Firms still confident of growth via laterals
Senior lawyers remain convinced that hiring partners is an effective way to build their firm's business despite concerns over the difficulty of finding and integrating promising candidates. The latest Big Question survey found that 64% of respondents believed hiring partners laterally was an effective means of strategically developing a law firm, including 15% who said it was 'very effective'. A further 32% felt it was 'quite effective' while 4% said it either did not work or was counterproductive.
March 10, 2011 at 07:26 AM
5 minute read
Despite scepticism about the role of recruiters and law firms' efforts to integrate new partners, a clear majority still put their faith in laterally-hired partners. Sofia Lind reports
Senior lawyers remain convinced that hiring partners is an effective way to build their firm's business despite concerns over the difficulty of finding and integrating promising candidates.
The latest Big Question survey found that 64% of respondents believed hiring partners laterally was an effective means of strategically developing a law firm, including 15% who said it was 'very effective'. A further 32% felt it was 'quite effective' while 4% said it either did not work or was counterproductive.
This finding comes despite 47% of respondents answering that the likelihood of transferring partners living up to expectations is only '50/50'. Just over a quarter (29%) said partner hires 'often' live up to billing, while a further 5% said such a result happens 'very often'. However, almost a fifth of respondents (19%) said it was unusual for such senior recruitment to work out.
Twenty-two percent of respondents also felt that their own firms were too focused on external recruitment at the expense of nurturing their own staff 'to a considerable extent'. A further 34% thought their firms were 'a little' too focused on recruitment over organic growth.
The poll, based on responses from more than 100 partners, also found a general lack of confidence in the ability and inclination of recruitment consultants to identify the right lateral partners for their business. Nearly one in two partners (48%) said they had very little or no confidence in recruiters in this regard, while 40% said they trusted recruiters 'a little' to find the right candidates. Twelve percent of respondents expressed a strong degree of confidence in recruiters.
The survey found law firms are much more confident in their own ability to identify, attract and retain the right candidates to build their businesses, with 9% saying they are 'good' or 'excellent' at finding strong partner candidates and 25% saying they are 'OK' at it.
Allen & Overy (A&O) senior partner David Morley said there was a role for partner recruitment but argued that the end goal was to not need to go outside your talent pool. He told Legal Week: "If you have an established franchise, the need to hire laterals is minimal. We make few lateral hires in London. We have a very strong pipeline of talent coming through in our key practice areas. However, when you want to grow in new markets and into new areas of expertise, you have to consider hiring laterals or other strategic options like mergers or alliances. Establishing new capacity through hiring laterals can be highly effective if you have a strong brand and you select and integrate with great care."
A&O uses a small number of recruitment agents which also help with the firm's pre-hire due diligence process.
Ashurst senior partner Charlie Geffen warned that hiring law firms should not be overly reliant on external consultants to vet potential partner candidates, commenting: "Although we do use recruitment consultants for searches and to make introductions, we tend to do our own due diligence in terms of lateral partner hiring."
He added: "We have only taken on lateral partners for strategic fit reasons – we would not take on a lateral solely to add revenue. We conducted some internal research with regards to lateral hiring and have found that this strategy has generally worked well for us."
The Big Question poll did find less confidence over law firms' efforts in integrating partner hires. Asked how structured their own firm's efforts to manage laterally recruited partners are, more than a third said 'not very' or 'not at all', while a further 43% said the process was merely 'OK'. Less than a quarter (23%) felt their firm had a strong process in place.
One firm that believes in the lateral growth strategy is SNR Denton, which has added 30 lateral partners globally since it was created by combination of Denton Wilde Sapte and US-based Sonnenschein Nath & Rosenthal last year. SNR Denton chief executive Elliott Portnoy commented: "Lateral hiring is a critical element of our growth strategy. When we set out on our expansive growth push some of our veterans were sceptical that it would be to the detriment of the existing practice but we have found instead that the new entrants have actually enriched our firm culture. There is a saying that rings true that 'the newly converted are the most evangelical'; these individuals have actually chosen SNR Denton as their home."
Partners on lateral recruitment
- 64% believe it is effective or very effective
- 48% have no or very little faith in recruiters' ability to find good candidates
- 34% believe partner hires usually live up to expectations
- 23% feel their firms have a strong process to monitor and integrate partner hires
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