Business plans are now an essential part of a lateral partner hire. In this TMG’s Take, Steve Nelson outlines the business plan changes that candidates should pay attention to.
In the mid-1980s, when lateral partner hiring became an accepted practice in the legal industry, we were one of the early champions of the legal business plan, and developed a methodology for drafting such plans. Since then, and particularly in recent years, drafting a business plan has become de rigueur for candidates seeking partner-level positions, particularly those coming out of government or in-house positions.
The basics of putting together a business plan have not changed. Those plans should primarily focus on the state of the market and why there is a need for a particular type of expertise, rather than a recitation of the candidate’s background. But due to the competitive nature of the lateral market and the increasing need for a relatively quick return on investment, we see the following changes:
- Law firms are now asking virtually all candidates, including partners with a book of business, for a business plan. Often this comes as a supplement to the due diligence questionnaires that are requested during the process.
- A growing number of law firms are now expecting their existing partners to put together a yearly business plan, so that they have both a framework for their client-focused activities for the upcoming year and a measuring stick on which they can be evaluated during year-end reviews. Indeed, we have been engaged by law firms to help selected lawyers draft such plans.
- There is an increased focus on tactics. Much of this is predicated upon the fact that the rise of social media has made it easier for lawyers to write articles, produce webinars, and to use Twitter and LinkedIn as part of their business development strategy.
- There is also an increased focus on a lawyer’s contacts. Again, because the pressure to produce revenues has increased dramatically, firms want to know that a candidate has some significant contacts that they can reach out to immediately. This often puts candidates in a quandary, as ethical concerns can raise significant issues about how much detail should be disclosed in writing. Our view is that candidates, particularly those coming out of government, should be discreet about actual names of people or companies, but should summarize the type and extent of their relationships. Once the process is further along, the candidate should be willing to disclose actual names in face-to-face discussions with the law firm.
- We see an increasing number of firms using the candidate’s initial draft as the first step in the development of a more formal document that is closely monitored during the lateral integration process.
Business plans are closely scrutinized as they offer a strong indication as to whether a partner-level candidate has what it takes to be successful in private practice. As a result, candidates should look at preparing these plans as an essential part of their strategy to land the right position in private practice.
The McCormick Group has recently updated its article, “Building a Better Mousetrap: A Model for a Lawyer’s Business Plan,” to incorporate some of the ideas discussed above. For a free copy, please contact Steve Nelson at firstname.lastname@example.org.
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.