Graceful succession cements client retention and ensures stability.
I am often the first call to enable a smooth and respectful succession for law firms, legal service companies, and their clients.
Succession Plans will be impacted throughout the next decade by the retirement of senior law firm partners and a bumper crop of associates seeking new or different work styles.
As Baby Boomer lawyers shift out — willingly or not — thinning ranks will be expected to service clients conditioned to have high expectations for speed and results.
This is the same class of clients who, already aware of the hollowing out of legal talent, have been adding to their in-house departments. They will also be proactive in electing to send outbound work elsewhere and get it done by other means, if and when necessary.
‘No Surprises’ Succession Plans
The legal market, which has undergone explosive change over the last 20 years, is evolving and accelerating at a ferocious pace now primarily due to fallout from the pandemic. As a result, lawyers at all stages of their careers are reimagining how their working lives will unfold. Moreover, they are acting on it and loving the results.
How do I know? Because I am often the first call to help enable a smooth succession for clients as well as law firms and legal service providers, while also supporting individuals who are changing their career direction, or easing into a new lifestyle and opportunities.
Timing and Actions
Succession, as part of business strategy, is best planned in detail two to five years before scaling back or full-on retirement, and in conjunction with colleagues and, most importantly, key clients. It is also vital to share Succession Plans and have contingencies in case of a need for early or unanticipated execution.
For law firms and legal service providers with deep bench strength, there are various solutions and tactics up for consideration. The best are long-term: embedding, secondments (permanent and term), laddered client teams, and cross-service teams.
Embedding and Secondments
Law firms and legal service providers with sterling and institutional client rosters often subscribe to organic talent growth. As a result, they often invest in and protect blue-chip client relationships by permanently embedding one of their own “organically grown” lawyers as in-house counsel. In the long term, that lawyer may be elevated to general counsel or higher, which helps cement the client-firm/provider relationship.
As a term arrangement, a secondment enables deeper knowledge and solidification of trust between a firm/provider and a client, which affords continuous opportunities to embed or lend talent. It is no secret that clients love secondments.
Ladders and Cross-Service
Teaming law firm/provider talent with in-house colleagues in a laddered style can provide natural steps to solidifying relationships. This enables the continuous graduation of matched sets of colleagues over a number of years, which helps to smooth the succession path while enabling better traction and retention.
Gracefully transitioning a client from being a “client of an individual” to a “client of the firm/provider” can be managed by the introduction of a multidisciplinary client team. This classic client retention strategy enables better cross-servicing and enables a smooth transition with dignity.
Firms and providers with shallower bench strength or that have fewer areas of practice or offerings often combine with law firms or legal service providers to bolster business and ranks though expansion. Often, these types of mergers or acquisitions can trigger a rebalancing of a talent roster, which can result in succession planning for professionals at all stages of their career trajectory.
Coming to Terms with Succession
Lawyers in many jurisdictions are mandated by regulators to have contingency arrangements. Still, it behoves them, and their clients and colleagues to discuss Succession Plans openly.
One of the easiest ways is by conducting a client service interview. Having done this many times, clients and firms/providers have told me that with the aid of a neutral third party, Succession Plans can be more easily broached, discussed, and acted upon.
Strategic management of a client’s interests are paramount to the success of all concerned. Therefore, solutions, consensus, and most importantly, continuation can be gained with respect and grace while providing peace of mind for all parties.