Legal Week argues that "ensuring the best individuals make it up the partnership ladder has never been harder."

They (properly) cite the landmark McKinsey study of nearly ten years ago, The War for Talent, which surveyed 6,000 executives from the "top 200" ranks in 77 large US companies across a variety of industries to conclude that the ability to attract the "best" people raised shareholder returns significantly over firms who couldn’t recruit or retain the best.  Since you as an equity partner are the shareholder par excellance, I assume you’re paying attention.

Why has it "never been harder?" 

“Critical talent is scarce and about to get even scarcer because of two looming trends,” [their report] stated, “the retirement of ‘baby boomers’ and the growing skills gap.”

But don’t law firms already have the selection process for the winners of the "war for talent" tournament down pat?  For internal, "home-grown" people, it’s the simple hire-from-top-law-schools, up-or-out, process.  To be sure, a third-year law student or a first-year associate (essentially, indistinguishable commodities) are unknowns, but "time will tell."  There’s a comforting belief in survival of the fittest to be partners. 

And while I myself have argued that the best series of sequential selection-gates for a career that involves punishing hours in exchange for high prestige and high pay is eight to twelve years of punishing hours in exchange for high prestige and high pay, we all know at bottom that being a successful partner bears little resemblance to being a successful associate.  Or, at least, "fitness" as an associate is necessary but by no means sufficient to demonstrate "fitness" as a partner.  In other words, what if our "survival of the fittest" contest primarily selects for "survival" and a lot less so for "fittest?"

But then there are always laterals to fill the gaps, right?  (After all, if the associate selection/retention/promotion process were perfect, there would be a far smaller lateral market, reflecting primarily shifts in prominence and attractivenes of practice areas and the need for seasoned practitioners in previously unexpected areas.)

But if you believe Legal Week, the price tag on a "big player just below partner level" is £2M, or US$3.5M—taking into account all the associated costs including six months to a year of being relatively unproductive.

Are you depressed yet?

I’m here to tell you it’s not as hard as they’d like you to believe. On this score, the original McKinsey piece has words that ring clear for law firms.  For example, while most corporations have very low turnover among their "top 200," this is not what they should be focusing on (emphasis supplied):

"It is the early and middle ranks of managers three to eight years out of college, their basic training already paid for, that represent a company’s investment in its future. […] The situation will come to a head as the number of 25- to 34-year-olds continues to decline over the next decade, and as their perception of future opportunities dims with the preponderance of older executives occupying the top positions in most companies.

"Paradoxically, it is the companies that have done the best job of recruitment and development that may be most at risk from poaching. But every company needs to understand why its high performers are leaving. Attrition must be tracked by performance level. The common practice of tracking voluntary as against involuntary attrition is not good enough: it’s probably your high performers who are choosing to leave.

"Creating and delivering a great employee value proposition is clearly the best way to retain people, yet only 16 percent of those surveyed say they are effective at giving high performers more exciting jobs to retain them. What can you do? Start by giving them a sense of belonging; as John Doe of Arrow Electronics points out, “It’s harder to quit if you are having lunch every quarter with your mentor.” Send them a clear message that they are valued: two very well-run companies recently discovered that several high performers had no idea that they were highly regarded and were being groomed. And wherever possible, give them a great boss.

"Just as account managers nurture and develop their key accounts, someone in every company should be responsible for nurturing and developing each key employee. Top-potential people should never fall off the screen."

I recently was invited to attend a day-long meeting of the managers of an AmLaw 200 firm on the strategic question of what to do with an office in a very challenging marketplace which they had opened some years earlier because the opportunity arose, but which had never benefited from an integrated vision of how it would cohere with the rest of the firm.

In fairly short order, a consensus arose that making strides in the difficult marketplace was all about "talent"—finding it, recruiting it, retaining and growing it.  Surely, if this is true for corporate America, it is true in spades for law firms. 

The question remains:  What armaments are available to fight this war?  How exactly does one wage the talent war?

Here the Legal Week piece calls for "flexibility in career structures…in line with broader lifestyle aspirations."  How often have we heard this before, and how often is it honored in the breach?

McKinsey reports dramatically divergent news.  Here are the most, and least, important contributors to career satisfaction, and the percentage of people citing them:

• firm’s values and culture (58%)
• freedom and autonomy (56%)
• exciting challenges (51%)
• a well-managed firm (50%)
• career advancement and growth (39%)
• […]
• respect for lifestyle (14%)
• job security (8%)
• acceptable pace and stress (1%)

"Flexibility" and "lifestyle" are almost below the horizon.

So you can just work everybody 2,200+ hours/year and assume that if your firm’s "values and culture" are outstanding (which indubitably they are!), you have no attritution problems?   Not exactly..

You must also:

• Challenge people by putting them in jobs before they’re entirely ready
  • and monitor them closely
• Put a good feedback system in place
  • and actually use it
• Truly understand your attrition problem
  • you could start by telling the stars that you think they are stars
• Move decisively on unsatisfactory performers
  • weak performers cause negative vibes and depress morale.

None of this is rocket science; but the £2M you save could be your own.