Over the three previous years, gross revenue declined, from $376.5 million in 2011 to $352.5 million in 2014, according to Am Law 100 data.
“We may have been a little bit slow to focus on how entrepreneurial we need to be,” he said. “Our lawyers didn’t need very long to realize that sitting on our reputation is not enough.”
West also emphasized how the firm encouraged some attorneys to move on.
“We don’t walk around chopping heads. We don’t have layoffs. But we want to make sure everyone is as successful as possible,” he said, which includes “finding the best places where they can be successful.”
For instance, this year, as the firm embarks on a top-to-bottom office renovation of its Washington headquarters, about half of 40 senior partners will retire or will give up their offices in exchange for temporary “hoteling” work spaces, the firm said.
Head count decreased on all fronts at Steptoe in 2015. The number of lawyers declined from 385 in 2014 to 374 in 2015. The equity partnership decreased by three, to 125 full-time positions. The firm has no nonequity partner class, according to the Am Law numbers.
Lateral moves have created some profit opportunities for Steptoe, West said. He gave an example: Toxic tort lawyer and former Los Angeles office managing partner Lawrence Riff became a superior court judge in Los Angeles County last year. This allowed the firm to bring in an eight-partner litigation and toxic tort team in Chicago, led by Robert Shuftan, formerly of Edwards Wildman Palmer.
“The question is: Can we use that opportunity to make that [practice] more profitable?” West said. “A lot of Riff’s team is still here and is part of the new reality.”
The firm also brought on a group of hybrid lobbyist-lawyers from Squire Patton Boggs who specialize in financial services. The group is led by Micah Green, now a co-chairman of Steptoe’s public policy group.
On the staff side, the firm added a chief pricing officer position. Linda Novosel joined the firm after working for about one year at Paul, Weiss, Rifkind, Wharton & Garrison as strategic pricing director.
The firm also passed the leadership of its diversity initiatives from “icon and legend” Sandy Chamblee, who retired, to partner Markham Erickson, whom she hand-picked as her successor, West said.
“To be honest with you, we are not where we want to be in terms of the diversity of our lawyer workforce,” West said. The firm has promoted to the partnership female lawyers, a black lawyer and an LGBT lawyer among its seven new partners in the past two years, he said. West said the focus now is on developing and retaining minority lawyers.
“It’s too early to say if ’15 shows what a smashing success it is,” West said of the overall changes he’s ushered to the firm. “But I think it’s not too early to say these changes are making a difference.”
