Firm Leadership

Rants, Raves, Rebuttals, Reflections, Revelations & Ruminations

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Post #731 – April 9, 2015

The Spring 2015 Issue of International Review is Now Available

International Review is my 24-page glossy, printed magazine distributed to over 1600 law firm chairs and managing partners throughout North America.

What happens as a firm leader when something goes sideways, espcially when it is the result of something you did . . . or even did not do, that perhaps you should have.  Recovering From A Leadership Misstep is another collaboration between me and my good friend and colleague, Ed Reeser proposing some remedial courses of action for when the worst that could happen, happens

In The Leadership Succession Process, I set out the three fundamentally different approaches to leadership succession, together with their respective advantages and disadvantages.  This article is an excerpt from the Introduction to my newest work, The Changing of The Guard: Selecting Your Next Firm Leader.  You will find more information on this NEW instructive guidebook on pages 12 and 13.

Stimulating Innovation In Your Firm had it’s origins in a Webinar that I was privileged to participate in with Andrew Smulian, Chairman at Akerman LLP; Ken Grady, CEO of SeyfarthLean; and John Paris from Williams Mullen’s Innovation Committee - while Inquiring Leaders Want To Know offers you ten questions to jump-start your strategic thinking.  Hopefully both of these offer some pragmatic advice to those interested in either subject.

Finally, When Job Descriptions Don’t Do The Job is an article that I hope will provoke you into taking action on job descriptions for your practice leaders.

As always, I sincerely hope that you find some practical ideas, tips and techniques here that you can put to use immediately.  Please send me your observations, critiques, comments and suggestions with respect to any of these articles. 

 Click on the Cover to download your complimentary PDF copy of the magazine.

Post #730 – March 25, 2015

My Newest Book Is Available For Pre-Order

Every firm eventually finds itself in need of a new leader.  The executive committee or board must seek to replace the current incumbent as that individual comes to the end of their term of office, announces a return to their practice, or perhaps is contemplating retirement.   Every year we also see firm leaders step down because of a loss of partner confidence, an unexpected disability, a tempting career offer from a prestigious corporate client, or even, on occasion, being laterally recruited by a competing firm.  While each firm’s situation is unique, the necessity for determining a succession process that will work is critical.

The Changing of the Guard: Selecting Your Next Firm Leader is a strategic guide to effectively managing the leadership succession process.  Supported by practical action points, real world examples, and expert insights, this text is broken down into 5 distinct parts:

Part One: Making ready
+ Choosing a nominating committee
+ Developing your timeline
+ Identifying the challenges your next leader will face

Part Two: Identifying criteria 
+ Develop/refine the job description
+ Identify your selection criteria
+ Identifying specific performance requirements
+ Develop a formal written application form and process

Part Three: Calling for nominations
+ Invite your partners to nominate candidates
+ Host candidate town hall meet and greets
+ Invite confidential input
+ Design and structure a formal interview process for candidates
+ Analyzing a candidate’s strengths

Part Four: Making the decision
+ Reporting on results of interviews and confidential commentary
+ After selecting your new firm leader

Part Five: Managing the role of the outgoing leader
+ Creating a transition/integration plan

The Changing of the Guard also features a series of exclusive interviews with law firm leaders on their succession planning experiences, these include:
• Stephen J. Immelt, chief executive officer at Hogan Lovells
• Vincent A. Cino, chairman at Jackson Lewis
• Carter G. Phillips, executive committee chair at Sidley Austin
• Timothy E. Powers, managing partner at Haynes and Boone
• Kim Koopersmith, chairman and managing partner at Akin Gump Strauss Hauer & Feld

Regardless of your current approach to, or role in the succession planning process, The Changing of the Guard is critical reading.  The Changing of the Guard: Selecting Your Next Firm Leader will be available in mid-April.  Pre-order your copy before 5pm April 8th and save $100 making your copy $295 (normally $395)

How To Order:  To pre-order your copy at the discounted rate of $295 simply email Daniel Smallwood at Ark Publishing: quoting the ordering code DS-E1 (Orders must be received by 5pm April 8th)

Post #729 – Wednesday, March 18, 2015

Hedge Funds Are Betting Big on Lawsuits

According to an article today on Bloomberg Business the lawsuit finance market is continuing to grow in spite of the US Chamber of Commerce warnings of wasteful litigation and corruption.

Hedge funds and others speculating on litigation are making more and larger bets.  Some corporate lobbyists warn that the new financial engineering encourages wasteful courtroom warfare, but investor demand for fat returns—and big law firms' appetite for business—guarantee the spread of litigation finance.

Burford Capital, the largest player in the litigation-finance business, reported that their revenue rose 35 percent, to $82 million.  Burford has built a $500 million arsenal, and thus far made 32 investments that have generated $209 million in gross recoveries. Burford mainly finances litigation initiated by major corporations and handled by big corporate law firms. Among the well-known law firms that have been involved in Burford-financed cases are Simpson Thacher & Bartlett, King & Spalding, and Latham & Watkins.  Burford’s CEO is a former Executive VP and GC of Time Warner.

Meanwhile, Australian-based Bentham IMF reported funding 10 deals in 2014, including "contract disputes, a patent-infringement trial, partnership disputes, and five law firm case portfolios."  Bentham says that for the year it had gross returns of $31 million in the U.S.

The U.S. Chamber of Commerce’s Lisa Rickard (president of the chamber's Institute for Legal Reform) condemns all of these developments, alleging that they lead to "more lawsuits, more litigation uncertainty, higher settlement payoffs to satisfy cash-hungry funders, and in some instances, even corruption."  Others unabashedly advertise their commitment to financing suits by the "little guys" against large corporate interests.  

This looks to be an area that is going to continue to experience increasing hedge fund investment attention.

Post #728 – Sunday, March 8, 2015

The Case For Psychometric Testing of Leadership Candidates

I’ve been a touch absent from this blog over the past two months as I’ve been scrambling, between client obligations, to complete the manuscript for my newest book, tentatively titled: The Changing of The Guard: Selecting Your Next Firm Leader and expected to be published sometime in April.  The chapters include specific guidance on everything from choosing a Nominating Committee and identifying your selection criteria; to designing and structuring a formal interview process and analyzing a candidate’s strengths.  And I suspect that it will be this last item analyzing strengths that will be the most controversial as I reserve no hesitancy in strongly recommending the use of psychometric testing.  Here’s a short excerpt from my manuscript:

So should your one consensus leadership candidate or all of them undergo psychometric testing?  

The vetting process in some firms has become more intense and my investigations have determined that more firms are beginning to believe that it is useful.  For example, in the recent selection of one new Firm Chair for an AmLaw 100 firm, five finalists were shortlisted from an original 11.  They were then all then subjected to six hours of psychometric testing, including a battery of online questions and an interview with a consultant.  

Meanwhile, Mark Rigotti, Chief Executive Officer at Herbert Smith Freehills reported to me: 

We have used testing as part of the selection of the most senior leaders, via an external provider.  This included two psychometric tests and in depth interviews intended to identify capabilities, preferences and potential for the role ahead.  As some one who went through these I found them very helpful in thinking about first how I would go about my role and secondly about the people needed on the Executive team to have a diverse balanced set of skills.  We also use some tests to assist with leadership development, rather than selection of leaders.  The experience with theses has been reasonably good with a number of people finding them helpful in working out what to leverage and what to work to improve their individual effectiveness.  Of course all these tests and tools don't make decisions or guarantee perfect leaders - they can enable improvement.

And from Fredrick Lautz the Managing Partner at 450-lawyer Quarles & Brady, I was told: 

During my term as managing partner, we have had two instances of which I am aware where we used psychometric testing.  Several years back we put a cohort of younger partners who we thought had leadership potential (roughly 30 attorneys) through a multi-day leadership training program with coaching follow-up.  And then two years ago, in the course of considering more regular leadership training for our current and pipeline leaders, we engaged a psychologist to conduct psychometric testing on a pilot group of current firm leaders, including attorney leaders and staff leaders.  In evaluating the attributes and qualities of our pipeline leaders and looking at the current stages of their careers (most of them have fairly long careers ahead of them and are not in a position to give up their current practices to run the firm), we decided we needed to reshape our leadership structure to design roles with responsibilities, expectations and levels of commitment which better fit those who we would expect to succeed to the leadership roles. 

Finally, from William Henderson, Professor of Law at Indiana University I received an incredulous query – 

WHY is a law firm wating until election to leadership to use psychometric assessment?

I have a lot of experience using these types of tools, both as an educator and doing projects for law firms.  Their primary value is in lawyer / leadership development.  Firms ought to be developing their leadership (and their lawyers generally) through psychometric tools that map onto an overall talent model.  That said, when it comes time to make a selection decision, there is nothing better than past performance data based on clearly delineated standards. Apply those standards to past performance data and the promotion decision becomes both obvious and accurate. Cravath understood this in the 1920s.  McKinsey then copied the model in the 1930s from first-tier law firms.  The short-term focus on revenue generation has obscured this logic.  Yet the logic pays enormous long-term dividends.

I firmly believe that if the role of your Nominating Committee and Board is to assist these candidates in building their self-awareness to be the best firm leader they can be, it is a very valuable exercise.  Your next firm leader’s self-awareness builds from honest self-appraisal about emotional strengths and vulnerabilities; values and attitudes, personality traits and unresolved conflicts.  You best candidate is a total person, not just a set of skills performing a role.

Post #727 – Monday, February 2, 2015

Three Little Questions To Stimulate Innovation In Your Firm

In a recent Webinar I participated in, I was asked, “From your experience, what one key thing is central to stimulating innovation in professional service firms?”

If I had to choose only one thing, and at first blush it may seem simplistic, it would have to be shaping your firm’s culture to embrace innovation.  And obviously, it has to start at the top – with the firm’s leadership.

The way I think about culture is that it’s all wrapped up in our habits (meaning, what behaviors are we prepared to tolerate) and our language (specifically, how do we use language to shape our collective thinking).

For example, in an earlier life, I was a Vice-President and Director of a Canadian-based, public company in the telecommunications industry.  I had the good fortune of working with a rather progressive, very successful CEO who held some very strong beliefs.  One of those beliefs, that he preached to all of his senior team, repeatedly, was that upon first being presented with any idea or proposed course of action – he would say,  “You have ‘no intellectual integrity’ voicing a personal opinion that suggests that you know whether it will work or not – because the reality is that you do NOT know for certain – and even if that same idea has been tried before – say, only last year – in this firm or some other firm and failed.  That still is not determinative of whether the idea will fail here and now”

He taught us that you only display intellectual integrity by asking and answering three sequential questions:

#1        NOT: Will this work?  BUT: How do we make this work? 
(which you will notice provokes a whole different mindset).  He believed you start with a focus on “possibility” not “profitability”

#2        What’s the worst that could happen?  (let’s be realistic, where might the crap hit the fan); and finally,

#3        Where is my backdoor if the worst that could happen, happens?

Unfortunately, winning the debate, arguing well, finding the slightest little flaw in the ideas of others is often the behavior that seems to be held in great esteem within our firms.   And allowing that behavior rarely builds trust or inspires innovation.   So to shape a culture that embraces innovation, I believe starts with the firm leader making it socially unacceptable to EVER offer an immediate opinion on whether any new idea will work.

In fact, in a number of the practice groups that I have worked with, they have, with my encouragement, adopted a group protocol (a rule for self-governing their collective behavior) that states: “in our group, we will LOVE every new idea . . . for five minutes!”


Remember to Join Andrew Smulian (Chairman and CEO of Akerman LLP), Ken Grady (CEO of SeyfarthLean Consulting), John Paris (Chair of Williams Mullen Innovation Committee) and me for a one-hour Webinar on Stimulating Innovation in Law Firms  – this Thursday February 5th hosted by Ark.

Post #726 – Saturday, January 17, 2015

Join Our Compensation Think-Tank

On February 11th, I will be joining old friends Mike Roster, co-chair of the ACC Value Challenge; Professor Bill Henderson from Indiana University; writing collaborator Ed Reeser and numerous others in San Francisco at our “Compensation Think-tank” – a forum for discussion and debate concerning ways to adapt to the emerging procurement environment and design reward systems that will attract and retain key lawyers while also incentivizing them to do more with less and in ways that will accrue to the benefit of the larger partnership.

Does the average rank and file partner understand that the years of ever-escalating compensation have come to an end?  How can firm management address the pressure to deliver on unrealistic expectations?  Of course many see the problem differently - or don't see the problem at all.  No compensation system is perfect.  But any sound compensation system will remove impediments to good management and be flexible enough to address the current and future strategic needs of the firm. 

How do we make sure that the culture of the firm, perhaps the single most important component of a thriving organization, is not only tolerant of change, but in fact complements and is reinforced by it?

For more information on attending a think-tank focused on aligning compensation systems with current and future business realities and the goals and objectives of your firm  -  Compensation [Re]Design For Law Firms.

Post #725 – Monday, January 5, 2015

Stimulating Innovation In Law Firms

It is ironic that almost every law firm, somewhere on their web site, will reference themselves as being an innovative, entrepreneurial firm. And yet, whether you are dealing with a business entrepreneur or a law firm partner, upon first hearing about a new idea or strategy, both will respond with the very same question. "Please tell me who else is doing this?"

The question is the same BUT the motivation for asking is very different. The partner needs to be reassured that some other law firm out there, that they may have a modicum of respect for, has done this and most importantly, experienced some success. For the business entrepreneur, the motivation in asking this question is completely different … they just want to know because if someone else has already done this, they likely aren't interested. It's already been done!

The time has come for law firms to create structures within the firm aimed precisely at innovation - groups whose job it is to solve difficult problems through creative business processes, a reinterpretation of the firm's position in the marketplace, new technologies or alternative staffing models.

Join Andrew Smulian (Chairman and CEO of Akerman LLP), Ken Grady (CEO of SeyfarthLean Consulting), John Paris (Chair of Williams Mullen Innovation Committee) and me for a one-hour Webinar  – Thursday February 5th hosted by Ark.

More details are available here:

Post #724 – Monday, December 15, 2014

2014 Year-End Review

I’m often asked about my consulting practice, what kinds of assignments I get called in on, for what sized firms; what I’m currently researching and writing about, and just generally how I spend my professional time.  As always, at this time of the year, I looked back over my various activities.  With some of these items (like clients served) activity is not a sufficient measure; results and the client’s satisfaction are really what counts (and to that end, you can find over 100 client testimonials and endorsements throughout this web site).  But for purposes of looking at where one’s time is invested, here is what my year looked like:


• Geographic Locations:
86% U.S. Based
14% International (Europe & Asia)

• Nature of Assignments:
36% developing / implementing strategic plans
45% governance and leadership issues
  7% client relations and marketing projects 
12% firm leader advisory / coaching

• Firm Size Range:
36% firms of over 500 attorneys
14% firms of 300 to 500 attorneys
43% firms of 100 to 300 attorneys
 7% corporate legal departments


• Participated in presenting at 3 Webinars
Successful Lateral Hiring (March) – sponsored by LA Daily Journal
Practice Group Leadership 2.0 (June) – sponsored by Ark
Law Firm Innovation (July) – sponsored by Ark

• Participated in 6 Conferences, Workshops & MasterClasses
Panel Moderator & Presenter – Compensation ThinkTank Conference (January in New York and September in Chicago)
Facilitator – Practice Group Leaders Workshop (February in San Francisco, June in New York, and August in Chicago)
Co-facilitator – First 100 Days Masterclass (August)


• Authored or Contributed to 18 Articles in Publications including: Newsletter
Harvard Business Review OnPoint Magazine
Managing Partner Magazine [UK]
The Lawyer [UK]
American Lawyer Magazine
Canadian Lawyer magazine
Of Counsel – Legal Practice and Management Report

• Two new issues (Spring & Fall) of my INTERNATIONAL REVIEW 24-page glossy magazine were produced and distributed to 1800 firm leaders.

• Began, in mid-March, to post articles and materials on my LinkedIn site resulting in one of my 17 posts, specifically on Leadership, generating in excess of 16,200 reads.


• I have had my qualifications approved to be admitted to the Association of Corporate Executive Coaches ( - The center of excellence and the #1 group in the US for senior level executive / CEO coaches.  I am included on their website under “Experts” with about 50 other CEO coaches including Dr. Marshall Goldsmith.

• Appointed as Contributing Editor to Of Counsel: The Legal Practice and Management Report
Of Counsel is a distinguished management report for law firms and corporate law departments, helping firm managers solve financial, business, and practice problems.

• Appointed to the Advisory Board of True Balance Longevity Institute Inc
True Balance is the Canadian leader in providing Regenerative and Anti-Aging Medicine, Bioidentical Hormone Replacement Therapy and Medical Aesthetics from five clinics throughout Alberta and British Columbia.

• Increased the size of my Linkedin site – Law Firm Leaders – to more than 280 members. 
Law Firm Leaders is the ONLY social networking site exclusively for the chairs and managing partners of firms of over 100 lawyers in size - with 62% representing leaders from firms of 100 to 300 lawyers; 16% from firms of 300 to 500 lawyers and another 19% coming from firms of over 500 attorneys.

• Received numerous “UNSOLICITED” LinkedIn Endorsements for my strategic planning expertise from firm leaders and senior professionals from major firms including these 20 firms: Allen & Overy (Europe); Baker & McKenzie (Asia); Debevois & Plimpton; Faegre Baker Daniels; Fasken Martineau (Canada); Foley & Lardner; Gordon & Rees; Gowlings (Canada); Jackson Lewis; Linklaters (Europe); Mayer Brown; Miller Canfield; NautaDutilh (Europe); Nelson Mullins; Norton Rose Fulbright; Shook Hardy & Bacon; Skadden Arps; Thompson & Knight; and Wyatt Tarrant

To all of my valued clients, colleagues and friends, I want to say thank you for allowing me to spend time with you; for your confidence, your commitment and your fellowship. I wish you and your families the very best in 2015

Post #723 – Thursday, December 11, 2014

There Could Be Real Trouble On The Economic Horizon

Once in a while I dabble in writing about economics, a subject that has always fascinated me.  Some readers will remember that back in August 2008, a time when most pundits were suggesting another possible 18-month recession, I had the audacity to author a piece entitled, Managing Through A Prolonged Downturn.  In that article, I stated: 

Conventional wisdom, publicly espoused by a number of market watchers and legal consultants is that: “The recession will be intense, but short.  Everyone wants to get back to normal.  Short term, the backlog of real estate will be sold as owners accept losses; banks will end the credit crunch; layoffs will make companies more efficient.”

My view is far little less confident.  I believe that unlike past experiences, this recession isn’t being caused by a downward spiral in a few isolated industries.  It started with the burst of a protracted housing bubble and then metastasized into a full-blown credit crunch, eventually destabilizing the entire financial system. Therefore, I submit that for the next five years, every time you think it's safe to get up and dust yourself off from this downturn, every time you feel like you've endured the worst of it, another piece of news is going to come along to freshly bludgeon you.  This time the economic slowdown is going to be a lot different and, in many ways, a hell of a lot tougher.

Well, we are now beyond my five-year prediction and many of my friends are elated with their good fortunes from the stock market and cheerily optimistic from reading the various newspaper forecasts for 2015.  Many believe that we are slowly returning to the pre-2008 period we so enjoyed.  Let the good times roll!

Today we all watched crude oil moving even LOWER than the $60 level the Saudi Arabian government claimed was something it could live with.  The price of crude oil has dropped 40% since June.  The Saudi’s are betting they can bankrupt the U.S. Fracking industry.  But that’s not the real story here.

The first hint of the real story was advanced in a Bloomberg article on December 2nd entitled: “Junk Bonds Backing Shale Boom Facing $11.6 Billion Loss.”   “The oil sell-off,” Bloomberg reported, “is deepening concern among bond investors that the least-creditworthy oil explorers will struggle to pay their obligations and prompt bankers to rein in credit lines as revenue slumps.”

The real story is that Energy companies sold $50 billion in junk bonds through October, 14% of all junk bonds issued.  But junk-rated energy companies trying to raise new money to service old debt or to fund costly fracking or off-shore drilling operations are suddenly hitting resistance.

What does this mean?

Go back to 2007 and have a look at what the total of subprime and Alt-A loans amounted to.  That number was about a trillion, and the losses in that sector were above 20%.  There you had a $1 trillion market with $200 billion losses.  Today, in energy sector junk bonds, you have a $5 trillion market which, if it experienced the same 20% loss rate means $1 trillion in losses.  This is far bigger than the subprime crisis that took down the economy in 2008.  

Smaller drillers are in trouble.  All of them had horrific single-day plunges, some over 30%, on “Black Friday” after OPEC’s Thanksgiving decision to keep production quotas at 30 million barrels per day.  These are the very companies that benefited during the crazy good times from yield-desperate investors who’d been driven to obvious insanity by the Fed’s interest rate repression.  These investors -- such as, perhaps, your bond mutual fund or your pension fund -- loaded up on energy junk bonds and leveraged loans.  Ouch!

Companies in this sector are now facing a harsh reality: crashing revenues and earnings. Some of them are going to have liquidity problems.  Unless a miracle happens that will goose the price of oil pronto, there will be defaults, and they will reverberate far beyond the American oil patch.

Meanwhile, the too-big-to-fail banks are bigger, the risky derivatives bets that tanked the market are larger, and the Federal Reserve’s money printing is running even further amok.

Post #722 – Friday, December 5, 2014

The Future of Legal Management Magazine – RIP?

On the LinkedIn site for the Association of Legal Administrators, the Managing Editor of the Association’s Legal Management magazine asked the following question, “What do you think of the Legal Management’s November issue?  We want to hear your thoughts on the content we are creating for our members!  This month learn how firms are revamping their online presence, explore 401(k) options for employees, and meet the legal industry's latest enemy: prescription drugs.  Are we covering the right topics?  Please let us know in the Comment section below.”

The first comment to be posted was this:
"I barely look at the magazine anymore.  When it was a paper version, I read it pretty much cover to cover.  The digital version is proving to be very difficult for me to maneuver around.  If there were even a way I could pull it up in book form and "flip" the pages, I might be more inclined to read it.  In the current form, I just always feel completely lost.

In spite of a number of offers from the Managing Editor to provide assistance (“If you would like a one-on-one tutorial on how to use the Legal Management website or the app, or both, I would be happy to provide one.”) that posting was followed by numerous Executive Director and COO’s comments, from small firms to those of over 500 attorneys, claiming:

I always read the print version but never read the online version. I used to read it at lunch time, but I can't do that now.”

I must agree with most of the comments here.  I, too, have pretty much given up on reading it.  I can carry a magazine about and read it any time there is light.  Reading on a computer, pad, or phone is very tiring on my eyes, especially the tiny phone screen. Additionally, it is far easier to flip between pages than jump back and forth between screens, even when there is an index or ToC.”

“I have not read any of the issues since you have changed to this format.  I find it difficult to maneuver.  I prefer the printed issues that I can take with me anywhere.  I hope you reconsider and bring back the printed issues.”

AND even from the owner of a Law Office Technology Consulting firm, this insightful observation . . .
I find it interesting that the ‘powers that be’ seem to think that going on-line is the wave of the future.  I disagree.  You can't take your computer and read the publication over breakfast, lunch or dinner, or over coffee, or on the bus / train, or while in the "library".  No....give me printed material every time.  When you are done reading it at YOUR convenience, you can always recycle it.  Please, stay with the print version!

The response from the Association’s Managing Editor in a classic demonstration of how to give clients what they want . . .
At this time, there is not a plan to bring back the printed version of the magazine. However, if you do have specific suggestions that would help with your user experience, please feel free to share them, either here or by emailing me . . .

The Editor’s comment was followed by the disgusted response of this COO:
Sometimes I think the HQ Staff doesn't realize that all of us are busy doing our job.  We really don't have the time to have a personal tutorial on how to use an app to read a magazine that many of us read over the years the "old fashioned" way.  By reviewing the comments in this blog, it seems that ALA Legal Management is probably being read less since the introduction of the electronic version, compared to the printed version.

Please do not misconstrue the intent of this Blog post.  I am not picking on the ALA.  I am sincerely fascinated by this discussion and thinking out loud about how many readers, those magazines that make themselves available ONLY in an electronic format may be turning away.  In the case of the ALA, their LinkedIn site identifies over 9000 members, but not one member answered the original question posed in this discussion post by citing some specific article that they enjoyed reading in the November issue.

Meanwhile, one wonders what those who invest good money advertising in this magazine might think after reading all of these comments.  For my part, it reminded me of an earlier life spent as a VP in a technology-based public company where the CEO would comment that "it is often not a matter of what our technology can do so much as what our sociology will accept."

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