By Patricia Wheatley Burt (FCIPD)
January 2009

Napoleon said that if you are inside your Castle, defending it, you have already lost the battle. Attack is the greatest form of defence – so all firms should be out there, attacking the competition, getting in front of their clients, thinking of ways to make their services and methods of offering them affordable, accessible, and to grab what is falling from the Top 100’s table! To do this, you need to have the right leaders in place.

And I also see it as a war against: apathy, depressing, misleading opinions, lethargy, ineptitude, incompetence at the top, jobs for the boys, and a general state of paralysis. Yesterday I was talking to a non-Executive Director who works very much within the Venture Capital world, and his prognosis is, in fact encouraging – in the end. First, though, he believes we will have to fall further and deeper into this economic gloom, starting with many businesses defaulting on their rent for the 1st quarter of this year, with March through to June being the worst period for redundancies and bankruptcies. After that, those investors who have been sitting on their money will start to pick up the bargain businesses for a snip! We will see the up-turn slowly showing in the 3rd and 4th quarters of 2009.

It has been suggested that in the professional sectors, Lawyers will have a harder time ahead of them than Accountants, because legal work is more transactional based. This of course maybe true (depending upon the service mix), and certainly the M & A Corporate Finance and Real Estate teams are suffering, whilst those in Insolvency and Employment are inundated with work - if they have the track record. What I think is different about law firms compared to other professions (including architects, structural engineers and accountants) is that over the past 15 years, law firms have taken on board more progressive business strategies, have developed more innovative management teams and therefore should have a stronger management base from which to change, survive – and thrive.

Burying your head in the sand?

Firms who took remedial action 3 , 6 or 12 months ago, are likely to be in a stronger position now, to start ‘bottom lining’ the market: picking up the opportunities. The question is, how prepared and well positioned is your firm; how would you answer the following questions? If you answer ‘Yes’ to any of them, you need to make some changes at the top!

- are your leaders still burying their heads in the sand, like ostriches, and are not prepared to recognise what is happening?
- how many of your Partners / Directors are still not taking the necessary action to mitigate the problems facing your firm?
- might some of your Management Board be overly challenged, / don’t have the skills and appetite for change, so are not the right people to lead?
- how can your Management Team challenge your ‘out of date’ leader, especially if there is no obvious alternative candidate?

The overly cautious, risk-averse Partner / Director could, at this point, be the one person to take off the Board or Management Team. They may be out of step with the needs of the firm. What you now need are those clear sighted individuals who can see the opportunities, who are positive, and who will bring those who are slower to change around to a positive future.

Transitional Leadership:

Back in 2005/6 I undertook research into the role of the Managing Partner in a law firm* now published as a book. Amongst the conclusions from this research, we identified that firms should select and mandate their Managing Partner (MP) in relation to the situation the firm finds itself in, matched to the differing skills and experience of the MP.

The current wisdom expressed by business gurus is that, in the unlikely event a firm makes no changes to the way it operates, it is in reality, going backwards and no longer competitive. In today’s economy, it is very difficult for firms to be in a static position for any length of time and survive. In fact firms are actively in one of 4 transition phases over a period of time – say 10 to 15 years:

- Start-up and Growth
- Status quo
- Crisis management or
- Continuous momentum

To identify the transition phase your firm is, you should do this by reference to:

- Your clients, their environment and economic circumstances;
- Balancing practice areas to flow with peaks and troughs;
- Your appetite and approach to marketing and business development;
- The quality, experience and agility of your people, (knowledge skills and abilities);
- Robustness of the firm’s infrastructure and support services teams
- Your financial security and ambition

Then, having identified which transition phase your firm is in, you should check you have the right leadership and management team in place for the next 3 - 5 years. Doing what you have always done will provide the same old solutions: watch your ‘blind spot’, as leaders you may need external help to get a better perspective. It is a time for realism, yes, and for honesty about who is best placed to leave the Castle, and start attacking the market place in these troubled times.


Patricia Wheatley Burt (FCIPD)
Principal Consultant
Trafalgar – The People Business
www.trafalgarpeople.com

For more ideas on how to get started on this Revolution and Radical Thinking Shift, please contact Patricia and her team on: +44 (0)20 7565 7547, or email her on: patricia@trafalgarpeople.com. *The Role of the Managing Partner, ISBN: 9780955713613, details available on website and Amazon.