Tag Archives: entrepreneurship

Three things about special law firm leaders

Fish school smallWith two upcoming talks on leadership development to deliver over the next few months to groups of lawyers, I thought it would be interesting to get some fresh ideas from one or two of my colleagues; Nick Jarrett-Kerr was kind enough to share his thoughts.

While Nick was quick to emphasise the mountain of books written each year on leadership, and that there is certainly no agreement around key attributes of successful leaders, having seen many leaders come and go for the past twenty years or so, he did feel three things stood out for him:

  1. The ability of a leader to create what Nick termed a stunning “second album”;
  2. Entrepreneurship; and
  3. Trustability.

Let’s consider each of these attributes in a little more detail.

  1. The second album: many new leaders come to the job for the first time with something of a mandate. They may have been elected or may have been selected by a committee or perhaps are the only ones prepared to do the job. In any event, they have usually set out what they want to achieve and the support behind them has provided a mandate to be able to deliver this. This alone enables them to achieve quite a lot in their first period in office.

In the music industry it is always said that the second album is much more difficult than the first. Something similar happens in law firms – the really good leaders have the ability to go on and create a really good second album after their first spell in office. Some less successful leaders seem to get stuck in the same old management-focused tasks and grooves they got involved with in the first period in office.

The best ones move forward and look for new opportunities and exploit those. The good second album sets the scene for the next thing Nick has seen in good leaders.

  1. Entrepreneurship – that uncanny ability of some people, like good leaders, to identify and exploit previously untapped opportunities for their firms. A leader who’s been in office for a while should know his or her business inside out – every area of skill in every department, practice group or industry sector focus area, as well as every office. He or she should be intimately acquainted with the market in which the firm is practising and the competitive nature of that in regard to things like pricing differentials and so on. The ability, within this, to spot new opportunities and new and emerging services and to exploit twists in existing services is one quality one sees in truly good leaders.

Or it may be the way to re-energise or re-position the firm in such a way as to better deal with its clients or possibly even the way in which it delivers its service. Equally entrepreneurial is the way in which a leader can help the firm to improve its processes, capture knowledge or create systems which provide unique ways of doing things. Good leaders can do some or all of these things.

  1. Trustability – those leaders who do well seem to be able to engender trust amongst their partners. They have consistent standards and naturally demonstrate these, rather than just talking about them. Behaviourally, they control themselves in terms of the way in which they go about their business, and so set good examples. They in turn monitor these amongst fellow partners. They don’t think short-term but rather, with a view to the longer term. They follow things through; they communicate well and don’t sit in a bunker getting bogged down in administration. They are good at prioritising and are seen to make decisions properly. They also show a very intuitive and sympathetic approach to decision-making: while the really good leader may not operate entirely by consensus every decision is carefully looked at and carefully considered against consultation that has taken place. All this builds trust and what follows is respect.

When trust builds like this it grows a leader’s confidence as well as the partners’ confidence in the leader and the firm, which ultimately builds strength and well-being.

In a forthcoming article I will highlight some interesting points Ed Wesemann shared with me around what leadership attributes he feels will be required for the future.

Entrepreneurship is at the Heart of Good Governance

Different peopleIn the last couple of years I have been honoured to advise nearly a dozen clients on complex governance projects in at least six different jurisdictions. Some of these projects have been driven by tax or regulatory considerations, but most have had effective management and leadership at their core. One of these projects was to help a mid-sized limited liability partnership to modernise its decision-making processes. Another was to create a structure to combine the best features of partnership into what is essentially a corporate structure. Several projects wrestled with complex partner compensation problems whilst other projects related to merger or, in a couple of cases, the firm’s growth which had rendered the historic structures obsolete or no longer fit for purpose. The context of this work has varied from traditional partnerships through to LLPs and LLCs, civil companies, corporations and multi-disciplinary structures.

What I have found is that the increasingly complex world of professional firm governance always raises the question of the qualification for ownership status. Until about ten years ago, professionals seemed to get promoted to partnership by little more than rites of passage and without questioning very deeply their fitness to be an owner. As a one-time managing partner, I have to put my hand up and admit to being at fault in failing sufficiently or rigorously to assess such promotions. More recently, however, equity in professional firms has become more tightly held, and this trend has been accompanied by a growth in professional competency and assessment frameworks, balanced scorecards, promotion criteria and partner job descriptions. Our recent Edge International Global Compensation Survey confirmed this trend, and particularly the growth in importance of business development skills as an essential partner competency.

Even so, firms nowadays are rightly reluctant to elevate professionals to partnership unless they seem to meet some hard-to-define extra qualities – some spark that lights them up. The negatives are easy to establish – no jerks, no journeymen partners, nobody who will impede progress, and nobody who lacks rainmaking skills.

Hardly anybody mentions entrepreneurship – maybe because it seems so difficult to describe in terms that lead to easy partner identification. Here then is a start. Entrepreneurship has been defined as “the identification and exploitation of previously unexploited opportunities.” It is clear from this description that the ability both to innovate and to drive is at the heart of entrepreneurship. In professional firms, this ability can be demonstrated in at least three areas – services, clients, and processes – and prospective partners should be required to show entrepreneurship in at least one of these areas. The ability to spot opportunities in new and emerging services or to exploit twists in existing services may be one such quality. Another might be the ability to re-energise or renew the way the firm interacts with its clients or delivers its services. Less obvious – but of equal importance – is the ability and drive to improve processes, capture knowledge, and create systems and unique ways of doing things.

In their business plans, prospective partners should be required to set out some of the unexploited opportunities that they could create, and how they would see themselves as exploiting and managing those opportunities for the benefit of the firm. I have lost count of the times that I have been told that firms contain partners who should never have been promoted. A more rigorous approach in promoting partners would in my view inexorably lead to more entrepreneurship, faster decision-making and better profitability.