Our firm is a sixteen lawyer firm in Cleveland, Ohio. There are six equity partners, three non-equity partners, and seven associates in the firm. Our firm is a litigation boutique that represents small to mid-size companies. Three of the six equity partners are initial founders and three became equity partners later. All six are in their sixties and plan on retiring at different times over the next three to six years. The firm is managed by the six equity partners. The non-equity partners have no involvement in firm management. The six of us have concerns as we approach retirement that there will be a leadership vacuum and no one will have the management skills to manage the firm. What are your thoughts regarding this issue?
Failure to train younger lawyers as managers in both the business of law and the practice of law aspects of a firm can result in a disaster either from a “internal revolution”, because the firm is unwilling to address the question and provide the opportunity, or from a decline in earnings and the exodus of key partners because the firm waits too long and ends up using untrained lawyers to undertake key management positions.
Law schools do not train or develop managing partners or lawyer managers, nor does doing excellent and complicated work for demanding clients. Highly competent attorneys do not necessarily make good managing partners or lawyer managers. Some of the best lawyers are the worst managers.
The better lawyer managers have a second sense for people and management, in addition to being good lawyers and possibly outstanding rainmakers.
I assume that you will be offering equity partnership to some of the non-equity partners in the near future to ensure that there are equity partners in place committed to carrying on the firm in the future after the six of you retire.
Many firms develop successors to management by delegating to selected junior partners short term management assignments and by rotating these partners through various management areas to develop their general management skills rather than developing particular lawyers as specialists in specific management areas. These firms begin to train junior partners by assigning short term, low risk management activities before entrusting them with key management jobs.
The following are suggested areas in which the management skills of non-equity partners can and should be developed:
Also keep in mind that transition of clients and referral source relationships will need to be considered and planned as well and this can take some time.
Based upon your retirement timelines I would start this process as soon as your can.
John W. Olmstead, MBA, Ph.D, CMC