A loyal and exceptionally thoughtful reader, and reasonably regular correspondent (also with a strong academic background in economics), writes:
Bruce:
I enjoyed your 9 February think piece. I would be interested in your views as to why law firms seem to be supporting the building of a “star” culture, rather than going the brand approach like the management consulting firms and the accounting firms.
From a law firm’s perspective, it costs money to select your stars and have your marketing department promote them. You then risk creating ego-centric stars who will not “play nicely in the sandbox” with their partners. You also risk them getting poached by another firm, or, in the case of star litigators, creating their own boutiques. Boies Schiller and Quinn Emanuel come to mind.
Could it be that there are still too many players in law and that brand is not yet a sufficient differentiator? The best brand survey that I am aware of that includes law firms is the UK Business Superbrands study:
http://www.superbrands.uk.com/Pages/DocumentManager/BSB-2010-Top-500.pdfYou will see that the Big 4 Accountancy firms rank between 10 and 45. McKinsey comes in at 108. The highest ranking law firm is Eversheds at 218 (it’s a national rather than a London survey, which likely explains Eversheds’ high rank) and the rest of the Magic Circle come in as follows:
Clifford Chance: 225
Linklaters: 238
Freshfields: 281
Slaughters: 286
Allen & Overy: 323From law firm management’s perspective, firm brand should be the ultimate goal rather than building stars, but it would seem that building brand is still extraordinarily difficult for law firms. After all, Freshfields have been solicitors for the Bank of England since 1743, and still could do no better than 281st in the 2010 survey.
It is true that the Magic Circle firms only became big players in the 1970’s after the maximum of 20 partners restriction was lifted in the 1960’s, nevertheless, even after 40 years as bigger players, they still are not “top of mind” within the business community.
Could this be because law firms still build business through relationships and buyers want to build relationships with stars rather than firms? Does law need to consolidate to similar levels as the Accountancy firms before this pattern can be broken and buyers start placing brand over relationships with stars?
Regards,
[Anon, a partner in a Global 100 firm]
Fascinating questions, the essence of which I take to be: Why do law firms seem to focus their efforts on promoting “stars” instead of building institutional brands?
As he points out, this would seem to be self-defeating for firms: Marketing and promoting stars in your firm’s communications efforts tends to draw clients and potential clients to–those stars, not the firm as an institution.
And we all know that stars are precisely those lawyers most likely to take advantage of the highly liquid lateral partner market. In other words, you’re investing in your greatest flight risks.
Generally, I believe it’s instructive to offer analogies between Law Land and everywhere else in business, because the contrast can be instructive and it tends to abstract from otherwise charged hot-button issues unique to our charming industry. But in this case I’m hard-pressed to come up with an analogue in business land to the star system we’re seemingly addicted to.
Let me hasten to add that there are obviously industries that revolve around stars: Sports, music, Hollywood, and alas, even best-selling books to start. But the only one of these that has something resembling firms is sports. No one ever bought a Rolling Stones album because Atlantic Records issued it instead of Warner Music, and nobody downloads Lady GaGa from iTunes based on loyalty to her recording company.
Sports, as mentioned, is the exception: And I’m prepared to argue that the loyalty of fans to a team actually has very little to do with stars. Teams are firms, and fans have loyalty to teams based on propinquity, family tradition, and who knows what else. In New York, the Mets and Jets are the blue collar teams, the Yankees and Giants the upscale, white collar teams. Does A-Rod put extra fans in the seats at Yankee Stadium? Does Derek Jeter? Maybe. When they both retire will those numbers change appreciably? I doubt it.
What I’m arguing is simple: No other industry organized around firms where brand name matters depends as much on stars as we do.
Not to put too fine a point on it, but this is insane. Stars come and stars go; they can decamp for greener pastures, and after that, the best predictor of being divorced is having been divorced. Investing in them is investing in a wasting asset with an uncertain half-life.
We need to build brands around our firms.
So why aren’t we?
To be fair, it’s dauntingly hard.
What is the “brand” of a law firm? Well, what is the brand of any product or service?
A brand is a promise.
A brand promises a certain consistent experience, an expectation of a particular quality level, experience of service, consistency, sameness (in the best sense), an implicit guarantee.
But law firm partners are anything but designed or acculturated to delivering a “consistent exprience” or “a particular quality level.” It seems at odds with our very essence.
Still, I don’t think it’s impossible; I just think it’s challenging, and that the first firm to begin to surmount it will have a tangible competitive advantage. I say this because I know a few (OK, just a few, but not zero) firms that are training their partners in such basic client “experience” skills as how to deliver bad news, how to talk about unexpectedly high bills, how to introduce new lawyers to the team, and so forth. Where do they go for such training? Well, for starters, Four Seasons and Ritz Carlton Hotels. (No, they don’t check in for extended stays; they go through the same boot camps trainees go through, at least at an executive level.)
Branding a law firm is hard at another level, of course: What exactly is the promise? Here in New York, in the last six weeks or so, all of the Wachovia bank branches in the city have been re-branded as Wells Fargo. They’re replete with banner logos in the windows and full-subway car ads promising “Upper West Side, we’re here for you” and “Wherever you want to go, we’re there to help.”
Say what?
I don’t mean to pick on Wells Fargo, but that branding campaign is a few bricks short of a load. And they presumably aren’t short of resources to spend on marketing consultants.
I’m not saying it’s easy for a law firm (or a bank) to distinguish itself in the eyes of potential clients. But it’s vital. We need to get this right, folks.
The days of promoting the stars as our default marketing strategy has to end. Altogether too many have demonstrated their capacity to be disloyal, they disserve their partners when clients follow them and not the firm, and they can unintentionally contribute to a firm’s fragility.
Drop the star mentality. Who is signing your paycheck every month? The firm or the stars?
