Current demographics in most law firms, regardless of size, have made succession planning a critical issue. How will your firm identify and execute the critical steps for effective succession planning for key administrative positions? Are you developing your next generation of leaders? What methods will help you get the lawyers to buy into the process?
FOR WHOM THE BELL TOLLS
Our law firms are aging rapidly. By 2020 more than 50 percent of the legal workforce will be age 55 and older. This will be accompanied by a sharp reduction in the available workforce between the ages of 35 and 55. These demographics appear to indicate many law firms face a potential 20 percent reduction among their current staff. However, a recent survey found that only 26 percent of law firms have succession plans in place for their key leadership positions and administrative teams. More than 60 percent of the law firms claimed to be relying on an informal or ad hoc process if needed.
Effective succession planning usually begins with analyzing the firm’s specific demographic trends. Retirement, disability or, unfortunately, even death might be the cause of future departures. And with many law firms already operating with minimum staff levels and most positions already multifunctional, your existing strategies may transfer critical operational knowledge of day-to-day responsibilities to various staff positions that could have little capacity to absorb it. Therefore, you also need an effective plan to fill key positions quickly when members of your senior administrative team leave the firm.
An effective plan should include strategies to transfer knowledge, not simply functions. Law firms create, use, and store large and valuable amounts of information, such as key client details, the firm’s core cultural values, its best practices and even important historical details. This information has recognized value because it includes both knowledge and experience, but this value can be lost if knowledge transfer methods are not expanded beyond the occasional one-on-one teaching moment.
Every law firm’s unique culture is created by the shared values of the people at the firm. They are demonstrated through behaviors deemed appropriate and acceptable for creating success at the law firm. The values then become internalized, part of daily routines, and help define the expectations of team members who make up the culture. As such, shared values need to be passed on to new leader in a formalized, rather than ad hoc, way.
Developing future leaders is critical to ensuring a law firm’s ongoing success. My experience working with leaders at firms of various sizes has confirmed that they need specific skills to be truly effective in their role, such as:
- A financial understanding of their firm and the strategic thinking skills necessary to address increased competition — in other words, the ability to understand their markets and their firm’s place in them.
- Excellent interpersonal and communication skills, including the courage to make tough decisions and the patience to try to reach a consensus.
- A keen sense of humor, since lawyers frequently take themselves too seriously. Creating a welcoming, encouraging culture often requires prioritizing positive things; injecting appropriate humor is often effective.
Depending on the structure of the specific law firm, there are different ways to transition leadership responsibilities. Assigning specific tasks to future leaders will test their ability to organize and handle projects. These next generation leaders should both understand and be involved in as many operational areas and decisions as possible. If the firm has a formal mentoring program, participation by the staff and administrative team may also be helpful.
OBSTACLES TO GETTING STARTED
Effective succession planning often requires some difficult conversations that many people prefer to avoid. Of course, getting started is usually better than agonizing over the inevitable. One place to begin the discussion is to focus on actual activity, not impressions or expectations. What are the practical realities of the succession path? What are realistic timelines and objectives along that path?
If possible, try to identify some specific activities and avoid being generic or vague. If you are the one who must initiate the discussion, start with the positive. Try to be empathetic and see the situation through the eyes of the other person, who may be confronting their eventual departure. Focus on needs, solutions and the details of execution.
MAKING SUCCESSION PLANNING A REALITY
Among my law firm clients, succession planning is rapidly moving from a strategic objective to a competitive necessity. Commencing succession planning discussions is difficult. It will require changes to common methods and the adoption of new paradigms of success.
An effective succession plan of action will need to include knowledge transfer and leadership development, as well as competitive adjustments for the market impact of diversity and value migration. However, we know that a knowledge advantage means nothing unless you also have an action advantage. Law firm leaders need to be proactive and plan now for the inevitable effect of demographics and time on themselves, their teams and their law firms.
About the Author
Michael Moore, JD, is the Founder of Moore's Law, LLC, and helps both lawyers and law firms create professional success. Moore specializes in individual marketing, client development, and leadership coaching and advises law firms on strategic planning, growth initiatives and resource optimization. A frequent speaker at ALA events across the country, his current topics have included mentoring, leadership, financial management and strategic planning.
Get More Insite into Succession Planning at Our Annual Conference & Expo
Succession planning is a major, ongoing challenge law firms face. Join Michael Moore as he discusses this topic more in-depth at the ALA Annual Conference & Expo in National Harbor, Maryland. Additionally, you can hear more on Legal Management Talk, where Moore was recently interviewed. Download the conversation through your podcast app, or listen here.