Orrick, Herrington & Sutcliffe LLP made its entry into the Houston legal market last week. It announced that it had attracted 15 Houston based attorneys from 6 firms to plant the Orrick flag in the Bayou City. Pulled from Andrews Kurth, DLA Piper, Haynes and Boone, McDermott Will & Emery, McGuire Woods and Susman Godfrey, the new Orrick team members are all well regarded and each of them alone would have been a nice catch for just about any firm.
Even with the 15 lawyer opening, Orrick may not be done. It reports that it has targeted another 7 Houston attorneys as possible additions. Judging from its start, it is possible that Orrick’s additional recruits will come from more than one firm, making the firm’s new Houston office a melting pot of 21 attorneys from as many as 8 separate firms.
While not revolutionary, Orrick’s approach in Houston nonetheless is different from most law firm market openings. Generally law firms enter a new market either with a merger or by laterally acquiring a discrete group of lawyers from one firm.
When using the common tactic of spiriting a group from a single firm, opening press releases often predicts a multi-service office of 8 to 10 times the opening size in short order. As experience has shown, however, such growth after the initial opening is easier said than done.
Orrick’s alternative approach of opening with a ready-made multi-service office is outside the norm. It entered the Houston market by simultaneously plucking free agents with varied specialties from multiple law firms and established from inception a new market office with a wide breadth of service offerings.
Orrick’s approach, termed “ala Carte” by the American Lawyer, may have allowed the firm to by-pass the difficult and frustrating maneuver of planting a new office seed that frequently fails to grow.
Is the Orrick, or ala Carte approach, the better way to enter a new market?
The answer to the question will be different for every firm and comes only after an examination of the pros and cons, some of which are discussed below.
Get the Free Agents You Want. The ala Carte stratagem allows a firm to open with a substantial office only consisting of the lawyers that fit the firm’s long-term vision. All others are avoided, as are the distractions they can create.
Each Free Agent Has Something to Prove. Each free agent comes to the firm with the opportunity to establish himself or herself as the new office’s Big Dog. The hierarchy slate is clean so opportunity and competition to succeed can be a significant benefit to the firm.
Mostly Filet, Little Fat or Gristle. If vetted well, the new additions are lean. Questionable performers typically won’t make the cut since there is no obligation to hire weakness from the free agent market.
Start Off With Girth. By exercising a disciplined lateral hiring strategy, the office can open with the kind of size and depth a merger provides but with few of the headaches. Soft performers that can come with a merger aren’t in the mix. A merger-like roster is added without the merger.
Culture Wars Times 10. A headache that comes with growth is blending new attorneys into the firm’s culture. The oft-difficult task of getting attorneys commonly familiar with one culture (as is the case with a merger or acquisition of laterals from a single firm) to acclimate to a new culture is compounded. If lawyers from 8 firms comprise Orrick’s ala Carte selections, nine law firm “ways of doing things,” not two, will have to be melded.
Teamwork Vacuum and Intra-group Competition. When a new office opens as a result of merger or single firm raid, some semblance of teamwork in the new group already exists. Opening a new office with as many as 8 law firm groups largely thrusts lawyers into a teamwork vacuum. Add to that the potential desire of new attorneys marking their territory, and the challenge can be formidable.
Steve Harvey Effect. Many of the new hires may feel that they are the choicest of beauties in what becomes an office wide beauty contest. Stroking those egos may be a volatile task exacerbated by individual insecurities as the firm’s Steve Harvey ambles about seemingly ready to crown a winner. And like shown by poor Steve, picking the wrong queen (or king) can create difficulties.
An ala Carte opening in a new market requires substantial discipline and work to succeed, much of it coming after the new office is opened. Considering the pros and cons, is the ala Carte strategy attractive to your firm?