Originally Published October 22, 2013

In less than six years, 10 of the 14 Pennsylvania firms listed in the Am Law 200 have announced or completed changes to the uppermost tier of their leadership structures following long, successful tenures.

Two of them, Pittsburgh-based Reed Smith and Philadelphia-based Morgan, Lewis & Bockius, announced those changes earlier this month, while others, like Saul Ewing, Cozen O’Connor and Pepper Hamilton, announced or completed changes earlier this year.

But the other firms — namely, Dechert, Duane Morris, Ballard Spahr, Blank Rome and Buchanan Ingersoll & Rooney — have had new leaders in place for a few years now.

The Legal, using information gleaned from its annual PaLaw magazine and data compiled by Legal affiliate The American Lawyer, looked at whether those firms have continued the growth they enjoyed under their previous leaders.

Boston-based consultant Jeff Coburn said that, in situations where a firm head plays an active role in shaping a firm, it’s important to “institutionalize” leadership by empowering the management committee and individual practice leaders to also have key roles.

Having a strong leadership structure in place, Coburn said, prevents firms from being caught flat-footed when the person at the top eventually steps down — what Coburn called the “Testa syndrome” in reference to Testa, Hurwitz & Thibeault, the large Boston firm that imploded in 2005 in part because the unexpected death of Chairman Richard Testa in 2002 left the firm without a natural successor and gave rise to infighting over its direction.

While Testa Hurwitz is one of several firms that have met a similar fate as the result of poor succession planning, a look at the numbers shows large Pennsylvania firms that have seen prominent chairmen pass the torch recently have, overall, fared considerably well under new leadership.

Dechert

In mid-2011, Barton J. Winokur stepped down after 15 years as chairman and chief executive officer of Dechert. The role was split into two, with New York-based partner Andrew J. Levander becoming chairman and Philadelphia-based partner G. Daniel O’Donnell becoming vice chairman and CEO of the firm.

Winokur had become chairman in 1996, taking Dechert from a firm of nine offices with three outside of the United States to one with 19 offices, including eight foreign locations.

Perhaps the most outwardly notable of his accomplishments, Winokur helped in moving up the firm’s profits per equity partner (PPP) from $345,000 the year before he took over as chairman to $1.96 million in 2009. The PPP figure had reached $2.35 million at its height in 2007.

The firm did, however, hit a rough patch just prior to Winokur’s stepping down, as the recession took hold.

In 2009, largely because of a slowdown in real estate finance work — a big driver for the firm in years past — Dechert lost more than $100 million in revenues, dropping to $713 million, and conducted a number of lawyer layoffs.

In 2010, the firm’s revenue dropped 9 percent, from $713 million to $648.6 million.

But the firm began an upswing in 2011, growing its gross revenue from $648.6 million to $671 million.

Dechert also opened a Frankfurt office and a Los Angeles office that year.

In 2012, the firm grew its revenue by 8.6 percent, from $671 million to $729 million.

O’Donnell said that despite a couple of difficult years during the recession, Winokur had handed off the firm “in very good shape.”

“I think it was poised for some of the growth we’ve been able to achieve,” O’Donnell said, adding that the firm fortuitously conducted a five-year strategy review soon after O’Donnell and Levander took over, which involved the partnership weighing in on the direction of the firm.

O’Donnell called the review “tremendously helpful.”

Duane Morris

In January 2008, Duane Morris Chairman Sheldon Bonovitz stepped down and vice chairman and litigation department head John J. Soroko stepped in.

During his 10-year tenure at the helm, Bonovitz grew the firm from 200 lawyers to more than 650 and increased its revenue from $70 million to $375 million, transforming Duane Morris from a well-known Mid-Atlantic regional shop to an international firm with offices across the United States and in London, Singapore and Vietnam.

While the firm saw its gross revenue dip 1.9 percent from $375 million in 2007 to $368 million in 2008, the firm has grown that figure every year since under Soroko.

The firm has also continued its geographic expansion, particularly in Asia.

In 2009, the firm grew its gross revenue by 5.4 percent, from $368 million to $387.7 million.

In 2010, the firm’s revenue rose 6 percent, from $387.7 million to $411.1 million.

The firm also entered into a joint venture with Singapore-based law firm Arfat Selvam Alliance — now Selvam LLC — in an effort to enhance its already established office in the country.

In 2011, the firm grew its revenue by about 1.1 percent, from $411.1 million to $415.6 million.

The firm continued to spread geographically in 2011, forming an affiliation with Mexico City firm Miranda & Estavillo.

Last year, the firm’s gross revenue rose by about 1.2 percent, from $415.6 million in 2011 to an all-time high of $420.5 million.

Earlier this year, the firm opened a Silicon Valley office in Palo Alto, Calif., and became the first U.S.-based law firm to open an office in Yangon, Myanmar.

The firm also opened an office in Muscat, Oman, through a joint venture with Al Mashaikhi and Partners Law Firm.

Soroko said growing the firm in the face of dwindling demand for legal work has been “a constant battle.”

“But I really give a lot of credit to Shelly in terms of his coming into the leadership of the firm and being the architect of a fundamental change in the direction of the firm that I have attempted to keep going and broaden and enhance in some selective ways,” Soroko said. “I think the aggregate effect is that the Duane Morris of today is in many ways a different and better firm than the Duane Morris of 16 years ago.”

Ballard Spahr

In July 2011, Arthur Makadon, who had been Ballard Spahr’s chairman since 2002, turned over the reins to former strategic planning partner Mark Stewart.

Makadon became chairman in 2002. In that year, Ballard Spahr had 440 lawyers and offices in Baltimore, Denver, Washington, D.C., Salt Lake City and Voorhees, N.J., along with its Philadelphia headquarters.

During Makadon’s tenure as chairman, Ballard Spahr added offices in Wilmington, Del.; Bethesda, Md.; Las Vegas; Phoenix; Los Angeles; and Atlanta. Much of that growth was also under Stewart’s leadership.

In 2012, the first full year under Stewart’s direction, Ballard Spahr grew its gross revenue 5.3 percent from $285 million to $300 million.

Earlier this year, the firm entered the New York market through a merger with white-collar and securities litigation boutique Stillman & Friedman.

Speaking to The Legal on Monday, Stewart said he was “slightly more bullish” on opening a New York office than Makadon had been, but noted that the firm took the same approach to opening that office that it had taken to all of its other strategic moves under Makadon’s guidance.

“The firm’s philosophy through that growth [under Makadon] was that we would grow if we found the right people, we would grow if we thought there was an opportunity with a platform or practice areas and we would grow if there was a client opportunity. That didn’t change at all,” Stewart said.

Blank Rome

In January 2009, Blank Rome’s litigation department head Alan J. Hoffman and Washington, D.C., office head and business department leader Thomas M. “Mike” Dyer stepped in to replace David Girard-diCarlo, who had been chairman of the firm for more than 20 years.

When Girard-diCarlo took over as managing partner in 1987, Blank Rome was largely a Philadelphia regional firm with $44 million in revenue. In 2007, the firm had 492 attorneys, brought in $315 million in revenue and had expanded its presence to markets such as Washington, D.C., New York and Hong Kong.

Since Hoffman and Dyer stepped in, the firm has had its ups and downs, including shuttering its Hong Kong office, but has in recent years grown its revenue significantly and expanded its geographic reach to Houston, Los Angeles and Shanghai.

In 2009, the firm’s revenue grew 3 percent from $312 million to $322 million.

In 2010, the firm’s revenue dropped 3.4 percent from $322 million in 2009 to $311 million.
The following year, the firm’s revenue dropped by just half of 1 percent to $309.5 million.

But 2012 saw the firm surge forward in a big way, posting a 6.3 percent growth in revenue, from $309.5 million to $329 million.

Hoffman told The Legal on Monday that the challenges to managing a law firm changed a lot post-2008.

Gone are the days of annual rate increases and expansive office space, Hoffman said.

Today, leading a firm means trying to grow while simultaneously operating in a more efficient manner for the benefit of the clients.

“Our mantra has been ‘remain relevant to our clients,’” Hoffman said.

Buchanan Ingersoll

In June 2009, Pittsburgh-based Buchanan Ingersoll & Rooney’s chief diversity and integration officer, Jack Barbour, took over as CEO of the firm from Thomas L. VanKirk.

Under VanKirk, the firm grew from about 350 attorneys at the end of 2003 to more than 500 in 2007, and its gross revenue increased from $157 million in 2003 to $282 million in 2007.

VanKirk was heavily involved in orchestrating the firm’s merger with intellectual property boutique Burns, Doane, Swecker & Mathis in 2005, the acquisition of seven-attorney Alhadeff & Solar in San Diego in 2007 and the July 2006 merger with Klett Rooney Lieber & Schorling, which had brought Barbour to the firm.

Following the first full year under Barbour, the firm’s 2010 revenue was nearly flat, inching up $249.4 million in 2009 to $250 million.

But, in 2011, revenue rose 3 percent to $257.5 million and in 2012 was up 3.1 percent to $265.5 million.

Barbour could not be reached for comment Monday.

Zack Needles can be contacted at 215-557-2493 or zneedles@alm.com. Follow him on Twitter @ZNeedlesTLI. •