In the boom times before the last great recession, associates were the key to profits. With work pouring in the door and the firm's lawyers stretched beyond capacity, your profits per partner would zoom if you could just add enough well-trained bodies. For better or worse, those days are gone. Today, the Golden Snitch of law firm profitability is to add successful partners or groups with existing practices in order to soak up some of the hours of all those associates you hired back when.
Let's assume that your law firm (or its Strategic Growth Committee or its Acquisitions Task Force) has finally decided that to be truly successful it really needs to add a private equity partner, a small group of patent litigators, and an office in London. What do you do now?
You are a crucial part of the successful recruiting process, but you should not be the only part. If you spent 10 to 12 hours every day doing my job, you could over the course of a decade probably become as good at doing it as I used to be at doing your job. However, just as I wouldn't dare practice law now—it just isn't what I do any longer—you should leave your most crucial recruiting tasks to the professionals and concentrate the bulk of your time and focus on billing clients for legal work.
Form meaningful relationships with a handful of recruiters who specialize in placing partners and groups. Check out their track records and their reputations for honesty and professionalism. The last thing your firm needs is to be identified with someone known for cutting corners or chasing the quick buck.
In the same way that a client might be well advised to avoid underused corporate lawyers who now call themselves restructuring experts, so too should you avoid folks who just started doing partner searches when the overheated associate market cooled down. Experience counts.
When I started recruiting in 1990, I swore that I would do only retained searches. I reasoned that finding partners is no different from other high-level executive searches and should be handled and compensated in the same way. Hard-won experience has changed my tune on this score. Apart from the fact that law firms are reluctant to assure payment in full even if the search is a complete failure, the retained search model, more often than not, simply does not work in the current law firm environment.
Over the years, I’ve spoken to hundreds of partners to say, “We've been retained to find a new General Counsel for Marsh McLennan [or Facebook, or Columbia University, or whomever]. Are you interested?” No one has ever said, "I'd love to talk to them but, while we're at it, I might as well call American Express and the Equitable too." It simply isn't an option. You either explore the opportunity presented or you decline.
With law firms, however, it is a completely different dynamic. If we call on behalf of Firm A, more often than not the candidate will say, "Well, Firm A is a fine firm, but, if I am really going to explore my options, I owe it to myself to see what else is out there," and he or she then proceeds to call friends (or the Managing Partner) at Firms B, C, and D. From that point forward, any counsel the recruiter might give on the pluses and minuses of Firm A (and B, C, and D) are presumed to be fatally tainted by self-interest. Our own client's odds of success then drop rapidly.
Consequently, both the law firm and the client are, in all but a handful of situations, better served by a non-retained search involving a small number of trusted recruiting firms. One exception: in those rare instances when the firm needs to keep information confidential and to be very discreet about the fact that it is looking (i.e., when acquiring or merging with another firm or opening a new office), an exclusive arrangement with a single recruiting firm will likely be the best approach.
Return our calls and emails as you would someone who is going to add revenue to your firm's P&L because, if we are successful, we will be doing just that. If you are too busy, have someone else let us know when to expect a response, and then live up to that commitment. If we waste your time with unsuitable candidates, tell us; if we continue to do so, fire us and work with someone else. If you are unresponsive, eventually we will "fire" you since we won't be able to recommend your firm to top partner candidates for fear of losing credibility.
This is important because we need to be able to differentiate your firm from others and effectively present it to lawyers in the targeted practice areas.
Rely on recruiters to ask the awkward question; to avoid miscommunication; to offer occasional insights on what is weighing on a candidate’s perceptions of you or what land mines you should be sensitive to; for intelligence on your competition (if the candidate has shared their identity with you); to help structure a competitive offer; for help in making sure laterals are well integrated after they arrive at your firm; and for much more.
If you are paying us 25–30 percent of a new hire’s first-year compensation for a resume alone, but not taking advantage of us as a resource, you are probably overpaying.
The market may have softened for associates but it is always hot for the superstar partner with a practice. In all probability, if you wait three weeks to set up a first meeting with someone whom you ultimately conclude that you do really want, you will have given a competitor the chance to get the candidate so excited that you may never catch up.
Similarly, if someone has fallen profoundly in love with your firm, there is no surer way to diminish that ardor than to unnecessarily delay the process, especially if it is not carefully explained.
The two are often different. Which critical competencies and personal qualities are absolutely essential? Which are merely on the wish list? When we send you someone who is not on-point, tell us why so that we can get closer to the bull’s eye next time.
You would think that this would go without saying, yet too often we hear of partners deciding to trust a "friend" who is a partner of someone they are thinking of hiring. Others call acquaintances to say, "We are thinking of using So-and-So for a conflict, what do you think of him?"
That fiction might have worked a decade or two ago but now everyone knows that it likely means, “We are thinking of bringing So-and-So on as a lateral partner.” You have just exposed him and, in some (hopefully rare) cases, he has already been locked out of his office and escorted from the building. Even if that story doesn't get around (but it probably will), recruiters will know your firm is not to be trusted and will be reluctant to risk a repetition of such indiscretion.
Do it honestly (even if you are in "sell" mode), clearly and repeatedly with the candidate, with the recruiter, and with any other people involved in the process. Let us know what you see as the roadblocks so that we can help you get past them if that is possible or, if not possible, find you someone else who doesn't have the same or similar issues that will kill the deal. Don't just tell us "the firm has decided it's not a fit."
If you tell a partner (or a recruiter who then tells the partner) that you expect 1,800 billable hours, and the partner arrives to find that those who fail to bill 2,200 are shunned in the lunchroom and denied bonuses no matter how good their work, you have gained nothing more than a hasty departure and another black mark on your retention scorecard.
If you expect that a lateral who has never handled a case with more than $5 million at stake will be able to snare those massive class actions that your client isn't giving you now, here too you are likely to be disappointed. As our three surveys of many thousands of lateral partners over the past two decades have consistently shown, if you work to ensure that your expectations and the recruit's expectations are reasonable and clearly communicated, both of you will be more likely to end up satisfied with the match.
Give them authority, responsibility, and make them accountable. Then put the firm's money where its mouth is. The firms that say, "Fred's useless with clients so let's put him in charge of hiring," make a grave mistake. Those new hires are going to be paying your pension, if you have one, or at the least keeping your firm vital and successful when you're at the Final Appeal Rest Home. Be they new graduates, fifth-year associates, or rainmakers with multimillion-dollar practices, those recruits are the future of the firm.
For the same reason, don't just shunt the faithful paralegal who has burnt out in litigation, or the secretary whose part-ner has retired, into the role of lateral partner coordinator (or associate recruitment coordinator, for that matter). Find someone who has excellent people skills, high energy, great follow-up, and saint-like patience.
Let that person know that the full authority of the firm's management will back him or her in this vital task, and then go ahead and back them. Let partners know that, if they blow off an interview at the last minute, you will remember that when it's time to set their points or bonuses, just as you (hopefully) would remember if they blew off a beauty contest with a prospective client. Even the 900-pound gorillas must understand how vital this process is to the firm's long-term survival.
Done correctly, the strategic addition of lateral partners and groups can add significant incremental revenues and new client relationships that diversify the firm. They bring vitality and fresh perspectives.
This article was originally featured in Of Counsel, Volume 36, No. 3 - March 2017.