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The Legal Intelligencer The difference between success and failure in a law firm can very often be traced to how well four main factors of firm life bring out the energies and talents of its attorneys, namely: leadership, including policy determination and implementation; firm culture; attorney compensation system; and client base. In recent years, law firms have benefited from thoughtful strategic-planning retreats and research. While the success of many firms stems from the energy, skill and reputations of founding and second-generation partners, at some point the firm must establish an identity that transcends these partners and attracts clients because of its special capabilities. Firms that position themselves through strategic planning are simply operating like any well-run business in an intensely competitive market. The strategic planning process, if well conceived and implemented, will foster communication, create a sense of ownership and common direction to bind the firm, help it withstand adversity, and achieve longevity and success. It will also build emotional equity, in addition to financial equity. The strategic panning process allows firms to refocus on teamwork and investment in the long run, even though this investment may reduce short-run profits. Firms must recognize that they cannot build a long-term continuous stream of business in one year and that they are not static. Internal and external forces change law firms, i.e., key clients and influential partners may come and go, economic trends and public policies may change. The glue that holds partners together includes their agreement about those collective values and beliefs about client service; an understanding and commitment about the firm’s mission, direction and goals; and partner compensation levels that are competitive with those of peer firms. Formulating the Plan First, the managing partner, or management committee and other partners, must be committed to strategic planning and its implementation. Without this commitment, the strategic-planning process will be unsuccessful. Lawyer management should: Set the tone and methodology to encourage communications and participation from all attorneys; Determine what should be the strategic-planning process, even if the goal is as simple as getting all partners together for a weekend retreat for fun and interaction to help remind them of why they are practicing law together; Have the will and obtain the collective support of the partners to hold them accountable for their actions or inactions relating to developing and implementing strategic plans for the firm, their practice areas and themselves; and Decide whether to take a “top-down,” i.e., lawyer management performs strategic planning with input from the lawyers, or a “bottoms-up” approach for strategic planning, i.e., each practice area develops plans, with the firm’s strategic plan being the cumulative input from all of the various departments and offices . In the latter situation, department heads and practice group leaders, together with members of their departments/practice groups meet and set realistic and achievable goals, given the expertise, personnel, personalities and level of business in the firm. There are certain issues to be addressed during the strategic planning retreat or study, such as: The firm’s culture; The firm’s governance and management; The firm’s compensation system , i.e., does it encourage or discourage partners to perform those activities to address the firm’s immediate and longer-term needs; The firm’s competitive position in its marketplace; Those plans to be implemented by the firm and its practice areas to achieve the goals; and Reach a consensus about the process of implementing the plans, assessing the results and administering corrective actions. Many law firms have found that experienced law-office consultants can expedite the strategic-planning process. Being familiar with firm dynamics and the economics of law firms, they can analyze and interpret financial and management information and partners’ responses. They can recommend alternative approaches for achieving firm objectives. Further, partners are usually willing to discuss their perceptions about the firm and respond to questions more readily with consultants than with other partners. Drafting the Plan The next phase includes drafting objectives for presentation to the partners in each of the areas studied. The following is an abbreviated presentation of objectives and strategies prepared for one midsized law firm: We will be the dominant and pre-eminent, full-service law firm of first choice in the region, with a statewide reputation for competence and professionalism of the highest order. A sample of some strategic goals are: Goal 1: Create, implement and promote a streamline governance system that enjoys the confidence of everyone and allows us to anticipate and benefit from changes in the environment through prompt, skilled and coordinated decision making and action. Goal 2: Systematically recruit, retain and train high-caliber attorneys who will be successors and leaders for our firm. Goal 3: Systematically recruit, retain and train high-quality staff who will have universal knowledge and skills to serve flexibly in various functions. Goal 4: Adopt and implement a formal, coordinated staff feedback system, which will be used in a positive way to provide input and increase accountability. Goal 5: Develop and implement attorney and staff career development systems that emphasize personal and collective responsibility, and reflects a shared intensity and dedication. Goal 6: Implement a client feedback system that will provide input and increase accountability, assisting us in being the best service provider of any type used by our clients. Goal 7: Identify and develop plans for new specializations so that we will fully serve our clients. Goal 8: Identify, develop and expand strategic relationships with client, business and professional groups. Implementing the Plan The final benefit of strategic planning is when the plan is implemented. This is commonly the most difficult part of the strategic-planning process. It is recommended that the plan be implemented through the firm’s existing organizational structure, i.e., the managing partner, the strategic-planning committee, heads of substantive practice areas and branch offices, etc. Individual partners should be assigned responsibility and be held accountable for the development and satisfactory implementation of each phase of the plan in accordance with an agreed-upon timetable. Partners responsible for the implementation phase should report to the managing partner, strategic-planning committee or other group designated to oversee the planning process. Problems or progress should be reviewed and assessments made to determine the most appropriate strategies to be followed. Status reports should be provided to the other partners on progress or problems in each phase of the plan in order to keep them apprised. Conclusion Strategic planning is a dynamic process. If conceived properly and implemented effectively, it will provide information required for determining and achieving immediate and long-term goals. Joel A. Rose is a certified management consultant and president of Joel A. Rose & Associates, Cherry Hill, N.J., which consults to the legal profession. He can be reached via e-mail at [email protected].

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