In an ideal world, law firms would work the way a Fortune 500 company works. A board of directors appoints the CEO and other officers, who are answerable to the board as well as the shareholders. That way everyone has an interest in stability, efficiency, and profit, and people are always being offered opportunities. I can tell you that law firms do not work anything like that, as outlined in my article on how it actually works. But just for fun, how should the ideal firm work?
A strategic plan
Instead of "make as much money as possible," the ideal firm has a shared goal of where it is headed. For example, "let's be the best at XYZ law in this area" or "let's be the best at client service in this area." The former become specialists and boutiques, and the latter become general practice full-service firms. Nothing wrong with either approach, but they lead to different strategies for marketing, among other things. At a specialist boutique, the referrals are going to be more from other lawyers than from the public. At a regular full-service firm, the referrals are going to come from existing clients or the public.
Checks and balances
Instead of dictators for life who do whatever they want, the firm leadership should be elected for regular, fixed terms. The question is: who are the electorate? Equity partners only? All partners? I would say all partners based on percentage of income, with the nominees abstaining from the vote. This would only be possible in larger firms, so at a small firm I'm at a loss for suggestions. But at a small firm, there are less concerns with entrenched, stale leadership because any partner can leave at any time.
Counseling and treatment
The partnership agreement should require all partners to be treated for any health conditions that may affect their job performance, such as psychiatric issues, substance abuse, domestic violence, financial/gambling problems, and other serious conditions.
This is the tough one. Because you don't get what you deserve in life; you get what you negotiate. A person's value to the law firm increases over time due to the incremental addition of life experience, legal experience, and polish. So their compensation should also increase incrementally. I am a big advocate of spelling out all of a person's compensation arrangements in a contract that they agree on in advance. However, to ensure fair compensation, the contract should provide for discretionary and performance-based bonuses at any time. This also has the nice effect of surprising people with bonuses when they are least expecting them.
The big firms all pay lip service to the concept of training and mentorship. The small firms don't do it because it's a waste of money on people who are going to leave anyway. What I advocate for is a balanced apprenticeship program with milestones that everyone agrees on and that are achievable. However, ultimately the milestones are dictated by the attorney's progress as well as opportunities that come up. In any case, offering opportunities to lawyers is how they learn, and they get better after practice (what a concept). I would say four second-chair trials and two first-chair trials in the first ten years is a realistic, achievable goal that also would add value to any law firm.
Last updated: July 6, 2018
© 2018 Andrew G. Watters