Growing into success does not mean merger
3 July 2000
27 September 2013
2 December 2013
3 August 2014
14 October 2013
24 March 2014
As every managing partner is painfully aware, the most difficult thing about strategy is its implementation.
Take strategies for growth. Even where expansion is a valid strategic imperative, merger does not often provide an appropriate, cost-effective and trouble-free route to implementation.
Too many mergers appear to have no good rationale other than growth for growth's sake. What is more, the recent batch of national and international mergers are the tip of the iceberg.
For every announcement of a successful merger negotiation, there are scores of ongoing discussions, frustrated or failed talks, and all the wasted expense and effort of trying unsuccessfully to identify and woo potential merger targets.
But the trouble does not stop there. For the relatively small number of firms which have managed to achieve a merger, a difficult and uncertain time lies ahead.
Most mergers take at least five years to properly digest, with huge costs to absorb or write off, and many casualties along the way.
So for many firms, while merger remains an option, growth can be better pursued by a mixture of true organic growth and a sustained and aggressive programme of lateral hires of individuals and teams.
A lateral hire strategy can, like mergers, be tricky, but holds many advantages over merger.
Laterally hired partners and small teams are easily digestible bite-sized chunks, focused to core requirements.
The identification of suitable targets, and the subsequent approach and negotiation can be individually tailored.
Due diligence is narrow, deep and focused, and culture alignment can be assessed on an individual basis. There is no clutter of unwanted premises and people. It is easy to formulate and considers the business case in a tidy manner while aftercare can be focused for painless integration.
It is also possible for team integration to be dynamic and close-up, and not piecemeal and fragmented.
And what is more, there are no cultural issues about who has taken over who.
Conversely, the acquiring firm can achieve an immediate fresh injection of new skills and ideas from an objective outsider drawing from relevant previous experience.
For the laterally hired partner or associate, a stimulating opportunity is provided to relaunch, refocus and revitalise a career in an atmosphere where they are likely to be valued and encouraged, and where expectations can be managed on both sides. And it can be a quick way to grow.
Many firms now have a continuous programme of research, search, investigation, enticement, induction and integration which can result in significant additions to the partnership base, the client base and the firm's revenues over a short period - and relative to a merger, at modest cost and risk.
A sustained programme can prove to be of similar cumulative significance to a modest-sized merger at least.
Nick Jarrett-Kerr is chief executive partner at Bevan Ashford
Mike Tyler, in his article "Corporate killing law misses the mark" (12 June), actually does something similar as regards his reasoning behind his criticism of the latest Corporate Homicide Bill.
The Government, judiciary and legal profession have all stood back as workers have been killed as a result of directors placing profit before safety. Time and again the press report that simply investing in health and safety would have saved life and limb. But the impression the public has is that of technical legal nit-picking and collusion evidenced by the ability of those responsible to avoid prosecution.
In short, neither the current law nor prosecuting authorities are effective and I would challenge the critics of the latest proposals to find an explanation or alternative that victims' families could believe.
The proposals have come about due to political pressure of ordinary individuals who believe our justice system is ineffective on this issue.
The failings may or may not be due to legislation being dated, but it is worthy of note that companies are to be more rigorously policed for anti-competitive behaviour than for killing people.
It seems the proposed legislation may not go far enough, despite the concerns of lawyers such as Mr Tyler, to address the concerns of the families of the victims of corporate greed.
Ray Deans, campaigner for the Simon Jones Memorial Campaign
the lawyer 3 july 2000