Much like many of us, I have observed the disorderly and brawly fight over the past few weeks between Armin Laschet, the prime minister of North Rhine-Westphalia and Bavaria Premier Markus Söder. Both have been fiercely contending to succeed Angela Merkel. Frau Merkel's grand transition plan had already derailed before after her initial handpicked successor, Annegret Kramp-Karrenbauer, unexpectedly called it quits early last year.
Merkel, who has been chancellor for almost 15 years, announced in 2018 that she would not run again when her term expires in 2021. At that time, she stepped down as party leader and endorsed Kramp-Karrenbauer as her successor. But her attempt at securing an orderly transition of power -- as well as her own legacy -- appears to by now have failed in all respects.
The way in which Angela Merkel’s tenure draws to an end holds several valuable lessons for law firms. Merkel, who has for a decade been Europe’s most influential and respected leader, turned ineffective and weak in her last term. On the international stage she failed in leading Europe to push back against President Trump and internally came under heavy criticism for how she handled the pandemic, leading to public apologies on 24 March. Her approval ratings have dropped to an historic low and her party might well lose the next elections. Angela Merkel should never have accepted her last term and now sees her legacy in tatters. (read my recent article on this topic here)
The second lesson is about leadership succession where it seems that many leaders keep making the mistake of trying to appoint their own successor. Except perhaps for some dictatorial regimes in dark parts of the world, these attempts typically lead to failure. It seems to be a common characteristic of those who have been in power for too long that they want to reach beyond their ‘grave’. For Merkel this attempt turned into an unworthy public fight for her succession, further adding to the stains on what should have been a superstar legacy.
4-Step approach for law firms
Also for law firms the transition from one managing partner to the next can be a disruptive and unsettling process that amplifies divisions that exists within the partnership. In this article we will highlight 4 steps guiding law firms towards a smooth transition of power.
1. What type of managing partner is needed at this point in time?
Law firms keep constantly evolving and different moments in time bring different challenges and different demands for its leadership. This is no different from corporate leaders in the business world. The next CEO is hardly ever a carbon copy of the one before. Like leadership transitions in the corporate world, law firms should start early on by making a profile of the next leader. What are the qualities that are needed to lead the firm successfully through the next term? Surprisingly few law firms actually consciously think about the desired leadership profile at all.
2. Preparation and talent pool
Despite the fact that the legal industry has grown into a multibillion business, the leadership has very much remained at a mum & dad store level. Outside the business of law it will be hard to find other business sectors making so much revenue, which are managed by untrained unprepared amateurs. Even compared to other forms of professional services that use the primus inter paris management model, few are from the start as ill equipped as lawyers are. Almost all the qualities that make a great lawyer (i.a. meticulous attention to details and an aversion to risk spring to mind) become a huge hindrance when it comes to managing the firm. Given the interest at stake it would make sense to structurally offer business- and leadership training to the partners in order not only to help them prepare for a potential future leadership role, but also use the insights gained to manage and grow their own practice in the meantime.
3. The selection and nomination process
Regardless the preparation as described above, you don’t want the process of electing the next managing partner to be as unsavory as the recent events in Germany. As illustrated by these recent events, you don’t want to have the departing managing partner steering his/her own succession. The responsibility for selection and nomination process is best left to the board or an ad-hoc committee appointed by the partnership. You might also want to avoid campaigning by opposing candidates as this will invariably highlight differences and fractures in the partnership and may in the end turn the looser and his/her supporters bitter. The most successful processes are well prepared with many bilateral consultations behind the scenes and in the end only one candidate that is guaranteed to have a broad majority support.
4. A well-managed transition
As long as law firms are managed by ill prepared lawyers, it will take at least six months for the new managing partner to settle in. New managing partners typically have no clue, are starting from scratch, making the same mistakes and reinventing the wheel just like the managing partners before them have done. We see this happening time after time and so much momentum, time and energy are lost. Basically those first six months are just status-quo and/or destruction. Destruction being for instance replacing the heads-of-staff only to find over time that the new ones are not really different from the ones before.
The solution to this is not as one might think a longer transition period during which the old and the new managing partner work side by side. This period should preferably be as short as possible, just long enough to transfer the files and effectuate the authorizations. The most structural solution would be to put in place step-2 and create a large pool of potential leaders that have been professionally educated and trained in all aspects (financial, strategic, organizational, communicative and more) of management.
For the time being the best advice would be to assign a professional management coach to help the new managing partner to avoid pitfalls and to be up and running, productive and effective in the shortest amount of time. It will come as no surprise that this is a service we offer.