8 September 1999
26 November 2007
21 June 1999
6 January 2003
27 June 2005
25 September 2006
Press coverage of mergers between firms reached its zenith following the recent announcement of the Clifford Chance merger with Rogers & Wells of New York. One of the more interesting aspects of the potential culture "clash" in such mergers is the perceived differences in methods of remuneration between US and UK law firms.
The lockstep system has been traditionally linked with the UK's more conservative attitudes. It is said that it encourages a strong collegiate culture among the partners and is the cornerstone of a team approach. Part of this bond means that when work comes into the office, the partner most appropriately suited to do the work takes responsibility for it. There is nothing proprietorial in the client - partners exist in an idyllic world, where personal gain and personal profit are sacrificed for the common good.
I am sure every partner, and indeed every assistant solicitor, will know the truth behind this abbreviated description of the lockstep system. But it is probably equally deluding to describe the US "style" as the only true path to a meritocracy, where hard work and overall top performance (primarily billings) is rewarded with the highest compensation and non-performers find themselves first down and then out. Under this system, only hard performance backed by hard numbers count. There is of course no room for lobbying, ingratiation, juggling of statistics or sheer luck.
Forgive the cynical side of me, but surely the debate between a lockstep system or "two smoking barrels" is academic. Above all, surely two things count: profitability of the firm, and the management of the individuals within it.
By and large, if the firm is making money its partners will be satisfied. Whatever the system, there will be perceived performers and non-performers, hard workers and sloths, rainmakers and plodders. These perceptions may or may not have a basis in truth. It is up to the management team to try and stay in touch with the reality of the performance of individuals and, increasingly importantly, teams, to attempt to iron out any feelings of injustice, reallocate work from the overwhelmed to the under-employed and to make each partner appreciate the contribution of others.
Whatever the system, both rainmakers and others will be encouraged by this approach and quality of performance rewarded in some way. This is not unique to the US "system". Every firm - irrespective of the system of remuneration - should realise the fundamental values inherent in a true sense of partnership. Under both systems, the art is to manage profitability, while developing a true esprit de corps.
In my view, there is a much more significant cultural difference waiting to rear its head than lockstep versus eat what you kill - the development over the past few years in the US of almost perverse rules on client conflicts.
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