Jack Newman is the kind of lawyer who, when one looks at the quality of his practice and the power of his credentials, one would think shouldn't have time for practice group management. He is accomplished in a specialized niche field, the energy group at Morgan Lewis & Bockius in Washington, D.C., and has built the kind of practice and leads the kind of team wherein one could say, Well if there's anybody I'd excuse from this because they're so powerfully good, he'd be the one I'd would excuse. Perhaps some of the success that he and his group have enjoyed have been because he has not ignored team leadership. We have the pleasure of bringing you Jack Newman to tell you himself...

I started a little law firm with another person about 30 years ago. It was an energy boutique and we had about 17 people in the firm. At that size, planning sort of happens every day. It's not necessarily a scheduled function and you plan in order to live. And that's what we did. We were in practice for about 15 years when we did a relatively small cross-town merger with the energy group of another large law firm. And all of a sudden overnight we had 35 lawyers in the room rather than just 16. That was quite a change for us. By present-day standards it's not very much, but by the standards of the time it was significant.

All of the 35 people are in the room. They don't know each other. They've got to practice together and the first logical thing to do is to sit down and find out what each happens to be doing at the moment, and what each think his or her prospects are. And that's exactly what we did. We took a little room over at the Mayflower Hotel and spent about ten hours. Each of us talked about our respective practices. But more particularly about the people that we knew, the subject matter that we covered, the clients that we knew of, and some idea as to the opportunities that we might together have that we did not have individually. The best and most important part of that exercise is that we happen to have a wonderful note taker. He didn't just record what we were talking about but as each person spoke about the opportunities and identified how it might be done, it was tagged with the responsibility and given a due date. And what came out of that was essentially a client-by-client review which, I think David Maister and others will tell you, is the first natural step in the evolution of a business plan. And that was in fact the first addition of our business plan. It was about five pages, as I recall.

This is our business plan today -- about 300 pages. I always hesitate to show it to folks who have not worked on a business plan before because it seems such an awesome kind of thing. We'll go through it in a little bit of detail. I'll tell you what's in it. I very rarely show this to a group that has not done a business plan before because it can be very discouraging to look at a document this size and think about all the time and effort that goes into producing it. We've now been doing it for 16 years and so it's really a creation of information, opportunities and intelligence that has been poured into the document. Each year is incremental -- we didn't start this and carrying it all the way through to the bitter end.

Today this business plan is developed before the beginning of each fiscal year. It takes us about six meetings, ten days apart, three to four hours in duration to do the update -- talk through the update of the business plan. Right now, for example, we are in the process of committing to writing the fiscal 2000-year plan, which we've just finished working on through the course of mid August through September.

The business plan incorporates all of the things that David Maister talks about. It covers not just a client-by-client review -- that's obviously the central part -- that is what are we doing for that client? What might we be doing for that client? Who's responsible for that client? Are we doing proper succession planning for that client? Where are the cross-selling opportunities? What was the business value last year? Could the business value be increased?

The significant part is that there is an action at the end of every item in this business plan. And there is an individual who is charged with assuring that it is completed. These are not general discussions; they are quite specific actions.

Now some of the things that we look at are not necessarily specifically client-related. We call them multi-client, you might call them general business environment. We approach those issues not from the standpoint of what does an individual client require, but in our industry what are the new issues that are emerging. And are we in a position to assist clients in connection with those activities? Are we in affect ahead of the curve? That is part of a review that we do which is a review of our external environment. And for most of us, I think we will regard the review of the external environment as just one notch less important than the client-by-client development. Because in an industry such as ours -- and it may or may not be true in areas you practice -- industries change, people change, government policies change, the law changes. And you've got to be aware of what is going on around you. You cannot assume that because you practiced successfully for four or five years in a given way, that the next five years are going to be the same. I can tell you that we feel that we have had to reinvent ourselves at least four times over the last 30 years.

One of our major areas, for example, is nuclear power. Nuclear power was going gangbusters in the early 1970's. And then no more plants were built after the Three Mile Island accident. But there was a lot of enforcement activity and so you had to be sure that your people knew how to handle themselves in an enforcement role as opposed to an administration litigation role. And now we face perhaps the greatest challenge of all with the deregulation of the electric industry and the aging of the nuclear power plant, where their licenses are going to have to be renewed over the next several years.

Now, again, we're plenty busy. We could just do what we're doing instead of taking those additional three or four hours every other Monday to do this planning process. I submit to you that at least in our practice we couldn't survive on that basis. And by survive I mean adding market share. We have a finite market -- probably 200 or so electric and gas utilities. And we want to be sure that we do not lose--- indeed that we gain -- some market share. It's not necessarily the business value in dollars that's critical. That's important, but market share is absolutely critical. And we do keep very, very careful control and very careful oversight of that.

I should tell you a little story about David Maister and his influence on us. As I said, we started doing this kind of planning about 16 years ago and David, I believe, addressed a group of Morgan Lewis partners at a retreat perhaps five or six years ago as I recall. I was not familiar with David's work at the time. As several of us sat there, it was kind of an epiphany for us. I don't think he was telling us a lot that was new but he was saying things and putting labels on things that we had been doing for the last ten years. And there's that terrific instinct to say, Damn, we must be doing something right, this fellow's pretty smart. Since that time, of course, I have read his books. And at least from my perspective and my practice I can tell you that the underlying theory of Maister's PracticeCoach® program is sound. We have used it for the last 15 or 20 years to manage a highly successful practice.

I think if there is one fundamental lesson that came out of that initial meeting with David, it was the notion that non-billable time is investment time, the difference between health and hygiene which is very, very important. In the last issue of this business plan, one of the last internal actions that we took was to record our non-billable in more finite categories than we had used in the past so that promotional activities get a different code than client development activities -- promotional activities being things like speeches and writing articles and so forth, and other client development being development of proposals and things of that nature. We track those non-billable hours very closely because, quite frankly, that's at least 50% of our bread and butter. We want to make sure we're investing properly. That we're earning a return on it and that we're doing all that we should be doing in a given area.

The billable hour is the coin of the realm in the legal profession. There is just no getting around that.

I didn't tell you the rest of my story which is that we eventually merged our firm -- what got to be a 100 attorney law firm into Morgan Lewis where we have been for the last five years. And, whereas in the former firm we could largely control our own destiny -- it was our law firm -- now we're part of a 1000 attorney firm operating out of 14 different offices all over the world, and it's got its own billing imperatives. And so we have, I think, managed however to convince the Morgan Lewis organization that there is merit in doing these things. That there is value and that indeed that it has application in other practice groups.

I never show this business plan, as I said, to a practice group I'm coaching. The thing that I use for a practice group that I'm coaching looks something more like this. This is a little presentation that I use with other practice groups called Building a Business Plan. And we show them; we talk to them about how it's done as a matter of process. And then we don't want to give them too much material to worry about so we just show them a few examples of what it would look like, and this is an example of what I use with them. And this happens to be one of the multi-client strategies or the generic strategies, which talks about the restructuring of the electric industry. And we use that as a sample. I've done this with three or four practice groups at Morgan Lewis.

There are some people who have become believers of PracticeCoach®. Our Labor Section are absolute believers in it. And we have a remarkable phenomenon that occurred there. You know everybody talks about synergies and cross-selling and that sort of stuff and actually most of that stuff happens by accident. But you can to some degree plan for it. We had our Labor Group essentially use our form of business planning. And then we sat down with them and in effect we put their template over our template and we found at least ten areas that we could sell together. Of those ten, three managed to be hits. That is, we were able to identify a client that might not have used either of us for that work, but together would consider us. And in fact did.

So there are some success stories. It is a hard thing to sell. But it's clearly worth doing.

I just want to quickly mention a couple of other points. Our business planning process is participated in by every single person in the energy organization and that's almost 50 lawyers who are in four different offices. And of late we've begun to use video conferencing to bring in some of the people from LA and Philadelphia and so forth.

I should also mention PracticeCoach® and the video briefing tapes from the program. This is how we use it. And I have used it over the past two years. PracticeCoach® is used in our practice group sessions. We assigned to a different partner in each session the responsibility for introducing the subject, the tape, and leading the discussion that follows. One of our useful moments with PracticeCoach® recently was on delegation. It's revealing, because if you're really having a true interactive discussion you get to pull back the onion. For us it was not just a matter of are we delegating, it was a matter of are we delegating properly. So you begin to have pretty good interaction between the members of the group.

So, in any event, that's our experience. As I say, it may not be a universally applicable experience but it's an interesting one.