With Succession Planning, Inertia Is Not an Option

Turning over the reins of a law firm is an art form. A well-staged plan that allows for a seamless transition from current leaders to the next generation ' in both client relationships and management responsibilities ' is crucial to the health and longevity of your partnership.

Failure to cultivate new leaders and expand connections to clients throughout a partnership can lead to political infighting and uncertainty, causing younger partners and associates to question their future, and leaving a firm exposed to a sudden vacuum of expertise, thus threatening longstanding client relationships.

There are a finite and critical set of issues that must be addressed. Fortunately, partners can work together to make succession a priority, and there are resources available to help effectively plan for it. The presence of a third party to facilitate a dialogue is always a smart move. It can offer judicious, impartial advice, sensibly steering what can often be an emotional and seemingly insurmountable process.

Transitioning Client Responsibilities

Senior partners devote the best years of their professional lives to the firm's growth and development and can be reluctant to identify and choose successors. But the torch must be passed. It is imperative that senior partners integrate younger attorneys into their relationships with marquee clients ' and impart their management philosophy ' when time away from retirement can be measured in years, not months.

In order to demonstrate that important clients will remain as important even after a senior partner retires, a firm must convey that there are concrete plans for transition and that clients' future needs are being considered. Efforts should be made to pair younger partners with emerging leaders at the client, who may feel more comfortable working with attorneys they see as their peers. This early focus will provide future leaders with the benefit of exposure and a visible vote of confidence.

Remember, any noticeable inattention to future leadership concerns or sense that transitioning is not a priority can undermine your relationships'now and in the future. A sense of continuity will strengthen your client ties and your partnership.

Focusing on Management

Senior-level partners who are part of the management team have developed different skill sets than other lawyers. But they didn't get them overnight. Most likely, they nurtured their leadership abilities in activities outside the practice, under the wings of predecessors and through relationships with successful peers and business advisors. After years charting the course of a firm or practice area and engaging in management, administrative and personnel matters, managers gain a valuable sense of what to do and when to do it. They have wisdom to impart. As they transition to retirement, they must have a clear way to share it with the right people in a way that benefits the firm and its clients.

An effective management committee, in conjunction with an outside party to guide its efforts, will allow a firm to hone in on the most crucial issues of succession. It will identify and add partners with intellect, drive, insight and a desire to lead. Its leadership will rotate, giving new blood valuable experience. It will set target periods for senior management to phase back from some duties. Its new leaders will benefit from the counsel of predecessors. It will determine post-retirement consulting or contract roles for departing partners, including mentorship, public appearances and specialty business development. Importantly, it will pave the way for transitioning ownership interests and adjusting partner compensation.

Keep Your Succession Focus

When it comes to succession planning, there are often no right answers. This is the time to ask questions and seek advice. Don't let inertia undermine what you've built.

Phillip A. Bottari, CPA, is partner-in-charge of the Friedman LLP Law Firm Services Group in New York.

Turning over the reins of a law firm is an art form. A well-staged plan that allows for a seamless transition from current leaders to the next generation ' in both client relationships and management responsibilities ' is crucial to the health and longevity of your partnership.

Failure to cultivate new leaders and expand connections to clients throughout a partnership can lead to political infighting and uncertainty, causing younger partners and associates to question their future, and leaving a firm exposed to a sudden vacuum of expertise, thus threatening longstanding client relationships.

There are a finite and critical set of issues that must be addressed. Fortunately, partners can work together to make succession a priority, and there are resources available to help effectively plan for it. The presence of a third party to facilitate a dialogue is always a smart move. It can offer judicious, impartial advice, sensibly steering what can often be an emotional and seemingly insurmountable process.

Transitioning Client Responsibilities

Senior partners devote the best years of their professional lives to the firm's growth and development and can be reluctant to identify and choose successors. But the torch must be passed. It is imperative that senior partners integrate younger attorneys into their relationships with marquee clients ' and impart their management philosophy ' when time away from retirement can be measured in years, not months.

In order to demonstrate that important clients will remain as important even after a senior partner retires, a firm must convey that there are concrete plans for transition and that clients' future needs are being considered. Efforts should be made to pair younger partners with emerging leaders at the client, who may feel more comfortable working with attorneys they see as their peers. This early focus will provide future leaders with the benefit of exposure and a visible vote of confidence.

Remember, any noticeable inattention to future leadership concerns or sense that transitioning is not a priority can undermine your relationships'now and in the future. A sense of continuity will strengthen your client ties and your partnership.

Focusing on Management

Senior-level partners who are part of the management team have developed different skill sets than other lawyers. But they didn't get them overnight. Most likely, they nurtured their leadership abilities in activities outside the practice, under the wings of predecessors and through relationships with successful peers and business advisors. After years charting the course of a firm or practice area and engaging in management, administrative and personnel matters, managers gain a valuable sense of what to do and when to do it. They have wisdom to impart. As they transition to retirement, they must have a clear way to share it with the right people in a way that benefits the firm and its clients.

An effective management committee, in conjunction with an outside party to guide its efforts, will allow a firm to hone in on the most crucial issues of succession. It will identify and add partners with intellect, drive, insight and a desire to lead. Its leadership will rotate, giving new blood valuable experience. It will set target periods for senior management to phase back from some duties. Its new leaders will benefit from the counsel of predecessors. It will determine post-retirement consulting or contract roles for departing partners, including mentorship, public appearances and specialty business development. Importantly, it will pave the way for transitioning ownership interests and adjusting partner compensation.

Keep Your Succession Focus

When it comes to succession planning, there are often no right answers. This is the time to ask questions and seek advice. Don't let inertia undermine what you've built.

Phillip A. Bottari, CPA, is partner-in-charge of the Friedman LLP Law Firm Services Group in New York.