Peer to Peer Magazine

SIX QUALITIES OF A LAW FIRM CEO FINDING THE FIRM'S FIRST CEO REQUIRES AN UNDERSTANDING OF SIX QUALITIES. 1. LEADERSHIP: The CEO must understand her role as the firm's leader, to both staff and attorneys. She must operate at a macro level, using her knowledge of the entire firm to understand what needs to be done, what the priorities are and who can execute them. 2. MANAGEMENT: Unlike leadership, management requires that a CEO understand — at a micro level — the work product, the work processes and the workers across the entire firm. Armed with that knowledge, she must ensure the firm's major departments work together toward a common vision. "Management is about coping with complexity." — John Kotter, leadership expert 3. VISION: The CEO is the single person within the firm with the power to execute, so she needs a vision for the firm. She must listen to staff and attorneys, then define and promote a vision that articulates the firm's core values and guiding purpose. "The only way to predict the future is to have the power to shape it." — Eric Hoffer, philosopher 4. STRATEGY: Only when the CEO focuses her leadership and management skills on an articulated vision can she and her team create a competitive strategy. That strategy — one firmwide strategic plan and many practice group plans — needs to focus on building the firm's competitive advantage. "The essence of strategy is choosing what not to do." — Michael Porter, strategist 5. FINANCIAL IQ: To ensure the firm's financial success, a CEO must understand the characteristics of a healthy balance sheet: growing revenue, ensuring collections, controlling costs, managing assets, monitoring liabilities and maximizing profit. In addition, a hot topic for law firms is pricing, which means the CEO needs to be even more aware of her firm's financial numbers. 6. EMOTIONAL IQ: Successful CEOs need to connect with their staff and their attorneys. As Gallup's 2000 report noted, it's all about the people. As such, Daniel Goleman's five principles of emotional intelligence — self-awareness, self-regulation, motivation, empathy and social skill — are critical. Many of Goleman's best-selling leadership books are ideal for a law firm CEO's leadership training. 54 Peer to Peer In their "Five Bases of Power," social psychologists John R. P. French and Bertram Raven identified three types of power that will have a direct bearing on law firm leadership. These give insight into answering the questions above. • Legitimate Power (Who will have power?): A leader has some basic power, based solely on her position. A law firm CEO certainly would possess legitimate power in the eyes of staff. However, no greater obstacle exists for a non-lawyer CEO's legitimacy than the lawyers. Will they accept her? Carl Leonard, Assistant Professor of Law Firm Management at The George Washington University, says lawyers are often reluctant to accept decisions made by professional managers. As a new leader takes the reins of the firm, her chances of success will be signaled by how much deference the lawyers show. • Referent Power (Who will lead?): For a law firm, which succeeds largely on the collegiality of its lawyers, the social aspect of the firm is critical. That is where referent power comes in. Can the new CEO build strong relationships with both lawyers and staff to earn their respect and trust? The perceptions of those at the firm will color her leadership — good or bad — and her power will flow from those perceptions. This is a key ingredient of effective leadership. Firms need to hope for a leader like WilmerHale's former co-managing partner William Lee, who believes: "Leaders must build a great team, delegate to them, trust them and always support them." • Expert Power (Who is qualified?): If lawyers are to hand over "their" firm to a non-lawyer and respect her leadership, she must be the right candidate — what French and Bertram call an "expert." BCG Attorney Search suggests law firm CEOs need "to be exposed to the latest management theories developed out of business schools. They need to be challenged and stretched in their thinking about how a professional services firm is organized and operated." Many of today's large firms have chief operating

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