When Philadelphia's Kleinbard announced a succession plan two years ago, the firm opted to maintain its three-managing-partner structure while replacing its outgoing leaders on a staggered basis. The last of those three moves came to fruition just this year.

Matthew Haverstick was then announced as one of the three new managing partners, along with Michael Frattone and Mary Beth Gray, even though he wouldn't officially take on the role until 2020. Now that he has done so, Haverstick spoke with The Legal about the succession planning process at Kleinbard—which, he said, was in the works even before he joined the firm in 2015—and how the firm continues to plot a plan for the future.

Haverstick's answers were edited lightly for length. 

Coming into this role officially, two years after you were announced as an incoming managing partner, do you think you had a different perspective than the typical new law firm leader?

Absolutely. I understand that probably in many or most firms it isn't something that can happen. To the extent firms can do that they should. It really allowed me to be very thoughtful about the transition, about changes I needed to make to my practice, about [whether I was] living too far from the city. … [It allowed me to] ease into it in a way that has me ready for it, as ready as I can be, but that also kept my practice as strong as ever.

What's the biggest change in your practice?

I have had to stop being as involved in minutia as typically I would have been. I'm lucky. The core group of lawyers with which I work, and especially the two who came with me from Conrad O'Brien—Mark Seiberling and Joshua Voss—are excellent and have been growing into the roles to take over the things and the job tasks, either the client interactions or the actual hands-on stuff that happens at a high level. They've been working at that for years too. They've managed to do a transition as well in the past couple years. A couple years ago I would have done every appellate oral argument. I love doing them and that's just how we did things. That's not something I can do anymore.

Another unusual characteristic is that you've been with Kleinbard for less than five years. So often we see people in managing partner roles who have already been at their firm for decades. Does that change your approach at all?

Not really, but I think what it does do is make me be more mindful to understanding that Kleinbard is an 80-year-old firm. … It has a lot of history and a lot of tradition and I wasn't steeped in that background like Michael or Mary Beth or some of the other people there. I think I need to be particularly sensitive to Kleinbard's history as I'm thinking about its future, because I didn't absorb that by osmosis. … How am I going to manage going forward and be forward-thinking, and still be respectful of that?

We talked two years ago about how Kleinbard reworked its approach to leadership and succession planning, including staggering the start dates of the new managing partners. Has that been as effective as you'd hoped?

I wasn't here for the planning stages of this … so I can't say what the expectation was. I think it's worked out incredibly well. It's led to a gentle transition that's easier for the street, easier for the firm, easier for me, Michael and Mary Beth to take hold of, as opposed to three people riding off into the sunset and just handing us the keys.

I don't know if they intended it to work out as well as it did, but it really is in my estimation the right way to do a management transition. It certainly made me more comfortable going into it and informally watching and talking to Mary Beth and Michael as they started out. A lot easier to ask questions as the new guy when the person who's one newer than you hasn't been there that long, but [does have some experience].

In the last two years you had not only three managing partners, but two people preparing to take on that leadership. At a firm of Kleinbard's size it seems like a lot of cooks in the kitchen. Was that a problem?

We discussed whether three was the right number for the next iteration of management. And as much as anything it was personality-driven. Michael, Mary Beth and I all enjoy our practices and we don't want to sacrifice that aspect of the profession simply so we can become full-time managers. Having three of us allows us the ability to do both things. 

This way, I think the dynamic between the three of us plays to our strengths and ultimately that's good for the firm. Anyone who has done a deal with Michael knows he's the one you want running your operations at a law firm. Mary Beth in her [employee stock ownership plan] practice deals with difficult personalities all the time so she can easily handle the multiple interesting personalities and those dynamics at any law firm. And I'm outward facing—I like looking out and communicating with the world and I think I can be a good cheerleader for the firm. 

Now that all three of you are in place, how long do you expect to lead as a group of three before some new blood comes into the top leadership ranks?

One of the really progressive things about Kleinbard is, the firm really seems to get, and mean it, that we all have an effective shelf life. It doesn't mean we're done being good lawyers, but you need to have fresh thinking in management. We're all [in our] low 50s. I would imagine we go a decade or so and then think, "Are we now not as fresh anymore? And do we need new thinking?" I don't expect it to be a lifetime appointment, and I know Michael and Mary Beth don't. I don't think that's in anyone's best interest, and certainly not the firm's.

But not so short that you're already picking the next person?

No. I tend to plan in longer blocks of time. For some strategic or business development ideas I think in 18 months to three years, sometimes five years. This is a good exercise for me because I'm really thinking about the firm and its growth and roughing out, say, what it looks like in a decade.

And I know Mary Beth and Michael feel the same about it. All of us want to think really broadly about that, what do we want to be in the next decade?

What does Kleinbard look like in a decade? What about the Philadelphia legal community?

I continue to be convinced that Philly firms are going to get larger and larger and larger and there's going to be less and less room for a midsize firm—and by midsize I mean 150 to 200 lawyers. We've seen three significant mergers in Philadelphia in the last month. 

I think Kleinbard is at an optimal size right now. I think a firm like ours, that is on the border of being a midsize firm, but [large enough to deliver] very good legal work … at [an appropriate] price point—I think that's a successful model for us. If you creep head count up or infrastructure up for a firm like ours into the 60s, 70s, 80s, I just don't see a lot of room for a firm like that in Philadelphia. So the question is: How do we continue to add especially lateral talent without meaningfully increasing head count?

I'm hard-pressed to believe that the Philadelphia market can support a glut of 100-lawyer or low-hundred-lawyer firms. 

We've heard a number of stories recently about succession planning at midsize firms, both successes and failures. What's your advice to those firm leaders and strategists whose succession plans are still in the works?

Have a succession plan and give yourself years to implement it. One of the reasons I know Kleinbard has been so successful is there was a deliberate effort to put together a plan. They brought in consultants, they gave it a lot of thought, and they spent time and money putting together a plan. And then there was a genuine, meaningful commitment to doing it. It wasn't just a plan for the sake of saying you had a plan or it wasn't a plan that everyone thought was going to be abandoned anyway because one person was going to make a decision about who the next anointed person was.

Not everything was anticipated but really a lot of the issues that would come up in succession, at least at Kleinbard, were. And we were ready for the one or two things that came up. Certainly when we get ready to start thinking about succession, we're going to start thinking about it years before we're actually ready to really do it because I want to make sure we replicate the process the firm used last time around.

|

Read More

Kleinbard Plots Management Transition With Three New Leaders