"Is this any way to recruit associates?" asks a lead story in this month’s American Lawyer.
What is "this way?" We all know the drill, most of us from both sides of the table:
- Top law schools orchestrate dances of 20-minute interviews between visiting firm partners and law students;
- questions are kept superficial (one Latham recruit got a steady diet of fantasy football questions);
- grades and class rank are presumed to be valid proxies for post-employment performance; and, in the event,
- of students offered summer jobs by "big" firms (> 250 lawyers):
- just 28% accept
- 40% of whom are gone by their 3rd year, and
- 62% of whom are gone by their 4th.
- And, according to NALP, half of associate departures are "unwanted" by the firms.
- Finally, depending on who you believe, replacing a needed associate costs from one to three times their fully loaded annual costs.
Worse, the pressure is intensifying. According to the National Law Journal‘s "250" report (ranking the largest 250 US firms by lawyer headcount), the number of associates at those firms has increased 76% over the past decade while the number of law school graduates has gone up just 7%. Firms are going to more law schools, reaching farther down into the class ranks, or both. And at the elite schools, firms are simply pushing harder. Georgetown Law, for example, anticipates a 10% increase in firm interviews this year, and the same again next year.
Need I add that most of this takes place with students fundamentally in the dark about what differentiates one firm from another?
"[Students] aren’t helped much by firm marketing materials, which often say the same thing and make firms indistinguishable from each other. “They all tell you they have great clients, and they work hard but [have] a very collegial atmosphere,” says the Stanford student. “It’s the same discourse over and over again.”
Fine. Diagnosis is one thing, prescription another.
A few firms are starting to take baby steps away from the blunt hiring instrument of simply trying to recruit students with the highest grades from the best schools, recognizing, as Karen Massa, recruiting director for Orrick, puts it, that you can be a top graduate from a top law school and still be someone "the firm should never have hired in the first place." The challenge is this: " Was there information that was available in the interview that would have let us know they really weren’t a good fit for the practice of law in a big law firm?" Massa says. "Were there questions we could have asked that would have revealed a little more?"
At Orrick, they decided to develop a list of traits that partners and associates would agree were hallmarks of success at the firm—and, through internal focus groups, they ended up with eight, including confidence, adaptability, and problem-solving capability. In St. Louis, the 75-lawyer litigation boutique Sandberg, Phoenix & von Gontard is pursuing something similar, albeit with a bit more of a point to it. They use a 40-minute psychological assessment test to gauge attitude and motivation. Says managing partner John Sandberg:
"The biggest ongoing challenge isn’t hiring people bright enough," but finding people with the right temperament. "A good lawyer has to have resilience. Crap happens every day, and you have to be able to work through that."
The structure and purpose of interviews themselves is changing at some firms, as well, as more recruiting efforts start to embrace "behavioral interviewing," which entails more detailed, thought-provoking, and potentially revealing questions. Traditional interviewing might use questions such as:
- Tell me about yourself.
- Did you enjoy working on law review?
- Why are you interested in our firm?
- Have you thought about what practice area you’re interested in?
Behavioral interviewing, by contrast, is premised on the notion that past behavior is the best predictor of future behavior. So the goal is not just to find out what candidates may have accomplished, but to uncover how—their thought processes and attitudes when confronted with obstacles. So a behavioral interviewer might ask such things as:
- Give me an example of a time when you had to make a split second decision.
- What is your typical way of dealing with conflict? Give me an example.
- Tell me about a time you were able to successfully deal with another person even when that individual may not have personally liked you (or vice versa).
- Tell me about a difficult decision you’ve made in the last year.
- Give me an example of a time when something you tried to accomplish and failed.
- Give me an example of when you showed initiative and took the lead.
- Tell me about a recent situation in which you had to deal with a very upset customer or co-worker.
- Give me an example of a time when you motivated others.
- Tell me about a time when you delegated a project effectively.
- Give me an example of a time when you used your fact-finding skills to solve a problem.
- Tell me about a time when you missed an obvious solution to a problem.
Think these are tough? Corporate America and non-law professional service firms (as well as the Magic Circle in Britain) often use case studies right in the course of the interview to evaluate how candidates think and how they approach problems. At McKinsey, a typical interviewee will go through at least five hour-long meetings, each including a case study to be performed on the spot. Multiple-choice quizzes involving basic logic and math are also employed. As one British law trainee who’d been through Linklaters’ assessment last year put it, "They ask you questions you cannot possibly answer. They want to stretch you and see what you can do."
I would go a step further.
Many of you, I’m sure, have read Michael Lewis’ wonderful Moneyball, which recounts the story of the Oakland As’ manager, Billy Beane, managing to put together teams that repeatedly got into the postseason despite having one of the smallest payrolls in baseball. To accomplish this, Beane had to "think different," and he did. He decided to largely discard conventional scouting wisdom (such as a player’s speed in the 40-yard dash, or a pitcher’s top fastball velocity) and to try to uncover, instead, characteristics of players that were actually associated with scoring runs and minimizing outs. Famously, for example, traditional scouts had ignored a batter’s ability to generate walks (since they weren’t hits, and batters were judged on hitting prowess). Beane realized that not only did a walk advance the batter to first as surely as a single, but it did so (a) without any possibility of an out accruing on the play; and (b) at maximum expense to the pitcher in terms of adding to the total number of pitches thrown.
The bottom line was that Beane and the As’ could pick up under-appreciated, and underpriced, players, without sacrificing actual performance on the field, by refusing to follow the conventional wisdom and pay (overpay, that is) for players’ characteristics that had market value but little intrinsic value.
What if, I wondered, this might be true of hiring associates as well?
Several months ago, I proposed to a few AmLaw 50 firms that we try to develop our own version of "Associate Moneyball," looking through firms’ data about associates’ backgrounds, who left and how soon, who made partner and who went inhouse, etc., to attempt to derive our own portfolio of characteristics that might predict success in BigLaw—assuming that hiring "the top 10% from the top 10 schools" is an exhausted strategy. What if, just to make up some hypothetical’s, we were to discover that taking one or more years to work between college and law school correlated with lower attrition? What if coming from inherited wealth correlated with the reverse? Were JD/MBA’s a better or worse bet than plain old JD’s? What if moving across the country from one’s home town roots [did/didn’t] increase a propensity to stay? What if… You get the idea.
This may be one of those potential insights that is simultaneously self-evident once you think of it, immensely desirable of pursuit, and impossible to execute in reality. Among the obstacles we encountered were anti-discrimination issues (you might want to know the answers to questions you’re not allowed to ask), and, perhaps more fundamentally, the difficulty of finding a real "counterfactual group" of law students at these top AmLaw firms who did not come from the top of their classes at the very best schools. Since the firms weren’t hiring sub-median students from sub-median schools, the data as to how those people might stack up doesn’t exist—and in all likelihood never will.
Project Associate Moneyball, however, remains deeply intriguing to me, and if anyone has suggestions for how to surmount the practical obstacles to doing serious analysis, please let me know. One possibility is that subtler patterns could be teased out even from the top students/top schools cohort to suggest ways to recruit more intelligently. One thing we can be confident of is that there’s enough money at stake to make it worthwhile.
In the meantime, you can always tell me about yourself.
Update: 9 August
A regular reader, Pete Smith of BCG Attorney Search, writes:
Bruce,
Thanks for the great post. I admire your access to firms and I applaud your efforts to and creativity in seeking out criteria that will actually make sense in terms of longer-term retention.
I have a couple of further thoughts:
First, I think the use of psychological profiles for associate (and, for that matter, partner) hiring is a great idea and that it will eventually trickle down as a standard (if never ubiquitous). Funny how the legal industry always seems a constant 15 years behind best business practice (and that’s probably charitable!).
Second, however, I think that the use of psychological profiles (and, for that matter, the other criteria that you tentatively advise might be indicative) is going only to add to the complexities of recruiter. By complexity, I simply mean that firms will add these extra criteria to hiring standards. Although firms will give lip-service to the possibility of making hires to candidates below their usual academic/school standards, this will not happen (at least, not any faster than they would anyway by virtue of other market factors).
Which brings me to my next point. I don’t think firms will ever be able to leave grades and school ranking behind. This is because, quite simply, grades are a very good indication of future success, as is school ranking. There are the obvious reasons, of course. Good grades in law school mean that a candidate has the "soft" qualities to get her/him to prevail in a ‘grade-on-the-curve’. Plus, of course, this necessarily meant success on the LSAT ("scientifically proven" to correlate to bar-passage), success in college and high school as well. These are all educational and social experiences that are distinct from each other. Thus, to my mind, law school grades are indicative of alot of success–both academic/professional and social/emotional. At any rate, one must admit, I believe, that grades at least are pretty closely tied to success in the actual skills that are to be involved in practice. Conversely, other life experiences can be the result of alot of chance (code word for motivations or circumstances that might have little to do with merit, or at least might have to do with too many other criteria to be relevant).
All this, combined with the fact that the world is constantly shrinking, moving towards a single global pool rather than a series of relatively smaller ponds, mean that firms (and, of course, most importantly, clients) will ask for the best, the brightest, and all the rest—all the rest meaning the right psyche profile and emotional IQ.
It is just going to get harder and harder to recruit and retain. Firms will have to sprint to keep in place.
Thanks, Pete.
And another regular reader who prefers anonymity writes:
Bruce, that is just a terrific article about "Associate Moneyball" at your blog! I’ve always been mystified by law firms’ inability to shake themselves of the terrible interviewing and hiring habits surrounding new graduates (and I’m not sure the situation is much better with regard to lateral hires either). I used to make a similar sports comparison with amateur drafts — if professional sports team drafted collegiate players the way law firms hired new law grads, they’d check the player’s height, weight, school and stat line and leave it at that. (I’ve sometimes wondered what a law firm version of the NFL Draft Combine would look like — maybe with the way social networking is evolving, we’ll see a virtual one someday).
I’m a big fan of Moneyball myself, and I’ve thought about how its lessons might be applied to the law (a tradition-bound industry if ever there was one). One of the insights I took from Moneyball was the benefit of identifying low-demand assets whose attributes produced value well above their cost. Beane succeeded because he was the only GM seeking out high-OBP players like Scott Hatteberg, and leveraged the low demand. What are the low-demand assets in the law today? Who are the undervalued lawyers who can bring as much as or more to the job than more highly-sought-after (and more expensive) practitioners? The most obvious candidates are women in their 30s and early 40s (especially moms) — just as, if not more, talented and driven than the other lawyers (younger women, childless older women, and men) whom firms fall over each other to recruit and retain.
If I were starting a law firm today, I’d zero in on the best women lawyers in this age range whose firms have rejected them because these lawyers don’t fit the firms’ billing structure. I’d supplement them with dad lawyers who are similarly situated, put a full-time day care center on the ground floor, create a flex-time policy that actually delivers flexible time, replace billable hour targets with sophisticated financial and client satisfaction metrics, and preside over what I expect would be a very happy and financially healthy firm.
Although my reader requested anonymity, I can promise to forward the resumes of any of you who would like to make an overture towards working at his hypothetical firm.
Reader feedback, public or private, is one of the most satisfying aspects of "Adam Smith, Esq.," and I gratefully thank all of you who provide it.
