It can take years to plan for and carry off a smooth and careful transition of key client relationships, or leadership of the firm itself, into new hands. Both are key to ensuring long-term firm vitality. Yet far too often advance preparation is chronically put off into the indefinite future, leaving the firm to scramble in the event of a crisis and often install an improvised, sub-par fix. With a modicum of thoughtful and sensitive advance planning, pursued with a “firm-first” attitude, these alarming and destabilizing crises can be avoided.
- Clients: Rare are the law firms that can count on a truly institutionalized client base, and even their ranks are shrinking. For the vast majority of firms, key client relationships hinge on personal interactions between the decision makers at the client and the partner or partners who have cultivated and led engagements over time. Universally, our experience is that the time to start a smooth hand-off from the veteran partner to newer hands is well before the familiar face steps back.
- Leadership: Seamlessly handing off leadership of the firm itself comes with its own set of issues, starting from the fundamental fact that—unlike the corporate world—very few law firms have institutionalized management or leadership training programs, and, for better or worse but for sure, it remains unthinkable for a law firm to install an outsider at the top. In the event of an abrupt leadership vacancy, firms can find themselves with no insiders properly prepared and an outside alternative inconceivable.
- What these have in common is their future orientation. They reveal your firm’s commitment to an ethos of stewardship, which simply means recognizing the debt owed to those who came before and a symmetrical commitment to leave the firm better than you found it for those who will follow. Jealously hoarding clients or being derelict about grooming future firm leaders are selfish and frankly inexcusable “me first” behaviors which elevate the personal and immediate over all else, and if tolerated and unchecked will frustrate prudent and responsible succession planning.
How we work in this area:
- Dispassionate “checkups” and strategic succession planning. If you have client and/or leadership transition protocols in place, we can assess them objectively and give you a report card on their timeliness, scope, and suggested fine tuning and adjustments.
- If you’re just starting to address these issues, we can work from a clean sheet of paper to devise a comprehensive plan ideally suited to your firm and the desires, needs, and capabilities of your partners.
- Our experience confirms that the design and implementation of compensation systems often has a potent impact on how and whether the intent of the transition plan will be reflected in the participants’ behavior; we can analyze and advise on potential gaps or discontinuities between what your firm hopes to achieve and how well key participants subscribe to and put the plan into effect on a day to day basis.
Two final points.
First, despite the best of intentions all around, crises can arise when events take unforeseen turns. Whether these arise from health emergencies, abrupt lateral departures, or surprise developments at your client or in your leadership ranks, we can provide steadying interim counsel while helping you map an effective and convincing path forward.
Second, it’s probably fair to say that few issues in law firm management can be as emotionally fraught as succession planning—whether for client relationships or internal leadership. We are highly attuned to that and emphasize throughout all of this work that an objective and sensitive approach must always be paramount.
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