Posted by: johnocunningham | September 16, 2016

Governance by Committee: Can Law Firms Make it Work ?

I was intrigued by questions posed in a recent column on Bloomberg’s “Big Law Business” page, entitled “Do Big Law Firms Have Too Many Committees?”

The column’s focus was on whether management by committee was a plus or minus for law firms, which got me to thinking about my experiences in law firms and in corporations, which have two very different forms of governance and decision-making. Law firms – in general – try to manage more by consensus and committee. Corporations manage more by delegation of authority and empowerment of the authorized individuals on whom accountability is placed.

I know from experience that the latter approach certainly moves faster, and it tends to cultivate more respect and trust for those who have been empowered to do an important job or make critical decisions, but the two approaches are not always as different as they might appear, though they have different upsides and risks.

The downside of a committee approach to decision-making is not just the time consumed in attempts to reach consensus, but the potential for rather personal debates and a sense of some people getting their way and others “losing” the debate.  This can sap the team’s energy and breed disruption. On the other hand, this form of decision-making, when it incorporates all of the points of view of all of the important stakeholders, is less likely to result in a disastrous gaffe born from an oversight due to lack of collective input. It is also less likely to give one group or another the feeling that they have not been heard (provided that various constituencies are all included, such as different departments, different professional functions, different levels of seniority and so forth).

But the two approaches are not always so different. In a corporation, a professional who is empowered to make decisions is wise to seek input from others, including all of the departments in the company who could be affected by that individual’s decision. In fact, someone who blithely makes decisions on an island will quickly be escorted to the door after seeing the ruinous results of decisions made without input, both practical and political in nature; and someone who quickly gathers input from affected groups before making a decision is always blessed with a better outcome. The difference in the corporate world is that the empowered professional who seeks input is not required to make everyone happy with his or her decision. They are simply accountable for good results achieved with methods that don’t offend the key players in the chain-of-command.

In a law firm, the committee approach and the results do not have to be so different. The chair of a committee or board can run meetings in such a way that input is quickly solicited and incorporated into expeditious decision-making. The key is to limit the time for meetings while making it clear to people that decisions must be made promptly and actions taken by certain agreed deadlines in order for the body politic to function and the firm to survive in a fast changing world.

I have personally witnessed and learned from people in the corporate world who were very good at running effective meetings (there is even leadership training in the corporate world that focuses on effective facilitation of meetings and group decision-making). If you want to conduct an effective meeting that facilitates and enhances collaborative communication, here are some guidelines to follow (from one of my prior posts):

  1. Identify the group purpose of the meeting in advance, and limit the purpose to something that requires consensus, analysis or brainstorming by the entire group, so that you don’t waste people’s time.
  2. Communicate the purpose of the meeting ahead of time, and state what you hope to accomplish with such a meeting.
  3. Invite all people necessary to achieve the meeting’s purpose, but only those people necessary for that purpose as well.
  4. Select a meeting venue that is conducive to your stated task, perhaps one that is quiet and isolated from distractions.
  5. Well ahead of the meeting, provide all attendees with an agenda and any supporting documentation that will be discussed.
  6. Limit the number of items on the agenda so the meeting does not run too long.
  7. Designate a meeting leader or facilitator who understands meeting principles and who can skillfully and gracefully maintain group focus and pace while encouraging people to participate and collaborate in developing solutions to group problems. Such a facilitator should also know how to summarize and state conclusions or action plans for the group as a whole.
  8. Designate a note-taker who can work well with the facilitator on summarizing issues and proposals discussed at the meeting while identifying action steps to be taken after the meeting by various team members.
  9. Request that all pagers, cell phones, and other electronic devices be turned off during the meeting, so that everyone in the group is respected.
  10. Start and end the meeting on time, leaving late attendees to get their own information from meeting summaries and post-meeting conversations. This will train people to respect the group and put the interests of the group above their own.

If you need help facilitating a productive group meeting or conference, don’t hesitate to contact me. For several years running, I ran the highest-rated service department in a company with several thousand employees while maintaining a high level of employee satisfaction and retention.

The Wall Street Journal Law Blog recently featured a post about law firms battling weak demand by charging higher hourly fees, which noted that expenses per lawyer are rising faster than revenue per lawyer at most large law firms despite substantial increases in hourly rates in recent years.

Recent surveys of smaller firms have similarly shown declining demand, perhaps because individual consumer clients are increasingly choosing to do their own legal documents, resolve their own disputes and/or seek out cheaper alternatives to traditional legal services.

So what does all of this mean for the future of legal practice?

Lawyers and law firms that have developed expertise in specialized, high demand niches – such as patent practice for biotech or high-tech clients – can continue raising rates indefinitely. So can firms who have reputations for being “the best of the best” in high stakes matters, such as mergers and acquisitions or “bet the company” litigation. More competition may enter these practices, seeking a slice of the top-shelf pie, but savvy corporate clients will not be penny-wise and pound foolish in selecting legal service providers for these kinds of work (or so they have indicated in various surveys).

But the world is different for lawyers who are doing “commodity work” (and by the way, clients view most legal work as “commoditized work”). Those lawyers – most lawyers –  will have to figure out ways to use technology, improve internal processes and manage projects more efficiently, so they can deliver legal products and services less expensively while maintaining or even increasing margins. You CAN raise hourly rates if you figure out how to cut the hours in delivery time proportionally.

What you cannot do over the long term is raise rates simply to make up for declining demand. That is the kind of death spiral approach that the postal service tried (which only led to more customers fleeing to alternative providers).  Any business school can provide a long list of historical examples of companies or whole industries that became extinct by ignoring trends in demand and innovation.

For law firms, there is a critical need to innovate and become ultra-efficient right now. Lawyers will have to imitate their business clients, who are constantly obsessed with how to serve customers better because they must. Just because we are part of a profession, we are not immune from the laws of economics.

To see only a few examples of how just one firm is aggressively approaching the need to innovate and become more efficient, check out the following links to articles on changes in labor and employment practice at Littler Mendelson:

  1.  Putting Products Into Services at Harvard Business Review
  2. Using Big Data in Employment Work at Today’s General Counsel
  3. Why You Should Disrupt Your Own Company (by changing how it works) at FORBES magazine

And for a look at how four firms have approached innovation to lower costs in order to win the battle for more clients and more matters, check out this article by John Kennedy at Law 360.

NOTE: As of the current time, I do not receive compensation or perform services, nor have I ever performed services for any of the law firms mentioned in this blog post.

This is my 45th post in a series of monthly features that I have dubbed “Best of My Blog Roll.” The concept is simple – at the end of a month I peruse my own blog roll (see that column on the right) for material created by other bloggers that I think is most worthy of sharing with others, and then I report on it here.

Reviewing blog posts for the month of August 2016, I have chosen to highlight the following:

  1. A post by David Ackert on the Ackert Advisory Blog, entitled, “Using Linked-In to Accelerate Your Networking Results,” which gives a simple three-step prescription for how to use Linked-In to locate and arrange a meeting with an ideal business prospect.
  2. A post by Mandy Edwards on her ME Marketing Services Blog, entitled, “Thirteen Social Media Tools to Make Your Life Easier,” which provides a snapshot of some of the most popular tools for managing and scheduling of social media activities.
  3. A post by Cordell Parvin on his Cordell Parving Blog, entitled, “Ten Things You Didn’t Learn in Law School…”  This post lists ten things that lawyers are not taught in law school but need to know in order to be successful.

One other thought-provoking post last month came from Steven J. Harper on his Belly of the Beast Blog. Harper is a former partner in an AmLaw 100 firm who often pens his views on things that he believes need fixing in the profession. In his August 10 post, he lays out portions of a transcript of recent ABA testimony at a Department of Education hearing. This post suggests that the ABA’s law school accreditation authority may be in jeopardy. If he is right, then law schools could have some changes foisted upon them, particularly those schools that have charged significant tuition while cranking out alumni with dismal prospects for full-time legal employment.

Posted by: johnocunningham | August 24, 2016

The Role of Trust and Competence in Forming Relationships

In her most recent book, “Presence,” Harvard Business School professor Amy Cuddy says that people quickly surmise two things about a new acquaintance:

  • Can I trust this person?
  • Can I respect this person?

Cuddy explains that the latter question translates to, essentially, “Do I believe this person is competent at what they do?”

Her findings, based on 15 years of studying common interactions with the help of other highly-qualified psychologists,  suggest that the primal question in our brains is the first one: “Can I trust this person?” She also concludes that professionals often focus too much on displaying competence and strength before trustworthiness, which can actually hinder the development of trust.

For those who are selling professional services, there is a lesson in this study. Try to connect with another person on a human level when you try to make a business connection. There are lots of competent professionals, but among them, there are fewer who can establish a link of trust with a prospective client based on shared values, experiences, or other subjective criteria.

In my own study of corporate clients, I have found that trustworthiness is almost always consciously articulated as a threshold concern, and there is a fear of those who open a first acquaintance talking all about their professional accolades. Displaying competence is critical to the formation of a new relationship, but it is secondary to proving you can be trusted.

Sales professionals have long known this, and indeed that is the reason for their maxim: “No trust means no sale.”

 

Posted by: johnocunningham | August 16, 2016

Communications: Spotting the Frauds

Security professionals are warning of an uptick in cyber phishing attacks aimed at senior executives and other high level targets within businesses and professional service organizations that serve them.

So-called “whaling” schemes involve cyber criminals sending business emails that are well-crafted and appear to be sent from a legitimate business authority, or even from an internal colleague.  The content sometimes appears to come from upper management, often tricking financial staff into making wire transfers to bank accounts controlled by thieves. Other schemes involve alleged legal subpoenas to obtain critical information and other fishing expeditions. Business email compromises have affected as many as 7,000 US businesses in the past two years, according to the FBI, resulting in some $740 million in losses.

The key to avoiding these fast-growing risks is security awareness training for employees, adequate internal control processes on release of funds and sensitive information, and regularly updated technology controls. Several accounting and consulting firms, as well as security consulting firms can provide valuable assistance in these areas.
Posted by: johnocunningham | August 8, 2016

What Makes a Workplace Work: Communications Are Key

A couple of articles that recently popped up on my social networks have given me cause to think about how critical communications are to workplace productivity and stability.

On the positive side, I noticed a Harvard Business Review article, based on surveys of hundreds of successful executives, which highlighted the six virtues most commonly seen by executives as critical to success. The article, entitled, “Creating the Best Workplace on Earth,” discussed the importance of the following virtues:

  1. Letting People Be Authentically Themselves
  2. Unleashing Information Flow
  3. Magnifying People’s Strengths
  4. Standing for More than Shareholder Value/Profit
  5. Showing How Daily Work Makes Sense and Makes a Difference
  6. Articulating Rules/Policies that People Can Believe In

It is interesting to note that 2/3 of those virtues are very dependent on communication.

  1. Unleashing information flow necessitates an understanding of how information is shared organizationally, how it can be better shared, and who needs to share it with whom.
  2. Standing for more than shareholder value at an organizational level requires the ability to find and articulate a meaningful driver and motivator for employees that is part and parcel of the organization’s mission and values
  3. Showing how daily work makes sense and makes a difference at an individual level similarly requires the ability to listen to and understand workers while describing the function and importance of their individual roles in a way that connects them meaningfully to the organization’s mission and objectives
  4. Articulating rules and policies that people can believe in is also dependent on the ability to develop and communicate rules in a way that workers will enthusiastically support while helping to police themselves for the good of all, as well as the organization

On the other hand, a negative view of what NOT to do can be found in a recent publication at Above the Law, which was entitled, “Three Factors that Make Law Firms So Toxic.” This article stressed the factors found as critical by Law360, which are:

  1. Inconsistent feedback, yet another communication issue
  2. Lack of opportunity for growth
  3. Lack of openness and transparency, which often stems from or is symptomatic of a lack of communication

It is pretty clear that both organizational productivity and failure are dependent in large part on communication issues. If you want to communicate well, you might want to invest in a professional who can help you achieve that critical objective in order to be more productive and more stable as well.

Posted by: johnocunningham | August 2, 2016

Best of July 2016 Blogs: Content Creation, Networks, and Innovation

This is my 44th post in a series of monthly features that I have dubbed “Best of My Blog Roll.” The concept is simple – at the end of a month I peruse my own blog roll (see that column on the right) for material created by other bloggers that I think is most worthy of sharing with others, and then I report on it here.

Reviewing blog posts for the month of July 2016, I have chosen to highlight the following:

  1. A post by Stephen Fairley on the Rainmaker Blog entitled, “How Google Defines Quality Content,” which gives a good snapshot of some key considerations in Google’s proprietary analytics for quality measurement. You can find other pronouncements on the subject by Google’s Matt Cutts on YouTube and other media sites.
  2. A post by Craig Brown on the LawVision blog entitled, “Why Your Strongest Contacts Are Not Always Your Best Contacts,” which illustrates the importance of cultivating so-called “weak links” to circles of people that you don’t typically enter. The idea behind cultivating weak links is not to be randomly entering new groups, but strategically looking at those which might dovetail with your clients and prospects for enhanced client development opportunities. The research that has been done on this subject at Harvard Business School is very detailed and convincing for those who might want to Google it.
  3. A post by D. Casey Flaherty on the Three Geeks and a Law Blog entitled, “Law Firm Partners, If It Ain’t Broke…,” which provides a heady discussion about the current competitive landscape in the legal services industry, the challenges ahead, and the necessity and likelihood of innovation and change (from within or from outside the legal profession).

I liked these posts because they all provide valuable insights into topics that are relevant to professional service providers (especially lawyers) who need to improve their content marketing, their networking, and their entire approach to client service and innovation.

 

Posted by: johnocunningham | July 26, 2016

“Do-It-Yourself” Social Media Marketing

There is no excuse for not having a social media marketing plan and strategy now. Even the smallest of firms with no social media “experts” has someone at the management level who is capable of quickly learning the basics about social media, which is composed of technology platforms that are designed for intuitive use, sharing and learning.

If you don’t know where to get started or how, just check out “The Fundamentals of Social Media Marketing” at the Hootesuite Academy, which can guide you through such topics as:

  • The basics of social media:
  • Optimizing social media profiles;
  • Social media strategies;
  • Content marketing;
  • Social advertising; and
  • Growing an online community.

There are plenty of additional online resources, and most social media platforms have help guides and/or FAQs that you can utilize. So get your “social” on, start having more fun, and raking in more revenue, using Facebook, Twitter, LinkedIn, Instagram, YouTube, Pinterest, Tumblr and other free or low-cost apps.

Posted by: johnocunningham | July 19, 2016

Three Things Anyone Can Do To Cultivate Clients

Over the years, I have interviewed many successful rainmakers and law firm clients about what works and what doesn’t in client development.

Based on what I have learned about cultivating a client or a prospective client, here are just three quick and easy tips to follow for client development:

  1. You can improve relationships with a client or prospect by introducing them, when appropriate, to other high-quality service providers and experts with industry-relevant experience and reputation.
  2. You can periodically send industry relevant data to them, along with well-researched and well-written articles on subjects of possible interest or concern.
  3. You can offer free training or legal talks on trending subjects, offering potential solutions to some of their problems and practical steps for implementation.

These are just a few ways you can bolster a business relationship. If you want to know more, I can provide a lunch-hour program on what works and what doesn’t in client service and development, based on interviews of hundreds of actual clients and numerous successful practitioners.

Posted by: johnocunningham | July 17, 2016

Client Communications: Duties After the Representation Ends

I recently reviewed an article on the subject of ethical considerations and professional obligations involved in law firm decisions to close or destroy old files containing communications and important information related to client matters. This article presented numerous issues that inspired me to research the topic and write a blog post of my own.

Lawyers have a special relationship with clients that is more than commercial, and therefore, requires careful consideration with regard to any decision that involves client communications. But the lines of professional responsibility with respect to retention or destruction of client materials is not so clear. In fact, the various state bar associations do not even agree on whether it is the lawyer or the client who owns the client files.

Some states have provided some degree of clarity by rule, while others have done so only by a stream of ethical opinions that touch upon issues involving disposition of client files.

The model rules and opinions of the ABA seem to offer some guidance to the states as follows:

  1. Unless a client consents, a lawyer or firm should not destroy any items that clearly belong to the client, by rule or by contract.
  2. A lawyer should be careful not to destroy information that may still be necessary or useful in the assertion or defense of a client’s position in a matter for which the applicable statutory period of limitations has not expired.
  3. A lawyer should take care to preserve accurate and complete records regarding receipt and disbursement of funds indefinitely.
  4. In disposing of any file or communications, a lawyer must take special care to protect client confidentiality, privilege or property rights.
  5. A lawyer should preserve an index or identification of files that have been destroyed or discarded.

Some states do impose a minimum period of time for which client files and communications must be preserved, some states impose special obligations with respect to signed original contracts or key documents, and some states allow for lawyers and clients – to some extent – to make their own agreements with respect to preservation, destruction or possession of client communications and documents.

In any event, lawyers are wise to check the professional rules of their own jurisdictions, as well as the opinions of their state ethics offices. They should also carefully draft their file retention policies and publish them to clients in all retainer contracts. Firms should also take a uniform and considered approach to when and how client data, documents and communications will be turned over to the client or destroyed.

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