The ambitions of US firms are well publicised, as indeed are their sometimes spectacular failures and setbacks.
Many continue to ponder the question of what it takes for a US practice to become a meaningful player at the top of the UK market and whether US firms will successfully capture market share from the magic circle and other top UKfirms.
My view is that there are a number of key prerequisites for success in the London market for any US firm.
In order to gain the most from the synergies of a joint US/UK capability a strong New York and national US practice is needed. Some of the failures in London have involved regional US firms which lacked either a capital markets presence, a blue chip corporate clientele or both.
In terms of an international business base, the desire for growth in London should only be driven by clients' needs and not by hopes of bolstering a flagging US domestic practice or by the personal ambitions of individual partners.
A US firm with a sufficiently broad team of top quality UK lawyers is as well positioned as any UK firm to attract and retain this work.
If joint US/UK capability is a key strategic aim for the future, it must be backed by a commitment to the long-term. This means a commitment to spending the money, taking the time and making the effort that is necessary to attract top lawyers and, more importantly, integrate them into the firm.
Firm-hopping by UK lawyers among US firms will be avoided by firms that spend as much time integrating as they do hiring. These standards cannot be compromised, no matter how badly the firm needs to fill a particular gap in its UK practice in order to offer clients the range of services they demand. Quality is the most important constraint on the speed of growth. Firms that play the “numbers game” do so at their peril.
Some US firms have successfully digested enormous market-driven increases in assistant compensation over the past few years. For this and other reasons, the labour market is now flooded with high quality assistants from top UK firms seeking alternative career opportunities.
Yet most of these assistants are too sensible to move just for the money. They need to feel that they have secure career prospects with high quality training and education to develop their skill base. Providing this is a central part of maintaining quality.
The challenge from the US firms has been largely diffused in the public eye by the visible failures. But I have no doubt that those US firms which follow these few basic rules will succeed.
Paul Harter is lead US partner at Gibson Dunn & Crutcher's London office.
See Lawyer 2, page 30-31