This article is my second in a series exploring life and career lessons learned from my favorite podcasts. This piece focuses on the lessons contained in “Freakonomics: The Upside of Quitting.”
Quitting generally gets a bad rap. Most of us like to think of ourselves as over-achievers who succeed at least in part through persistence and grit. To this end, perhaps the most repeated aphorism on the imprudence of quitting is Napoleon Hill's gem “a quitter never wins, and a winner never quits,” but there are countless more. Just Google “quitting quotes,” and you'll see what I mean.
While most conventional wisdom on the topic suggests only losers quit, this superficial conclusion lacks nuance. Explore a little more and another thing you'll learn is that there may be great wisdom in strategic quitting. A couple of the most sage maxims on the flip side of the quitting coin are, “Strategic quitting is the secret of successful organizations” and, “Of all the stratagems, to know when to quit is the best.”
This nuanced take on quitting is the topic of what I believe may still be the most popular episode of the great “Freakonomics” podcast: “The Upside of Quitting.” If you are somehow unfamiliar with Freakonomics, it is a melding of behavioral economics, pop culture, psychology, and current issues that first burst into our collective consciousness in 2005 when University of Chicago Economist Steven Leavitt and New York Times Journalist Stephen Dubner released their groundbreaking debut book, Freakonomics: A Rogue Economist Explores the Hidden Side of Everything. The book applies economic theory to cheating teachers and sumo wrestlers, bizarre baby names, self-dealing realtors, the impact of legalized abortion on crime, and the economics of illegal drug dealing. In Freakonomics and three subsequent books (SuperFreakonomics, Think Like a Freak, and When to Rob a Bank), Levitt and Dubner apply their same brand of pop-economics to offer unconventional analysis of other real-world phenomena and perplexing social questions.
Capitalizing on the success of the Freakonomics book series, Dubner launched Freakonomics Radio on NPR in 2009 and began to distribute Freakonomics Radio via podcast in 2010. I have been an avid listener from the time I first discovered it around the time of the launch. While there are many great episodes, “The Upside of Quitting” remains one of the best—turning much of the conventional wisdom on the topic on its head.
For lawyers and law firms, I am not suggesting that quitting means quitting the practice of law entirely. What I am suggesting is that lawyers and law firms should regularly consider whether they are on their optimal path for success.
Lesson 1: Fail fast. Levitt argues that one of the single most important factors for his success in the field of economics has been to follow the mantra “fail quickly.” To this point, he believes that one of his great skills as an economist has been to recognize the need to fail quickly and being willing to jettison a project as soon as he realizes it’s likely to fail.
Lesson for lawyers: Regularly consider whether your current firm offers the right platform, support, rates, synergistic practices, jurisdictional coverage, and culture for your clients and practice. If it does not, don't let your practice become too entrenched at the wrong firm. The passage of time makes it increasingly difficult to make the decision to leave the wrong platform for a better fit.
Lesson for law firms: The same is true for a law firm following a given path—both long- and short-term strategic planning should be regularly evaluated and re-evaluated. Many law firms wait until a crisis forces them to rethink their focus, succession planning, metrics, mission, structure, and/or culture. By then, their options will have decreased significantly and their potential paths forward will be severely limited. Don’t wait until there is a fire to purchase fire insurance!
Lesson 2: We learn more from our failures than we do from our successes. People who are able to admit that the time has come to quit and move on to a new experience are far better positioned to succeed than those who stick with a suboptimal path or approach. There is no shame in quitting.
Lesson for lawyers: The lateral market has become increasingly fluid and lawyers have become increasingly mobile in the past 20 years. As firms have become more and more focused on profitability due in part to the publication of AmLaw 200 metrics and the perceived need to keep up with peer firms, both lawyers and firms have shown decreased loyalty to one another. In this increasingly fluid market, all law firm partners should be thinking about whether their firm has delivered optimally for their practice and clients. If your firm has not fully delivered, there absolutely are other firms out there more effectively providing the type of support, culture, and price sensitivity you need. There is no shame in learning from the shortcomings of your existing firm and exploring whether there is another firm out there offering a better fit.
Lesson for law firms: It is easy to become “fat and lazy” when the getting is good. But law firms should never become complacent. Think about what is NOT working; where things COULD be improved. Law firms must learn from their mistakes and constantly adapt to an evolving landscape. Firms that do this best will be best positioned for success.
Lesson 3: Quitting can be good for your emotional and physical well-being. A psychology study at Concordia University in Montreal revealed that the ability to abandon goals that are essentially unattainable is good for your health.
Lesson for lawyers: The two most common refrains I hear from law firm partners after a lateral move are: “Why didn't I do this years ago‽*” and “One thing I never expected was how much this move would rejuvenate and re-energize me.” Moves can be life-changing for both your practice and your mental approach in ways you never imagined. Don't discount the benefit a move can be to your physical, mental, and emotional well-being.
Lesson for law firms: Adopting a new course, a new strategy, a new structure, or a new direction can also re-energize and rejuvenate a firm. There is a certain amount of morale-boosting of the troops and improvement of esprit de corps when a law firm decides as a group to move in a new direction. Don't discount this cultural benefit.
Lesson 4: Don't let the “sunk cost” fallacy get in the way of doing what is best. Telling yourself you can’t quit because of all the time or money you've expended to get where you are today can be a huge mistake. Economists would tell you sunk costs are independent of any future event and should not be considered when making choices about the future.
Lesson for lawyers: While the time and money spent on law school and building your career cannot be discounted entirely—working relationships and knowledge gained from years at your present firm are certainly an asset—it is unlikely those things will be completely lost upon a move to a new firm. On the contrary, it is far more typical that a move actually multiplies the network, relationships, and knowledge of the lateral partner. Nor is the cost of law school and the time spent at your existing firm relevant to whether you would be better off at another firm. Don’t fall into the psychological trap of believing you are a “lifer” at a firm simply because you have spent 20 years there.
Lesson for law firms: Whatever sunk costs are associated with the strategic vision your firm has been pursuing, those costs are irrelevant to the future direction of your firm. Think about only what is best for the firm's future: Should it continue pursuing the same course of action (e.g., fierce independence) or should another direction be considered (e.g., combining with another firm for greater diversification, market penetration, access to clients and talent, etc.)?
Lesson 5: Don't let psychological notions of loyalty or cognitive dissonance skew what is right for you. The example Freakonomics discusses is “the offer” Zappos makes to its trainees: “We'll give you $3,000 if you quit right now.” (As of the date of the podcast, only 30 out of 2,000 trainees had accepted the Zappos offer.) Zappos understands that once the offer is declined, a certain psychological loyalty, or cognitive dissonance, seems to kick in: ”So, the next morning after you rejected the 3,000 dollars, you’re going to wake up and say, ‘My goodness, I really must love this company if I rejected this amount.’” Similarly, there is a cognitive psychological mindset when a person has made a decision to act in a certain way over time. They’re going to overly justify their behavior by telling themselves that they made the right decision.
Lesson for lawyers: Partners often have a sense of loyalty to their firm that is rarely returned in the current legal environment. Keep in mind that it is increasingly rare for a law firm to let its sense of loyalty to its partners outweigh what is best for the firm. While loyalty is an admirable quality, don't let a sense of loyalty outweigh what is best for you, your family, and your practice.
Lesson for law firms: Firms regularly make strategic decisions because they believe a given direction is what the partnership wants. Strong leadership is necessary to point the firm in the right direction and persuade the partnership that the direction is the correct one in the face of what may seem to be a contrary partnership mandate.
Lesson 6: Don't let the fear of the unknown overcome your acceptance or fear of the “known.”
Lesson for lawyers: This is the “devil-you-know” fallacy. Many lawyers believe their current firm may have its flaws, but it is the devil they know. The fear of the unknown is greater than the fear of staying put. But you don't know what you don't know. If you're not 100% happy where you are, exploring what else may be out there is an easier step than you think. It doesn't mean you're necessarily casting the devil you know aside. You're simply taking the simple step of determining whether there may be a better option for you, your clients, and your practice. Once you take that first step, you can then determine whether your exploratory examination of your options compels you to make a move.
Lesson for law firms: A firm that has followed a given course for a period of time may decide that is the right course because it is the only course it knows. This is not the right way to think about your firm's future. It is important to keep your eyes and ears open to the evolving legal landscape to ensure the firm is best positioned for success.
Lesson 7: Don’t discount the opportunity cost of continuing the course you are on. To conclude this episode, Dubner offers the following sage advice: “Remember the opportunity cost: every hour, every ounce of effort you spend here cannot be spent there. So, let me counter Napoleon Hill’s phrase [a quitter never wins and a winner never quits] with another one, certainly not as well known. It’s something that Stella Adler, the great acting coach, used to say: ‘Your choice is your talent. So, choosing the right path, the right project, the right job or passion or religion — that’s where the treasure lies; that’s where the value lies. So, if you realize that you’ve made a wrong choice — even if already you’ve sunk way too much cost into it — well, I’ve got one word to say to you, my friend: Quit.’”
Lesson for lawyers: Choosing the correct course is critical. As a recovering lawyer myself, however, I recognize that lawyers are focused on their work and their clients, not on which firm offers the best platform for their practice. This is where a knowledgeable and experienced recruiter comes in. A good recruiter will help you identify which factors are most important to you and your practice and which firms will provide the best platform to deliver on those factors.
Lesson for law firms: Leadership at a given law firm is highly unlikely to have a full picture of the evolving legal landscape. That is why strong leadership regularly reaches out to experts for advice. In the world of knowledge and information regarding the evolving legal landscape, firm culture, internal issues at firms across the globe, etc., no one has greater access to knowledge and information than a top recruiter at a global legal recruiting firm like Major, Lindsey & Africa. To this point, I regularly tap into our global resources and information sharing at MLA to advise law firms on large strategic initiatives, succession planning, and lateral growth planning and execution. As part of these initiatives, I regularly meet with law firm executive committees and leadership to discuss such things, and I have represented and advised a number of firms exploring and executing combinations, lateral growth initiatives, and office openings. I'm always happy to share the information I have gleaned in nearly a decade at MLA following 17 years of practicing law. Reach out anytime.
*If you are unfamiliar with the interrobang (‽), I highly recommend the “Interrobang” episode of the 99% Invisible podcast: https://99percentinvisible.org/episode/interrobang/. It is a pet project of mine to popularize the interrobang. Why not‽