A New Philosophy for Managing Partners: Building Consensus Versus Managing As an Autocrat

A majority, or a defined super-majority, of the partners will undoubtedly be sufficient to implement most management objectives. Yet, the firm's philosophy is key in establishing a firm's culture, and all hands should be on the table. Partners must clearly feel that decision-making will be in firm, but fair hands, and that each partner will be treated with courtesy and respect.

During the formative process, if one or more partners strongly resist or refuse the call for individual subordination, the other partners must give serious thought to how the descendant partners should be treated before a structure is finally determined. For example, they may require participation in the management in order to ensure their "buy-in" or, failing acceptance after significant effort; they may best be subject to separation. Isolation is an unacceptable alternative, since it leads to non-cooperation, exclusion and simply delays dealing with a problem partner.

Selecting the Management Structure

Once a management philosophy has been identified and agreed upon, it is incumbent upon the firm to determine the form that management will take. Good practice and experience dictate that it will not work to allow partners (or members/shareholders) to exercise autonomy on all matters affecting the firm. Traditionally, many firms name a single managing partner/ shareholder and a management committee, i.e., an executive committee. Decisions of consequence relating to structure, which must be made, include:

1. What exactly are the roles and responsibilities of the partners, managing partner, executive committee and department chairs?
2. How do they interact and what is the reporting responsibility of each to the other(s)?

In some firms, one partner assumes the leadership role naturally, either because the individual is a founding partner or controls a significant client base. In firms where the partners are relatively young and inexperienced, however, this process of natural selection may be more difficult (if not impossible). In firms where no partner surfaces as a natural leader or no one wants the job, the firm must take aggressive action if it wishes to grow and satisfy its members' professional, economic and personal objectives.

The firm must make some hard-and-fast decisions about the kind of leadership required and what the members are willing to accept. Should a managing partner be elected by the general partnership? Or should this individual be appointed by the management committee?

Sometimes the firm's size will preclude this particular dilemma. The smaller firm is in a position to establish a democratic form of governance that includes all the partners in a leadership role. But, when this is not practical, the partners face a difficult choice and risk setting up two power centers — and consequent decisiveness — if the general partnership elects both the management committee and the managing partner. To avoid this debacle, in some firms, the management committee selects the managing partner.

Qualities of an Effective Leader

What kind of person makes a good managing partner? Generally, lawyers are not recruited to a law firm on the basis of their interest or skills in management. They are rarely trained by the firm in management skills. Consequently, lawyers' skills and levels of interest in management frequently leave something to be desired. Regardless of training or experience, however, some important characteristics of successful managing partners include the following:

• The leader must possess respect and support, and have the clout and the willingness to wield it when necessary.
• The leader's skills must combine judgment, commitment, and vision.
• He or she must possess a sense of humor, be reasonably "thick-skinned" and be a "people person."
• He or she should possess a vision about what the firm should be and a good sense of timing for when and how to discuss and implement initiatives.

The most successful managing partner is not necessarily:

• The best lawyer;
• The biggest rainmaker;
• The "workaholic" partner, the senior partner;
• The "idea" partner; or
• The "willing" partner.

What partners expect of managing partners:

• Leadership … but not dictatorship.
• Financial knowledge.
• Address the problem … but pick your battles.
• Be a visionary … but a realist.
• Be decisive … but build consensus.
• Be an example … but admit your mistakes.
• Delegate … but be in the know.
• Treat everyone fairly … but know the "buttons."
• Know key clients/be visible in the community.
• Be a risk taker … but be accountable.
• Listen to all points of view … but make the call.
• Expect the best … but tolerate mistakes.
• Be accessible … but you must get away.
• Communicate.
• Communicate.
• Did we mention … Communicate.

Analysis

In the final analysis, individual needs of attorneys have to be balanced with individual partner independence to be responsive to the firm's organizational patterns and policies. Applying management techniques to practice areas may introduce to the firm a new take on methods for enhancing profitability.

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Joel A. Rose is President of Joel A. Rose & Associates, Inc., a firm of management consultants based in Cherry Hill, NJ. A member of the Board of Editors of this newsletter, he may be contacted at 856-427-0050 or [email protected].