Its the time of year when pundits gaze into their crystal balls and serve up their best guesses as to the course of the new year. While I profess no prognostication skill, about four times a month I do hear this present concern from managing partners across the country that I believe presages a significant issue for medium size firms. From managing partners at these firms I hear: we have a successful firm today, but too few rainmakers among the ranks of our senior and newer partners. I am concerned that my firm does not have a future, and I would like to retire in the next ten years.
The demographics and financial trends in the profession lend some credence to this swelling concern. And by the way, I hear this type of comment from all size firms. Most lawyers practice in small to mid-sized firms without the expertise of a marketing director, so client development skills are left to quixotic fate. Many firms have no written succession plan in place, and as managing partners look toward retirement, they see one, maybe two other colleagues who are bringing in the bulk of the business, and maybe they'd like to retire also.
With profit growth flat or next to it, this swath of firms has not been able to stop working long enough to, nor had the motivation to focus on rainmaking skills in a deliberate manner. Or maybe the motivation's been there, but the results have not. Other responses such as mergers often fail, and clients have become astute negotiators on the issues of price and services adding further margin pressures.
What course to the future, then? Being a practical person sorely lacking my own crystal ball, I look at this picture analytically and not darkly, from the building blocks on up.
Build a Book of Business One by One
As a newly minted sales manager, my boss would counsel me to inspect what I expected from my team. While attorneys are encouraged to bring in business, this goal is rarely inspected more than (passingly) once a year. In most cases, too, compensation is not directly tied to marketing results, be they new matters or cross-selling or referrals. If you want to embark on tying compensation (and I don't suggest it without other practices I will address later), you have to institute a tracking system so you know how clients come to you, and give equal weight to cross-selling and referrals -- they are more profitable than brand new matters.
To reduce this to a personal level, ask yourself this question: if I started my own practice today, could I prosper with the clients I have? Before you talk to your relatives about a loan, let's look at the resources you currently have.
On an individual level, study up on marketing and sales as seriously as you studied for the bar -- well, maybe not that seriously. Books, audio and video tapes, interactive CD's abound. Don't rule out non-legal treatments either; the process is the same, and often cross-industry learning is enlightening. Don't tell my publisher I said this. There are numerous web sites involved with marketing/sales that provide learning tools, list servs, and newsgroups.
You had a study group in law school; create a marketing study group at your firm so that you can share ideas and practical successes and pitfalls. There are also networking groups outside of your firm that mix non-competing professionals for the purpose generating leads.
On an organizational level, bring in lunch time speakers who are experts in rainmaking and pick their brains. Even better (at the risk of appearing self-serving) bring in an outside firm to run your marketing program and training sessions for regularly scheduled, focused interactions, retaining them with measurable goals clearly spelled out.
Focus your marketing on present clients, and prospective client groups you like to serve. List them, market to them, but do not fail to track results monthly so that you see what is happening to your book of business. If you're a managing partner, inspect these individual results monthly, report on them at every partner and staff meeting, and finish each review with this: What other practice area should we introduce to this client, and how will we do it?
Who Will Lead Your Firm?
Successful firms have effective leaders, and while you may not be able to identify the next managing partner in your firm, giving leadership assignments and training to potential people today will assure an efficient succession to the next generation.
There are numerous short term executive level general management programs run by graduate schools of business that are worthy training grounds, and many now gear programs to professional service firms. Future managing partners will need to understand the broad business functions and operations that these general management courses provide. With this background, and successively more responsible leadership assignments, you will allow the best individuals to emerge from your colleagues. Remember, leadership is a studied art. Leaders chart the course, keep people moving toward a goal, build consensus, and are not afraid to make judgmental decisions. But the best leaders get lots of practice before they hit the majors, and succeed because they have been coached into success.
This article has been reprinted with permission from New Jersey Lawyer, March 3, 1997.