I recently finished a review of the 2018 version of the Georgetown University Law Center’s Report on the State of the Legal Market. Although the report contains numerous quantitative facts reflecting continued struggles for the law firm services market (falling productivity, realization and profit margins), I was intrigued by the commentary regarding strategy.

The report addresses the tendency to follow or even double down on strategies that are failing.

When thinking about goals and the development of strategies to achieve them, it is a bit like selecting one of the numerous routes available to a specific travel destination. It is typical (and advisable) to evaluate progress, and change plans if the chosen route is found to be blocked or includes unreasonable delays.

Unfortunately, the norm for many businesses, including law firms, is to re-double efforts when chosen strategies are not providing the projected progress towards the realization of goals.  The report details several reasons for this tendency including these three (paraphrased) reasons:

  1. Commitment Bias – As an organization invests time and money in strategies, it is predisposed to value those strategies more highly — “in for a penny, in for a pound.” We see this time and time again as firms continue to pursue approaches that are not yielding desired results. The investment one has made in an initiative should not be the deciding factor when it comes to making future investments. An objective evaluation of progress is the mark of leadership.
  2. Finish-What-You-Start-Syndrome – Most of us have been programmed since we were children to stick with what we have started until we have completed the task. Somewhat like commitment bias, this approach to strategy often makes little sense. Once we determine that what has been started no longer serves our purposes, the effort should be terminated.
  3. Ego/Face Saving – Finally, all too often firm leaders become far too personally vested in a strategy. To change course, abandon the failing strategy and start anew feels like failure. However, the effective leader operates in the best interest of the firm, and is not afraid to change course when necessary — no matter the degree to which they are personally identified with the strategy.

Routine monitoring of progress is the key to identifying and challenging strategies that are not serving the firm. Any strategy should include a series of actions and specified interim progress milestones. As time passes, with benchmarks failing to support targeted milestones,  the strategy itself should be increasingly questioned.

The Georgetown report provides some great insights into the state of the profession and some very good additional perspectives on failed strategies.

For those interested in other readings on law firms and ways in which leadership can address the challenges of transition, see here.