It’s a question that is increasingly exercising minds across the legal industry: “How do we go about linking Partner reward to business performance?”
It sounds like a simple question, until you look closely at those final two words… Then questions emerge. “How do we define business performance?”
Is it purely about contribution to income and profitability now? Or is there a bigger picture, a longer game that’s just as much about sustainable growth, strategic focus – seeing the opportunities first AND being able to seize them?
The answer, usually, is both. What law firm does not want to blend short-term financial performance with long-term growth? However, this directly impacts on reward strategies in ways that are not always obvious.
The vital context here is provided by the seismic shifts in the global legal market that have been ongoing for some time now. This change has put a premium on collaboration and referrals between previously siloed units – and, as a result, demands new behaviours from partners, and increasingly collaborative cultures within legal firms.
This is the new imperative facing those tasked with designing Partner reward schemes. It’s suddenly a lot more complicated.
The right scheme now has to reward sometimes conflicting behaviours – it has to encourage empire building in terms of fee income, but also common cause in terms of the overall health of the firm.
So what is the answer? The truth is, there is no panacea, no magic bullet. The right answer depends on the firm, its strategy, its people, and its existing culture and behaviours. And it is only part of the solution. Partner reward now has to be integral to a wider strategy – a strategy that everyone can buy into, and through which they can clearly understand not just the ‘how’ of remuneration, but the ‘why’.
All this and more – including a look at the cultural impacts of the four most common schemes currently in use – is explored in detail in our latest whitepaper: The Going Rate? Create the Perfect Partner Remuneration Scheme.
It’s free, so take a look.