It’s that season of the year when management locks itself into hushed secret venues and makes determinations regarding law firm partner compensation. In recent years, we have witnessed a rapid escalation of compensation paid to Big Originators. And, as Sean Boland, the vice chairman of Howrey observed, when the big producers don’t get what they want, they bail out; in Howrey’s case, as in the case of so many before it, the defection of big producers can be fatal. The issue is not simply compensating large fee producers well. Rather, the issue is creating a compensation system in which partners are financially rewarded for integrating a client’s work throughout the firm and disincentivized from creating silo practices which are not completely integrated within the law firm.
Creating such a system requires the creation of financial rewards for the working law firm partners who roll up their sleeves and do the work as well as those who take a leadership role on particular matters, even when the matter and client was originated by another partner.
The long simmering debate over whether a client hires a lawyer or a law firm needs to be seen from the perspective of the law firm: Is it the law firm that was hired to do the work or a particular lawyer who was hired. Long term law firm financial viability demands that a law firm create a culture in which partners are rewarded for creating a firm-wide team and an ethos in which the firm is a well integrated true partnership, collectively providing outstanding legal services to clients, rather than a collection of silo practices. The personal pronoun must be rejected in favor of the collective pronoun: It’s not “my client,” rather it’s “our client.”
In an escalating competition of law firm partner free agency, is it time to determine a different way to slice the law firm profit pie to enhance the long term vitality and prosperity of the law firm? It takes a village to raise a child. It also takes a village to build an enduring law firm.
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