Recently I gave a talk titled “Succession Planning: Why most firms should but don’t” and once again I am left with little doubt that succession is one of the most significant issues facing professional firms of all sizes and from all regions in Australia (and I suspect this maybe the case in the US and UK as well). As us Baby Boomers still hang in there for any number of reasons (some of which we outline in our paper), firms in my experience often choose to adopt one of 3 positions.
- Some firms take the ‘ostrich pose’ and simply avoid any impending succession issue, often until is too late and/or when it becomes someone else’s problem (e.g. any remaining partners or next of kin).
- Other firms-and an increasing number of them I am pleased to say- successfully deal with succession by planning for it and adopting any number of strategies some of which are mentioned in our paper.
- Then there is a third category of firm, whose leaders with all the best intents purport to plan for and deal with their succession issues but for some strange reason never quite succeed in pulling it off. This is often, but by no means exclusively, the case in first generation firms when the handing over of the baton is often fumbled or dropped and after the founding fathers leave or retire the firm becomes a shadow of its former self or worse still withers and dies.
In trying to work out why succession planning in this third category often fails, almost like manna from heaven, a recent blog from fellow Verasagi Michelle Golden* articulates far better than I could the problem-and suggests some solutions. In “The Apprentice Who Can’t Take Over The Practice”, Michelle looks at the traits of the successful partner on the one hand “a natural at marketing”, “an expert or niche practice specialist”, “recurring referrals from the same sources”, “meticulous about work” and “service quality, tight control of relationships” and those traits common to ‘the apprentice’, “highly valued right arm to partner”, “no book of business”, “full plate”, “non equity partner or forever manager or associate” and “subdued personality”.
So what’s the problem I hear you ask? Well as Michelle correctly points out, what is “frighteningly absent” is self-sufficiency on the part of the junior person. When the partner leaves or retires, things can start to unravel as the junior has not been taught and therefore has not learned the skills needed to successfully take over the reins.
In short, the traits Michelle identifies work well for both the partner and the junior, as well as for the firm and for the firm’s clients provided the two remain in their positions but as soon as one leaves, it all can fall apart pretty quickly.
Divine intervention for me did not end with Michelle’s blog. Jay Shepherd*, another fellow Verasagi, in his latest post at Above The Law, “Supervising Partners and Teaching Partners” adds to the reasons why succession does not always work. He highlights both the frustrations of a young lawyer as well as the roles a partner can play in contributing to or alleviating them - the ‘supervising partner’ again often being the source of much frustrations.
I strongly recommend you read both Blogs..There are some good anecdotes and advice from each but for me the following takes from each succinctly sum up why succession might not work in some firms:
- “The primary job of an associate is to learn how to someday be a partner”. If an associate is not working for a teaching partner, they are wasting their time.
- If you are the junior person: “Remember this as you progress in your career: its far better to get to the point where you bring in work that you don’t do than it is to always be doing work that you don't bring in”
- If you are the Partner: “seek out a strong worker who is also a people person. He might be harder to tame, but an entrepreneurial spirit will ensure the continuity of your practice”.
Sage advice for any firm likely to be in this position and wont most be at some stage? I guess the only exception might be those sole practitioners who choose to have no one in their employ they can consider anointing as their successors- so it is not going to ever be an issue for them anyway.
If you don’t plan for succession, don’t expect to have any future leaders to worry about. If you plan but don’t enable the apprentice to become the master, the art will be lost- as might be your firm.
*Michelle Golden & Jay Shepherd will both be visiting Australia in February 2012 as part of Firm of The Future program for professional firms. Jay was last in Australia in 2010 as the key note speaker at ALPMA Summit and now runs his own consulting business Prefix LLC. Michelle is also a consultant to professional firms and a Social Media guru, having recently published a best selling book Social Media Strategies for Professionals and their Firms