Revolving Doors are Spinning at Law Firms

When I was a very young boy growing up in Pittsburgh, Pennsylvania, my father would tell me that the revolving doors at Kaufmann's department store were what powered the escalators.  It made sense at the time.  As my father pointed out, the escalators didn't operate when the doors were closed.

Law firms are a lot like old-fashioned department stores like Kaufmann's.  When the revolving doors are turning, with partners going in or coming out, that is a sign that things are happening inside.  Unlike department stores, however, when partners are coming out, arms loaded with client files instead of shopping bags, that is a bad sign for the management.

Reading the U.K.-based legal press (which should be required reading for lawyers everywhere), I notice that the Month of the Revolving Door is once again upon us, not just in Britain but almost everywhere. January is the month when law firms experience the highest volume of partner departures to other firms. 2012 so far has been no exception.

In mature legal markets, especially, partner retention has become as critical a strategic issue as associate retentions, especially in these days of decampments en masse, by entire practice groups or offices.

A partner's decision to go to another firm is almost always a rational business decision. There can be a variety of precipitating events. Lack of what a partner believes to be appropriate and equitable financial recognition can brew into resentment throughout the year. In many cases, the "spark" for the decision can be disappointing year-end profit distributions. In almost every case, however, the partner has concluded the he or she has a better future elsewhere.

Weak or infrequent internal communication between the firm's management and its partnership is a frequent characteristic of "revolving door" law firms. When partners start muttering about being "kept in the dark" or being treated like employees, rather than owners, they usually are already looking for the door.

Culture and collegiality are important, but law firm leaders need to present a compelling business case throughout the year for their partners to remain on board.

Norman Clark

Read more on the Walker Clark Worldview 

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