“It is on the vigour, imagination and professionalism of smaller companies that much of our hopes for the future must lie.”
Sir John Harvey-Jones
This is the opening to book Troubleshooter that was published to coincide with the series and of which Sir John made his name, following his retirement from ICI. I have an original, slightly decaying copy which contains some rather tragic stories (Tri-Ang amongst others).
I am sure for many people Sir John holds a special place in their heart. He was Chairman of ICI from 1982-1987 and was the finest industrialist of his day. His record at ICI speaks for itself. His first book Making it Happen should be required reading for all Managing Partners (I will happily lend my copy to first one who leaves a comment on this blog!).
Sir John was a great champion of manufacturing and even though he had worked inside a business that was super-tanker size by comparison to the minnow businesses that he advised, nevertheless the guiding principles were the same:
- A shrinking market;
- Poor work practices.
Sir John died in 2008 and his loss was mourned by many people whose lives he had touched. But I wonder what he would make of today’s legal sector with all the changes and threats that it is having to deal with?
Where would he even start?
I think fundamentally one of the biggest issues is the partnership structure. Yes there may exist more LLP structures now, but they are still run along the same, moribund lines.
In colloquial terms with the business being organised in this way, the partners can’t see the wood for the trees. Or, even if they do have a line of sight out of the abyss they are not able to act on it because of the structural problems that it throws up.
It is very likely that they are still clinging on to unprofitable departments which are only being kept alive because it is too expensive to disband them or they they think the minute amount of turnover is at least spreading the overhead cost.
Can you imagine many business models being able to run at a constant loss? Fiduciary duties aside, it would simply be unsustainable. As I have previously written about, if you were to appoint a Chief Profitability officer, my guess is that many departments would be shut down; but of course we know that won’t happen whilst the partnership model subsists.
And then we have the people skills. Too many partners are ill-suited to managing others and just because they run a profitable department does not give people licence to treat others any differently to the way they would want to be treated. Partners exist to serve and the sooner that that message is got home the better will be the profession. Put your people first and then your clients and the business will run a lot more smoothly and profitably.
But even if the internal partnership issue could be fixed, you then have the huge of welter of changes that are happening in the market:
- Regulatory; and
- Big brands entering the space.
The one thing you can be sure of is that those new entrants will have done their homework, and will have a clear purpose and vision. But most law firms will have neither. The patient is being kept alive to serve … the partnership. Nothing has been retained in the business as a War Chest. There has been little or no investment in your people. And the systems are barely keeping up with where you need to be. Yes, a few firms will have lovely new offices but they hide a multitude of issues best kept inside the firm!
The point about Troubleshooter was at least those businesses who were part of the series were prepared to open up their doors to Sir John and seek his advice. Some acted on it, others did not. But I wonder how many law firms would be prepared to open their doors in quite the same way?
Law firms are by and large small businesses, and are run as such. I worked for 5 law firms during my career and save for 1 of them, they were run along the same lines: make profit for the partners so they could enjoy a nice lifestyle. I know this is crude but it is the truth.
I am not naive. Having worked in many family run businesses, I recognise that the business is there to serve the owner’s needs but that is why most small businesses stay that way.
Unless the owner has a vision that is bigger than one person, they won’t grow.
I am not suggesting that all law firms should immediately race off and find a troubleshooter. I am quite sure that for a significant number of them, they will be told 98% of what they already know (or at least I damn well hope so). But the trick is having the ability to find the missing 2% that will unlock the latent potential of the firm. Very often bringing in someone from outside not only challenges you to think differently, but they can also spot the areas that are worth investing in or have the greatest potential for growth. In many ways that was what Sir John did with great humour and aplomb.
Of course, far from me to tell you how to run your firm but please, please don’t leave it until it is past the point of no return to do something. I will take no pleasure, later on, in saying “I told you so” (as well as many others no doubt).
At this stage, I could come up with some 7-point plan, get you to act on each point and … problem solved. But we all know that as yours is a people business nothing is that simple. No instead, I only need say one thing:
FIND YOUR PASSION.
Unless you love what you do, and not just for the money, then nothing will work.
You have to be inspired to act.
No amount of nagging, shouting or blindingly obvious business planning will make any difference if you don’t believe in the business and, more particularly, YOU.
I wish I could say it otherwise but I can’t.
If you are simply going through the motions then you might as well close shop now.
You have to care. Nobody can force you to keep doing something you dislike.
Don’t side-step this issue. It won’t go away. As a troubleshooter I can’t measure your desire level or even your interest, but I can tell within 5 minutes if you love what you do. Just think about someone you deal with. You know what I mean.
OK may be this isn’t what you were hoping me to say but it stands above everything else. Too many people in legal practice don’t like their jobs and unless the issue is addressed you can forget all the other clever stuff. This calls out for inspired leadership. Leadership of the type that lawyers are not used to. It doesn’t have to be the swashbuckling stuff of legends but just the type that gives every lawyer renewed hope and belief in the firm.
One simple point for Managing Partners: can you say with conviction that every person in your firm is the most that they can be? If the answer is no, then what are you doing about it? Of course you want to reach your financial milestones and keep up the PEP but trust me when I say that that goodwill that underpins your game plan is not going to last forever.
Leadership is just the start. Accept that the law firm model is broke. Stop deluding yourself to thinking othrwise. It may not be terribly obvious right now but once the consumer/client gets a sniff of the other options in the market, they won’t hang around on your style of service.
And then you have ABS, merger frenzy, borrowing, under performing partners and technology.
“Stop and focus” as Michael Gerber says in his book Awakening the Entrepreneur Within.
It sounds ridiculous but just stand back for a moment, pick a direction that you want to head in and start to execute as if your life depended on it. Stop asking “What if” all the time, and assume that you will make mistakes. Failing faster is key. He who hesitates will disappear. Time is not on your side. Go to work on the business and try to imagine how the Best law firm in the world would operate. If you don’t know then start to speak to your clients about what they want.
I certainly don’t have the charisma or Sir John but just imagine him standing on your shoulder right now. What would he be saying that you had to do? Perhaps the title to his first book says it all Making it Happen. Perhaps that should be your creed from now on.
No more excuses.
Just go for it.
~ Julian Summerhayes ~