Building a Successful New Practice Group – a detailed study into why most initiatives fail and the factors critical for success

Most firms are finding it difficult to build new practice groups and are disappointed at the rate of progress. Many blame the fact that their firm’s ‘brand name’ works against them. But we were not sure that was a valid reason, so we conducted a study. Of the 20 or so case studies we investigated, most of the initiatives were judged to have failed. But what was most interesting was the similar pattern of behaviours for the initiatives that succeeded.

From this analysis, we have developed a template of best practice in the form of a phased approach, the details of which are below:

Phase 0 – Lay Foundations for Success

Many new practice groups fail before they’ve even started because the foundations for success are not laid.

Those firms that succeed tend to appoint a project sponsor at this stage. This person should ideally have influence within the firm. The role of this person becomes more important in the next stage, but one of their critical tasks in this early phase is to ensure that the right group leader is appointed.

Ideally the leader for the new group should be an internal appointment because the next phases are tricky and only an insider will know the ropes. But it isn’t always possible to find a suitable candidate from within. Nine firms in our study recruited outsiders. They were all given a year to succeed. In all cases this was extended, but all the partners except three were deemed to have failed and these were the only ones to stay longer than two years. Indeed, one group made two failed attempts with successive outside partners, but achieved modest success when they made up a senior associate from inside the firm.

Phase 1 – Project Set Up

Again, the firms that achieve only modest successes tend to put less emphasis on this phase. The leader has some critical tasks:

To clarify what the firm expects – too often the Board are vague and this creates scope for misunderstandings. At one level it makes it difficult to measure achievements. At another level it leads to a lack of clarity as to what support the new group is going to need from the sponsor or others.

To build a profile for the embryonic group internally – at one end of the spectrum, there can be a lack of any knowledge that the initiative is underway. At the other end, rumours and misunderstandings can easily spread which can lead to partners blocking progress unnecessarily. The project sponsor needs to be there to support if necessary.

To appoint a core team– no single person can grow a new practice by themselves. The ideal core team to initiate a new practice group comprises 2 or 3 partners and their teams. Any more than 5 partners is frankly unworkable and time will end up being wasted debating a plan and priorities. It may be appropriate to keep a wider team informed of developments, perhaps because the new practice group links with their type of work, the sector/industry they serve or because you might be sharing clients.

To draft a business plan – typically what happens here is that the leader drafts a plan and shows it to others. Some reply with comments. Many don’t. And if they do, the comments aren’t always constructive. This isn’t the best approach. If you want commitment it’s much better to get the core group to draft the plan. This way it’s everybody’s plan and you will find more things get done.

To agree roles, responsibilities and measures of success – teams tend to perform better with these aspects clear and, though this sounds obvious, it happens rarely. Again completing this step more rigorously can make a big difference when it comes to getting action. Bear in mind that the leader doesn’t have to do everything. The other partners can take the roles of Marketing, Finance, HR/Recruitment etc.

To educate and train your staff – to be able to deliver any new expertise required. This is critical to be able to win work and persuade clients of your ability to do it well

Timeframe: 6 to 9 months to build a committed team.

Phase 2 – Raise profile and win instructions

Now the fun and hard work really starts! The critical success factors are as follows:

Successful business development projects underway – a provisional business plan may already exist. What is needed now is a short list of BD projects. Avoid being over-ambitious. It can take too long to get complicated projects completed and the group can lose enthusiasm.

Team members committed to activity – it helps if the group members volunteer to be accountable for certain projects, rather than the leader hand out jobs. Commitment and enthusiasm are a vital factor in getting the new team off the ground.

Regular team meetings – and the more frequent and more informal, the better. Too often groups assume the best way is to meet monthly and have long boring meetings. Not surprisingly, this puts a lot of people off!

PR plan – one important aspect of the BD plan is getting market profile. One successful group put a good deal of emphasis on this area and became recognised as a leader in a niche field within two years. Enquiries for work and instructions flowed in as a result. As an embryonic group, the marketing budget might be quite small so profile through the web or in leading trade journals can be useful because they are so cheap.

Sales visits –you need to get out there and meet potential clients or referrers. Most lawyers find this activity the least pleasant but it’s essential. I recommend going in pairs.

Growing support for group in the firm – the groups that work best focus at least as much attention inside their firms as outside. As we have already recognised some partners will be anxious about the impact of this new group on their flow of business and will appreciate being kept informed of progress.

Attending other groups’ team meetings – some leaders of new groups have achieved breakthroughs by attending the team meetings of other groups and presenting ways in which they can help them. By targeting the right groups with the right messages, leads will be generated.

Cross selling from other groups – the easiest clients to get will already be clients of the firm. However we are not aware of any law firm which has cracked the challenge of getting an effective cross selling culture in place. If you build good trusted relationships with the Client Partners of appropriate clients, work will be referred to you.

Timeframe: 12-18 months for additional instructions flowing into the firm.

Phase 3 – Grow and consolidate performance

We’re on a roll now or at least should be! But probably not achieving the margins that the firm expects. So the focus of attention in this phase needs to move to addressing the following issues:

Repeat instructions from clients – there’s more instructions from the person who has already instructed you, plus other individuals at the client who can instruct or influence who receives instructions. The groups that do best tend to have clear Client Partner roles and plans for developing client relationships.

Group is growing in size – and the leader again has a plan for helping ensure that there are sufficient people with the skills and appropriate charge out rates for doing the work.

Knowhow system set up – as the group gets bigger it gets harder for each member of the group to know who knows what, so some system with simple processes will help share knowledge, build efficiencies and improve margins.

Other lawyers show interest in joining the group – perhaps one of the best measures of success because most of us like to be associated with success

Higher rankings in industry surveys – love them or hate them, they play a role in creating a perception in the market and can influence who gets short listed for some jobs

Cross selling to other groups – you know you’re doing well when you start introducing other parts of your firm to clients you’ve won in the first place

Acknowledged as a success in the firm – this is what it’s all about and other fledgling groups seek out your advice!

Timeframe: at least 3-5 years to achieve the performance levels of the rest of the firm.

It will have been a challenge, but for those who have done it, it will have been one of the most satisfying experiences of their careers.

Lots of other stuff being prepared on this subject….watch this space!

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One Response to Building a Successful New Practice Group – a detailed study into why most initiatives fail and the factors critical for success

  1. Pingback: From Surviving to Thriving as a Practice Group Head | Tony Reiss

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