Law Firm Management: Are Your Succession Plans Up to Date?
By Charles A. Volkert III, Esq.
There’s no bigger indication of an ineffective succession plan than when major clients jump ship after a partner retires.
The U.S. workforce is at a pivotal transition point: Starting back in 2010, roughly 10,000 baby boomers have been turning 65 each day — and that rate will continue until the end of 2029, according to the Pew Research Center. Many of these boomers are legal professionals. A recent study from the American Bar Association estimates about one-third of all lawyers are over the age of 55, and the implications of this reality for law firm management are huge.
As boomer-era attorneys and legal support staff retire, legal managers can’t just hope for the best. Preparing for the future is an imperative now. Just like individual lawyers must plan for their own retirement, you need a strategy to meet the challenge of inevitable staff departures. Here are six law firm management tips for effective succession planning:
1. Don’t procrastinate. Many firms and legal managers overlook succession planning until it’s too late. Effective transitions take time, both to plan and to execute. You need to build consensus around long-term staffing goals, discuss retirement with senior team members, identify and then train future leaders, and transition clients to new attorneys. None of those things can be accomplished overnight. Ideally, succession planning should start about three to five years before a key employee’s retirement.
2. Develop a leadership training program. A firm should continually build up its “bench players.” If they’re going to be expected to take over someday, less-senior attorneys need to have a full complement of leadership skills. Conferring these abilities should begin with an in-house mentorship program, where senior partners and legal managers advise and instruct mid-level staff. Other means of cultivating future leaders include sending them to legal conferences, encouraging them to remain compliant with their CLE credit hours and helping them widen their professional network. When relevant, reimburse the cost of attaining a key certification or another degree, such as the MBA.
3. Prioritize client relationships. One of the most important aspects of law firm management is strengthening client relationships, and that includes preparing them for the future. There’s no bigger indication of an ineffective succession plan than when major clients jump ship after a partner retires. The key to preventing this is to start preparing now for a future transition, including managing clients.
4. Keep options open. A new associate is lured away by a competing firm, senior partners delay their retirement, a shifting client base requires more or fewer staff attorneys … Effective law firm management, especially when it comes to succession planning, requires contingencies and backup plans. So instead of having one associate replace one partner upon retirement, have a pool of trained and highly skilled attorneys at the ready to take over. And make no promises to would-be leaders: Circumstances change — and so do people.
5. Consider using outside help. Succession planning is difficult, in part, because it forces boomers to contemplate the end of their careers and even to train their replacements. As mentioned earlier, these can be sensitive and even contentious topics. For that reason, it may be helpful to shift some of these law firm management duties to a neutral and impartial consultant.
Another instance when you might want to get outside assistance is when you’re having trouble replacing specialized lawyers from within the firm. In these cases, you could work with a legal staffing agency to recruit and hire the rising stars you need. An agency could also help you fill non-attorney supervisory roles, such as legal managers or eDiscovery directors.
6. Maintain a succession mentality. A succession plan is a living, evolving document, and so should be your mindset about succession: Changes occur in your workforce and the economic climate. At least once a year, perhaps around the time of annual performance evaluations, evaluate the readiness of lawyers and legal support staff alike that are part of your succession plan to determine whether there are shortcomings.
As nature abhors a vacuum, clients and staff feel uneasy when there’s a gap in the leadership hierarchy. For long-term success, let succession planning be an ongoing priority for your law firm management strategies.