After a period of sustained economic growth and increasing profitability, the legal sector, in common with many others, finds itself with a dearth of talented people and dramatically rising labour costs. One can barely pick up a legal sector news publication without registering the sense of disillusionment felt within law firms, including that of partners. The response to this has been in some respects predictable and in others, extraordinary.
The predictable and perhaps kneejerk response has been significant salary hikes. More surprising is the apparent road to Damascus conversion to the notion that, as well as being lawyers, fee-earners are employees and (some have been bold enough to suggest) individuals with their own career ambitions.
Many firms seem genuinely shocked by the fact that proper management of the most complex and expensive resource they have could bear dividends. The reality, of course, is not that this was not known, but that some chose to ignore it, being reluctant to “waste” valuable fee-earning time on the development of their key asset. Others attempted to solve the problem by succumbing to the confused notion that if one recruited more accountants than you could shake a stick at and invest millions of pounds in IT, these things alone would resolve all management difficulties. For many, it has involved falling prey to every management gimmick or tool going, often described as “radical”. Surprise surprise, these actions have not proved wholly successful.
The truth is that in most instances we are talking about basic common sense in respect of managing people and action is long overdue.
Firstly, in dealing with the situation which we find ourselves in, HR functions are beholden to be extremely discerning about their choice of external consultants. When selecting the supplier of the next “cultural audit” on “value added assessment”, a healthy degree of cynicism is crucial. The decision to purchase such services must be firmly rooted in what everyone with an ounce of common sense knows about people and the short and longer term commercial needs of the business. Often, HR departments have been battered into submission and now only gain plaudits for securing discounts from recruitment consultants. Repositioning of the role is vital in achieving business advantage – in looking forward, it is up to firms themselves to ensure they are adequately served by their existing HR functions and all practice support areas.
As regards the lawyers, having “discovered” that they want more information about their performance and a coherence around their development, they must now react accordingly and be less pathetic and more in control. Many lawyers, in an attempt to “play to the gallery”, have been only too willing to pretend to partners that management techniques did not matter to them or just simply exude a frightening cynicism when asked to think around development or career planning. Fortunately, when now asked their views, lawyers are responding in a manner commensurate with their intellectual capacity and are giving answers which suggest they are often dissatisfied with the way in which law firms are currently run, and more importantly how they are managed as individuals.
In short, the legal sector’s ability to be sufficiently dynamic in order to survive in anything like its current ownership model must not be resource constrained by its failure to manage in the broadest sense. The HR function, where it has lost its way, must begin again to add value and lawyers must be more honest, creative and courageous in managing their own careers.
Finally, and perhaps most controversially, partners and partnerships must start to display a real sense of leadership and take the time out to understand a little more about what might motivate their employees – not to satisfy the apparent desire of their HR departments, but to deliver both the client service desired and the growth and future which forms a great part of that other, once thought of as an odd concept, the business strategy.
John Renz is director of human resources at CMS Cameron McKenna.