Tag Archives: firm strategy

Sight-Checking your 2020 Strategy

When I look at the strategic documents of law firms, I often see lack of clarity; it often seems to me that the plans form a patchwork quilt made up of many separate plans and business recipes of different practice groups – and can sometimes be as many as there are partners in the firm.

It’s probably no surprise then that the summary statement of a firm’s purpose and direction can often appear unclear or bland, resulting – as such statements often do – from much internal debate, negotiation and compromise. After all, a statement which is too overtly global can upset practice groups that practice only locally. Descriptions which are explicitly corporate can alienate practice groups and their members who don’t do corporate law, whilst litigation practice groups may not resonate with a focus which looks too transactional. Hence law firms gravitate towards the meaningless and the anodyne in their quest for words which sum up the firm, resulting in phrases such as ‘the preeminent firm in our region’, ‘a top 50 law firm’ or ‘a leading national firm’ adorned with descriptive but largely empty adjectives such as ‘client-focussed’, ‘energetic’, ‘dynamic’, and ‘innovative’.

The problem is that none of these statements end up meaning much either to clients or to partners. It is true of course that what matters is not the firm’s ‘mission statement’ but the detailed and executable strategic plan. However, if the firm’s high-level strategic intent is fuzzy, unfocussed and meaningless, there is every chance the strategic plan will lose its impact. As with a bad newspaper headline, the reader will usually turn the page, leaving the article unread.

What’s more, without a compelling sense of destiny, a strategy plan can easily default into yet another operational improvement plan. This is not necessarily a bad thing as such plans usually involve trying to optimize such worthy matters as the pursuit of high quality, excellent client service, effective people management, hygienic finances and outstanding profitability. However, improvement plans do not tend to diverge or differentiate the firm from similar firms, and are subject to the laws of diminishing returns as the firm reaches its natural improvement ceiling.

At the opposite end of the spectrum, I have come across a number of firms that have worked out a compelling and inspirational sense of their vision, purpose and direction and who then assume they have a strategy – when in fact all they have is an ambition with no real idea how to attain it.

One very important feature of an effective strategy for a professional service firm is that there should be a clear line of sight for every group, and indeed every partner, between day-to-day operations and the firm’s overall strategic goals. In short, partners must be capable of identifying how their work, career aspirations, specializations and capabilities fit in with and contribute to the firm’s overall strategy. It is difficult to achieve this line of sight when the firm’s stated but vague objective is just to get bigger, to become generally famous, or to improve its profitability.

As we approach the next decade of this century, my feeling is that many firms need to check their 20-20 vision. I propose a simple way of testing the effectiveness of your firm’s strategy. I call it the GLOSS test – GLOSS standing for ‘Good Line Of Sight Strategy’.

This is how it works: take a good look at each of your firm’s practice groups and any discrete team within any practice group then answer, to the best of your ability and judgment, just three sets of questions for each group or team.

  1. Does each group have a plan which clearly contributes to the firm’s goals and its vision? Is there a clear link between the plans of the individuals within each group and the firm’s plan?
  2. Are the strengths, capabilities and experience of each and every group and its partners important to the achievement of the firm’s strategic objectives and relevant to the firm’s success? Do the groups and the partners help the firm stand out from the crowd in a manner which supports the firm’s strategy, and in ways that are meaningful to the generality of the firm’s clients and referrers?
  3. How likely (be honest!) is it that each group – and indeed each partner – will be able in due course fully to realise the agreed plans and to achieve overall objectives? Even if achieved, to what extent would this move the firm towards its long-term goals?

This test can tell the firm a great deal about the effectiveness of its overall strategy and its unity of purpose. If the answers are not compellingly clear and positive, it is time to take another look at the firm’s strategy, particularly as we approach the twenty-twenties.

Edge Principal Nick Jarrett-Kerr is one of the leading UK and international advisers to law firms on business issues, strategy, leadership and management. In addition to matters of strategy, Nick has a particular interest in law firm governance, partner compensation, partnership performance criteria and partner development. He regularly leads or facilitates strategy days, retreats, partner conferences, practice group retreats and away days.

Simplicity

There is one thing I have learned over many years helping run large law firms and since then consulting to professional service firms: keeping things simple and as brief as possible is the essence of achieving success. That means ‘easy to understand and to apply’.

The reasons are simple too. Professionals, in particular those in ownership or senior roles, simply don’t have the time, motivation or gas-power to take on yet more complex, lengthy systems or processes to get things done, especially when it is outside their comfort, practice or client-zones.

I have spent most of my time figuring out how to deal with relatively complex issues and challenges, but in a way that is easy for busy professionals to understand and apply. Put another way, I learned early on not to put anything on the table that was too complex or time-consuming. People simply switch off or don’t give it the attention it deserves. Also, philosophies, concepts or approaches have to be simple enough to able to ‘walk around in peoples’ heads’. Then they don’t need to consult a lengthy document or manual to remember the essence, or need a new dose of discipline to get these things done.

One rider to this; simple approaches and ways of doing things take a lot of thought, dedication and effort to identify, work out, test and prove in the field. This is sometimes not so simple! So, this is one of those things that is easy to talk about, but tricky to achieve in practice.

Let’s take a brief look at a few areas where these principles can be applied in practice to good effect. Coincidentally, they happen to be the areas where I do and enjoy most of my work.

Strategy

Strategy is one. This principle applies equally to strategy for the whole of the firm or for a department or individual: only include the essentials, use a practical, proven framework that gets results, and which can be summarised in six to ten pages or less. Break the exercise down into pre-strategy essentials that need to be settled, actual strategy formulation and then post-strategy implementation and stress-testing. Be able to summarise the key aspects on one ‘strategy snapshot’ page – ideal to hand out to new recruits or even existing and potential clients so that they know what you are about.

Finances

We can never move too far away from the finances when discussing anything to do with firm practice in professional services. In this area, after dealing with many firms internationally, it has struck me how often partners and staff are drowned in reams of lengthy financial reports and analyses. It soon becomes clear that very little of this material gets absorbed and truly serves any purpose.

All of the excess material might keep a certain type of management happy – those who like to think, ‘At least they can’t say they didn’t have the information’. But that of course is not the point. The point should be to help everyone get results.

In this area, I have found a key is to produce a monthly (or on-demand) one- or two-page financial snapshot or dashboard report that is colour-coded, and summarises partner, partner-team, department and firm standards for performance and actual performance on key financial variables. If one needs to dig deeper in relation to a key variable – e.g., total lock-up days – one can always request that detail from the finance or accounts team.

Following the earlier point, it took us about three years of formulation and testing until we got this right, and working to our complete satisfaction. Then it was a case of refining it each year.

People

I long ago came to the conclusion that the key to results in the management of people is ensuring a truly genuine interest is taken in anyone for whom one is responsible. We developed a new philosophy, system and approach to ensure this took place throughout a firm – the Responsible Partner and Development Discussion system. With this system, most people at every level reached something like their full potential, they were happy, partners attracted good staff who stayed longer, and our employment brand and engagement levels grew stronger.

Again, this was kept as simple as possible. That is a key reason why it works.

Succession Planning

The system we developed for the management of people has a number of off-shoot benefits. One is addressing the hardy annual issue of succession planning. So many firms struggle with this. Some introduce quite complex monitoring and management systems to address it, but with limited results.

As in other areas, succession planning can be kept quite simple. If something like the Responsible Partner philosophy mentioned above is adopted and applied rigorously, over time it automatically builds succession throughout a firm, and it has the benefit of being organic. Let me expand on this a bit. If a partner uses the approach successfully and builds a high calibre team of professionals at different experience and competency levels over time, she or he will find successors start to pop up within that partner team. It takes a good few years, but it is guaranteed to happen: this has been proven time and again.

Achieving success in practice today undoubtedly takes high levels of competence and performance in a number of different areas. It used to be that working like a dog and looking after clients was it. The rest could more or less take care of itself. Those days are long past.

Contribution Criteria

Practice and client needs have become much more sophisticated and challenging. Trouble is, in many firms, partners and staff still don’t really know what they should be expecting of themselves or one another. It is important to spell this out in summary in a positive, constructive way which propels the firm forward and acts as a motivating guide to individuals to contribute in various key areas. These will include hardy annuals like financials, business development, people and support for the firm, but also things like building the capital fabric of the firm, building succession and active support for the brand, and raising each of these to exemplary levels through innovative approaches.

Brand

Finally, brand is another key area which can get attention. Everyone in the firm should understand what the firm’s understanding of brand is. ‘Brand,’ as I teach it, is the aggregate of what other individuals think and feel about the firm as a practice, as an employer, its services and the key individuals within it. Everything brand-related flows from this simple framework and makes it easy for everyone in a firm to grasp the nuances, concepts and necessary support systems to strengthen a firm’s brand, its employment brand and the brands of individuals within it.

Dare I say it? I believe that adopting this ‘simple’ approach to everything relating to leadership and management also makes this part of practice fun. More practitioners and staff will want to participate in and contribute to these initiatives as they will feel they ‘get it’ and don’t need a course in management to get results and get things done. This in turn grows future leaders and managers internally.

Edge Principal Sean Larkan is a former corporate/tax lawyer with extensive experience in conference and retreat presentation and facilitation. As an Accredited Practitioner of Human Synergistics International and a certified Master Coach, he offers Edge clients knowledge and experience in such areas as leader, group and organisational behavioural and cultural diagnostics and coaching, and serves as a critical adjunct to firms’ strategy implementation. He is the author of Brand Strategy & Management for Law Firms.