Succession planning has been a relevant, if somewhat disconcerting and avoided, topic for a number of years.
In August 2016, The American Lawyer magazine devoted an entire issue to it. Author Julie Triedman found the trend and the risk it poses so prevalent she gave it a name: The Graying of the Am Law 200. The underlying phenomenon, the aging out of the current generation of traditional rainmakers, is set to ripple across law firms of all sizes and specialties.
On the eve of 2018, things haven’t changed much. Now, AmLaw’s Meghan Tribe has some new data to offer. According to Tribe, “this lack of planning has hit law firms right where it counts most: their pockets. The study found that 52 percent of law firm leaders said they lost at least a quarter of a retiring partner’s book of business on average when they left the firm.”
Even more revealing are additional findings on why this business is leaving. The article goes on to say that 49 percent of those respondents who said they didn’t have a plan in place for client team leadership said this was because they had “difficulty identifying successors” and “faced resistance from senior partners”.
TMG has taken a deeper look at why, even in the face of this kind of potential hit to revenues, some firms are still reluctant to undertake succession planning. Each reason is understandable, but each acts as a barrier that only makes it more likely that with no plan in place, revenue will eventually walk out the door.
TMG’s Take is a regular e-mail advisory produced by The McCormick Group. The company’s Legal, Government Affairs, and Law Firm Management groups combine the expertise of more than 15 Consultants to help law firms fulfill all of their lawyer and administrative recruiting needs. TMG’s Take covers topics across the spectrum of law firm management, including associate and partner compensation, growth strategies, marketing and business development, operations and facilities management, finance and accounting, professional development, and technology. Please direct all inquiries to Steve Nelson, Managing Principal at (703) 841-1700 or email@example.com.