Laterals can be a wonderful addition to a law firm. They can also be an incredibly expensive drain – financially, in terms of resources and with respect to morale. Here’s how to ensure your lateral hires can help rather than hurt your firm.
It’s said that laterals have around a 70% chance of surviving in a firm over five years. Of course, there are always those firms that refuse to admit an error and hold onto a lateral well beyond the realization that the fit is wrong, which would bring that success rate down even further. It’s also suggested that laterals will only retain 30% – 60% of the work they say will come with them, so firms need to be prepared to give up some of their existing work to keep the lateral afloat, at least for the first few years. And as lateral moves are the best way to get a raise (meaning firms are probably paying more than they should for these newest members of the firm), laterals can be lucrative for the moving lawyer and ultimately an expensive failure for the firm.
There’s no doubt that there’s a place for laterals in a firm’s business plan, and carefully hired they can be of tremendous and lasting benefit to the firm. Laterals can bring with them new clients, new referral relationships, more credibility to a practice area or industry group, new legal knowledge, a great mentoring source and potentially, leadership material for the firm.
However; in order for laterals to truly shine, you need to follow these three steps:
- Hire right;
- Integrate them properly; and
- Maintain them well.
The best way to support a lateral is to ensure you hire them correctly. Some firms hire laterals because they are dangling in front of them. A senior partner at a firm is approached by a colleague with an offer to make them an offer. The senior partner advises the firm they’d be crazy not to hire this lawyer. The firm contorts sufficiently to create the circumstances required for the hire. But there is very little guarantee that this hire will actually work out. They may be the best hire the firm has made in ten years, or it might be a cultural, logistical and financial nightmare. And these types of hires are very difficult to get out of.
Alternatively, the partners could have a gut sense that they should be looking for a particular type of lawyer. They look, they hire. Repeat last two sentences of previous paragraph.
Instead, look at your various practice group/industry group/client team plans. Look at your predictive modelling (for the next five years) of the various teams to see if any gaps exist or might be coming up due to retirements, moves to the bench, or simply the age and experience shift that happens over time. (I.e. a first year call in four years will be a mid-level associate that might be working toward partnership. You might need another junior by then). If you can train someone up from inside of the firm, all the better. But if there is an obvious gap that will need filling, at least now you have a sense of precisely what/who you need. Write up a job description, stating area of law, range of year of call, size of the book they would need to bring, how much the firm can feed them in the first two years (see below for explanation), the personality type that would fit in best with the various teams this lawyer would be part of, and any other qualities, requirements or characteristics desired. Advertise (internally and external) for the position. As candidates arise, gauge them against your job description. In other words, look for a candidate that fits the needs of the firm. Don’t adjust the firm to fit the candidate before you.
Integrate them Properly
Too often, lawyers enter the firm and are expected to immediately fit in and be productive. That simply isn’t realistic. You need to set the stage for their entrance, and support them carefully in their early days.
- Before they arrive, ensure their office, technology, marketing, passwords and assistant(s) are all set-up.
- A lateral will bring a book of business but it is NEVER enough to keep them busy. The firm will have to guarantee to provide them with a certain amount of work – at least initially. In preparation for this, create a formal list, ensure client relationship partners are on-side with this work distribution, and have a plan in place for making introductions and getting the lateral up and running on these files as quickly as possible.
- Plan out their first week which should include introductions to lawyers they’ll work most closely with, various admin and tech training, and invite them to team meetings to introduce them to the members and for them to learn more about the firm’s capabilities in those areas. A lateral partner may already have some work to do and client meetings to deal with in that week as well, so ensure you coordinate all other meetings and training around those.
- Provide the lateral with access to your marketing person (or a coach) for the purpose of developing a personal marketing plan. It will begin with notification to all of their clients and contacts of their change of firm. It will also likely include a plan for how to introduce the lateral to the clients the firm will be giving them.
- Have a lawyer inside the firm responsible for integration and support of the lateral. This lawyer should meet with the lateral initially and oversee their in-take into the firm. This lawyer should then meet with the lateral regularly (monthly) to see how things are going, and generally be available for any questions or issues that might arise.
Maintain them Well
The integration period should last about six months. Thereafter the new lawyer should know the ropes, the firm, and have their work in order. Now they are in maintenance mode. The firm should check in the with lawyer quarterly to ensure they still have a plan, are successfully working that plan, and have a sense of what the lawyer is doing. It doesn’t hurt to check in with team members – informally – at the six-month to one-year mark to see how things are going with the new lawyer. The firm should also be monitoring the new lawyer’s financials on a monthly basis and raising any concerns with the lawyer who was assigned to integrate the lateral.
If the lateral is a senior lawyer, ensure that the firm has set aside some funds to support their marketing. Check in with the lawyer at six months to ensure they are satisfied with their technology, their assistant, etc.
Partners often do more research on buying a new car than they do on hiring a lateral – yet ultimately a lateral is a far more expensive purchase and can have more positive (and negative) impact on the business than purchase of a vehicle. The decision to hire a lateral, and which lateral to hire, should be approached with care and thought. Once hired, the lateral should be properly supported and closely monitored.
This is an important investment. You expect a car to depreciate the minute you drive it off the lot. With a lateral, you expect them to significantly increase in value on an annual basis. The chances of that happening are far better if you hire them well and nurture them well right from the beginning.
Heather Gray-Grant is a business strategist, marketing expert and executive coach for law firms and lawyers. She can be reached at email@example.com