MinnLawyer Blog

Big Law firms use a number of management techniques that most of the business world has either shunned or jettisoned long ago. Lock-step pay increases for associates is one example of this (most businesses think merit is kind of important in pay increases). Recruiting all your entry-level lawyers annually in a “class” is another (most businesses have the crazy idea of hiring as their needs actually require). But to my mind, the ubiquitous use of the billable hour as a primary measure of performance is one of the most pernicious of the faulty business practices that have developed at big law firms.

At most big firms, if you don’t bill a large amount of hours annually (usually somewhere between 1,700 and 2,200, depending on the market), you don’t have a prayer at partnership. As a result, Big Law lawyers on the whole are underrepresented in bar association offices (and at bar events like the annual meeting) and have to spend much of the day chained to their desk to make sure they meet their billable minimums. Once they make partner (if they are so lucky), high billable expectations continue to the point where firms have started to weed out some of the “less productive” partners.

In days of yore, there was a lot less reliance on punching a clock as a measure of productivity at law firms. Partners may have gone off to a three-martini lunch or to play a round of golf with business contacts rather than billing eight hours. The day may not have been “productive” in the sense that not a lot of billing went on, but, a few months later, one of those contacts might call to steer a major case to the firm or to ask it to take over all the legal work for Acme Electronics. From a cost-benefit analysis, I leave it to you which is the more “productive” use of time — an uninterrupted string of $400 hours or bringing large chunks of business to the firm that might keep lots of lawyers busy.

I realize that there are incentives in place at many firms to reward rainmaking. The issue is that the potential sanctions for not making the quota for billables are a lot scarier than the enticements for rainmaking are sweet. With billing 1,800 a year and family or other commitments, it’s hard to find time to network with potential new clients. Plus I haven’t heard there is much mentoring in rainmaking going on. Young associates see partners chained to their desk and follow suit. Then their review comes around, and they are told they have to work on their rainmaking skills. These days, they might not make partner because they never developed this skill with the time that they didn’t really have without anybody really showing them the they way. They thought they’d make partner by doing what they see the partners do — grind away at their desk and make their billable requirements with a high-level work product. For some reason, I can’t get the song “Born too Late” out of my head.

At least one industry analyst has told me that some hard-up-for-work big law firms in other jurisdictions have actually sent lawyers out to mid-sized companies to make proposals for performing the company’s legal work and thereby solicit business. Why do I have the sinking feeling those lawyers won’t get a break on their billable requirements? I think big firms really need to think about the message they send out with their performance measures. What behaviors do they really want to encourage? Sometimes it’s worth taking a hit on billables now to get more business later.