Legal Discomfort*

October 20th, 2011 by Susan Hackett

* There is an old truism that suggests that our finest moments are most likely to occur when we are feeling discomfort, for it is then that we are propelled to leave our routines and our comfortable, familiar ruts to innovate, thrive anew, and confront the challenges of what is next.

It’s an auspicious moment for me: long known as “The Voice of the In-House Bar” from my tenure at the Association of Corporate Counsel, I now am at liberty to put forward my own voice, and my own opinions.

I want to hone in – with my first post – on the concept that drew me to open this new business – Legal Executive Leadership. Legal leadership is sometimes attributed to good lawyers who provide “quality” legal services over their career, and is measured by their hard work. But a large inventory of hours does not a leader make, even if that lawyer won lots of cases, was popular with her clients, or made lots of money. Leadership is not the same thing as success in practice, nor even good management skill. Legal leaders do more than deliver quality, manage large matters, and devote huge amounts of time to their work: they lead those with whom they work to higher levels of performance by inspiring teams to deliver results they didn’t know they had in them.  They deliver better (rather than simply “more”) results for their clients by tackling well-established norms and behavioral comfort zones, pushing forward toward new solutions and new directions, and rewarding others for taking risks with them.

So “legal executive leadership” requires great lawyers to become more than law school or law firm training prepared them to be: simply put, it requires lawyers to be executives who lead. Hence the name of our new practice: Legal Executive Leadership.

Legal Executive Leadership (as a concept and as our business model) is going to make a lot of people uncomfortable in the coming months and years – we’ll be helping legal executives step outside of the relative safety of traditional practice to adopt new ways of working that challenge their teams to be smarter business people who contribute more value to their clients as a result.

So in this first blog, I’d like to ask both in-house and outside counsel to think about what legal executive leadership means in their practices.

To start, I would suggest an exercise in deliberately re-thinking what I think are the two most time-honored and hamstrung mantras of in-house practice:

 

  1. “I hire the lawyer, and not the firm,” and
  2. “No one ever got fired for hiring BigLaw.”

 

I’d like to address the re-examination of Mantra #1 to In-House Lawyers:

“I hire the lawyer and not the firm” is no longer – if it ever was – good advice. In-house leaders need to focus more attention on meaningfully articulating their expectations and desired outcomes to the firms that serve them, and then rewarding the firms that deliver what is requested. Firms need to be both accountable for what their lawyers do, and supportive of practice innovations that relationship lawyers wish to implement to better anticipate and respond to their clients’ needs. Thus, I think that in-house legal executives must be at least as attentive to hiring the firm as they are to selecting the individual lawyers they like and trust to do the actual work.

Without a firm supporting them in their quest to provide value-based service to their clients, in-house counsel’s favorite outside lawyers are often swimming against a strong current in larger firms’ business models that are based on inefficient and highly leveraged or “pyramid” lawyering, and outrageous targets for ever-increasing profits-per-partner. You do your favorite lawyers a disservice when you ask them to provide services that their firms will not compensate them for. They will not be as successful in convincing their firms that you are demanding such a service model as you will be. Be a leader. It may make you uncomfortable, but it’s time for you to stand behind your lawyers with the power of your purse.

I’d like to address the re-examination of Mantra #2 to Outside Counsel:

“No one ever got fired for hiring BigLaw” has to be the greatest insult that in-house counsel have ever dealt their outside lawyers. While it doesn’t say much for the state of in-house counsel management skills either, those of you in law firms should be equally ashamed that this is common thinking amongst your law department clients. Obviously, in-house counsel seriously lack confidence in their firms if a primary reason they’ve selected them is that the firm’s reputation will enable them to assert plausible deniability when the firm fails to meet expectations or the matter spirals out of control. And if the firm’s primary pitch is to assert that using a smaller, lesser known firm is somehow inherently dangerous, they’re marketing to clients’ FUD – fear, uncertainty, and doubt – a rather pathetic way to demonstrate value for a bunch of very smart and talented people.

Shame on in-house counsel if they are avoiding their duty to their clients to be accountable for delivering the best results, instead of just the most expensive or widely-recognized firm. This is not to suggest that BigLaw firms can’t deliver the best service; just that they should be selected because they’re the best, not because they’re the best known: or, to put it in the immortal words of John Houseman, firms should make their money the old-fashioned way, they should “eeeeeeaaaaaarrrrn it.”

It is with an unswerving focus on value, efficiency and results that law firm leaders will win the trust and loyalty of their clients in the future. Not by the height of their position on the AmLaw 200 list. And there is increasing evidence from recent surveys that in-house counsel are beginning to take that message to heart – while they may not boast the highest profits per partner, firms beyond the AmLaw 100 are making more money from client work efficienctly done; they aren’t keeping the numbers high by cutting internal costs and administrative personnel to preserve partner take.

So, in-house counsel: go ahead and hire the lawyer, but only after paying equal attention to the firm in which he works; make clear that your business comes in the door and stays because of the great legal team they boast, so that the firm recognizes the lawyers’ value by some other yardstick than simply how many hours individual lawyers can rack; and make sure the firm supports your lawyers’ capacity to serve the client’s best interests, and rewards them for it, just like you wish to do.

And for those of you in firms: build your reputation on your firm’s ability to profit from efficient service models that render great results; price your work and bill your clients like it’s your own money you’re spending; and build your reputation based on stellar client service, and not via your placement on a listing of the most expensive firms on the market; do more than assert that your lawyers offer quality – demonstrate that their services translate into value for your clients.

Legal executive leadership requires vision and a willingness to experience discomfort – head on. No more laurels to sit on, either for firms and clients … or for me as I take on this new challenge of a consulting practice. I hope I’ll be good enough to live up to my business’s new name, as well as my clients’ aspiration to be knows as the best – legal executive leaders.

Susan Hackett is the CEO | CLO of Legal Executive Leadership – you can contact her at hackett@lawexecs.com.