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Leading light

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In a fast-changing market, leadership is becoming ever more important for law firms. Diana Bentley looks at the qualities and responsibilities expected of a good leader in today’s firm, and what the future might bring

Leading light

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With the pressures of competition and regulation growing in the legal services market, it is hardly surprising that the kind of leadership law firms need is under increasing scrutiny, and attitudes to the role of managing partner have been changing. “Increasingly, many firms are requiring the managing partner role to be performed by business-minded people who can add real value to a firm, in the sense of leading its strategic growth, managing change and ensuring its financial wellbeing,” says consultant Peter Scott, formerly managing partner of Eversheds.

Inside out

Determining the right person for the role can be a challenge. The traditional perception remains that contenders must know the firm particularly well, and usually be one of its own. “Unlike commercial companies, most law firms searching for a leader look around and think: ‘Who have we got?’” says Alison Morley, managing partner of Capsticks. “The trouble with that is that your recruitment pool is smaller. The people available may not have the necessary skills for the job, or the one who does could be your best fee-earner, and you’d take them away from that.”

Opinions still differ on whether firms should recruit internally or get an outsider to fill the leadership role, but more lawyers seem to be appreciating the attractions of external appointments. Jeremy

Harvey, managing partner of Coodes, points out: “People in the industrial and commercial sector possess the management and operational know-how that many law firms need, and which we lawyers must learn.”

Some suspect that the appointment of more non-lawyer COOs is a sign that firms are becoming more business-like in their approach. Tim Aspinall, managing partner of DMH Stallard, believes that firms may, in time, take the same approach to leadership roles as commercial companies. “The view of the managing partner role has changed, but we’re still not at the point where they are like CEOs in other sectors, moving between one business and another performing a leadership role. But new entrants are likely to drive the speed of change, as they bring normal business practices into the legal services market,” he says.

Fail to plan

Lying at the core of the job, now more so than ever, is identifying and establishing a strategy for the firm. “This is where every managing partner should start,” says Aspinall. “Whatever the firm’s size, its managing partner needs to have a thorough understanding of the legal market, the segment in which the firm operates, and how it can dominate that segment. The strategy should provide the vision that underpins the development of the business, and clarify the firm’s market segment and brand position.”

Many firms have a collective approach to considering the direction of the firm. At Coodes, Harvey consults with department heads on what they see ahead for the firm and what their clients need, so he is well briefed to do most of the thinking and analysis. The firm adopts a business plan every six months, and has a rolling three-year plan. London-based firm Silverman Sherliker has biannual partner meetings to fix the firm’s business plan. But firm founder and senior partner Jonathan Silverman notes: “Everyone contributes, but someone has to lead. The managing partner must identify where the business needs to go and decide where it should be in the marketplace. Someone has to have the vision.”

An awareness of the wider market and the economy is also something that Harvey insists managing partners must have. “You have to understand the markets in which your clients operate, and the economy generally. After all, it’s all about our clients, what they want and what their circumstances may be, and you need to appreciate that in order to shape your strategy and the services you offer.”

A clear strategy will also help the managing partner build a team and a firm that is united in its purpose and culture. “Developing and articulating a clear strategy that partners and employees believe in creates an alignment of interests across these groups, so this is a key challenge for the managing partner,” notes Aspinall. “The strategy must be reinforced regularly at formal and informal meetings, and a few simple messages can inform people’s efforts in their everyday work.”

Personal characteristics

One challenge key to building that united team is managing a team of diverse personalities. Silverman explains: “As the firm grows, you have to get like-minded people on board. But as the practice develops, you may acquire different clients who want a variety of services, so you may end up with some different people in the firm.”

This highlights the importance of the personal characteristics of leaders. Top of the list is being a good listener and the ability to inspire others. According to Silverman: “In a progressive practice, the managing partner needs to identify what the partners want. Managing partners must be good listeners and good at managing people. You’re leading a business of professionals who are driven – hopefully – and you can’t coerce them. You must get buy-in for what you want and what needs to happen.”

Tenacity, too, is called for in a profession whose members are notoriously assertive and individualistic. “You must be self-propelled, tenacious about pursuing your goals, and thick-skinned,” comments Morley. “You must be willing to fight your corner when you have to, and adapt and evolve as the firm progresses. You can get all the facts and figures on something, but then you have to go with your gut feeling, so you have to be brave. You have to be clear and have a good sense of direction, and accept that, sometimes, you will be wrong.”

This strength is particularly important for leadership in the legal profession, adds Morley, because gaining acceptance as a leader is especially hard in a traditional partnership structure. “A key issue for any managing partner is to establish themselves as a manager of their peers. A CEO may be accepted as a leader – a managing partner of a firm has to fight to be accepted by their equals.”

Peter Scott on vision

It is often said that leadership is about ‘the vision thing’. This should be central to the role. Jonathan Swift noted that vision is the “art of seeing the invisible”. This requires leadership which:

  • challenges everything about a firm;
  • understands what clients are going to want from their lawyers in the future;
  • develops a plan as to how the firm will be able to provide what its clients want and how they will want those services delivered;
  • manages the performance of its people to provide those services on a consistent basis to drive client satisfaction (because achieving competitive advantage for a law firm is primarily about its people); and
  • drives a firm to perform to a higher level than its rivals.

An array of duties

Forging strategy, however vital it may be, is only one of the tasks firm leaders must now address – they need to get involved in everything from marketing to recruitment, financial management to IT. Managing partners say the role needs to be continually adapted to meet the new challenges faced by law firms.

Aspinall insists that today, pricing, productivity and efficiency must be at the top of most firms’ agendas. “Clients want to see their law firm behaving like any other well-run business, and not wasting time, money or effort. Pricing work well and doing it as effectively as possible is now a more compelling duty, demanding skills that may not come naturally to lawyers.” Monitoring performance within the firm is also an essential task. Having robust financial data to compare performance against targets is vital, says Morley, but she also keeps a close eye on staff turnover. “This is really key to performance. You need to look at staff attrition rates.”

Harvey says another subject that has come to the fore within the last decade is process management. “If you have a big matter, how do you get it done, within the given time frame, and make a profit on it? How do you manage it? Do you have to change your processes or send some work out? Managing partners now need to understand a whole lot more – IT, marketing, risk management and so on. You can’t be a master of all these things, but you must understand what is involved, how all these things fit together and what is needed for particular functions. For process management, for instance, we get systems analysts to advise us. But you must have an overview of all these matters and keep abreast of them.”

Managing partners must therefore be savvy about determining where they can make a difference themselves, and where they need support. “People sho uld work out what part of the job plays to their strengths; otherwise, the range of roles is too big, and you end up doing a little of everything and nothing very well,” maintains Morley. “I’m more people-orientated, and where I make a difference here is encouraging and motivating people. I’m not so good at number-crunching, but I have a good CFO and COO to do that.” Silverman adds that this approach is also important for the overall health and future of the firm: “Otherwise – and in a small practice especially – the management skill base and knowledge is always invested in one person.”

While not every managing partner is a rainmaker for the firm – nor wants to be, preferring to delegate the task to others, like department heads – many see developing existing client relationships and finding new clients as central to the role. Scott explains: “Managing directors and CEOs of clients often want to mix with people they regard as their peers. Having the ability to be a business developer often goes hand-in-hand with having a keen strategic sense of where the business needs to be going.” He urges those with an appetite for this part of the role to seize it.

Retaining clients is also a key challenge. Listening to clients and monitoring their feedback is now seen as an essential part of good firm management. Many firms use client satisfaction surveys at the end of matters, and employ independent consultants to undertake broader satisfaction reports. “Clients want you to succeed. Giving them a third party to talk to about the relationship, what works, and what needs to be improved is a fantastic way of strengthening the relationship – providing you act on the feedback,” says Aspinall.

Scale and style

Does the size of a firm affect the qualities needed for the managing partner role or the challenges of management? According to Aspinall, small to medium-sized firms can offer more opportunities to instigate change. “Our size and culture gave us the ability to be at the cutting edge. We’re one of the first firms to use process maps to streamline the way work was done, to use management information in a completely different way that strengthened the relationship with the client, and to use modern pricing techniques. This ability to adapt is critical in a fast-changing legal market.”

But there are also some particular challenges of the role in small to medium-sized firms. “In a larger firm, managing partners can develop greater resources, to enable them to delegate to others many functions now required to make a firm successful,” says Scott. “The role can then become more of a leadership and strategic role, as it should be. In smaller firms, the role is often unkindly and incorrectly referred to by other partners as ‘just admin’.” But, he adds, larger firms also need to have the capacity to take on the fee-earning work of the managing partner, so their role can be full-time management; otherwise, their client work will always take priority.

Key characteristics of leaders

  1. Clear sense of purpose
  2. Strong values – personal integrity
  3. Commitment to developing others through coaching and mentoring
  4. Champion of diversity
  5. Ability to engage and communicate across all levels
  6. Self-awareness and taking time to reflect
  7. Collaborative, networked and non-hierarchical
  8. Agile and innovative, technologically curious and savvy
  9. Personal resilience and grit
  10. Excellent track record of delivery

Source: Management 2020: Leadership to Unlock Long-Term Growth (Commission on the Future of Management and Leadership, in conjunction with the Chartered Institute of Management, July 2014)

Learning on the job

In light of all these pressures and changes, it’s clear that the managing partner role requires real commitment, and the ability to make and lead change. Scott explains: “Firms tend to choose leaders for the future tasks which are perceived to be required to be carried out. For example, a steadying hand on the tiller may be required after a period of hectic expansion, to consolidate the progress which has been made. The opposite is also often the case, and then firms will choose someone who can drive the firm forward to achieve its strategic goals, rather than being just a safe pair of hands. Answering the question ‘What kind of firm do we want to be?’ will often determine the nature of the person chosen to lead the firm.”

This means that being able to develop in the role is essential, to support a firm through changing times. According to Patrick Woodman, head of external affairs of the Chartered Management Institute (CMI), professionals like lawyers are often called ‘accidental managers’. “Sometimes, highly skilled people like lawyers forget that management is an entirely new ball game, and those who are managers need to train and be developed accordingly.” Management training should go hand-in-hand with professional education and training in organisations like law firms, he suggests.

This July, the CMI, in conjunction with the government-appointed Commission on the Future of Management and Leadership, released its report on UK management and leadership: Management 2020: Leadership to Unlock Long-Term Growth. It insists that all managers can benefit from training. “There’s still a perception that leadership is the preserve of the talented few, but business skills can be learned and improved on through education,” Woodman avows. Many managing partners take such notions to heart. Aspinall has enrolled in numerous courses, including several offered by Harvard Business School. Scott urges people to consider formal training for the subjects on which they need most help. Harvey has undertaken courses and reads constantly on the subjects he needs to master. “The job of managing partner is much more skill-centered now. The last book I read was on digital marketing – it’s what you have to do,” he remarks. Morley has found that having a personal coach is invaluable, both for personal development and for support in what can be a lonely job. All say that a willingness to learn constantly on the job is essential.

Whatever their natural ability or training, the best leaders know how to inspire people and get the most out of them, while managing change and business transformation. The role is not for the faint-hearted, Harvey asserts, but adds: “It’s very good to see a business change its culture and transform itself, and grow and prosper. That’s very satisfying and worthwhile, however hard the job may be.”

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