partners   3959

« earlier    

Big Law Should Raise Partner Billing Rates 10+ Percent Now | Law.com
The connection between delegation and partner billing rates isn’t entirely obvious but it’s real. Many partners recognize that much of the work they do is not true partner-level work. Hence, they are wary about charging full partner billing rates; but rather than delegating (as they should), they appease their conscience by shaving a little off their billing rates. Despite this back-pressure, the failure to delegate results in unnecessarily-increased client fees and also denies associates learning opportunities and disinclines partners from doing that which they should be doing, i.e. going out and finding more high-quality work. Raising partners’ billing rates assertively will push back on this dynamic, increase delegation, lower fees, and thus help stem the contraction in market demand.
On the issue of re-balancing where margin is generated, let’s again start with two observations. The first is that, over time, technology will continue to reduce the demand for junior lawyer time relative to that of senior lawyers. The second is that today’s billing rates generate higher margin on junior lawyer time than on senior lawyer time. To see this latter, take a look at the amount by which billing rates exceed compensation (converted to an hourly equivalent) by lawyer cohort. What you’ll find is that billing rates are 4.5 to 5.0 times compensation for junior associates and only 3.5 to 4.0 times compensation for senior associates and counsel. Again, linking the two observations: Big Law is on a path to see margins and profitability diminish as technology continues to erode the demand for junior lawyer time.

Big Law’s margin structure is befuddling. It is inverted relative to all other businesses—all others charge a higher mark up on their higher-value products—e.g. in the rag trade, the mark up on haute couture is much higher than that on prêt-à-porter (ready-to-wear). The inversion is the cumulative effect of many years of raising associate rates more than partner rates while being careful not to let senior associate and counsel rates come too close to junior partner rates. Clients are instinctively aware of the nonsense that associate billing rates have become; that’s why they say they see the value in partner billing rates but balk at the junior associate rates. The truly weird part is that Big Law’s wacky billing rate structure is entirely of its own making. Clients care greatly about the total fee charged; they care little about how that total is arrived at in the law firm’s billing system.
partners  pricing  compensation  clients 
17 days ago by JordanFurlong
New Partners Don't Know What to Expect After Promotion, Survey Shows | The American Lawyer
Of the 238 survey respondents who answered the question “What has disappointed you the most” about making partner, 71 were disappointed with compensation.

Asked to rate their satisfaction with various aspects of partnership, only 57.2 percent of new partners said they are satisfied or very satisfied with compensation.

One respondent said they were disappointed to be “treated as a glorified associate for purposes of compensation and bonus (and, thanks to the midyear associate raises, I’ll make less than most senior associates this year).”

Another said that buying shares, along with lower-than-expected pay and an end to performance bonuses, had placed a strain on finances. “It’s really depressing and demoralizing to get a promotion and then to have to put your family on a strict monthly budget,” that respondent said.

James Cotterman, a consultant at Altman Weil, said he’s not surprised by the number of new partners expressing a misalignment between their compensation expectations and reality.

“In general, career progression management is not a legal profession strength,” Cotterman says. New equity partners see higher pay, but they have to pay for their own benefits and self-employment taxes, as well as capital contributions.
jf  partners  firms 
17 days ago by JordanFurlong
TMG’s Take on the Further Decline of the Portable Book of Business | The McCormick Group
But slowly the concept of the portable book of business is losing steam. First, firms are well aware of the statistics that show the percentage of laterals that can ring even three-quarters of their projections is 50 percent at best. Second, the increasing efforts of clients to concentrate their work among fewer firms, to go to approved lists, and to emphasize law firm teams rather than individuals, are making transfers of clients from one firm to another more difficult. Finally, the candidates are becoming increasingly jaded about the lateral market in general. Too many times, we hear the comment, “they really don’t want me, they want my book of business.”

 

Firms often fail to realize that lateral partner recruiting is still a bit of a romance. When firms, either on their own or through recruiters, do things like setting a hard line on minimum book of business, demanding a lateral partner questionnaire after the first interview, or conducting a “Spanish Inquisition” into the candidate’s existing client base, they turn off many good candidates who perceive that the firm values dollars over quality or culture. As a result, the firm that least emphasizes a portable book of business most often gets the candidate who actually has the portable book of business.

 

We recently met with a managing partner of a regional law firm who offered a unique breath of fresh air. “I don’t care at all about a portable book of business. What I want to know is if that lawyer lost whatever book she claims, would she have the ability to rebuild it.”  As the practice of law continues to emphasize collaboration and client service, more firms are going to need to adopt a similar attitude.

 
lateral  partners  bizdev 
7 weeks ago by JordanFurlong

« earlier    

related tags

&  'championships'  'vibras'  "illusions"  (and  2021  a  absence  admin  admisison  adobe  affiliates  alexander  amazon  american  an  and  anymore  apple  are  as  associations  attribution  b  balvin  banks  be  bessemer  biofilms  bizdev  brand  branding  bring  business  by  capsule  cardi  chapters  chronic  clients  cloud  code  collection  columbus  compensation  computing  concepts  conference  csv  curb  data  denying  diplomatic  diplomats  diversity  ecosystem  end  ends  equity  example  exclusives  experience  express  facebook’s  fading  family  favorites  featured  festival-goers  firms  foot  for  forrester  freezedriedgourmet  freezedrying  gabor  gartner  github  give  glasgow  google  guess  hbr  icoms  icoms2021  idc  images  indian  infographics  innovation  iran  j  jetboil  jf  kickstarter  killed  lament  landscape  lateral  laterals  likely  loans  locker  louis  love  macphee  managedcloud  management  marketing  med  meek  melrick  members  mill  most  movementstrategy  nbic  new  now  ntwrk  of  officially  officials  on  online  panorama  parents  partner  partnership  pivotalcloudfoundry  posts  pricing  product  proofpoints  propaganda  provide  puma  rec  reebok  releases  repo  reporting  repository  roi  rolesandresponsibilities  roses  salesforce  same-sex  sampha  sanctions:  schools  scotland  seed  sergi  services  shopify  snowy_river  software  startups  strategy  succession  summer)  talent  technology  the  tidal  to  tpp  trading  treat  trends  trump  un  up  upgraded  us  usergroups  venture  visas  wang  warns  web  with  women  won’t 

Copy this bookmark:



description:


tags: