Lateral moves: How partners can succeed at switching law firms

As the global markets recover and law firms dust down their strategic growth plans, successful partners are finding themselves increasingly in demand. If a partner is feeling unappreciated or ambitious for more opportunities, it is easy to be seduced by an unexpected call from a headhunter into thinking about jumping ship.

From a management perspective, hiring partners from competitor firms is an obvious strategic response to low organic growth. It is also considered a sign of a firm's vitality and attractiveness in the market.

But, research shows that 32 per cent of lateral hires fail,¹ so the risks to both partners and firms need to be carefully weighed up when considering new opportunities. The financial and reputational rewards can be great, but many underestimate the emotional, practical and professional upheaval involved in partners making lateral moves to competitor firms.

Motivations to move

Making a move to another firm is a critical career decision. Once the flattery of the headhunter's call subsides, partners need to question their motivations for moving with rigour and honesty. Short-term issues within a partner's current firm can often be exaggerated or temporary and can usually be resolved. Partners need to ask themselves more long-term strategic questions to avoid pursuing options or taking decisions they may later regret.

Key questions include:

• Will my practice have a greater chance to develop in another firm?

• How will my career be enhanced by joining another firm?

• Who really owns my client relationships?

• How aligned am I to the strategic direction and values of the other firm?

• What will I miss most about leaving my current firm?

If the motivation is to earn more money or
a response to feeling undervalued, it is
even more important to ask wider questions. Financial rewards, along with the market profile that moving will bring, provide positive effects in the short term, but
longer-term career satisfaction will
come from other factors.

Due diligence

Making a lateral move should be approached in many ways like a commercial merger. Partners should draw up lists of the questions they need answering to evaluate the value created for them by moving to a new firm, just as they would evaluate a company looking to make an acquisition. Partners should not leave all the due diligence to the acquiring firm, but should play an active part in building the business case to join another firm and in checking
out important facts.

Key questions include:

• How do my skills and experience complement those of other partners?

• How supportive are other practice
  areas or offices to my appointment?

• What is the culture of the firm
  really like?

• Who will be my sponsors and
  how influential are they?

• What are the expectations of me in terms of billing and client relationships?

• What are the potential commercial
  and client conflicts and how will
  these be dealt with?

Partners need to meet as many partners from the new firm as possible, especially those they don't already know and those who are opinion formers or door-openers for client work. They need to satisfy themselves that there will be a coalition of support who will help them to succeed and with whom they instinctively feel they can work collaboratively.

Contractual issues

It's beholden on all partners considering a move to remind themselves of the terms of their partnership agreement with their current firm. These documents are usually signed in the congratulatory glow of being elected partner; the details surrounding leaving arrangements are understandably not usually a subject of focus at the time.

In particular, partners need to check their responsibilities for confidentiality in not sharing information with other firms and the details of any restrictive covenants, garden leave arrangements and notice periods.

Once a partner has decided to resign, they may be surprised to find how hardnosed their firm becomes in enforcing the terms of their contract, especially if the move is to a competitor firm. It pays to be open about contractual issues from the start of any conversations with headhunters and other firms to avoid any misunderstandings or difficulties later on.

Reaching a decision

Partners need to make a decision about whether they are prepared to move before an offer has been made from another firm. By the time an offer is on the table, there will be a lot of pressure to accept it and the new firm will want a rapid decision to avoid leaks outside the firm.

In reaching a decision, partners should ask themselves:

• Would I have joined this firm if they hadn't pursued me?

• What is the new firm offering that
  I can't achieve in my current firm?

• Where will I be in five years' time
  if I make this move?

• How prepared am I to deal with a potential loss of friends and clients?

It makes sense to ask people you trust
what they think about the firm you are thinking of joining, and, if appropriate,
to include some of your clients in your
decision making.

Partners should also prepare themselves for a buy-back situation in which their existing firm makes a counter-offer to persuade them to stay. This can be a difficult situation to deal with but, if the decision has been logically thought through, there should be no temptation to stay.

Experience shows that partners who do waiver and decide to stay usually find that the relationship with their firm is never the same again. Something fundamental changes in the relationship once partners show themselves capable of seriously contemplating a move.

Communication plan

Once the decision to leave the firm is made, things can move pretty quickly. Partners who have not moved firms before can find themselves caught by surprise by the need for a carefully-orchestrated communication plan and by the response from colleagues and friends.

It's worth preparing and rehearsing the rationale for your decision. Resigning is not easy, especially when a partner has spent their entire career at a firm and has a wide circle of friends and supporters. Presenting a coherent and consistent narrative for the career decision will avoid the conversation becoming bitter or acrimonious.

There will usually be a coordinated communications plan between the firms concerned, but partners on the move need to involve themselves in the messages being developed and in the timing of communications to internal and external contacts. There will always be people the partner will want to contact (and should be allowed to contact) personally. The sequence of who and how people hear the news is important to get right to sustain good relationships with team members, colleagues and clients, and to avoid
burning bridges.

Partners moving to other firms need to be enthusiastic about the opportunities the new firm provides while also thanking their existing firm for all its support. They should avoid any temptation to be negative about the firm they are leaving or to make barbed comments that may come back to haunt them. There will inevitably be a sense of betrayal amongst some colleagues. Partners need to brace themselves for damaged friendships and defensive behaviours
from formerly close colleagues and
team members.

Career transition

Joining a new firm is a major career transition and partners should prepare well by putting together their own induction plan. Turning up and expecting things either to be the same, or for everything to be done for you, will make integration more difficult. It can also result in doubts about the decision to move.

Partners often underestimate the frustrations of working with different billing, time recording and IT systems, along with the impact this can have on the time available to develop relationships with colleagues and clients. Getting to know key people in business services early on can help with this process enormously.

Whilst many partners prefer to take their trusted secretary with them to their new firm, asking for an experienced secretary from the new firm helps partners to find their way around the firm's systems, policies and politics more quickly. It is also a more positive sign to colleagues of the partner's desire to integrate into the practice team.

Similarly, if partners bring a team or individual associates with them, it is important to support the integration of those associates into the wider team. Laterally-hired partners should actively get to know a wide range of associates in their new firm and involve them in their client matters. They have a key role to play in cross-fertilising skills and experiences, and in making sure that associates have a positive experience in the changed team dynamics.

The first 90 days

Experience shows that laterals who take time to consider and plan how they will use their first 90 days in a firm integrate more quickly and successfully.²

Moving to a new firm is a big step and some partners arrive so anxious to deliver that they bury themselves in matters and business development. But, it pays to take time to build internal relationships. On joining a new firm, partners should listen and learn, meet as many partners as possible and show enthusiasm for what they plan to contribute to the firm. This will help to raise their profile and encourage other partners to refer work to them and involve them in matters.

Lateral partners can be surprised by the suspicion, resentment, indifference and curiosity that can variously greet them on joining a new firm. How partners behave in the recruitment process may change once the lateral is a new colleague. There is often the need for a charm offensive to be undertaken, especially if the new partner has joined the partnership on an enhanced reward package.

New lateral partners also need to spend time understanding the history of the firm, working out who the key influencers are and keeping an open mind about how things are done. There is nothing more annoying than new partners talking constantly about their old firm or making detrimental comparisons. Partners need to adopt the language of 'we', even when they still feel like an outsider.

In the short term, new partners should:

• meet with their practice leader to establish short-term objectives;

• ask their sponsors for a list of key partners to meet;

• identify a mentor from another
  practice area;

• get to know key people in business services;

• work with a wide range of associates;

• mentor highly-rated associates;

• introduce their clients to other partners;

• share their contacts widely;

• invite their clients to seminars and
  firm events;

• attend social events, partner meetings, associate drinks; and

• expect some form of debrief on
  their old firm.

Active integration

Once the initial honeymoon period is over, lateral partners need to develop a longer-term plan to integrate into their new firm. Transitioning clients to the new firm is a key part of this. Laterals need to invite their clients to meet other partners, to attend client events and, if appropriate, to meet the managing partner. Laterals can sometimes guard their client relationships closely to gain a sense of personal security, but their new firm will be looking to build wider relationships and new revenue streams. Partners who actively work on this are more quickly accepted by colleagues.

Laterals also need to check in regularly with their sponsors and practice leaders. In the first year or so, it pays to ask regularly how things are going to ensure expectations are being met and to pick up any issues on either side of the relationship.

Once laterals feel relatively established in their new firm, a deeper level of integration can be achieved by putting themselves forward for a role on a committee or a firmwide project. This widens knowledge and relationships and demonstrates a commitment to the wider firm. It can also renew a sense of excitement about the new firm after what can be a difficult first year.

Risks and rewards

It is not so long ago that being elected a partner in a firm meant a job for life. In today's world, it is increasingly likely that partners will find themselves at more than one firm during the course of their careers.

Partners need to understand that advancing their careers in this way will inevitably lead to some sense of loss in the short term. However, by planning their careers and making well thought-out strategic decisions, the longer term rewards and opportunities that greater mobility opens up are enormous.

Jill King is a consultant and the former global HR director at Linklaters
(www.jkinsights.co.uk)

References

1. See Lateral Partner Hiring and Integration for Law Firms, Mark Brandon, Managing Partner, 2013

2. See The First 90 days: Proven strategies for getting up to speed faster and smarter, Michael D. Watkins, Harvard Business Review Press, 2013