Five steps to making your lateral selection process work.
With the summer over, we can expect a run of lateral moves. This weeks ‘The Lawyer’ is reporting four major poachings and lateral raids. So below senior equity there will be even more movement.
Yet business statistics tell us that lateral hires have a high failure rate. Back in 2013, consultant Mark Brandon interviewed nearly 2,000 partners and found that 33% moved on within 3 years of a lateral move and 44% had gone within five years. The immediate impact of failure is financial, with recruitment time and search fees in excess of £100,000. Then there is the hidden costs of low morale, pressure on associates and market reputation.
So why do firms, who pride themselves on seeking evidence and facts, get it so very badly wrong?
The first answer is in the selection process. All too often lateral hire partners are sought to fill a painful gap rather than for strategic growth. That impacts on the decision and partners will supress their concerns in order to stop the pain of not having a partner in place. On top of this, the selection process is full of flaws including:
§ Focus on the clients and partners they bring rather than the person
§ Being swayed by promises of bringing significant clients. In reality, clients will often opt to stay with a firm rather than go through the upheaval of decoupling from a number of well-liked partners
§ Multiple interviews in which all partners ask the same questions and so effectively ‘coach’ the candidate
§ Failure to ask the candidate difficult questions about leadership style, personal mistakes, management approach which give indication of cultural fit
§ Failing to think through how the partner and their portfolio can be incorporated into the current team
§ Setting up unrealistic expectations – creating pressure all round
Put all of this together and you have a recipe for lateral loss.
So what should firms be doing to ensure they hire a partner for the future rather than a thorn in their side?
1. Select strategically. Panic hiring is rarely successful and so anticipate ahead. Yes, this means taking a risk which all lawyers hate, but it is less risky than a lateral loss.
2. Get a search consultant who plays a moral game and is not just working a database. A real professional will always get to know your firm, will vet the candidate list for fit and will never, ever search within your firm.
3. Profile. There are many psychometrics which are reliable indicators of how a person will behave and how their leadership style will manifest. Ensure you select a well-researched tool and use a qualified person to do the profiling. The few thousand you spend will likely save you in excess of £100k in a lateral mistake.
4. Ask the difficult questions. A nice get-to-know-you-chat is not an interview. Be prepared to ask the difficult questions. If your due diligence indicates that the person has a ‘reputation’ then ask about it. Better a difficult interview than an even more difficult discussion about the need to leave a year down the line.
5. Have a transition plan. Not a day learning about IT and markets, but a full, supported and supportive plan for pulling the partner into the partnership. Lawyers are resilient, but the stress of trying to prove yourself in a new and confusing environment is a fast track to failure.
Next month, deWinton-Williams will focus on the psychology of transition and how to avoid all the mistakes which make laterals so hard to love.