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23 February 2009
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Indian firm Amarchand & Mangaldas & Suresh A Shroff & Co has taken the unusual step of converting to a full lockstep model after years of maintaining tight reins on its equity.
Amarchand currently operates an eat-what-you-kill system, whereby a small number of founding partners and family members are understood to command a large proportion of the equity.
Managing partner Cyril Shroff (pictured) believes using a more meritocratic system will give the firm an “acquisition currency” that will allow it to grow “massively”.
He said: “We wanted to create a more broad-based partnership. The benefits of lockstep are well-known, and ;collegiality ;and sustainability were what we were looking for.”
The restructuring is expected to finish by the end of March.
Amarchand has 450 associates and 40 partners, 15 of whom are in the equity.
Anon | 23-Feb-2009 12:21 pm
Sense prevailed..at last !!!!! Indian law firms are largely family owned and it high time these greedy partners acknowledge merit..
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obs | 23-Feb-2009 2:19 pm
BrandA smart bit of branding - AMSS have been suffering from the departure of their most junior and talented layer for years.As such, this is high time for them.
Vinod Joseph | 23-Feb-2009 4:22 pm
LockstepWhoever wrote this article doesn’t have a clue what lockstep means. A lockstep system is one where equity partners in a law firm are paid according to how long they have been in the partnership. Lawyers in the partnership for seven years, for example, will all earn the same, even though they may all bring different amounts of work to the firm. Many European firms are moving away from the lockstep system (under which senior partners always make more than partners junior to them, even if they bring in less revenue) to a merit based system (where Partners are paid according to their billings or killings!). On a general note, most Indian law firms controlled by a family, neither follow the lockstep system, nor are they strictly merit based (where you are paid according to what you kill)
Anonymous | 23-Feb-2009 5:08 pm
Amarchands LockstepThis is a positive move. Lockstep encourages a collegial climate where the firm comes before individual partners, however powerful they may be In adopting it, the firm is sending out a powerful message
Stepped | 23-Feb-2009 5:15 pm
JosephMr Joseph, what do you mean exactly?That eat-what-you-kill-style systems are meritocratic in that a few family members get most of the cash because they kill the most, hogging all client relationships at the expense of junior partners?
Anonymous | 23-Feb-2009 5:46 pm
A new game startsCyril has been clever as usual. By being the first mover in this direction he has taken the game by the scruff of the neck. He has changed the dynamics of the Indian market and now has the opportunity to take full advantage of being the leader of the pack
Ex Amarchand Lawyer | 23-Feb-2009 7:16 pm
Fact v. fictionThis article is incredibly sketchy on details. It raises more questions than it answers! There is no mention of how the points are awarded on the lockstep - is it based on tenure or other factors? What AMSS may have understood to be a "lockstep model" may be very different from what it is.
Anonymous | 23-Feb-2009 9:45 pm
Key wordsI think the key word is sustainable - there is no perfect system , but lockstep does discourage a purely short term view. This model should serve them well for a few years - and help them grow
anonymous | 24-Feb-2009 4:52 am
Amarchand's Lock-StepFriends, both Shardul & Cyril have always been very candid in stating that AMSS is a family run law firm and would remain so. In this bargain he may have lost partners, so what? both are Stars and would continue to be! How should they run their family business is their problem and hence do not warrant any outside comment, nor should these comments matter to both of them. Atleast they are trying hard to fulfill the aspirations of any young lawyers, albeit in limited manner, but they are taking steps in right direction.
Anonymous | 24-Feb-2009 6:28 am
Interesting!!!!!Lock Step model is not suitable for Indian firms, as mentioned by a very knowledgeable and observant commentator below, it is a system which is controlled time bound formula and does not really incentivise merit based growth. Also, in Europe it has been seen to choek young lawyers to grow within a firm. Hopefully, this does not lead more disaster at an already troubled set of young bright minds seeking rewards and recognitions in Indian firms. Most importantly, I hope that the firms in India do not trample over each other to follow suit, causing chaos and more confusion in an already absolutely confused law employee market.
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