Retaining clients in a cut-throat business climate and keeping qualified attorneys are among the issues keeping managing partners of Hartford area law firms awake at night.
In an informal survey of Hartford area law firms, managing partners said the sluggish economy has created an atmosphere in which many attorneys are working around the clock and that presents a challenge in attracting and retaining good attorneys.
“In the last 15 years or so, as associate salaries were skyrocketing, the younger generation has been more apt to move from job to job,” said Charles “Chuck” Welsh, partner in charge of the Hartford office of Edwards Angell Palmer & Dodge. “If your asset is your people and they’re willing to leave, you have a real problem.”
Welsh said the challenge is to get quality associates to think that his firm is the place they want to be, as opposed to thinking they want to get a great starting salary and leave in two years.
“You have to have the right technology to delivery the services, but you have to focus on your people, providing training and providing them with interesting work to do,” Welsh said.
Welsh said his firm is department-run, and much time and energy is spent on training. Each department has its own internal training as well.
“We also do a full-day training where we bring in all the associates to New York for a night and have dinner and do a full day of training for them,” he said. “It’s a good opportunity to be collegial and show them we’re committed to them.”
Edwards Angell Palmer & Dodge also encourages its attorneys to find relevant conferences to attend. In addition, lawyers make regular contributions to a blog.
“It’s a way to make a name for yourself in a certain area,” Welsh said. “Clients are saying we want a business partner; we want someone who provides us with value-added services and comes in and provides us with a seminar. If we have an associate who is ready, it’s a great way for them to get out in front of a client.”
John “Jef” Wolter, managing partner at Updike, Kelly & Spellacy in Hartford, said keeping specific attorneys busy during slower times can be a struggle.
“We’ve had certain areas of the practice, for example, real estate, that have been slow for an extended period of time, so the challenge of keeping those people engaged — attorneys, support staff and the like — is a larger issue because this downturn has been so extended,” Wolter said.
Meanwhile, other areas of the firm — including bankruptcy, creditors’ rights and health care — have been much busier. The consumer protection and Wall Street reform Dodd Frank Act and an ever-changing need for improved technology has forced firms to be ahead of the curve when it comes to upgraded technology.
The changes mean employees’ roles are shifting, and new skills are needed.
“You really need information technology specialists,” Wolter said. “I have a couple of bank clients who don’t want a piece of paper from us. It just totally changes the skill set, so we have some employees that you can retrain, but others that you can provide all the training you want, it’s just not going to happen.”
Wolter said the first five parts of his firm’s latest strategic plan all relate to information technology.
“Whether it’s looking at new software, new hardware, new personnel, it’s very time consuming, very intense,” he said.
Proving to clients that their firm offers the best service available in the market is something many firms struggle with.
“We don’t want to let what we do become commoditized,” said Welsh. “Everyone is shopping for price and everyone is looking at their budgets. You have to make it clear that you’re going to deliver a better product.”
Rick Cavo, chairman of the executive committee for Litchfield Cavo in Avon, said he fears the same thing.
“Lawyers are not fungible,” Cavo said. “The smartest lawyers, the most creative lawyers, get the best results and clients need a specific sophistication and focus to understand that.”
Cavo said he worries that with the economy still hurting, companies with only the bottom line in mind may pass over the best law firms.
“What I fear might happen is that law firms that do even a tremendous amount of work for a client may still be viewed as just another expense, and therefore the best firms may not get the work they would have in the past,” he said.
Cavo concedes he’s only seen this on the fringes and not with the main clients yet.
Gerry Goulet, managing partner at Hinckley, Allen and Snyder in Hartford, said the economy is creating a changed business environment, and he hopes attorneys can keep pace.
“I think the real challenge is, as companies go out to marketplace they say, ‘We don’t want to do it the same old way. We don’t want to be billed hourly; we want to be billed on a project basis,’” Goulet said.
Goulet said his firm has been working actively on cases billed on a project basis, rather than hourly, for about 18 months, and he expects project-based billing will continue to increase.
“If you have one of the national companies successfully go out and request a proposal at competing firms, and end up with an arrangement that gives them stability, gives them some predictability and maybe cuts their overall legal bill by five percent, that’s communicated throughout the business world in short order,” he said.
Beverly Garofalo, managing partner of the Hartford office of Jackson Lewis, said proving to clients that they’re the best firm for the job can be endless.
“We know that clients are being sought after by other firms, so you have to be the best you can be at all times,” Garofalo said. “You really have to do it all: be there for your clients by giving them top-quality work, be competitive, but also be out there marketing and developing new business.”
Garofalo said attorneys must stay on top of all developments related to their business, and must essentially be on call 24 hours a day.
“It’s increasingly difficult to be a generalist,” she said. “You need to be able to have people who are experts you can tap into on a moment’s notice. I’m seeing our clients are under pressure like I’ve never seen before. I see them responding to e-mails at 1 in the morning and getting on planes… They’re not asking us to do something they’re not doing themselves, which creates more pressure.”
Garofalo concedes that Jackson Lewis is surely not alone in feeling the pressure.
“There’s a feeling that you are busy and you know that a lot of places aren’t busy,” she said. “You never know what the future is going to bring, so you have to make the most of it.”
