THE AMPERSAND
Dear Friends and Colleagues,
Welcome to Fall. Here’s how my September ended. After a near perfect weekend in Fernie with the family, we decided to stay for dinner and drive back to Calgary later than normal. Travelling north on highway 22 and then east on highway 540, we saw a full moon rise, the northern lights appear and a lonely tractor bringing in the crop. I felt as though we were driving through one of those Travel Alberta television commercials. It was pretty spectacular, I must say.
The leaves aren’t the only thing changing in downtown Calgary these days. Change is afoot at many law firms as well. While in-house legal departments continue to hire steadily, wooing (without much woo) some of the best and brightest into corporate jobs, the law firms are experiencing continued high turn-over at the junior ranks and arguably not enough of it at the senior-most end.
Most big firms have accepted the reality that notwithstanding great professional development programs, expensive retreats, caring mentorship plans, cutting-edge diversity initiatives and all the free pop you can drink, only about one-in-ten articling students will make it to partnership. I could, and may, write a book on the reasons why. In one line, to borrow from the old car commercial, this is not your father’s Oldsmobile. Partnership is not the brass ring it was a generation ago. The traditional support systems at home aren’t in place like they once were and the stigmas around lawyers who go in-house are long gone. Add to this that young lawyers can leave a firm four, five, six, ten years into practice, go in-house, work predictable hours, make good money, get free parking, more time off and a pension. It’s not a fair fight.
At the other end of the org chart, firms continue to struggle with long-serving partners, be they equity or income partners (a topic for another day) either too indelicately forcing out careers full of institutional memory and goodwill or allowing under-performers to take out more than they contribute without finding other tangible off-sets to add value. See below, “What Are The Obligations of Partners in 2012 and Beyond?” for more on this. Point is, the challenge remains to balance the need for a smooth transition from one generation to the next, respecting the previous one while motivating the next. Not easy.
Interestingly, what drives so many of these issues is the unavoidable reality that law firms sell time and there’s only so much of it that can be sold at an hourly rate to cover the overhead. All that free pop adds up. Left with pressure to maximize per partner profits, the older group that won’t leave fast enough either gets a nudge and leaves or doesn’t and hangs around too long and the younger group that wants more, now, either gets it and is left wondering, “Is this it?” or gives up and seeks oxygen elsewhere. It’s complicated. It’s also not entirely new. These issues have been around for a long time. They are simply exacerbated more now than before because of the pressure on the economics of the world in general and on law firms in particular. Watch for firms to improve margin, not by raising rates or finding more hours, but by cutting fat, downsizing and merging.
On a lighter note, we are pleased to once again serve as a Gold Level Sponsor for the upcoming Candy Cane Gala in support of the Alberta Children’s Hospital. Please click here to see a complete list of sponsors.
Enjoy October. If the forecast is to be believed, our amazing run of weather is about to end with a thud.
Regards,
Adam
Biking in Fernie with my 5 year old on a perfect fall day.
What are the Obligations of Partners in 2012 and Beyond?
By: Thomas S. Clay
Article Link: www.altmanweil.com
“Partners who do not consistently achieve the required level of contribution should be relegated to a status other than equity ownership.” When I made this statement before a group of managing partners, one said, “Isn’t that awfully harsh?” My response was, “It may seem harsh but it is eminently fair. It is not fair to have some owners contributing in all the ways that sustain the health and vitality of the organization while others choose (independently) not to do so. If they are making that choice, then the organization has the right, and possibly the duty, to require those partners to suffer the consequences. Living up to one’s obligations is ultimately about fairness among owners.” [Read more]
Changes and Challenges
By: Gail J. Cohen
Article Link: www.canadianlawyermag.com
Economic changes over the last few years have had a dramatic impact on the practice of law in Canada and abroad. Old ways of doing business do not work anymore and the industry is being forced to make substantial structural changes. Canada still lags behind many countries in reassessing the way the legal profession is regulated, continuing, some may argue, to be a self-regulated monopoly that enriches practitioners while acting as a barrier to access to justice. [Read more]
Art of the Deal: What is it Really Like Working on an Energy Deal?
By: Marzena Czarnecka
Article Link: www.lexpert.ca
They tell you about deals like this in law school. Textbook, they call them — the deals that unfold just the way they should…And then they tell you that this is theory, and that in real life a deal will never play out like this.
Except that, Virginia, there is a Santa Claus, and everything on a deal can go right. All you need is an experienced buyer that knows exactly what it wants (and what it’s willing to pay for the goods), a prepared target that knows what it’s worth (and what it’s willing to give up), management teams that hit it off even when engaging in hardball negotiation, boards that know what fiduciary duty means, and financial and legal advisors who go the distance. [Read more]
The Inner Workings Exposed
By: Gail J. Cohen
Article Link: www.canadianlawyermag.com
For this month’s cover story, we convened a panel of experts on law firm management with representatives from firms of different shapes and sizes as well as lawyers and non-lawyers. We gathered in Toronto in late June to discuss the hottest topics — vexing issues, even — on the minds of law firm leaders. Some of them resonated across all the firms, including that of transparency within the firm. Law firms are partnerships and one thing everyone at the table agreed on was the need for openness, particularly the sharing of financial information and strategies. That doesn’t mean everyone has to know how much everyone else makes, but being open about how it works so everyone from articling students to senior partners feel they understand the system, where they fit into it, and what to expect. [Read more]
Law in the Global Marketplace
By: Yves Faguy
Article Link: www.nationalmagazine.ca
For better or for worse, the practice of law isn’t what it used to be.
It isn’t what they typically prepare you for in law school, but the market for legal services is undergoing a sea change. Of course it’s impossible to say with any degree of accuracy what the legal marketplace will look like in 10 years. But this much you can expect: It will be significantly different than it is today. [Read more]
Business Development Should be Fun
By: Lindsay Scott
Article Link: www.canadianlawyermag.com
Working as a new lawyer is hard enough without having to strategize about developing business. The good news, I’m told, is business development should be fun or you’re not doing it right.
Sometimes referred to as a “soft skill,” a lawyer’s ability to build a professional network and bring in (and keep) clients is critical to his or her success in private practice. I spoke with several senior lawyers this month to gain advice on how new lawyers can start developing business in a way that is natural and, ideally, enjoyable. [Read more]
What Lawyers Really Wish They had Been Taught in Law School
By: Sandra Rubin
Article Link: www.lexpert.ca
Ask a random group of lawyers what they wish they had been taught in law school, you’d be surprised just how random the answers are.
As law students everywhere wrestle with the ins and outs of contract law, criminal law, constitutional law and civil procedure, law school graduates say they could have used a healthy dose of another C-subject: common sense practical skills. [Read more]
Canadian Law Firms Ease into Ad Waters
By: Jeff Gray
Article LInk: www.theglobeandmail.com
The ad begins with a scene of a slender 40-year-old woman being lifted out of her wheelchair and strapped into a rowing scull.
As her oars cut into the sun-dappled water, her voiceover tells her story in edited fragments. She once loved water skiing, sailing and scuba diving. But then her car skidded off the road, and rolled five times. [Read more]
