Should the Managing Partner or Executive Committee of this firm focus on how its RPL stacks up industry-wide? Well, of course they could, but suppose they did just that and chose to try to raise their standing in the averages? Their choices would be (1) to fundamentally change their office footprint, a project which could absorb a decade with no guarantee of a superior outcome on the other side; (2) try to move up-rate in their practice area mix, which could also absorb a decade, etc., while drastically disrupting the lawyer ranks in the process; or (3) deleverage when they have, by hypothesis, found a leverage ratio that’s close to optimal for their client list.
But there is one reason they might feel embarrassed or defensive about their RPL quotient, encapsulated in the doubts potential laterals might express about the low RPL figure. Why might a lateral raise that and why might the firm take it as a serious and substantive question?
Because we’re always and everywhere comparing ourselves to others. What we’ve achieved, the path we’ve chosen, is never sufficient; we seem to have a preternatural compulsion to always be looking over our shoulders at others. If you doubt this, I invite you to conduct this experiment on your own: Suggest a slightly new, different, and better way of doing things to a colleague and ask their reaction. I’ll lay odds the first words out of their mouth will be, “Who else is doing this?”
Among the rest of the population, the “non-lawyers,” I bet much of the time the reaction would be the reverse: “I hope no one else is doing this!”
True story: The COO of a firm with a large Boston office told us how the decision whether or not to close the office during a heavy snowstorm was arrived at. “Did we see whether the courts were closing? Whether clients were shutting their offices or cancelling meetings? If the mass transit authorities were warning that people ought to get home? No! None of that. What made the decision for us was simple: ‘Is Ropes & Gray closing?'”
Back to RPL: Do not look over your shoulder at “yours” vs. “theirs.” Spot yourself your own business model and strategy. If you’re an elite firm dealing with high stakes matters, then by all means a higher RPL is probably an index of health for you. If you’re like our hypothetical firm above, pay your RPL zero heed. If you’re moving from a general practice, full service, destination-for-nothing-in-particular “Hollow Middle” firm into one focused on a particular niche (a “Category Killer”), and if that niche comes with intrinsically lower rates, celebrate a declining RPL.
It all depends on who you are. Not who the other guys are.