In a guest post, Aric Press, partner at the legal consultancy Bernero & Press and former editor-in-chief of The American Lawyer argues the path towards a high achieving culture in law firms turns out not to be money driven. It’s human nature, unleashed.
I’m invited to several law firm partner retreats each year, usually as a speaker about trends in the marketplace. Before I go to the podium, I often get to hear the annual state-of-the-firm address. (I’m the one, second row, stage right, listening carefully.) Recently, a couple of these talks have stayed with me.
They were notable for the fact that once the speakers finished their jokes, the rest of their remarks focused exclusively on the financial health of their firm. The only calls to action were exhortations to push harder to meet ambitious budget goals so that the highly compensated partners gathered in these rooms could be, well, a little better compensated. There was virtually no talk of professional excellence, improved client relations, or a larger mission for any of the firms. As the first President Bush once lamented, these moments called for a ‘vision thing.’ Instead, all the partners heard were cries for pumped-up balance sheets.
They were a poor substitute for inspiration. Not only did those cris de ledger represent a crabbed view of success and motivation, they also ignored remarks made last year by two distinguished observers of law firms. One came from Ashish Nanda, who now leads a prominent business school in India. While he was teaching at Harvard Law School, Nanda had published a very positive account of how Bingham McCutchen grew by absorbing once proud but somewhat distressed firms. After Bingham failed last year, my former colleagues at The American Lawyer asked Nanda for comment and he astutely pointed up the shortcomings of this strategy when the firm hit hard times. The promise of money, he said, ‘is a very weak glue.’
Couple that to what Robert Dell said in an interview with me late last year. Dell was reviewing a splendid twenty-year run as chair of the enormously successful Latham & Watkins. This year Latham not only topped the Am Law 100 gross revenue chart but the firm placed in the top twenty on profits per partner. So he knows how to make money but that’s not his goal. For him, it’s about building and maintaining the firm’s strong culture. Dell said that there’s an idea afoot that ‘culture’ is a code word for focusing on soft or emotional skills. Hardly, he said: ‘We think we have a high-performance culture. We work at that. That’s not soft.’
It’s not soft and it’s not easy and surely it’s not just about the money. Now, you can spend the rest of the decade researching high-performance cultures. A simple Google search for that three word phrase yields 382,000 references, many of them filled with impressive-looking charts and what Wikipedia likes to call ‘weasel words,’ highfalutin and ultimately useless descriptions. What Dell and the best of the business analysts are talking about is a culture in which the members agree on goals, strategy, and performance expectations, work collaboratively, and, by word and deed, care passionately about their work, their customers, and their colleagues. In such organizations, wealth is an important by-product not the end itself.
Another quality found in many of these cultures (I’d say all but I don’t know them all) is that they embody the lessons set out by Daniel Pink. He’s a Yale Law School graduate who has become the Malcolm Gladwell of business writers. Pink is a populariser with a gift for taking specialized academic research and converting it into lively descriptions of how the business world might work. He is nothing if not ambitious and iconoclastic. For example, his best-selling book Drive argues that in the new economy dominated by knowledge workers and service professionals, traditional top-down management is counter-productive. Carrots and sticks, he says, worked in the age of the assembly line where repetitive tasks were king. But in the new age where the coins of the realm are creativity and blinding insights—so-called ‘right brain’ behaviours—command and control leadership gets in the way. And, to come back to the beginning, that means that to produce better and more creative work, money-as-motivator doesn’t work.
Pink isn’t a fool. He recognizes that talented people, which is to say everyone, need to be paid what he calls ‘baseline rewards…the best use of money as a motivator is to pay people enough to take the issue of money off the table.’
Do that, he says, and then it’s time to turn to ‘the three elements’ that stimulate intrinsic motivation. Pink calls them: autonomy, mastery, and purpose. If those sound familiar it’s because at least in mythic terms those three qualities were present at the creation of the law firms that thrive today. Firms have always been businesses but they weren’t only businesses. And that’s what Pink, Dell, and Nanda are all saying.
There isn’t space or need here to elaborate fully on Pink’s work. For that, read his books or, if you have the time, dig deeper into the original research. The point is that great firms don’t just talk about money, don’t just measure financial achievements, and don’t just rely on points and profits to encourage behaviour. In Pink’s view, humans want more than that. They are driven, the research says, to tackle and master complex tasks and then work to get better. They need time and space to pursue their interests and, in the right settings, long to be part of something bigger than themselves.
Again, none of this is easy. Counting hours: that’s easy. And, there’s no single path to a high performance, Motivation 3.0 culture. There are only the path not taken and your path. The research is compelling and of course there is the evidence at the top of the profit charts too should some of your partners express scepticism.