“All happy law firms are alike; each unhappy law firm is unhappy in its own way.” Tolstoy wrote that. Or maybe it was Tolstoy’s lawyer. I forget.
Whoever wrote it, it’s wrong.
Unhappy law firms – and by unhappy, I mean the law firms where the partnership is fracturing – are often unhappy in similar ways and for similar reasons. I regularly do consultations with a couple of lawyers who are planning to open a firm together. It makes sense; starting a law firm is scary, and doing it with someone you like and trust feels like it helps mitigate the risk.
These new partnerships are often founded on the basis of friendship. It’s a natural instinct, but a misguided one. Law firm partnerships are more like marriages than friendships. You’ve got to be able to have hard conversations and resolve conflict that will stress test the strength of a partnership far more severely than most friendships will have to endure. Unless you’re friends with me. I’m not a walk in the park, I’m told.
When partnerships break, it can be brutal. What often feels like a dispassionate business decision to the departing partner, feels more like a betrayal to those staying behind. The similarities to going through a divorce are striking. But not all partnerships are doomed to break apart, and of those that do, most don’t need to have someone utter, “et tu, Brute?” with their last breath.
I’ve noticed four key traits that shared by both partnerships that endure and those that end productively and without drama.
- Build on Shared Values
Whether your firm values are articulated on motivational posters or are just baked into the way do business, it is important that the partners share core values. For example, if Partner A values using technology reducing overhead staffing costs so she can work less and earn more, but Partner B values loyalty to long-standing employees, there will inevitably be conflict over how the firm should spend money. It’s not important what the core values are, but partners who drastically different values will likely produce endless conflict.
- Talk about Money
Let’s get this out of the way. Talking about money is crass. Making it. Spending it. Saving it.
It’s one of those verboten topics that makes people uneasy. It is intensely personal, and a lot of emotional baggage gets bound up in the topic. But it is critical that partners be able to productively talk about money. Who is earning what in exchange for what and how that is going.
A lot of new partnership try to circumvent this difficult conversation by deciding that they will split all revenues and expenses equally. It’s a nice idea. I tried it myself for a short but memorably disastrous period of my career.
Almost inevitably, one person feels like they are working harder than the other and the equal division ideal breaks. My point, however, is not that dividing money equally in a law firm partnership should be avoided; rather, it is that whatever your partnership decides to do about money, you need to be able to discuss it in a productive, open way. And you should do so. Regularly.
- Resolve Conflict Sustainably
For a bunch of folks who resolve conflict professionally, we don’t always model the best behavior in our firms. Something about cobblers’ children and shoes comes to mind. After ensuring shared values and talking productively about money in a partnership, it is an unfortunate reality that some conflict is still going to arise.
(You want to spend how much a 4K monitor, Erik? What even is 4K?) Sorry, minor PTSD episode.
Like resolving conflict with your significant other, you need to be able to talk with your partners when you disagree – and that conversation has to leave everyone feeling respected and heard. This is hard, especially in the midst of long, stressful days. Powder kegs of old resentments never properly put to bed can explode at inopportune times and over inconsequential issues, and the results do nothing but hurt a firm’s productivity.
Take a clear, hard appraisal of your partnership’s track record at resolving internal conflict. Resist the urge to dismiss it as touchy-feely or unimportant. If you conclude that internal conflict resolution is not one of your strongest skills, then… hey, nobody is good at everything. Suck it up and call one of the many excellent members of the NCBA’s Dispute Resolution Section to help you out.
- Know When and Why to Call it Quits
Some problems are intractable. Some partnerships have a life cycle that lasts less than your entire career. There are times when the right move for everybody involved is to split up.
There’s a million possible things that might feel big and intractable enough to warrant leaving a partnership. I’d encourage you to use the first three items – shared values, talking productively about money, and focusing on resolving conflict well – as your touchstones in deciding. If you can’t look at your partnership and feel like you are either doing those three things well or working on doing them well, then maybe it’s time to explore other options.
It’s not the end of the world. It feels pretty bad at the time, particularly for the partners remaining behind, but ultimately everyone will benefit from getting into a work situation that is a better fit.
If it is time to go, try your best to have productive conversations about wrapping things up. And if you’re lucky, nobody mutters, “et tu, Brute?”
Erik Mazzone is the Director of the Center for Practice Management of the NCBA. He spends his days speaking, consulting and writing about law practice management and helping the CLE department dispose of their leftover lunches.