«
Managing Partner Non-Billable Time in a Law Firm – How Much? |
Main |
Law Firm Capital – How Much Do We Need »
Apr 23, 2013
Law Firm Succession – Client Transition
Question:
Our firm is a 24 attorney firm in Chicago West Suburbs. We have 10 partners – five of which are in their early 60s. We represent small to mid-size business clients. Recently we have been discussing the eventual retirement of the senior partners and approaches to client transition. We would appreciate your thoughts.
Response:
Client transition involves different challenges that have to be overcome in order to successfully transition client relationships. Consider the following challenges and hurdles:
- Relationships take an investment of time and must be nurtured on behalf of the parties making the introductions and connections as well as the parties trying to form the new relationship. Attorneys often want immediate gratification and the "quick fix" and are unwilling to invest time needed for longer term results. More than a "one-shot" simple introduction is required.
- Clients hire lawyers not law firms.
- Client transition requires trust on the part of all parties (introducers and new players). A high level of trust must exist within the law firm organization between the attorneys involved and within the client organization between the parties there as well.
- There is potential risk of embarrassment for all concerned. The transitioning attorney in the law firm could risk losing the client if the other attorney does poor work for the client. Another issue is the loss of control over the client. The individuals in the client organization could also risk criticism (or even their jobs) if the new relationship does not pan out.
- Many law firms are "lone ranger" rather than "firm first" or "team based" firms. As a result there is no inclination or incentive to invest the time and effort nor take the risk to refer work to others in the firm.
- Lack of knowledge regarding other partners' practices.
- Fear of losing clients.
- Fear of losing client control.
- Compensation systems in many law firms encourage hoarding of work and discourage the referring of work to others.
- Communication systems in some law firms do not facilitate relationship building among attorneys. Effective client transition is simply not possible without strong relationships and high levels of trust among attorneys in the law firm.
Effective client transition is not a one-time lunch or introduction event – it most go deeper to bind the new relationship. This takes time. Start early and allow ample time for an effective partner winddown.
I generally suggest five year client transition programs.
Click here for our blog on succession/exit strategies
Click here for articles on other topics
John W. Olmstead, MBA, Ph.D, CMC
Posted at 07:44 PM in
Tags: ,