In order to achieve bottom line results that are more and more hard-fought, firms are frequently turning (some quite belatedly) to business management principles used in other industries–organization around teams, commodities work outsourcing, Six Sigma quality control, process and knowledge management efficiencies, and, in response to client pressure, estimating, budgeting and budget management systems. Embedded in this trend has come the increased use of "metrics"–a word that has long struck fear into the hearts of lawyers, who didn’t become accountants for a reason. It is a word we will be using frequently in upcoming entries.
In addition to establishing metrics for demonstrating, for instance, who in the firm does what and how, there are proposals to come up with a metric that identifies and quantifies the attributes firms should be hiring and rewarding in their talent development process.
A new firm founded expressly for that purpose by Bill Henderson is Legal Metrics, whose mission "is to transform legal services through the power of metrics," that is, by taking a more "measured approach" to identifying and developing legal talent. Henderson’s firm proposes to ask partners "what values and traits they want in their lawyers…and then pour over the resumes and evaluations of associates and partners to try to identify those characteristics shared by" "successes."
This is becoming a growing and for the most part welcome area of research with potentially industry-changing applications.
University of California Berkeley faculty members Marjorie Shulz, Professor of Law, and Sheldon Zedeck, now Emeritus Professor of Industrial/Organizational Psychology, published a paper in 2008 entitled "Identification, Development and Validation of Predictors for Successful Lawyering" identifying 26 discrete factors associated with being a successful lawyer. They are working with the Center for Creative Leadership to help quantify and market advice on those successful predictors.
Although we have long been promoting the use of more sophisticated approaches to hiring and development (see KPMG Model Delivers Risk Management, Teamwork, Client Satisfaction and Diversity Too, Legal Thought Leaders Pinpoint People Management Issues as Critical, Law Firms Are Not Google: Hiring for Success, Assessing Courage and Courageously Assessing, The Outliers of Law–Embracing Heresy, Sotomayor and Predicting Who Rises to the Top of the Lawyering Heap, LSATs and Premier Law Schools as Recruiting Guides?, Are Your Superstars Spoiling the Apple Cart?, etc.), there is in fact scant experience in the industry with those approaches. A few small, innovative firms have used assessments of one sort or the other to improve their talent management results, and we have often been the ones advising them. But big-firm experience lags.
In a small step forward, a number of law firms–such as Orrick, Herrington & Sutcliffe, DLA Piper, Drinker, Biddle & Reath, and Morgan Lewis & Bockius, according to The Legal Intelligencer, as well as Baker Botts, Paul, Hastings, and Vinson & Elkins–have adopted "behavioral interviewing," a tried and true tool for most companies but one still being explored in this field.
In 2004 Baker & McKenzie undertook a comprehensive review of talent hiring and development that resulted in the custom construction of an assessment to be used for both those purposes and also a Harvard Business Review case study.
The firm’s management was convinced that "pretty much everything that is discussed in terms of our strategy, from growing our business in China to opening a new office, comes down to people issues and opportunities somewhere along the line…and that the business we’re in is really a relationship business. Technical expertise is a given. The real differentiator is the added value clients experience from counsel who inspire trust, who fully understand a client’s needs and desires in the client’s context, and who relate effectively with the client on a human level."
The hope for what would be called the Development Framework that came out of that review was that it would "rejuvenate professional development and make inroads into curbing the firm’s attrition rate. At the heart of this strategy was an increased focus on recruiting, developing, and retaining employees with the highest potential. This did not always mean seeking out the “best” people so much as the “right” people (i.e., those attuned to the firm’s culture and possessing the skills, experience, and personal qualities expected by its clients)." (emphasis added)
Over an intensive two month global interview process in 40 offices, a group of psychologists identified 5 Key Performance Areas, and within the KPAs, 18 individual Activity Categories, and 14 Personal Qualities of successful lawyers, with a couple of surprises: "being nice" and "being affiliative." These findings became the backbone of, among other things, the recruiting process, informing everything from interview questions and techniques to the post-interview evaluation and a detailed final candidate summary that projects skills and development needs, as well as likelihood of a successful fit at various levels–including associate and partner.
While there has been no published follow-up to this initiative, the standing of Baker & McKenzie as the world’s premier firm by a number of metrics, with significant improvements in revenue and profitability during the period in question, attests to the potential this kind of approach can bring to a firm.
Of course there are skeptics–we are lawyers, after all–and some of the questioning is not misplaced. Some consider this new inclination to quantify what it takes to be a good lawyer as simply dressing up the status quo in a pseudo-science, contending that Am Law partners can’t be trusted to identify, in Henderson’s process, success factors for recruits any more than they can do so now, where "like me" seems to be the criteria. Which has been demonstrated to result in an utter lack of diversity regardless of how you cut the talent pie.
Further, one wonders how such an approach–replicating the attributes of the current "successes" –augurs for partners being made ten years out who are trying to do business with their more diversified and talent-current business peers. Nor does Henderson’s metric take into consideration the vagaries of the pyramidal business model and the impact of politics, which no doubt account for more "success" than most other factors.
Others continue to point to a mistaken belief in the potential of test takers to manipulate these assessments.Then there is the contingent that takes exception to the entire ethos of planned careers and strategic hiring altogether. "The most important things that happened to me–in work and in life–were fortuitous. No statistical model could have predicted them," notes Steven J. Harper, an adjunct professor at Northwestern University and recently retired partner at Kirkland & Ellis.
In 2007 McKenna, Long & Aldridge thought there had to be a "better way to [screen candidates] than the typical 20-minute interview process" and instituted a 30-minute online assessment over the objections of its lawyers who were "concerned that we’d be labeled as the weird firm. But [so far] only one student has questioned the assessment." The firm has been reported to be quite pleased with the results. Evidently some recruiting directors at other firms have expressed interest in the program, but no one from firm managements.
Why not? According to the firm’s recruitment director: "I think they are concerned with stigma–what will [candidates] think of us? They don’t want to be different. We now have a market where firms could be more creative [about hiring], but lawyers don’t thrive on change."
That there is a need and use for more sophisticated metrics in the recruitment and development of legal talent should by this late date be undisputed. But there is a danger in simplifying the inquiry to quantification that can easily result in negative returns. It is imperative at the outset, as Baker & McKenzie did, to identify who you are as a firm and who you want to be identified as going forward. It is a sloppy undertaking with little hard data and many "soft" findings. But only by first doing so, can the emerging world of metric tools be intelligently added.
As David Brooks wrote about the future of the US in a column earlier this year, so law firms might heed the same advice: "In a world of relative equals, the U.S. will have to learn to define itself not by its rank, but by its values. It will be important to have the right story to tell, the right purpose and the right aura. It will be more important to know who you are." Certainly as applied to law firms, "values will separate the biggest winners from everyone else."
Ultimately, with respect to the emerging world of talent metrics, Aric Press’s conclusion that "what matters is that the inquiries have begun" is also ours.