<i>Sales and Service Strategies</i>: Law Firm Culture and the Effect upon Women Rainmakers

Law firm culture is the primary obstacle to business development, according to LSSO's Women Lawyers Survey: Sales and Business Development Issues. Out of the 418 participants who responded, more than 40% of female lawyers suggest that various organizational and institutional barriers inhibit their ability to be successful at sales.

Research, however, reveals that firm culture as a deterrent to success can be overcome through training, determination and teamwork. While it is likely true that firm culture actually does hinder business development more than it helps, it is also true that the most successful women rainmakers are finding ways to circumnavigate these obstacles and drive success despite how their firms recognize, measure and reward business development.

Law firms certainly can do more to drive business development success. Yet the arguments against billable hours, origination credits and 'eat what you kill' compensation systems are not new. These traditional law firm structures have been under attack for years. What LSSO's study of women lawyers reveals, though, is that firm culture is not a defining or critical success factor. True rainmakers recognize firm culture as the deterrent that it can be and are able to find creative and innovative ways to work against the grain.

In contrast, those women lawyers who are less successful self-report a lack of knowledge, skill and training in business development. Or, they finger external factors, such as market pressures or gender bias, as obstacles to their personal success.

The messages here are twofold: First, law firms that arm their women lawyers with the tools and training to succeed in business development will reap rewards two to three times over. Second, attitude, including having confidence in one's ability to control business development success, is critical to becoming (and remaining) a rainmaker.

What's Firm Culture?

LSSO's survey respondents identified specific components of firm culture, such as policies, operations and standards, as undermining their efforts to increase business. Core complaints include:

• Conflicting incentives;
• Pervasive 'eat what you kill' mentality;
• Absence of strong, supportive leadership; and
• Poor mentoring and lack of training.

Current compensation and review structures as well as training are the keys to most of this deficiency, according to the female attorneys. Business development efforts are rewarded only in the most direct manner: revenue generated translates into monetary reward.

Show Me the Money

When a compensation system does not reward the behavior the firm seeks to encourage, more altruistic activities (such as mentoring) generally are not treated as priority actions. Given the lawyers' daily pressures of time and service delivery, they naturally may be more likely to engage in the activities that will directly benefit them financially. In fact, nearly 60% of women surveyed reveal that their law firms reward and recognize business development solely through bonus and compensation. Another 26.2% report the absence of any incentives. Those female attorneys whose firms offer money as an incentive perform better, with partners typically generating more than 40% more annual revenue than those at firms with no incentive.

Yet despite this discrepancy, women lawyers believe their firms can do more. Few compensation systems, they report, acknowledge the value of teamwork and common goals of the firm by equally rewarding those who dedicate time and effort to business development support functions, such as:

• Client relations and retention;
• Leverage of firm resources; and
• Introductions to partners from other practice areas.

When properly recorded, there are processes that make it relatively easy for firms to measure these all important activities. Why aren't more law firms doing so? For all the noise that firms make about how much they value, promote, practice and epitomize 'teamwork,' it would appear that few are 'walking the walk' when it comes time to reward those who actually practice what the firm preaches.

What Else Gets in the Way?

It is unsurprising that women partners who see gender as their primary challenge perform below average, as do those who report that they lack the required skill set to develop business. On the latter point, lack of skill rivals lack of time as the key deterrent to business development success in the eyes of women lawyers; both capture more than one-third of women's votes for the most challenging aspect of business development. Nearly 60% of women lawyers reveal that colleagues support their business development efforts. However, just one in four female attorneys report receiving help from others who are good at business development. Clearly, there is more that can be done to help women do better.

Learning to Overcome

It is counterintuitive that the most successful women rainmakers trump the trends working against them, whether personal or implicit in incentive structures and firm culture. These women make cross-selling a priority despite the contradictory incentives in place at many firms. Just over 50% of women report effectively selling other services offered by their firm. These women boast close to two times more annual originations at every level, including equity partner, of counsel and senior associate.

Attitude Is a Choice

It is telling that those women lawyers who see firm-imposed policies as their primary obstacle to business development perform more than 40% better than an average female partner. Making a decision to overcome obstacles is a quality inherent in the best rainmakers. The successful women lawyers in LSSO's survey reported that they are highly motivated, spend more time building their practices, plan their business development strategies, are proactive and highly skilled at relationship building, ask for referrals, receive work from many sources, and are working in firms that support their business development activities.

The data also suggest that women who possess (or develop) a positive attitude do better than those who do not. Those who took a supportive approach to their success (or failure) report 16% – 35% higher originations than the typical female equity partner. In contrast, the female partners who negatively judge their business development failure capture just 61.7% of average originations earned by female partners.

So, What's a Firm to Do?

By no means should law firms interpret the data about the abilities of those who are already successful to mean there is no reason to improve. It is worth emphasizing that these women lawyers have been successful in spite of ' not because ' of their firms. Imagine what will happen in firms where women spent less time overcoming obstacles and more time developing clients. As such, law firms must devote greater and appropriate resources, structures and budgets to motivate lawyers ' both men and women ' to engage in the right kinds of business development activities. Many of the more successful women lawyers reported receiving resources from the firm to improve their business development efforts. Accordingly, firms that encourage the wise investment of lawyers' time and effort in business development activities have the potential to yield a much better return.

The BTI Consulting Group's independent research reveals an increased investment in business development at law firms ' both in dollars and people. Business development accounts for 21.4% of the marketing budget at the largest firms, second only to salaries. Similarly, business development is the largest budget item at mid-sized firms, at 25.1% of marketing dollars.

Law firms are also adding key business development professionals to their teams. Business development professionals provide firms with invaluable resources and tools tailored for the firm, specific groups and individuals. Business planning templates, sales training and skill development, coaching, and coordinated use of technology and information are foundational, critical tools for firms of all sizes, practices and geographies. In conjunction with this boost in funding and resource allocation, law firm management will be likely to expect a corresponding increase in revenues and profits.

Conclusion

As firms compete in an increasingly crowded marketplace, the competition for clients is fierce. If that isn't enough, law firms must also focus now on the 'war for talent.' These serious pressures can be addressed, in large part, via mentoring, development and training programs. When done well, they develop professionals ' both female and male ' that are equipped to deliver powerful results.

[IMGCAP(1)]

[IMGCAP(2)]

Catherine Alman MacDonagh, Esq., is Director of Business Development at Day Pitney LLP and a co-Founder and COO of the Legal Sales and Service Organization, Inc., an industry association that focuses on sales, service and quality issues in law firms. She can be contacted at [email protected] or [email protected] or 617-345-4608. Marcie L. Borgal Shunk is a Principal of The BTI Consulting Group in Wellesley, MA, a firm that conducts strategic market research and client satisfaction studies. She can be reached at [email protected] or 617-439-0333.

Law firm culture is the primary obstacle to business development, according to LSSO's Women Lawyers Survey: Sales and Business Development Issues. Out of the 418 participants who responded, more than 40% of female lawyers suggest that various organizational and institutional barriers inhibit their ability to be successful at sales.

Research, however, reveals that firm culture as a deterrent to success can be overcome through training, determination and teamwork. While it is likely true that firm culture actually does hinder business development more than it helps, it is also true that the most successful women rainmakers are finding ways to circumnavigate these obstacles and drive success despite how their firms recognize, measure and reward business development.

Law firms certainly can do more to drive business development success. Yet the arguments against billable hours, origination credits and 'eat what you kill' compensation systems are not new. These traditional law firm structures have been under attack for years. What LSSO's study of women lawyers reveals, though, is that firm culture is not a defining or critical success factor. True rainmakers recognize firm culture as the deterrent that it can be and are able to find creative and innovative ways to work against the grain.

In contrast, those women lawyers who are less successful self-report a lack of knowledge, skill and training in business development. Or, they finger external factors, such as market pressures or gender bias, as obstacles to their personal success.

The messages here are twofold: First, law firms that arm their women lawyers with the tools and training to succeed in business development will reap rewards two to three times over. Second, attitude, including having confidence in one's ability to control business development success, is critical to becoming (and remaining) a rainmaker.

What's Firm Culture?

LSSO's survey respondents identified specific components of firm culture, such as policies, operations and standards, as undermining their efforts to increase business. Core complaints include:

• Conflicting incentives;
• Pervasive 'eat what you kill' mentality;
• Absence of strong, supportive leadership; and
• Poor mentoring and lack of training.

Current compensation and review structures as well as training are the keys to most of this deficiency, according to the female attorneys. Business development efforts are rewarded only in the most direct manner: revenue generated translates into monetary reward.

Show Me the Money

When a compensation system does not reward the behavior the firm seeks to encourage, more altruistic activities (such as mentoring) generally are not treated as priority actions. Given the lawyers' daily pressures of time and service delivery, they naturally may be more likely to engage in the activities that will directly benefit them financially. In fact, nearly 60% of women surveyed reveal that their law firms reward and recognize business development solely through bonus and compensation. Another 26.2% report the absence of any incentives. Those female attorneys whose firms offer money as an incentive perform better, with partners typically generating more than 40% more annual revenue than those at firms with no incentive.

Yet despite this discrepancy, women lawyers believe their firms can do more. Few compensation systems, they report, acknowledge the value of teamwork and common goals of the firm by equally rewarding those who dedicate time and effort to business development support functions, such as:

• Client relations and retention;
• Leverage of firm resources; and
• Introductions to partners from other practice areas.

When properly recorded, there are processes that make it relatively easy for firms to measure these all important activities. Why aren't more law firms doing so? For all the noise that firms make about how much they value, promote, practice and epitomize 'teamwork,' it would appear that few are 'walking the walk' when it comes time to reward those who actually practice what the firm preaches.

What Else Gets in the Way?

It is unsurprising that women partners who see gender as their primary challenge perform below average, as do those who report that they lack the required skill set to develop business. On the latter point, lack of skill rivals lack of time as the key deterrent to business development success in the eyes of women lawyers; both capture more than one-third of women's votes for the most challenging aspect of business development. Nearly 60% of women lawyers reveal that colleagues support their business development efforts. However, just one in four female attorneys report receiving help from others who are good at business development. Clearly, there is more that can be done to help women do better.

Learning to Overcome

It is counterintuitive that the most successful women rainmakers trump the trends working against them, whether personal or implicit in incentive structures and firm culture. These women make cross-selling a priority despite the contradictory incentives in place at many firms. Just over 50% of women report effectively selling other services offered by their firm. These women boast close to two times more annual originations at every level, including equity partner, of counsel and senior associate.

Attitude Is a Choice

It is telling that those women lawyers who see firm-imposed policies as their primary obstacle to business development perform more than 40% better than an average female partner. Making a decision to overcome obstacles is a quality inherent in the best rainmakers. The successful women lawyers in LSSO's survey reported that they are highly motivated, spend more time building their practices, plan their business development strategies, are proactive and highly skilled at relationship building, ask for referrals, receive work from many sources, and are working in firms that support their business development activities.

The data also suggest that women who possess (or develop) a positive attitude do better than those who do not. Those who took a supportive approach to their success (or failure) report 16% – 35% higher originations than the typical female equity partner. In contrast, the female partners who negatively judge their business development failure capture just 61.7% of average originations earned by female partners.

So, What's a Firm to Do?

By no means should law firms interpret the data about the abilities of those who are already successful to mean there is no reason to improve. It is worth emphasizing that these women lawyers have been successful in spite of ' not because ' of their firms. Imagine what will happen in firms where women spent less time overcoming obstacles and more time developing clients. As such, law firms must devote greater and appropriate resources, structures and budgets to motivate lawyers ' both men and women ' to engage in the right kinds of business development activities. Many of the more successful women lawyers reported receiving resources from the firm to improve their business development efforts. Accordingly, firms that encourage the wise investment of lawyers' time and effort in business development activities have the potential to yield a much better return.

The BTI Consulting Group's independent research reveals an increased investment in business development at law firms ' both in dollars and people. Business development accounts for 21.4% of the marketing budget at the largest firms, second only to salaries. Similarly, business development is the largest budget item at mid-sized firms, at 25.1% of marketing dollars.

Law firms are also adding key business development professionals to their teams. Business development professionals provide firms with invaluable resources and tools tailored for the firm, specific groups and individuals. Business planning templates, sales training and skill development, coaching, and coordinated use of technology and information are foundational, critical tools for firms of all sizes, practices and geographies. In conjunction with this boost in funding and resource allocation, law firm management will be likely to expect a corresponding increase in revenues and profits.

Conclusion

As firms compete in an increasingly crowded marketplace, the competition for clients is fierce. If that isn't enough, law firms must also focus now on the 'war for talent.' These serious pressures can be addressed, in large part, via mentoring, development and training programs. When done well, they develop professionals ' both female and male ' that are equipped to deliver powerful results.

[IMGCAP(1)]

[IMGCAP(2)]

Catherine Alman MacDonagh, Esq., is Director of Business Development at Day Pitney LLP and a co-Founder and COO of the Legal Sales and Service Organization, Inc., an industry association that focuses on sales, service and quality issues in law firms. She can be contacted at [email protected] or [email protected] or 617-345-4608. Marcie L. Borgal Shunk is a Principal of The BTI Consulting Group in Wellesley, MA, a firm that conducts strategic market research and client satisfaction studies. She can be reached at [email protected] or 617-439-0333.