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Feature

posted 1 Nov 2006 in Volume 1 Issue 4

Nurturing talent

Many corporate organisations have realised that true service excellence derives from happy, motivated - and appreciated - staff. Ny maximising the use of non-fee-earning time and enabling their people to blossom, law firms can gain an advantage in service delivery, CRM and new business generation. By Gillian Gilthorpe.

Fee earning versus non-fee earning. The very words convey that one has a greater value than the other. It is of no surprise then that the majority of lawyers are far more comfortable doing their legal work – using the skills and knowledge they have spent years acquiring – than having to justify lower utilisation rates because they have been involved with time-consuming non-fee earning activities.

Most law firms’ appraisal systems and review processes recognise and reward high billable hours, high utilisation rates and the hitting of financial targets. So, if there is little importance attached to non-fee earning time in the remuneration process, how do you convince partners that they should allocate more hours to it? Many firms are now looking at the alignment of their appraisals and remuneration to reflect the behaviours they want to encourage and deliver.

Increased competition for all firms to win new clients and defend existing ones means a greater focus is required on their marketing strategies. Marketing and business-development professionals are having to empower partners and their teams, not only to maintain their client relationships, but also to develop them even further, and client-relationship management (CRM) plays a key role in this area. Understanding that lawyers are under great pressure to deliver on tight deadlines for competing clients is necessary when trying to motivate them to commit to strategic marketing campaigns and activities. Unfortunately, many well thought-out campaigns fail to be as successful as planned, because the partner either did not follow through due to their lack of commitment, or they were unable to prioritise the non-fee-earning time due to client work.

Modern demands
In today’s modern firms, the demands on partners’ time is continually increasing. Excellent service delivery and a prompt response are vital for clients. A successful partner now has to have the skills to write and implement a strategic business-development plan, win work, develop stronger relationships with their clients, update the CRM system, manage and motivate larger teams of people, train and coach their future stars, raise the profile of the firm and themselves, be on various committees (internal and external), socialise across the firm and, also, find time to do the legal work and hit their financial targets.

Assuming the demands for legal work remain positive, then the future challenges for the majority of firms will centre on:

• Increasing client expectation around service delivery;
• Working more innovatively as competition increases;
• Meeting the growing aspirations of their people.

All of these areas require an increase in non fee-earning time for partners and so we are seeing far more firms referring to it as ‘investment time’, as they try and persuade partners of its value. An increasing number of firms now see the greater value that this time brings to the business, so new attitudes and changes in behaviour are being demanded from their partners.

Law firms are starting to realise they need to implement major change to their cultures to compete in the new marketplace.

All successful businesses are made up of three key areas: people, customers/clients and profit.

Today’s rising stars
A firm with a strong fee-earning culture focuses on profit and its clients. Success is often measured by a short-term focus on achieving high profit, rather than developing a long-term sustainable business. It understands that it needs to attract and retain good people, but if no value is given to the development and motivation of these staff – and no time to nurturing its future partners – then it is not surprising that the firm will struggle to retain its rising stars and, ultimately, this will damage profitability.

The aspirations of young lawyers today are far higher. Not only do they want to be good technical lawyers, but they also want to develop management and marketing skills, and be able to contribute to pro bono work and charitable initiatives. The new generation of lawyers are not nervous about selling and networking; in fact, they have come through a highly competitive process – selling themselves to obtain their training contracts. If they are expected to work longer hours as the demands of fee-earning time continually increase, but are not given opportunities to develop other skills in non-fee-earning time, then they burn out, lose motivation and invariably leave. These young lawyers fully appreciate that they will be working long hours. However, if the partner finds time to motivate, coach, encourage and praise – involves them in marketing activities where appropriate and gives them more client interface – then they will feel valued and enjoy what they are doing far more.

Motivation
Many US companies are particularly good at motivating their people. They develop a whole team ethos within the business and only recruit individuals who share the same attitude to client service and teamwork. In this way, they actually recruit and manage against their values and create a loyal workforce, which goes the extra mile.

Last summer I went to New York on a service-excellence tour with my managing partner. We saw six blue-chip companies that had made service excellence a differentiator in their marketplace. Interestingly enough, none of these were law firms.

We were particularly impressed by the way Ritz Carlton Hotels uses its CRM system to provide the knowledge required to ‘delight its customers’.

Atlantic Health Systems had cut the time of a heart bypass operation from six and a half hours to just two and a half, by standardising processes and enabling its ‘prima donna surgeons’ to value the support and expertise of the team of nurses around them.

We were also impressed by the logic of the ‘strengths finder’ of the Gallup Organisation, and the leadership principles at budget airline JetBlue Airways.

All of these successful organisations believe in putting their people first, not their customers. They understand that if you have the right people, doing the right jobs – and if you inspire and motivate them – then they will never let your client down. It’s part of their make-up to give an excellent service at every opportunity and to work well with their colleagues. The service delivery we saw from the US companies was outstanding – their customers continually gave them repeat business and recommended them to others. All the businesses were highly profitable.

If law firms are going to aspire to these high levels, then they will need to see change not only in attitudes and behaviours. They are also going to have to embrace the concept that key leaders of the business will be doing far more non-fee-earning work in the future.

Leadership behaviours
The American organisations we saw concentrated on freeing up time for their leaders. They were clear that their strengths were crucial to growing the business and ran ‘interference’ around them, so they were not dragged down into the level of detail that other people should be managing. They identified the level of skills and knowledge individuals in the business had, then looked at ways of releasing talent. This was often by giving them more responsibility in management or training – and was one of the ways they identified their future stars.

These companies were very clear that people in the business who are cynics or poor performers should not be tolerated and suggested raising the bar, particularly around behavioural issues. They found managing around values and behaviours brought buy in from the highly motivated people in the organisation and, in turn, isolated the poor performers even further.

Knowing your people’s strengths helps when placing them into roles, as you understand where they can succeed. If they are being successful, then they will motivate the people around them and help drive the business forward.

If law firms adopt these principles, technical lawyers who shy away from marketing will remain in their comfort zones, doing the fee-earning work. The trade off would be that their non-fee-earning time would be used to train and coach younger lawyers so their skills are used to benefit others in the firm.

Partners who are talented managers and rainmakers will be given lower financial budgets (or not expected to do any fee-earning work) as their value will be seen in other areas – and their performance will have different indicators. It makes sense to play to your partner’s strengths, because not only will your people benefit, so will your clients.

If non-fee-earning time is maximised in the right areas, your clients will see a highly motivated team working for them and, hopefully, experience it right across the business. Receptionists and client-service teams will be seen as part of the wider experience in the service delivered to them, for example. This will help build stronger relationships with clients and if service excellence is the main focus of your people, then it should start to differentiate you from your competitors.

It is also important to find the common threads between the culture of your clients’ businesses and yours. As corporate social responsibility rises higher up the agenda for many organisations, it may well be that your own attitudes around this are similar to your clients and that, in turn, may further strengthen your relationships. One of the main benefits clients experience when firms start to maximise their non-fee-earning time, is that the firm is operating more as a business than a partnership. Clients will start to see other strengths you have as businessmen and women, as well as your legal capabilities.

Fierce competition in the legal marketplace, therefore, may be the catalyst that firms need to look internally at how they treat their people and value their time. Hopefully, going forward, the age-old argument of fee earning versus non-fee earning will disappear, because both will have equal value.

[Boxout] Case study: The Gallup Organisation
The Gallup Organisation explained that you need to concentrate on the strengths of your people and manage around their weaknesses. Too often, we gloss over people’s strengths and spend an inordinate amount of time trying to train the weaknesses people have, rather than looking to develop their strengths further – then seeing how these strengths can add extra value to the business.

The Gallup Organisation identifies 34 strengths then, by completing a simple online questionnaire, its people can explore those relevant to them. These strengths include ‘achiever’, ‘analytical’, ‘strategic’ and ‘WOO’ [win others over].