It is no wonder why a lot is written about law firm succession planning. Transferring a law firm onto the next generation so the institution endures is the ideal for most but unattainable for many. Sue Remley’s Succession Planning: How to Hand Your Law Firm to the Next Generation presents the issue clearly and provides some thoughtful ideas about how it is best accomplished. But as I wrote in Succession Planning at the Smaller Law Firm-A Bigger Challenge, affecting a succession plan at a smaller law firm can be far from easy.
Even though succession planning at a smaller law firm can be difficult, by no means is it impossible. Positioning a smaller law firm so that it thrives generationally is a matter of advance planning and discipline. Dramatic steps are not necessarily required but there can be no substitute for approaching each day with the future in mind.
Think About Your Firm with a Long-Term View. One of the difficulties faced by large law firms is that true long-term value may become secondary to short-term financial rewards to the owners. A large law firm that sacrifices short-term profitability so that it can build for the future risks defections from owners possessing a short-term outlook. For that reason, large law firms often find it difficult to dedicate current resources to long-term value creation. In a small firm, however, where ownership is less dispersed, a true sense of ownership can exist and be convinced into building for the future. In some respects, therefore, a smaller law firm may be more suited to preparing for succession planning than often thought.
Make Hiring Decisions Premised on Longevity. Not all associate candidates or lateral hires aspire to work at an AmLaw 200 law firm. Many young candidates eschew the BigLaw option because it offers little in career longevity-a point BigLaw may acknowledge based on its turnover statistics. Smaller law firm desiring a multi-generational future should make young lawyer hiring decisions thinking about how each candidate may grow into a long-term contributor. Just because a firm is small does not mean potential long-term contributors are not available in the marketplace.
Include a Leadership Assessment in Annual Reviews. Most law firms review their young lawyers annually to assess economic contribution and to provide constructive feedback. Smaller law firms thinking long-term will include an assessment about an attorney’s leadership qualities and efforts for the firm’s institutional benefit during the preceding year. Law firms thinking about the future cannot think only about billable hours and substantive milestones if the future of the law firm is valued.
Assign Firm Projects and/or Responsibilities to Your Younger Lawyers. Sue Remley identified the difficulty that senior lawyers have with letting go of control. It won’t seem so much like letting go if the firm develops the practice of integrating young lawyers into important roles for firm projects or responsibilities. Not only will doing so make the transition to succession easier in the future, but the training of the younger lawyers “by doing” will be individually invaluable as well as beneficial to senior management. Moreover, early involvement in firm projects or activities can reduce the demands on senior level lawyers.
Contributions to the Firm Should Be Rewarded. Financial reward for firm projects or responsibilities tackled, even if modest, is crucial to the development of the next generation. Just as one should reward business development successes, rewards for successful efforts at strengthening the firm should likewise be granted. Positive reinforcement will aid the firm in the present but also create leadership for the future.
The seeds for succession planning must be planted and watered if future leadership is to be harvested. Is there any reason these simple steps should not be a part of a law firm’s long-term strategy?