The legal industry has seen a spate of law firm mergers for the past several years. In 2004 and 2005, there were almost 100 mergers (47 and 49 respectively), and there have been about a dozen so far in 2006. Law firm leaders merge firms because they hope the combination will produce business synergies and economic advantages. The impact of the merger on the work, performance and careers of the lawyers who are affected by it is not the primary focus of their attention - even though the success of the merger depends on the buy-in and cooperation of these lawyers. Lawyers' work experience, performance management, and career concerns are, however, at the heart of what professional development (PD) leaders do. Involving PD early in the merger process, and making them essential members of the post-merger integration team, will facilitate the lawyers' integration and the merger's ultimate success.
It is well known that most corporate mergers fail to produce the desired benefits that led to the merger in the first place. In large part, the success or failure of a merger depends on how the post-merger integration process is handled. This is especially true in law firms. The merger cannot succeed unless the newly merged firm can marshal the collective efforts and productivity of the lawyers in both legacy firms. But mergers cause considerable change, and lawyers feel uncertain and afraid of how the change will affect their lives. Leaders of the newly merged entity must reassure and persuade them that the changes will be to their benefit. But it is difficult to manage change in a law firm in the best of circumstances, and it is especially so in what David Maister calls the "tense political drama" of a merger.
Professional development leaders can be instrumental in leading this change effort. They are uniquely equipped and positioned to help integrate lawyers from both legacy firms into the new entity. Because they deal with lawyers' performance, development and retention, PD leaders are acutely sensitive to lawyers' needs and concerns. They focus on the professional experience of lawyers, including work assignments, performance management, mentoring and training, and understand what lawyers need in order to do their work and feel engaged. PD leaders' responsibilities - and therefore, their perspectives - span across offices and practice groups. They are dedicated to improving lawyers' everyday learning and long-term careers. This engenders the kind of trust that leaders need to achieve a successful merger.
Pre-Merger Involvement of Professional Development Leaders
PD leaders should become strategic partners in the merger process as soon as it appears more likely than not that a merger will occur. They should be involved in preliminary merger discussions in order to understand what the new entity's core strategy will be, decide how that strategy will be implemented, and provide insights that may impact the shape and feasibility of the strategy. The more time the merging firms have to plan in advance, the more smoothly and rapidly they will be able integrate into a unified new entity, ready to pursue the merger's hoped-for benefits.
PD can add value during the early stages of the merger process in many ways:
Many law firm partners work extremely hard to effectuate the merger. Then, when the merger is announced, they breathe a sigh of relief and assume the work is done. In fact, this is when their hard work really starts. Now they will have to persuade and motivate skeptical, anxious lawyers from two separate firms to work together and trust each other as colleagues in a single new entity. In particular, the first few weeks after the merger is a critical period in which trust- and relationship-building must take place. This requires that law firm leaders exhibit high emotional intelligence, especially the ability to empathize with and address lawyers' fears, concerns, and objections.
Leaders from both legacy firms, and especially leaders of the new entity, should be prominent, visible, accessible, and diplomatic. They should welcome - in person - as many of the lawyers in as many offices as possible. They should transmit the new firm's values and avoid or overcome the "us vs. them" or "winner/loser" mentality that sometimes accompanies a merger, especially if one of the legacy firms becomes dominant in the merged firm. They have to be able to answer questions that worry these lawyers. For instance, if the legacy firms have different billable hour requirements, compensation structures, or paths toward partnership, what will the expectations be for associates in the new firm?
While partners who handled the merger negotiations may understand the significance, synergies, and promises expected from the newly combined firm, to other lawyers the picture is not so clear. Those lawyers who were not privy to the merger negotiations may not be inspired by the new partnership's "grand vision." They need to hear candid, reassuring and inspiring explanations from law firm leaders whom they trust. Professional development personnel can support law firm leaders by arranging specialized training or coaching in presentation and communication skills for them. They can also be such leaders themselves.
Frequently, PD leaders are the first firm personnel sent to offices of the newly joined firm as "traveling ambassadors." They are well suited for this role because they usually know most of the lawyers in their own firm and sponsor activities that are designed to welcome lawyers from the other firm. PD leaders are often charged with coordinating and supporting office and practice group integration efforts. They conduct PD programs, such as mentoring and training workshops, that bring lawyers from the legacy firms together as equals. PD efforts can also promote communication throughout the firm about the merger's progress through PD events, publications, and the PD page on the intranet.
It is a good idea for PD personnel to survey the concerns and expectations of the firm's lawyers. The questions to ask might include: What do you like about your old firm's way of doing things? What are you glad to leave behind? What have you heard about the culture or practices of the firm you are merging with? What worries you about what you have heard? What are you looking forward to? Answers to such questions can yield valuable information that might otherwise be overlooked by the planning team, as well as concerns that need to be addressed promptly.
The implementation process should be monitored as it moves along. Mergers are full of unexpected surprises. The PD leader can make sure that the firm is kept apprised of any problems and challenges that come up, and that systems are in place to address them. For instance, both legacy firms may pride themselves on having good partner-associate communication. But the information given to associates, topics that can be discussed, and level of candor deemed acceptable between partners and associates may be extremely different in both firms. This may create misunderstandings or negative reactions. Personnel who are on the alert for such flash points, or are available for managing conflicts, can prevent such misunderstandings from occurring or escalating.
Impact of the Merger on the Professional Development Team
One immediate question for the new firm will be who will have responsibility for professional development. If only one of the merging firms has a professional development director, the answer may be easy. If, however, there are PD directors in both firms, the new firm will have to choose a leader for the group and make decisions about staffing and operations of the PD function. This may mean that some people lose their jobs, others are promoted, and many will see their jobs change. The whole structure of the PD function may be reorganized. PD managers who have been autonomous may suddenly have to report to a new director in a distant office.
One of the first challenges for the new PD team will be to overcome political, cultural, operational, and geographic hurdles in order to work together collaboratively. The role of the PD team in the combined firm and the functions, systems, and programs for which PD personnel will be responsible, should be determined as quickly as possible. Among the issues the new team will have to deal with are the following:
Many of the considerations for making mergers run smoothly also apply when a law firm acquires a group of lawyers. Failure to plan for integrating new lawyers can undermine the ability of those lateral lawyers to become productive, happy and profitable citizens of their new firm.
A large firm I worked with acquired a group of lawyers from another firm. Because of space constraints, these lawyers were given offices near each other on one floor - but that floor housed administrative personnel and was not near the floors where other lawyers had their offices. This was a temporary arrangement and lasted only six weeks, but it slowed the integration of the lawyers into the firm.
In addition, the firm initially neglected to incorporate the lateral lawyers into its work and culture. At first, the lateral lawyers were very busy on matters they brought with them from their prior firm. They worked with each other and not with others in the firm. Later, when they started to work with other firm lawyers, problems arose because the laterals approached work and team members "the way we did it in our old firm," which was different from what the new firm expected. They acted like a separate "firm within a firm." They kept together at firm events - when they went at all. And because they failed to form alliances and build relationships with the new firm's partners and managers, much of the client support that they had been promised failed to materialize.
A few simple steps - even though they were late - remedied much of the conflict. Those steps included:
Matching mentors and mentees in a mentoring program requires substantial effort and discernment. Many law firm mentoring programs match people who they think will get along. But matching people because they have compatible personalities does not promote the developmental purposes of most mentoring programs. Firms should seek matches that will promote the program's goals of furthering the learning and career advancement of mentees.
Here are some suggested approaches that increase the chance that matches will be meaningful:
Columns. I am writing columns this year for Diversity & The Bar Magazine on topics related to diversity and mentoring. The first two columns are now available online: