter Drucker called the “wrong quality”—when we get so caught up in what we are technically capable of doing that we build products and services that are out of synch with what the marketplace wants to buy. It is also reminiscent of a prior post, “Too Good, Too Expensive and Too Inconvenient."

 

Defining "branding" isn’t easy. I would define it as matching your unique qualities with problems that your defined market wants to solve and then finding a way to convey that through image and style. Branding also involves deciding what you are not and the business you will not pursue.

 

• The first step is to define your strengths
• Second, match those strengths with problems the prospects want solved
• Next, define your market as narrowly as practical with an eye toward market leadership
• Lastly, invent a way to combine your strengths, the market you are addressing, and the benefits your customers will realize into a “brand”—a combination of the visual, audio, print and style that conveys that message.

 

It is not an easy task, but for more partner income it is one worth pursuing

 

Morepartnerincome.com is sponsored by Juris, Inc. For information about Juris® products and services for increasing law firm performance and partner income, go to www.Juris.com.

 

 

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One of the blogs I especially enjoy and learn from is David Maister’s Passion, People and Principles. His recent post “Dangerous Rubbish About Leadership” is classic Maister. Maister the contrarian opens the post and the insightful and wise Maister ends the piece.

I agree with his message, at least my understanding of it. Success is not determined by our desire for it. It is determined by how we pursue it. A law firm’s core beliefs about “how” it pursues its activities are what make the difference between the merely competent and the exceptional law firm. As Drucker has noted, competence isn’t enough to survive.

The view of a leader as one who lays out a destination and says “follow me” is an outdated concept that does not work in Maister’s view. It appears that Maister discounts the importance of destination in part because the destination for most law firms is usually the same. However, if you do not know where you are going, any road will do. The law firm that has an organization pulling in many different directions is likely to get nowhere. Someone has to set the course. Sometimes the destination is defined as where the law firm is not going. There has to be focus or concentration. That doesn’t mean that the organization is not prepared to change course, take advantage of opportunities, or benefit from serendipity.

Destinations are temporary targets. Having a destination doesn't result in reaching it. I believe Maister is saying what really drives success is the core belief system that is imparted in an organization by its leader or a succession of leaders. I’m not suggesting people want to be led, but people do need a copy of the playbook. They need to know the boundaries within which they can exercise their own judgment and creativity in pursuit of the organization’s purpose.

We use the shorthand phrase “I65 North” to remind our team where we are headed. It emphasizes that each individual is an independent traveler in that journey. You can drive as fast as you can as long as you are not so reckless as to endanger those around you. You can go as slow as your circumstances require as long as you are not impeding the progress of others. You can get off and get back on. But you can not go south, east or west. As important as our destination is, where we are not going may be even more important. We are going north. If you don’t want to go there, then you need to find yourself another highway to travel.

Maister ends his post with the following statement: “Great leaders (there, I’ve said the dreaded word) get people to focus on the key elements of strategy – the standards on which the firm is going to compete. With a clear ideology to rally around, talented people get the choice of saying ‘I can believe in that. I think I’ll stick around to a part of that and be a member of a society of like-minded people operating together in accordance with common values.’ That commitment, in company after company, has led to service line and market sector choices not no-one anticipated, because they were not the guts of the strategy, but rather the outcome of the strategy – the firm’s own way of doing things. If a leader can create THAT – then I’ll agree to use the term ‘leader.’“

Morepartnerincome.com is sponsored by Juris, Inc. For information about Juris® products and services for increasing law firm performance and partner income, go to www.Juris.com.
 

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While work/life issues were last on the list of the top five reasons for lateral moves among law professionals, these issues are closely related to work environment issues which also ranked in the top five reasons. Work environment was the third highest reason for lateral moves among women.

Work environment issues include the physical aspects of the office. Does the firm maintain a professional environment and provide legal professionals and staff with the appropriate tools, resources and technology? This category also includes the physical location of the firm. Is it in a high crime area? Is the location an accessible one easily reached by the firm's team members? It also involves the culture of the firm, including its core beliefs and how partners and associates relate to one another. Confrontational, political, and competitive environments score low, while cooperative, encouraging, and friendly environments are the attractive work places.

The biggest operating cost and most valuable asset of a law firm is its people. Everything else is chump change. Do not pinch pennies when it comes to the firm’s facilities and tools. Protect the firm’s investment by being concerned for the care and well-being of its team. Make common courtesy a job requirement for all, including partners. Be intolerant of anyone and anything that creates a hostile or less than welcoming environment.

Some firms are catering to those who place work/life issues high on their priority list. When a firm can do so, it benefits from the services of talented professionals who, because of lifestyle or choice, place personal and family requirements ahead of the job demands for frontline legal professionals. Not all firms have the mix of business and depth of staff to accommodate work/life concerns. Those that can’t, or won’t, will lose talent to those who can.

 

Morepartnerincome.com is sponsored by Juris, Inc. For information about Juris® products and services for increasing law firm performance and partner income, go to www.Juris.com.
 

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Instill these concepts in your young team members, and they will increase per-partner income and firm success.

Opportunity Wedge: There are two certainties in life:

• Change is constant.
• We are always judged by others.

What we are is determined by how others see us. The Opportunity Wedge illustrates that life is a journey involving constant change.

 

 

 

At birth, our opportunities are the greatest. We can become a bum or a great achiever. Our final destination is determined by our own decisions and actions. As we journey through life, one decision after another narrows the alternate opportunities available to us. For those who have already sacrificed their best opportunities through bad decisions, the opportunity wedge is an unpleasant and fatalistic concept. Thus, I am always reluctant to introduce the Opportunity Wedge to an audience. But for the young associates entering the firm, it is an important concept for their mentor to convey. Where the associate goes from here will be determined by the associate’s own decisions and actions. Make the right decisions, and the future is a bright one. We are the captains of our own destiny.

It is an organization’s culture (its core beliefs) that gives that organization its character and personality. The Opportunity Wedge is a part of ours and the following catch phrases and short descriptions identify others. I recommend them to you.

Make My day: You are the person who decides what kind of day you will have.

Pros Play Hurt: Show up and play your best.

Keep on the Gas: Don’t let up just because you are almost there.

Presentation Counts: A cake is one thing; one with icing is altogether another.

Finish, Don’t Quit: Achievers bring things to a conclusion.

Listen to be Heard: Great conversationalists ask and let others talk.

Dress for Success: Clothes may not make the man, but they make an impression.

It Is All About Giving: Relationships are built by helping others.

Two Words to Use: “Thank you.” “You’re welcome.” “I’m sorry.”

People Bank: Save them; they pay a great return.

Smile: People can hear yours.

Humor: It is disarming.

Miss Manners: Behavior counts.

Persevere: Never throw in the towel.

Standing 8: Take the time to refocus.

Play Offense: Act, don’t react.

True Believer: Be a “can” vs. a “can’t” person.

Practice/practice: Stars aren’t made—they practiced.

We, Not I: Great things are accomplished through others.

Collaboration Trumps Competition: Personal contribution is valuable, but it took collaboration to build the Pyramids.

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It happens in every law firm. The tail has a tendency to wag the dog. It is called Sub-optimization and it cuts into partner income.

 

Sub-optimization is when the interest of certain departments or individuals drives actions and decisions rather than the goals and objectives of the organization as a whole. It is as if the organization chart has been turned upside down.

 

I hesitate to tell you how often I have spoken before groups of law firm accounting or administrative personnel and had someone in the audience remark, “We don’t want our lawyers to know they can do that.” That confession is sometimes followed by a chorus of support from a portion of the audience. Their interest in maintaining their work routine without disruption was in control of their actions. They would withhold information about tools and capabilities already available to you through your existing law office business systems because your use of those tools might disrupt their established routine.

 

Sub-optimization is a naturally occurring tendency in any organization. Sub-optimization is most intense when the organization fails to effectively communicate the goals and objectives of the entire organization. It is lowest when the organization has communicated each area’s role in pursuing those objectives. People need to know where the organization is going and how they are expected to contribute to that journey.

 

The law firm needs to be one team pursuing common goals with a common set of core beliefs.

 

Surveys indicate that less than 16% of all law firms have a written strategic plan. That does not mean that the partners do not have a consensus about the direction and goals of the firm. Partners meet frequently, and while some disagreements may exist, there is considerable unity among partners about where they want the firm to go, how they want the firm’s clients to feel about the law firm, and the efficiency and effectiveness of the law firm as a team.

 

If your firm doesn’t have a formal plan that can be communicated to the firm’s team, work with the other partners to fashion a statement of direction and expectations for how the law firm wants to be perceived by its clients and others. Document and communicate throughout the firm, how each area is expected to contribute to the accomplishment of that road map to the firm’s future. When you do so, you give your administrative team and your associates a good feeling about their job and how their performance contributes to the firm’s goals and mission.
 

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