When it comes to law firm performance, does alignment matter? A recent article by The American Lawyer investigates, positing that the answer is an emphatic yes. Deborah Farone, author of “Best Practices in Law Firm Marketing and Business Development” reports on the topic, citing that recent research demonstrates there is a strong correlation between a firm’s culture and its performance. According to Farone, firms that align their compensation and other recognition methods with their key goals and objectives, demonstrate a high degree of transparency and reinforce their vision with communications are more likely to demonstrate success than those that are merely average.
Alignment applies to large, multi-practice firms and small firms alike. So, how does a firm’s management begin to put alignment into place? According to the article, there are several tactics law firms can follow to begin the process. First, operational and marketing tactics should all be based on a well-defined and articulated strategy. Secondly, strategy must be communicated, up and down the organization. “Sharing strategy both with direct reports and throughout the organization leads to greater loyalty, a shared sense of purpose, and collaboration. The time spent communicating these decisions is an investment that pays off in multiples,” notes Farone.
Farone adds that C-suite members should have a role on the executive committee to provide input in the development of the firm’s strategy and vision. Not only will C- suite involvement build loyalty, these executives will be allies in plan implementation. Additionally, Farone suggests that compensation metrics should be transparent and reward those behaviors that a firm values. Consider rewarding not just for business development activity, but where there is collaboration across all practice areas, (as quoted in The American Lawyer).
During compensation time, Farone recommends looking at qualitative metrics for more than simply self-reporting. Consider asking partners not only to self-report, but to answer assessment questions, such as: “Over the past year, which partner outside of your practice, helped you build your practice the most?” Third-party recognition will give a more robust picture. Lastly, Farone declares that leaders of the firm, practice areas and committees should be those who emulate the values of the firm and further its strategic mission. Bad behavior that goes against firm policies and standards puts the firm at risk, erodes culture and communicates a message that the mission is not a serious one, (as quoted in The American Lawyer).
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In a recent article, The American Lawyer takes a deep dive look at the strategies and practices of a small group of firms that ...