How will your firm know if its strategy is working?

Although the process of developing a strategy is valuable in itself, clearly the main aim should be to ensure that the strategy is implemented and achieves the desired results. This does not mean that any strategy will provide you with a reliable blueprint that can be implemented in full. I have never been involved in developing any strategy that met that very rigorous test. However, a good strategy should provide a clear starting point for your firm’s evolution and be capable of being adapted in the light of experience so that it remains relevant and aspirational, yet achievable.

The first thing to do is to write the strategy down in a simple and communicable fashion. The choice of words is really important. No strategy can be implemented effectively unless all those concerned have a common understanding of what it is.

Spending a significant amount of time choosing the words you are going to use and testing them on others is thus a good investment. Words that can be understood equally well and in a common way in many different linguistic and cultural contexts will add a lot, especially if people from more than one country or with more than one linguistic or cultural background are members of the same firm.

A strategy is more likely to be implemented by those who feel they have shared in its development. Therefore, it is recommended that whatever you come up with is shared as a draft with a wide range of people before it is finalised. Ensure that your partners and other stakeholders feel that they have had some work to do in developing the strategy, rather than thinking they are just being presented with a fait accompli.

Remember that lawyers are not the only important people in law firms. Sharing the strategy with support staff and giving them a sense of ownership will also help with implementation. The same goes for clients and other stakeholders.

Good strategies should have clear, measurable targets. Where possible, these should be hard numbers. They can be checked when the strategy is adopted and re-checked every six months, for example, to see if progress is being made. The numbers concerned might include turnover, profit margin, number of clients, number of partners, number of staff, percentage of business derived from particular types of work, and so on. In order to ensure a level playing field, somebody reliable and impartial should be asked to generate all of the numbers involved on a consistent and regular basis (such as the finance director).

Allocate responsibility for each part of the strategy to a different person and make its implementation a key part of their responsibilities. Arrange a formal meeting with that person when the strategy is being implemented to agree with them what they are going to do, how they are going to do it and over what timescale in order to achieve the target they have been given. Record these discussions and share the results with the individual concerned.

Performance in this area should be considered in annual performance reviews. Also ensure that there are regular progress meetings in which the measures of performance are presented and agreed, and in which conclusions may be drawn about what should happen next.

It is essential that any strategy is pursued consistently over a long period of time (i.e. several years). If, during this period, it becomes necessary to change the strategy, that change should be articulated and explained clearly and all documents recording the strategy should be updated.

If the strategy is re-drawn after the first few years because it has not worked, it is extremely important that the reasons for the previous failure are fully understood and a significantly different approach is adopted the next time around.

Your colleagues and your staff will ignore future strategic planning activities that you seek to instigate if they feel that previous efforts in this field have been unrewarding. It is therefore recommended that each significant step during the normal management and development of your firm be tied to the relevant strategic objective, so that everyone can see how it is being driven by the strategy.

In order to avoid unnecessary confusion, if you end up doing something that is not aligned with the strategy, ensure that you explain to everyone that this particular thing was not envisaged in the strategy, and how you plan to adapt the strategy to accommodate it.

When assessing the success of your firm, make good use of external directories and rankings. A good strategy should result in your firm moving up the rankings. If that does not happen after a few years, it is important to step back and ask why not.

Stephen Denyer is the global markets partner at international law firm Allen & Overy (www.allenovery.com)

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