Bringing Lateral Attorneys on Board: A Blueprint for Success

Survey Results

A survey of published materials, an interview with a lateral recruiter and discussions with attorneys who have made recent lateral moves lead to a few key and undisputable conclusions about how ' and how not ' to effect a successful lateral hiring and retention program at the firm. Most, if not all, of these key principles apply regardless of firm size, though the smaller the firm, the less complex actual implementation is likely to be. This article is about the essential elements of the successful implementation of lateral hiring, meaning how to bring the lateral lawyer on board and do so to the mutual benefit and personal satisfaction of the lateral and the firm. The process involves far more than throwing the new lawyer into deep water and seeing if he can swim.

The process is not one of lip service, but requires actual ongoing effective management. The job is not one for the firm's hiring coordinator or the HR department. The task demands a responsible partner to manage the process and a group of firm attorneys with the backing of firm management and the authority to make it happen over a period of time. Here is what it takes, according to lateral industry authorities and according to attorneys who have made lateral moves in the recent past who were interviewed for this article.

Validating what many authors and laterals say about the subject are surveys conducted in 1996 and 2006 by attorney search consultants Major, Lindsey & Africa. The 2006 survey report by Jonathan Lindsey of MLA New York, Lateral Partner Satisfaction: A Decade of Perspective (hereinafter called the 'MLA Survey'), which compares 2006 results with the 1996 report, is widely available online. It is worth more than a casual read.

The Association for Legal Career Professionals has also published a Lateral Hiring Best Practices Guide available as of March 2008 at http://www.nalp.org/assets/769_07lateralhiringbestpracti.pdf. The Institute of Management & Administration is in the process of conducting a 2008 Law Firm Lateral Hiring Survey in which you can participate via the IOMA law firm management Web site at http://www.ioma.com/law_firm_management as of March 2008. Completion of the survey entitles you to a free 'summary' of the results. The full report is to be published in IOMA's Compensation & Benefits for Law Offices newsletter, for which you will likely have to pay real money.

The Blueprint for Success

The following steps under the blueprint for success are not listed in order of importance. This is because all are equally important. This is not a menu from which to pick and choose, but a blueprint of instructions, all of which must be accomplished to do all you can do to achieve success without taking unnecessary risk with your investment in a new lawyer or group of lawyers. There are many more elements applicable to beginning and conducting the actual hiring process that are not listed here. This list begins when the hiring process is far enough along to begin to bring the new lawyer on board.

Having said this list is not in order of importance, there is one element that must be in place, and be sustained, in order to make the rest of the process work. That one element is, who is going to do it?

Ownership of the Process

Someone must clearly own the process of managing the lateral attorney's entry into, and first months of existence at, the firm. This should be an authoritative attorney and not a member of the firm's HR or attorney recruitment staff. There should be one partner (either a different person for each lateral or lateral group or one person for the firm as a whole) fully empowered to guide the process with the backing of the firm's management committee. This person may be the practice group chair relevant to the new lateral. There must be no question of this person's authority to drive the process.

In addition, as listed below, others in the firm will have to be active in the process over a period of time. The one designated manager and those who are also involved in the process must receive actual, tangible recognition and compensation for this effort. The firm should define the mission via well-publicized firm policy, recognize the leadership involved in the process and reward the effort. In return, the firm should expect and demand that the progress of the effort be tracked, documented, adjusted as necessary and followed up on.

According to the author of the MLA Survey, 'The firm should implement a system of accountability so that there is a high level of awareness as to what exactly needs to be done and in fact is being done ' and by which specific individuals, by what deadlines ' to integrate the lateral more fully.' Another way of saying this is to employ good management principles ' and reward it.

The concept of paying for billable hours and originated business is no stranger to the practice of law. The management of a lateral integration process should be no different. In fact, a wise firm will take the process one step further and reward when it comes to compensation any attorneys who help other attorneys develop business or who engage other attorneys to develop prospective business. Track the number of attorneys who work on business originated by other attorneys. This concept actually goes beyond the scope of, but is certainly applicable to, lateral integration. Track as an element of the compensation decision the efforts of attorneys who work with other attorneys in 'cross-marketing', internal marketing, business development between practice groups, introductions of existing clients to others in the firm, etc. All of this is essential to lateral integration so why not apply it firm wide?

According to Elizabeth Purcell of MLA, whose practice concentrates on high-profile lateral partners and opening new offices for Amlaw 100 firms in Atlanta, Dallas and Charlotte, NC, firms should clearly track matters referred from one attorney to another to gauge whether partners are truly serving clients as a team. 'Track how many different partners and associates bill time to a particular partner's clients.' Specifically regarding lateral integration, she said, 'Your firm should design a compensation plan that rewards both the owners of the lateral integration process and, equally important, others who play a role in lateral partner integration and retention.'

Here are the key elements of implementing the lateral integration program.

Use a Business Plan

In the Oct. 2006 issue of this newsletter, Natasha Ciancutti of Major, Lindsey & Africa wrote an article headlined Using Business Plans As a Due Diligence Tool for Lateral Partners. Her article focused on developing a joint business plan between the firm and the lateral to avoid the lateral's making a wrong move in the first place and in order to maximize the mutual benefit of the lateral's move.

It would seem the firm should first have a business plan itself in order to make lateral moves consistent with the business plan as opposed to the throwing darts at the target method and hoping the lateral move is a good one. The task would then be to develop a business plan with the lateral consistent with the firm's business plan but specifically designed to integrate the lateral and his business base, to deal with client introductions, introduce the lateral to other practice groups in the firm, and to develop in detail a marketing plan to expand the lateral's business by exploiting the platform offered by the firm. Like any well managed business plan, it should be revised from time-to-time as things progress.

A major aspect of the process should be the marketing plan, both lateral and firm-focused. According to Purcell, the plan should have an element that assumes the lateral has no portable business, 'Assume he is an assistant U.S. attorney being brought onboard. Who would you introduce him to? How would you market his expertise outside the firm? How would you cross-market him within the firm?' Devising a plan to do this, she says, will go a long way toward expanding the value of the lateral beyond his portable business alone. 'Increase his value', she says. 'Don't just try to take advantage of his self-created value.'

Improvement and Growth

Thus, the focus should be on improvement and growth. The term 'lateral' is itself a misnomer because it implies a simple sideways move, from one firm to another. Think of the actual plan as a growth move, not just a lateral one. The move should result in an improvement of the lateral's practice and value (and his compensation) and of the firm's value and scope of practice and client service (and thus profitability).

Part Two of this article next month will deal with more specific elements of the business plan.

Bruce Jackson, a member of this newsletter's Board of Editors, is a partner in the Atlanta law firm of Arnall Golden Gregory LLP. He can be reached at 404-873-8590 or at [email protected].

Part One of a Two-Part Article

The lateral movement of attorneys between firms requires a well-defined and well-executed management program in order to maximize the benefits of the move to both sides. This article sets forth the key elements, all of which must be addressed in order to maximize the investment a law firm makes in the lateral and in order to achieve career satisfaction and retention of lateral attorneys.

Recruiters and firms are constantly trolling for new prospects. Most attorneys get frequent calls soliciting them for potential moves. This means firms not only must develop effective management strategies to play the lateral game, they must also, and perhaps more importantly, effectively work to integrate laterals they acquire, and retain them. This has led to another piece of the lateral movement growth industry: people studying the issues and publishing survey results, articles and books on the how to integrate and retain laterals (and retain existing attorneys).

Survey Results

A survey of published materials, an interview with a lateral recruiter and discussions with attorneys who have made recent lateral moves lead to a few key and undisputable conclusions about how ' and how not ' to effect a successful lateral hiring and retention program at the firm. Most, if not all, of these key principles apply regardless of firm size, though the smaller the firm, the less complex actual implementation is likely to be. This article is about the essential elements of the successful implementation of lateral hiring, meaning how to bring the lateral lawyer on board and do so to the mutual benefit and personal satisfaction of the lateral and the firm. The process involves far more than throwing the new lawyer into deep water and seeing if he can swim.

The process is not one of lip service, but requires actual ongoing effective management. The job is not one for the firm's hiring coordinator or the HR department. The task demands a responsible partner to manage the process and a group of firm attorneys with the backing of firm management and the authority to make it happen over a period of time. Here is what it takes, according to lateral industry authorities and according to attorneys who have made lateral moves in the recent past who were interviewed for this article.

Validating what many authors and laterals say about the subject are surveys conducted in 1996 and 2006 by attorney search consultants Major, Lindsey & Africa. The 2006 survey report by Jonathan Lindsey of MLA New York, Lateral Partner Satisfaction: A Decade of Perspective (hereinafter called the 'MLA Survey'), which compares 2006 results with the 1996 report, is widely available online. It is worth more than a casual read.

The Association for Legal Career Professionals has also published a Lateral Hiring Best Practices Guide available as of March 2008 at http://www.nalp.org/assets/769_07lateralhiringbestpracti.pdf. The Institute of Management & Administration is in the process of conducting a 2008 Law Firm Lateral Hiring Survey in which you can participate via the IOMA law firm management Web site at http://www.ioma.com/law_firm_management as of March 2008. Completion of the survey entitles you to a free 'summary' of the results. The full report is to be published in IOMA's Compensation & Benefits for Law Offices newsletter, for which you will likely have to pay real money.

The Blueprint for Success

The following steps under the blueprint for success are not listed in order of importance. This is because all are equally important. This is not a menu from which to pick and choose, but a blueprint of instructions, all of which must be accomplished to do all you can do to achieve success without taking unnecessary risk with your investment in a new lawyer or group of lawyers. There are many more elements applicable to beginning and conducting the actual hiring process that are not listed here. This list begins when the hiring process is far enough along to begin to bring the new lawyer on board.

Having said this list is not in order of importance, there is one element that must be in place, and be sustained, in order to make the rest of the process work. That one element is, who is going to do it?

Ownership of the Process

Someone must clearly own the process of managing the lateral attorney's entry into, and first months of existence at, the firm. This should be an authoritative attorney and not a member of the firm's HR or attorney recruitment staff. There should be one partner (either a different person for each lateral or lateral group or one person for the firm as a whole) fully empowered to guide the process with the backing of the firm's management committee. This person may be the practice group chair relevant to the new lateral. There must be no question of this person's authority to drive the process.

In addition, as listed below, others in the firm will have to be active in the process over a period of time. The one designated manager and those who are also involved in the process must receive actual, tangible recognition and compensation for this effort. The firm should define the mission via well-publicized firm policy, recognize the leadership involved in the process and reward the effort. In return, the firm should expect and demand that the progress of the effort be tracked, documented, adjusted as necessary and followed up on.

According to the author of the MLA Survey, 'The firm should implement a system of accountability so that there is a high level of awareness as to what exactly needs to be done and in fact is being done ' and by which specific individuals, by what deadlines ' to integrate the lateral more fully.' Another way of saying this is to employ good management principles ' and reward it.

The concept of paying for billable hours and originated business is no stranger to the practice of law. The management of a lateral integration process should be no different. In fact, a wise firm will take the process one step further and reward when it comes to compensation any attorneys who help other attorneys develop business or who engage other attorneys to develop prospective business. Track the number of attorneys who work on business originated by other attorneys. This concept actually goes beyond the scope of, but is certainly applicable to, lateral integration. Track as an element of the compensation decision the efforts of attorneys who work with other attorneys in 'cross-marketing', internal marketing, business development between practice groups, introductions of existing clients to others in the firm, etc. All of this is essential to lateral integration so why not apply it firm wide?

According to Elizabeth Purcell of MLA, whose practice concentrates on high-profile lateral partners and opening new offices for Amlaw 100 firms in Atlanta, Dallas and Charlotte, NC, firms should clearly track matters referred from one attorney to another to gauge whether partners are truly serving clients as a team. 'Track how many different partners and associates bill time to a particular partner's clients.' Specifically regarding lateral integration, she said, 'Your firm should design a compensation plan that rewards both the owners of the lateral integration process and, equally important, others who play a role in lateral partner integration and retention.'

Here are the key elements of implementing the lateral integration program.

Use a Business Plan

In the Oct. 2006 issue of this newsletter, Natasha Ciancutti of Major, Lindsey & Africa wrote an article headlined Using Business Plans As a Due Diligence Tool for Lateral Partners. Her article focused on developing a joint business plan between the firm and the lateral to avoid the lateral's making a wrong move in the first place and in order to maximize the mutual benefit of the lateral's move.

It would seem the firm should first have a business plan itself in order to make lateral moves consistent with the business plan as opposed to the throwing darts at the target method and hoping the lateral move is a good one. The task would then be to develop a business plan with the lateral consistent with the firm's business plan but specifically designed to integrate the lateral and his business base, to deal with client introductions, introduce the lateral to other practice groups in the firm, and to develop in detail a marketing plan to expand the lateral's business by exploiting the platform offered by the firm. Like any well managed business plan, it should be revised from time-to-time as things progress.

A major aspect of the process should be the marketing plan, both lateral and firm-focused. According to Purcell, the plan should have an element that assumes the lateral has no portable business, 'Assume he is an assistant U.S. attorney being brought onboard. Who would you introduce him to? How would you market his expertise outside the firm? How would you cross-market him within the firm?' Devising a plan to do this, she says, will go a long way toward expanding the value of the lateral beyond his portable business alone. 'Increase his value', she says. 'Don't just try to take advantage of his self-created value.'

Improvement and Growth

Thus, the focus should be on improvement and growth. The term 'lateral' is itself a misnomer because it implies a simple sideways move, from one firm to another. Think of the actual plan as a growth move, not just a lateral one. The move should result in an improvement of the lateral's practice and value (and his compensation) and of the firm's value and scope of practice and client service (and thus profitability).

Part Two of this article next month will deal with more specific elements of the business plan.

Bruce Jackson, a member of this newsletter's Board of Editors, is a partner in the Atlanta law firm of Arnall Golden Gregory LLP. He can be reached at 404-873-8590 or at [email protected].