BALANCING COMPETENCE, CLIENT DEVELOPMENT, AND CULTURE IN SELECTING PARTNERS AT PROFESSIONAL SERVICE FIRMS

In the post-industrial economy, much of the current and future growth is with the professional service sector. Examples include consulting, law, accounting, advertising, entertainment, etc. Even software can be said to be more a service sector industry than a manufactured product.

From time to time, such firms find it useful to bring in senior level people in a partnership role. An inappropriate lateral hiring decision for a firm can be awkward and expensive.

When hiring laterally, there are three general expectations: (1) professional competence (2) ability to develop new clients or bring in an existing book of clients and (3) good fit with the existing or proposed firm culture. The ideal is to optimize all three variables. The worst case is to force yourself into thinking you have to make trade-offs. A middle ground is to work with all parties in achieving a reasonable balance between variables.

The typical situation within professional service firms is the following case:

Mullin Smith & Dale is a Worcester law firm that is seeking to hire Jane. She is a partner at another firm. Her area of expertise is intellectual property and she has an outstanding track record in servicing some of the most important biotechnology companies in Worcester County. Managing Partner David Mullin believes she can bring in a substantial book of business and increase the firm's visibility within the biotechnology community.

Mr. Mullin is concerned, however, that there is a clear lack of cultural fit. He has worked hard to create a warm, friendly, and cooperative atmosphere within the firm. She has a reputation of being anything but warm, friendly, and cooperative!

The partners are into a trade-off mind set where they begin to think that EITHER they get a rainmaker OR they get someone who would fit in with the firm culture.

The enclosed document is called the "Working Together Letter" because it is an attempt to clearly set forth expectations in all three areas so important to firms----competence, client development, and culture. It invites the person to respond and to focus on these critical issues.

Our client was the person seeking to be hired by the firm. Her initial response was one of anger. "How dare they write this to me!" We explained that this "Working Together Letter" was a tremendous gift. It put on the table all the key issues of concern. It gave her a forum for confronting these issues before she took the job. Finally, the letter allowed her to clearly see the firm's cultural values.

She responded to the Letter with a "Working Together Letter" of her own and the deal was consummated. She joined the firm as a partner two years ago and both parties are still pleased.

"Working Together Letters" work. We hope they work for your firm..

Jane Smith
123 Main Street
Boston, MA 12345

Dear Jane:

Confidential

SUBJECT: Working Together

All of us at Mullin Smith & Dale are enthusiastic about the possibility of you joining us. At this advanced stage of our discussions, I think it is important that both sides put on the table all issues--both positive and negative. My purpose in writing is to frame these issues under the categories of competence, client development, and culture.

I would appreciate your responding in writing or over the phone. In return, I hope that you put together a "Working Together" document for me, outlining where we stand on these three factors.

Competence

We have the greatest respect for your reputation within the Boston legal community. At some point, we would like to be able to speak with two or three of your clients. I view this request as appropriate "due diligence" on our part.

Client Development

For the sake of the record, I want to be explicit about client development issues. You mentioned that you are looking for a compensation of $X. It is our hope and expectation that under our compensation system you could make that and more! If you do not have reasonable expectations of generating 3.5 times $X in billable work and referral credits within eighteen months, both you and I will be disappointed.

I also want to be clear about our expectation in referral work. We think that you will be in a good position to refer work to us. We want to refer work to you as well. One of the first things we would do upon your arrival is to work out how together we can accomplish this mission. We want to make sure our client development plans are coordinated.

Culture

Jane, this is the area where I have the most concern. Most of our great strengths are also great weaknesses. I don't believe you are an exception to this general rule. Your great strength is your outstanding reputation as a tough, take-no-prisoners litigator. Your reputation also is that you bring that tough quality in your dealings within the firm.

We would like to think that our reputation is that of being collegial, caring, and sensitive to the needs of attorneys and non-attorneys who work with us and for us. We are excited about having you with us. But we are not going to change a professional environment we have spent years developing. Many of us left large Boston firms for the purposes of finding exactly the kind of culture we have at Mullin Smith & Dale

Is this type of firm you want? If so, we can offer it to you. If it is not, you will find yourself frustrated with us. And we will be frustrated with you.

*

As I said at the beginning of this letter, I wanted to put on the table all the issues that both sides need to look at. Competence, Clients, and Culture is a useful framework to discuss these issues. I welcome your response and how we measure on these three important variables.

Sincerely,

David Mullin Mullin, Smith & Dale

Dr. Laurence J. Stybel and Maryanne Peabody are co-founders of Stybel Peabody Lincolnshire, Boston's oldest consulting firm focusing on career effectiveness for senior executives and senior professionals. The readers of MASSACHUSETTS LAWYERS WEEKLY voted it the "Best retained search Firm" in 1996 and again in 1997. Clients include virtually every major high technology firm on Route 128, five of the six largest universities in New England, most of Eastern Massachusetts major health care systems, 49% of Boston's largest twenty five law firms, and 17% of New England's thrift institutions. They are also sponsors of the Board of Directors Resource Center at www.stybelpeabody.com. You can phone them at 617/371-2990.