Law People : Law Practice Management, Law Firm Coaching : Ronda Muir of Robin Rolfe Resources : Law People Blog

Firms of Endearment: How World-Class Companies Profit from Passion and Purpose
by Rajendra Sisodia, David Wolfe and Jagdish N. Sheth contends that companies with more emotionally intelligent employees have stronger bottom line performance than those who don't.  David Wolfe can be a controversial adviser, and some have suggested that being recognized as a good corporate citizen should be sufficient reward for conscientious organizations, without having to convince themselves that both their individual psyches are above par and that their bottom line improves as well.

Regardless of the sniping, the underlying research makes the FoE claims believable.  High EI clearly hits the bottom line. Ninety percent of top individual performers across industries have high EI whereas only 20% of low performers do. Those who raise their EI are roughly 25% more productive than before.   Insurance agents who score high on EI sell twice as much in policy premiums as agents who score lower. Managers at American Express Financial Advisors who complete a training program focusing on one's own and others' emotional reactions achieve significantly higher rates of growth in funds under management than their untrained peers.

Plus, data suggests that employees who are emotionally intelligent are more likely to access and profit from feedback, helping them achieve more over time.

So the logic of companies who have more emotionally intelligent employees out-performing their lower EI brethren (and sisters) certainly makes sense.

The application to law firms and law departments, where checking one's emotions at the door is standard procedure, is obvious-- more emotional intelligence--whether hired, trained, or promoted-- will not only improve culture but produce bottom-line results.

• Email This
• Print
• Comments (2)
• Trackbacks
• Share Link

Carol S. Dweck, a Stanford University psychology professor, is the author of the recently published "Mindset: The New Psychology of Success," which documents how people with a "growth" mind-set who believe they can improve themselves out-perform those with a "fixed" mind-set who believe their capabilities are fixed.  "The growth mind-set person recognizes that you're not good at something before you're good at it," Dweck points out. 

In one instance, Dweck found that when people experience a blow to their self-esteem, those in a fixed mindset repair their self-image by trying to feel that they are better than others, which n a business setting might take the form of blaming or taking things out on a colleague. Those in a growth mindset recover their self-esteem by trying to improve themselves and correct their deficiencies.

While it's gratifying to see the impact of personal belief documented so clearly, parts of this thesis are hardly new-- optimists outperform pessimists across all industries and job descriptions (except in law), in part simply because they believe they are capable of effecting change.  And the success that this sense of empowerment generates in any arena leads to the expectation of and achievement of success in others.  Optimists are also more resilient--understanding that specific setbacks are just that, and not a referendum on their personal worth, which makes them more likely to persevere.

Which brings us to lawyers, the least optimistic of any career, for whom Dr. Seligman has documented that pessimism is in fact a career enhancer, and who consistently score low on resilience.  For lawyers, the new psychology of success begins with systematically training themselves to confine their pessimism to their legal analysis and to bolster their resilience and optimism in the rest of their lives, including management.

In any event, Dweck's overall assertion that rigid thinking benefits no one, least of all yourself, and that a change of mind is always possible, is welcome.

• Email This
• Print
• Comments (1)
• Trackbacks
• Share Link

A recent study conducted by the Center for Creative Leadership found that effective leadership has changed over the last five years. Eighty-four percent (84%) of those polled said leaders today are valued for collaboration skills, such as building and mending relationships, rather than solitary heroics, the standard five years ago. Specifically important is being able to "enhance co-worker relationships." This change is due, according to those surveyed, to the more far-flung demands of leadership, which often go beyond an individual's capability, creating a need to work interdependently with others across boundaries—geographic, language, cultural, and expertise.

Law firm and law departments would do well to take note of this study-- "leader" is often a designation born out of unrelated circumstances-- a lawyer has extra time, was good at revenue production so will maybe be good at this too, or is simply senior, none of which relates to his or her ability to build a collaborative organization that supports individuals and teams. 

In a recent interview, Daniel Goleman, author of Emotional Intelligence: Why It Can Matter More than IQ and more recently Social Intelligence, commented on the error many make in choosing leadership:  "Too many organizations are rather naive about the ingredients of leadership and make the classic mistake of assuming that someone who is an outstanding individual contributor would therefore be an outstanding leader. If they're an outstanding individual contributor, keep them as an individual contributor. Give them a raise," he says emphatically.

This study brings that point home in spades.

 

• Email This
• Print
• Comments
• Trackbacks
• Share Link

The Carnegie Foundation for the Advancement of Teaching summarizes its two-year study of the North American legal education system by concluding that "law school provides the beginning, not the full development, of students' professional competence and identity.  At present, what most students get as a beginning is insufficient."

The report recommends "a dynamic curriculum that moves [students] back and forth between understanding and enactment, experience and analysis," integrating traditional classes with clinical approaches to legal education.  Yale Law School, City University of New York School of Law and NYU were recognized for having balanced curricula.

Given the recent changes in a number of law schools' curricula, one commentator asked whether this "problem" wasn't already on its way to being solved.  Others asked why the Foundation had not addressed the perennial questions of improved ethics and relationship training and whether law school could be shortened to two years.

In an essay in the January 8, 2007 edition of the National Law Journal, Stephen J. Friedman, dean of Pace University School of Law, and formerly commissioner of the SEC, general counsel of The Equitable and E.F. Hutton, and co-chairman of the corporate department at Debevoise & Plimpton, finds law graduates to be "ill-equipped to be effective beginning lawyers" and wants curriculum at law schools to be "more purposeful, more focused and more integrated."  He notes that rising legal fees discourage over-the-shoulder training and rising salaries push young lawyers towards early specialization in order to be more productive.  He advocates a third year of broad and interrelated training that heps students learn how to function, as well as think, like lawyers.

Shortening law school to two years would produce a larger number of graduates to feed the maws of Wall Street and perhaps reduce tensions in the retention wars.  But more "personal relations" and "client management" types of course targeted to raising the emotional intelligence and relationship skills of law graduates would be the most direct and dramatic route to both increased attorney productivity and increased attorney and client satisfaction. 

• Email This
• Print
• Comments
• Trackbacks
• Share Link

The Dewey-Orrick merger that was supposed to have closed this month has fallen through, and for reasons that seem to reverberate repeatedly over the law business landscape:  retention and culture.  Leading up to the announcement, at least ten Dewey partners left the firm, including rainmakers in the coveted M&A department.  This is Orrick's fourth failed attempt at merger over the last few years.

It looked like a good match--both venerable firms with complimentary specialities, similar per partner profits and each with rising revenues.  They had successfully negotiated the details at the top-- the name would be Dewey Orrick, the two chairmen would serve as the combined firm's co-chairs, with Orrick's chairman also named as presiding partner.  But, as the New York Times noted the obvious, "law firm consolidation involves combining two organizations whose main assets are their people"-- tricky assets to nail down on the balance sheet. 

With their particular personality traits, lawyer buy-in can be an extra challenge to obtain, and then to keep.  Perceptions in the ranks as to the new firm details, such as heirarchy-- Orrick appeared to be retaining management control over crucial matters, compensation--Orrick partners would end up funding Dewey's unfunded pension system, and culture can undo the best efforts of leadership.

It takes not only economic due diligence, but diligently assessing and closing the deal up and down each firm's ranks before a merger can successfully occur.  And then it takes a well-planned and well-executed integration to keep that success over time.  Shouldn't we know that by now?

• Email This
• Print
• Comments
• Trackbacks
• Share Link

The 100 Best Employers

From over 400 organizations surveyed, five law firms, down one from last year and with most of the survivors heading down the list, made Fortune magazine’s 2007 list of the best 100 employers to work for: Alston & Bird, Arnold & Porter, Nixon Peabody, Perkins Coie and Bingham McCutchen, with Morrison & Foerster having dropped off.

The list is based on two criteria: an evaluation of the policies and culture of each organization, and the opinions of the employees, which is given more weight. Two-thirds of the total score comes from responses to a 57-question survey, on attitudes towards management, job satisfaction, and camaraderie, sent to at least 400 employees from each company. The remaining one-third of the score is based on demographic makeup, pay and benefits programs, and culture.

It's a tough competition, with No. 1-rated Google providing employees free gourmet meals, a swimming spa and free doctors on site.

But apart from offering outsized bennies, there are some lessons Google may be able to offer us legals.

Hiring for the Right Reasons

Google has doubled the number of employees in each of the last three years, and now with 10,000 employees, expects to double in size again this year, resulting in about 200 hires a week. It also enjoys an attrition rate of 4%, low by Silicon Valley standards. Historically, much like law firms, Google has relied on grade requirements and interviews to make hiring decisions. The challenge is to continue to find valuable employees at such an astounding rate of growth.

A recent review of over 2 million data points made it clear that Google's hiring criteria were not necessarily correlated with success at the company. So Google has revamped its hiring process, using assessments of existing personnel to produce a more quantitative measurement of success in terms of skills, intelligence, personality and integrity. All incoming applicants will now take a personal survey, which Google is already finding produces better matches for its work and culture.

Lessons for Law Firms

Law firms with spiraling growth requirements are competing to hire from the same number of law graduates with good grades from the same number of top-rung law schools as 20 years ago. The lesson from Google, the best company to work for and possibly the hiringest company as well, is that grades and an interview don't do it anymore. Now is the time to identify your real indicators of success and hire candidates with those.

• Email This
• Print
• Comments
• Trackbacks
• Share Link

In a study conducted last fall of managing partners, general counsel, and other legal leaders, Altman Weil identified five key market trends and critical concerns.  It noted that people management was one of the highest priorities on everyone's list, with one partner saying that he goes to sleep "never knowing who might be leaving tomorrow."  The limited pool of quality law graduates, the "free-agent mentality" of lawyers from new associates to rainmakers, Gen-Xers emphasizing work-life balance and achieving diversity were all cited as challenges to people management by this august group. 

To my mind, the other four critical areas identified-- growth, competition, client service and even pricing-- are also each dependent on achieving effective people management.  Growth requires wrestling with "cultural, office and practice integration," competition is felt most dramatically in the "war for talent," with quality people, superior client service skills and strong training and development programs giving firms the competitive edge.   Client service requires superior communication and relationship, among other, skills, and "improved project staffing." (See our entry today on KPMG's success with their staffing model.)  Even pricing is acknowledged as a function of the quality of a firm's work and service-- which general counsel have consistently linked to people skills.  (See our entries Do You Know Why You Were Fired? dated November 8, 2005 and Companies Unhappy with Their Law Firms dated December 20, 2006.)

So why do law firms and law departments not take advantage of the extensive body of expertise available on hiring, retaining, developing and motivating people?  Maybe, as David Maister has suggested, it is the herd instinct that keeps them from going for the glory-- rather go down as a group than risk a "new-fangled" approach.  Interestingly enough, that is what our psychological profiles of lawyers tell us-- that they are risk-averse, often low in resilience, optimism, and emotional intelligence, all of which has helped mire them in an 18th-century business model. 

Here's the question-- which firms will be the real leaders, the ones who actually take the out-of-the-legal-box steps toward addressing these critical people management areas?  Because there seems to be a consensus that that is the only effective way forward.

 

• Email This
• Print
• Comments
• Trackbacks
• Share Link

Accounting firms have long been ahead of law firms in innovative management strategies for personal service firms-- and as law firms head toward numbering thousands instead of hundreds of lawyers, there is much we can learn from how accounting firms manage people.

At a two-day ARK Group conference in December on Women in Professional Service Firms, Sandra Bushby, KPMG's national director of Women's Initiatives and other Workplace Solutions, recounted how KPMG uses workstyle assessments, particularly the "color-coded" Birkman Method, to put together successful client and project teams.  The firm-wide assessments were undertaken primarily as a risk management strategy-- to build teams that have the varied talents to insure that everything from technical details to interpersonal skills to long-term visionary considerations are fully dealt with.  But by balancing teams with accountants with red, green, yellow and blue workstyles, KPMG is finding that it is also achieving an unexpected bonus:solving the diversity puzzle-- creating culturally, gender and racially diverse teams.

Law firms, whether big or small, have a world of insight available to them from the use of assessments, which they often do not take advantage of.  Lawyers will contend that law is too "technical" or "expert' a service for personal or work styles to have any impact on success.  Yet accounting is no less technical, and accounting firms have had to become expert in drilling down to the most effective risk management tools available-- which style assessments unquestionably are.  To have the additional bonus of effectively producing diverse teams without resorting to "affirmative action" add-ons is ground-breaking-- a one-assessment-for-all-purposes bonanza.

• Email This
• Print
• Comments
• Trackbacks
• Share Link

The Board of Law Examiners proposed increasing the passing score on the New York bar exam from 660 to 675 in 5-point intervals, the first of which was instituted in July 2005 with the next two increments scheduled for the following two summers.  Those have been delayed and the National Conference of Bar Examiners has issued a 155-page report on the diversity impact of that proposal.  If the full 15-point increase were instituted (which is significantly less than the 33 point increase initially considered), fully half of all African-Americans would fail the exam--up over 8% from the prior fail rate.  The impact on other races would also be significant--an additional 5% of Hispanics, 6% of Asians and 10% of Puerto Ricans would fail, but their total pass rates would in each case remain over 65%.  Only the African-American pass rate would fall below 50%. 

This data corresponds interestingly with the study conducted by Professor Sander at the University of California, Los Angeles, which has generated fierce debate.  Sander's provocative study concludes that a major reason blacks are not as well represented among law firm partners as they are among new associates is that they have much lower average grades than their cohorts.  Sander also indicts the law schools for admitting blacks who are not prepared enough to do well at law schools.  Very few blacks graduate from the top 30 law schools with high grades.  While blacks make up 1-2% of law students with grades in the top half of their class, they make up 8% of corporate law firm hires, yet they are one-fourth as likely to make partner, and they leave large firms at 2-3 times the rate of white associates.  An interesting fact is that blacks have a much better shot at partnership at smaller firms, which are less likely to hire associates with lower than standard grades.

Some commentators have questioned the importance of grades (women lawyers have higher grades than men but are also under-represented as partners), others have attributed the fallout to a lack of mentoring or training, or to the fierce competition for able blacks, who are often hired away by clients, while still others contend that the big firm hiring practice sets blacks up for failure, reinforcing stereotypes on the way.

The importance of the two studies converge, particularly for New York law firms, if raising the bar pass rate further reduces the number of eligible black associates that firms can choose from.  Will those reduced numbers make prestigious firms lower their grade standards even further, with the implication that retention rates may drop even lower?

There is no question that any firm solving the diversity puzzle reaps a hiring, marketing and productivity bonanza.  Successfully hiring and integrating blacks, as well as other minorities, including women, requires that a firm understand its own and its associates' cultural strengths and biases, have an active, long-term integration program that addresses each specific attorney and his/her goals, and honestly, consistently and regularly evaluate its own progress.

• Email This
• Print
• Comments
• Trackbacks
• Share Link