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How To Make Unproductive Law Partners Productive Again

One of the early signs regarding one or more partners who have made a conscious (or sometimes unconscious) decision to "slow down" can be found by reviewing the monthly productivity reports. A reduction in billable hours recorded is usually the first sign that a partner is making a lifestyle change. Of course, it is important to analyze this phenomenon over a period of several months to be sure that some temporary problem(s) is not occurring which has a relatively simple short term solution.

Some people are unable to deal with a basic lifestyle change and will not inform even their closest business associates about their plans. These individuals will simply start coming into the office a little later, take longer lunch hours and leave earlier at the end of the work day. In their minds, they have not made a fundamental change in their commitment to the firm regarding their work ethic. They just want to "relax a little" and "take time to smell the flowers". Since they come to the office everyday and continue to carry a client caseload, they rationalize to themselves that they are fully productive and deserve full compensation and staff support for their effort.

A Definite Decision

We need to differentiate between the partner who makes a conscious decision to reduce his work output vs the alternative partner who simply rationalizes his reduced effort. Dealing with each of these partners is fundamentally different and requires a variety of management expertise.

When a partner decides to slow down his productive effort and communicates that decision to firm management, the resulting action alternatives are pretty clear and straightforward. Management must do at least the following:

  1. Examine historical productivity reports for the past two or three years, including both billable and non-billable time;

  2. Meet with the partner and discuss the partner's plans for the future;

  3. Establish some form of agreement whereby the partner can work less and receive a pro-rata reduction in compensation share;

  4. Define the specific details of the working relationship, including the level of support staff to be provided; the length of time of the agreement; the effect of the new relationship on firm benefits; participation in firm management, if any, including change in voting status; and other related issues;

  5. Reduce the agreement in items 3 and 4 above to writing, and have all applicable parties to the agreement execute it; It is extremely important for all parties to clarify each issue in as much detail as possible, to avoid misunderstanding and possible bad feelings at a later date. Written communication of the agreement(s) is paramount, especially requiring all parties to sign the documents.

Another Alternative - No Stated Decision

Many, many problems have occurred during the past several years in firms where one or more partners has simply reduced his contribution to the life of the firm without telling anyone his intentions. In several cases, the partner himself did not make a conscious decision to "slow down" or to spend less time on client matters. It was simply something that evolved and gradually became reality.

Firm management must be alert to this potential problem by regular analysis of the productivity reports for each timekeeper. It is not nearly enough for other partners to become uncomfortable with one of their own, who is perceived to be slowing down. It is the direct responsibility of firm management to spot the trend(s) and identify potential problems before they become irritating and troublesome to the partnership at large.

When a potential problem regarding a less than totally productivity partner has been identified, what should management do to solve it?

  1. Consider the use of a peer review program, to get the collective input of several other partners on this delicate subject;

  2. Appoint a special ad hoc committee to meet with the partner(s) to solicit reasons, feelings, lifestyle changes and other possible issues that may be impacting the subject partner;

  3. Consider the goals and future plans of the partner in relationship to the needs of the firm;

  4. Establish a specific program which is mutually acceptable to the partner and to the firm similar to the agreement proposed in earlier paragraphs;

  5. If the partner is unwilling to accept a pro-rata reduction in compensation and benefits due to his reduced contribution to the revenues of the firm, then firm management must make the difficult decision regarding possible termination of the recalcitrant partner;

  6. If the decision in item 5 above is made, it is extremely important to document oral agreements, conversations and final decisions to avoid potential litigation and unfavorable publicity for all concerned parties;

Another Alternative

Partners who have been identified under either one of the two previous scenarios do not have to be terminated nor do they need to be lost in the sometimes bureaucratic spasms of management. En- lightened managers of well managed law firms have developed several methods for "recycling" previously unproductive partners.

Some suggestions that have proven useful include:

  1. Utilizing the business potential maturity of the partner to allow more time on specific target marketing activities without a concurrent demand for minimum billable hours;

  2. Assigning internal training of associates and paralegals to a mature/experienced partner to utilize that client expertise and many years of "battlefield know-how";

  3. Evaluating the management potential of the partner to determine whether or not full-time management responsibility would not be the most productive use of the partner's future effort;

Summary

It appears all too often that many firms take the so-called easy way out of a situation when one or more partners is diagnosed as "unproductive". That solution is simply to ask the partner to leave or, at a minimum, to accept sharply reduced compensation and related benefits because of a perceived lack of acceptable productivity.

A key issue here is to clearly define what productivity really means to the specific firm. An optimum partner compensation system has two major components to be continually successful:

  1. It must be perceived to be fair by all participants;

  2. Total contribution of each participant must be considered when compensation decision are made;
Therefore, all productivity including both quantity and quality of non-billable time must be considered along with billable, billed and collected time as management decisions are made. It is imperative that firm management collect, analyze and evaluate all avail- able information, both objective and subjective, as decisions are considered regarding "less productive" partners.

If all of the above considerations are seriously evaluated, the problem of the unproductive partner can largely be eliminated. Serious desire on the part of firm management is all that is required for implementing a successful program.




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