February 2007

I recently wrote about the critical role firm culture plays in the success or failure of marketing initiatives.   In that same vein, I want to draw your attention to a recent post on  Tom Peters’ blog on the same topic.  Juli Ann Reynolds (President and CEO of the Tom Peters Company) writes that:

 A beautifully crafted strategy can fail when the employees in various divisions within an organization clash. Logically, we think that strategy should drive behavior, but, in reality, it’s the culture—underlying norms, values, belief systems—that dictates how effectively people work together.

The comments made to his post re-enforce the notion that culture is key.   Juli Ann ends her thoughtful post with this question:

How do you change this and bring culture into alignment with strategy?

In my view, the issue is more acute in the professional services field where the "herding cats"/"you’re not the boss of me" mentality causes people to live in silos and feel free to change or not as they see fit.  So the question is there for all of us:

How can we cause the culture of our firms to change in a manner to allow our marketing programs to succeed on a grand scale?

I am back on line.

I wanted to take a moment to thank everyone who sent me emails or posted comments to my prior post about my Dad’s passing.  Those notes and comments were an incredible source of support to me and to my Mom and sister, with whom I shared them.  I have chosen not to have any of those comments published.  The sentiments and words of solace and wisdom are better left private. I hope you understand.  I do not have the words to adequately convey my great appreciation to all of you.  But know that my family joins me in saying thank you to all of you.

I begin by asking you to forgive me this entry.  It has nothing to do with client service or the management of law firms.  But it has everything to do with who I am as a person.  And it is a measure of how important this blog is to me that I turn to it when I have something like this to share.

My dad died an hour ago.  I am stuck at O’Hare waiting for a plane to get to Florida to be with my Mom.  Because of the weather problems in Chicago this week, I won’t get to Tampa until tomorrow morning.  My Dad had been suffering, ravaged by both Parkinson’s and Alzheimer’s, and he was out of it.  But the finality of it hurts.  And after 56 years of marriage, my Mom hurts all the while knowing that my Dad is in a better place.  And it pains me to hear her in pain.

My Dad was not a great person in a Churchillian manner.  He was a great person in the salt-of-the-earth-solid-midwestern-stock manner.  He went to church, he paid his taxes. He voted in every election, and while he loved politics, he disliked politicians.  He was a great friend.  But most of all, he honored my Mother, and he was a great father.  My parenting skills will never be as good as his.  And as much a wordsmith as I am, he was not.  He struggled to find the right words, but he always communicated exactly what needed to be said.  He was humble and not at all prone to self-promotion.  I guess that says something about my Mother.  Or that certain traits skip generations.

Allow me one story about my Dad.  My wife and I were talking about adopting kids since we seemed unable to have children of our own.  I am very proud of my Irish bloodlines, and I had a hard time embracing adoption because my child’s blood would not be my own.  I told my Dad of my struggle and he looked at me and said, "Being a father is not about your heart, its about your soul."  I now am the proud father of 3 adopted children and 1 biological child.  Every time I look at one of my kids, I thank God I was the son of a wise man.

So, to my Dad, I pray the old Irish prayer with a bit of a twist:  May the wind be at your back.  May you step lightly.  And now that God has you in the palm of  His hand, please ask him to bless your family as we struggle to cope with the absence of such a great man.

Seminars.  Blogs.  Creative people.  Great ideas.  Detailed plans.  If marketing was easy, everyone would be good at it.  But the disturbing sameness of law firm marketing and its disturbing ineffectiveness lead to all sorts of questions.  In the world of business, there are memorable marketing campaigns to play an instrumental role in the success of a product.  But one would be hard pressed to find a law firm marketing campaign that really launched a firm’s success.  Have you ever wondered why?  I know I have.

I think I may have found an answer–culture.  A firm’s culture manifests itself in behaviors, and those behaviors in the results that marketing plans are designed to change.  It follows that if you can change the identified behaviors, the results will change too.  But changing behavior is not an easy thing to do, and marketing plans, no matter how well thought through, are not able to change the behaviors at issue.  What causes behaviors?  Beliefs–mindsets.   Substantial research establishes the simple relationship between beliefs, which cause behaviors, which yield results.  So to change results, you have to start with the beliefs basic to the behaviors that need to change.

How do you change beliefs?  One obvious conclusion is that firm management must be strongly supportive of and involved with and significant plan.  But there has to be more.  Beliefs don’t change by decree.  They change by virtue of modeled behavior, rewards (financial and otherwise), encouragement and follow through.  There are experts who help accomplish cultural change.  Professional assistance is always useful.  Without incredible commitment and follow through, though, one lesson is that trying something and failing may be worse than not trying at all.  Such failures only reenforce the futility of change.  Without open minds (not exactly a strength of lawyers), real change is unlikely.

Monica Bay said to see the movie, so I did. Actually, I have wanted to but just haven’t gotten to it.  I watched it last night.  This is a "must see" movie.  In is impossible to watch the movie and not believe that we are killing ourselves.  A true call to arms.  The science, the statistics and the photographic evidence are ever so compelling.  And Al Gore does a great job.  If he had campaigned like he presents in the movie, he would have won a landslide.

Bottom line:  If you haven’t already done so, please see this movie.  And let me know what you think.

On more than a few occasions, a firm’s website is one of its first communications to a new client.  The client wants to check a firm out before picking up the phone to make a call.  So I’ve reviewed a lot of websites to see what the firm says about itself.  I’ve concluded that the same consultant has written the websites for virtually every firm in America.  If I had a nickel for every time the phrases "pre-eminent", "full-service" and "leading" were used, Bill Gates would be the world’s second richest person.  With limited exceptions (see Wachtell’s website, for example), the websites don’t offer real insights into the firms or their people.

The conclusion is inescapable.  Law firm websites have become like presidential candidates.  Slickly packaged to be sure, but packaged in a way to say nothing in order to avoid offending anyone, but so devoid of character and meaning as to inspire no one.  Completely vanilla. 

Seems to me that websites are a real missed opportunity.

Thought leaders like Tom Peters and Kevin Roberts have written about the transformation of service into experience.  That is, simply providing great service is not enough to develop the intense loyalty one wants from clients.  Instead, the client’s entire experience must be so intensely satisfying and special that the client wants to repeat it.  Those who want to think further along this line should read Daniel Pink’s "A Whole New Mind."  Great book.  Very thought provoking. 

Everybody knows the Miranda warnings.  You have the right to remain silent.  You have the right to an attorney.  And so forth.  I was involved in a conversation recently that made me wonder whether we in the legal profession ought not have a similar set of rights for our clients that all lawyers could recite as easily as any fan of TV cop shows can recite the Miranda warnings.

Here was the exchange.  I asked this question:  Should a client have the right to approve a course of conduct that will cause fees to exceed an agreed upon budget?  I was shocked by some of the answers I heard.  More than half the lawyers who answered me said that the client should simply pay the bill if the work was properly done.  More than half!!!!  Client "Miranda" warning number 1:  You have the right to approve a course of conduct that will cost you money!  And corollary number 1:  If I forget to ask your permission to do something that costs you money, you have the right to not pay me.  That’s right, if a lawyer exceeds a budget for a task or a time period without telling the client it is about to happen and discussing the best way to handle the situation, the lawyer ought not be paid.

The operative concept here is budget discipline.  Our clients live by it.  Those that don’t live by it all to frequently die by it–that is, are fired because of it.  In this day and age, with all the technology available to track expenditures and time, there is no excuse for exceeding a budget.  Indifference doesn’t count.

"People are, frankly, disgusted by it."  So says Susan Hackett, senior vice president of the Association of Corporate Counsel.  She was, of course, referring to the most recent increases in the salaries of first year associates.  Major New York firms have raised the salaries of first year associates to $160,000, and firms in Washington, Los Angeles and Chicago have raised their rates to $145,000.

By way of comparison, a federal district court judge earns approximately $163,000 and an associate Justice of the Supreme Court earns approximately $200,000.  Meanwhile, lawyers who have no experience, have never tried a case–heck, haven’t even taken a deposition, are earning more than many inside counsel who hire firms to do their company’s business.

I have written many times that the one certainty when it comes to associate salary increases is that partners do not pay for them.  Susan Hackett likewise expects law firms to raise their billing rates to cover the cost of the increased salaries.  Some law firms may require their associates to work more hours on the matters they have–notice, not more hours on more matters, for the firm would already have the additional matters if they were there to be had.  But when you live by a simple formula — rate x hours = revenue — firms will play with both sides of the equation.  But in the end, clients are the ones who live with the result of that equation.

To think that this insanity is driven by just a couple of firms where the practice is "bet the company" litigation and mega transactions, where even the most outrageous fees are dwarfed by those charged by the investment bankers.  Because these firms can charge whatever they want, they can raise rates to give themselves a competitive advantage in attracting talented law students.  Then law firms who have a taste of this kind of practice but a lot of regular work too feel compelled to match the increase so that they too continue to attract the talented associates, and then the firms who have only regular work do the same thing.  In doing this, though the firms forget two things.  One, incoming associates are mindful of the price tag that comes with the hefty salary (how many attrition articles do you want to read?) and, more importantly, most of the work out there is regular work for regular clients, and those clients cannot afford the endless increases.  Its like sheep being led to the slaughter.

So expect to hear a lot of complaining, as predicted by Ms. Hackett.  Whether anything really changes is another question entirely.  At some point, inside counsel are going to realize that they have the power to change all of this, at least with the exception of the fees paid on "bet the company" work and mega deals.  I am waiting for some inside counsel to rise up like Howard Beale in the the 1976 movie, Network, and shout out "I am mad as hell and I am not going to take it anymore."  I am waiting, but I am not holding my breath, because for too long inside counsel have fed the insanity and refused to move from the comfort zone of hourly rates to the economic sanity of alternative fees.