Yesterday I noted the issues
raised by a WSJ piece on clients looking askance at paying going rates for
first- and second-year associates.
There are really only three ways to
resolve this issue, beyond, of course, extending the status quo:
- Firms bill out junior associates at lower rates
- Firms stop hiring junior associates.
- Firms find ways to make the junior associates more
valuable to the clients.
I've seen #1 and #2 discussed in the
past few years, but I've seen very little of #3.1
#1 is happening to some extent, at
least for some firms (and some insistent clients). We've certainly seen a
variant of #2, slow law-grad hiring, over the past two years.
Why not look at #3?
Making Junior Associates More Valuable to Clients
I can think of three straightforward
ways to make first- and second-year associates more valuable. They can cram
more "law" into the same number of hours, they can gain experience faster, or
they can take on different valuable duties.
Hours, More Lawyer
An hour is an hour. How can you cram
more "lawyering" into that hour? It's like saying, "Sleep faster; we need the
The reality is that resources
perform tasks with different levels of skill. It's clear that a senior partner
will have more skills in almost every aspect of the law than a first-year
associate, right? Well, by the same token, some recent grads have more skills
than others. If there is slower hiring all around, then "higher quality"
graduates are available to those firms who might not get to pick first in the
choose-up game of hiring law-school grads.
It's like choosing up sides for a
pickup baseball game.2 If the captain who chooses first gets to
pick three players at a time, then clearly the other team will be significantly
disadvantaged.3 Thus in choosing up sides, each captain gets
only one pick at a time. For years, law has worked more like baseball free
agency, where the rich teams got lots of picks and the smaller-market teams had
to play Moneyball. However, with slower hiring, there are more "top-tier" new
hires available to the firms that choose 2nd, or 102nd. There's no guarantee that
a given high-ranking graduate from a highly respected school will be the better
hire, but firms believe that on average those choices will do better... and there
are now more of those choices available.
Gaining experience faster seems like
another "sleep faster" paradox; how can you gain experience other than an hour
at a time? Hours are fixed quantities.
Hours are indeed fixed quantities,
but the quality of each hour varies. Which of these three will grow
associates skills the most rapidly?
- Proofreading a senior partner's brief.
- Doing basic research.
- Taking more responsibility.
Few would doubt that #3 will grow
the associate faster... but who's willing to give deep case responsibility to a
first- or second-year associate?
The answer is... you are. And I am.
Look at the local prosecutor's office; it's not uncommon for recent grads to be
given significant responsibility on a case. Maybe they're not leading
first-degree murder trials (though occasionally that does happen), but they're
regularly on the line representing the people (that's us) in all sorts of other
matters, with real stuff - like freedom and futures - at stake.
In the best corporations in America,
new hires are often given serious responsibility. Often they take full
responsibility for at least a small area or project. Google, Microsoft, and
other technology companies make this an explicit part of their practices, and I
see it increasingly in non-tech companies too.
In fact, there are even some law
departments that are hiring right out of law school. They're not sending these
recent grads to two-year training programs; rather, they're throwing them into
the water and taking but occasional looks to ensure they're still swimming.
Indeed, most of them will swim, and they'll learn in a hurry to swim
In fact, this is an elegant solution
to the problem... from the client's perspective. I'm not sure it bodes well for
the firms, though. What if the corporate law departments discover this practice
works out so well that they only need the firms for high-end work, specialty
work, and so on? What happens to the firm's economic structure, especially at
the larger (AmLaw 100) firms? I don't know the answer, because it's still a
largely theoretical problem. (Calling Adam Smith, Esq.) But it might not be
quite so theoretical in five years.
In other words, it might be
worthwhile for the firms themselves to look further at this option, increasing
associate responsibility significantly. It's not so much about billing out the
associate as much as creating associates who are worth billing sooner, who add
more value faster to both firm and client.
Obviously one side effect of both #1
and #2, above, is added client value. But there's another way to add client
Consider training your team -
associates and partners - in Legal Project Management. LPM, at least in my book
(pun intended), is about adding value, about finding ways to increase
effectiveness and increase efficiency at all levels. It's about working together
better as a team. It's about learning to understand responsibility, leadership,
delegation, and task-assignment. It's about strengthening those skills, beyond
"lawyering" itself, that define client value.
Add client value, and the clients
will jump aboard.
They'll still clamor for ways to pay
less, since that's the way of the world. But firm and client will be able to
have a different conversation, one that focuses on shared goals rather than
simply hours and years-in-the-job.
Which conversation do the firms want
to have? For that matter, which conversation do the clients want to have?
I think this is a case where both
parties do indeed win.
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1Of course you can combine #3 with #1 and/or with the
slowed-hiring variant of #2. For the sake of keeping the initial discussion
simplified, I'll treat the four options (the three numbered items plus status
quo) as either-or propositions, understanding that the real world isn't that
2Do our kids even know how to do this anymore? I haven't seen
a pickup game in decades. I'm constantly floored when I take my son up to the
local ballfield for a bit of practice and find it empty. Do we really
need adults to organize every single baseball game? Eek, it sounds like I'm
getting old or something!
3Well, at least it seems that way, though I don't notice the
Yankees or Red Sox or Phillies in the World Series this year.