The Importance of Leadership in Law Firms

Law Firm


Employee satisfaction is also a question of good personnel management. But in the competition for the largest mandates and the most billable hours, the leadership qualities of the senior partners hardly play a role. This could soon change because the competition for the best talents and the increased use of legal tech, flat hierarchies, and good team leadership, as emphasized by the articles from melbado are becoming increasingly important. We took a look at what is important in personnel management and how law firms with particularly satisfied employees manage their associates.

In the search for talent, law firms spare neither expense nor effort: elaborately designed career pages on the company’s own website, expensive recruiting events, and headhunters – in the competition for qualified junior staff, many a euro is invested to outperform the competition. Comparatively less energy (and capital) is used to keep the laboriously recruited specialists in the company. Why? An above-average fluctuation is bad for the business and damages the image. It is particularly bitter for law firms when entire teams switch to the competition or set up their own law firm and take the clients with them.

How do you retain good employees?

Dr. Anja Schäfer, a business coach and mentor for lawyers, has observed that satisfaction among young lawyers during the induction phase is relatively high in the first two to three years of their careers. Between the third and sixth year of employment, however, it decreases rapidly. “During this period, the displeasure among colleagues is greatest,” says Schäfer, who herself worked for eight years for a medium-sized law firm in North Rhine-Westphalia, “and this is not only due to salary, but in particular to a lack of appreciation and other soft factors.”

Good leadership ensures loyalty and good vibes

Whether employees are satisfied or dissatisfied depends to a large extent on the management style of the partners. After all, they are responsible for distributing the workload. They decide what the promotion of young talent looks like, who makes it to the next hierarchical level, and what tone is cultivated in the company. However, the topic of leadership is still given little attention in law firms. How the young lawyers are managed by the senior partner of the department usually depends on his personality. “Everyone manages their department according to their own taste,” says Schäfer. The appointment as a partner does not take place according to whether he can lead a team, but according to what he brings to the law firm financially.

Carmen Schön, the fully qualified lawyer and law firm consultant, also thinks that medium-sized law firms still have a lot of catching up to do when it comes to leadership. Often there is not even a model of what good leadership should look like, complains Schön. The leadership quality of the partners varies greatly within law firms. There are partners who regularly give feedback to their employees, and “speechless partners” for whom “no criticism is praise enough”.

More systematics needed

Anyone with the appropriate training can learn good leadership, assures Schön. So why do law firms have such a hard time with this topic? “The training for executives is based on the fact that a deficit is compensated,” explains consultant Schön, which is why further training on the subject of leadership in law firms is usually voluntary. In addition, they start far too late. Young employees are not adequately prepared for their management tasks. According to Schäfer’s observations, professional training is supported by law firms or is even part of the compulsory program, but the partners of medium-sized law firms in particular often have little understanding of the necessity of developing soft skills. If at all, there would only be selective training opportunities, without a continuous approach being pursued.

In addition to professional training, management training, including the module’s communication and leadership, is a compulsory program for lawyers, says Schön. In addition, regular feedback meetings – at least twice a year and not at the door – should be part of structured and longer-term personnel planning, says Schäfer. After all, the interest of law firms in training programs on the subject of “leadership” has recently increased significantly, the coaches observe. Young professionals and employees willing to change jobs can find out about the leadership qualities of their potential employers in online portals such as Kununu. This creates a certain amount of pressure. The next generation increasingly demands leadership competence on the part of the partners in law firms.


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Medium-sized law firms show how it works

The annual ranking “Azur100” also shows where associates feel particularly comfortable. It is striking that medium-sized law firms perform better than large law firms in the category of “employee satisfaction”. The Berlin law firm BMH Bräutigam & Partner came in 1st place in this year’s Azur100 ranking in the category “Satisfaction” and achieved 96 out of 100 possible points. Founded in 2007, the law firm focuses on transaction consulting and litigation and employs around 60 people, including nine equity partners, four salary partners, and twelve associates. The hierarchical levels at BMH Bräutigam are rather flat, each career starter is assigned to a partner who is responsible for the training of the associate. In addition, each junior can choose a mentor who will assist him as a sparring partner.

“Good leadership has a lot to do with trust in employees,” says Dr. Alexander Wulff, Partner at BMH Bräutigam. “Employees need a certain amount of freedom so that they can develop. This also includes accepting if they don’t do everything the way the boss does.” After only half a year of training, the young professionals should take over their own mandates. The company’s own contribution to sales and remuneration are transparent for all employees from day one. From the second year onwards, employees participate in the firm’s profits and are involved in management decisions. There is no pressure to succeed and target agreements at the “Billable Hours” at BMH Bräutigam.

“The spirit in which our senior partners founded the firm is still alive,” says Dr. Patrick Auerbach-Hohl, who is also a partner at BMH. But he also knows that it becomes increasingly difficult to maintain the “founding spirit” as the size of the firm increases. “We have to tackle the topic of employee management even more systematically in the future,” explains Auerbach-Hohl, especially the younger partners, this would be close to the heart. Some things have already been initiated and implemented, he assures. For example, coaching for the partners recently took place. In the future, associates will receive appropriate training.

The law firm Greenfort was also able to conquer one of the top places in the category “satisfaction” in the Azur ranking. Greenfort’s 25 lawyers maintain flat hierarchies. On the business cards, the designation “partner” or “associate” is deliberately omitted, and a formal dress code does not exist in the law firm founded in 2005. “We wanted to cut off a few old habits,” explains Dr. Daniel Röder, who is one of four founding partners at Greenfort. Every career starter first goes through a training program, which includes not only technical content but also coaching on conversation, rhetoric, and conflict management. “Our employees should see themselves as consultants, so it is important that they develop certain key qualifications,” explains Daniela Hangarter, partner responsible for personnel at Greenfort. Each junior is assigned a partner as a mentor who accompanies him in the first four years of his career and conducts so-called 360° feedback discussions at least twice a year. Salaries are standardized up to the fifth year of employment. “Billable hours” can play a role in the variable salary component from the fifth year of employment. However, they are only one element of a total of three factors, emphasizes Hangarter. In addition, the employees take on tasks in various working groups of the law firm on management topics such as recruitment, marketing, or digitization.

And what about the leadership qualities in the partnership? All partners have undergone leadership coaching with an external consultant, explains Röder. But Greenfort also wants to deepen the topic in the future. “We have just initiated an organizational development program in which leadership will be an essential element,” says Röder.

The leadership of the future: matrix instead of an organizational chart

Flat hierarchies, work in project teams and a stronger team orientation will play an increasingly important role in law firms in the future, predicts consultant Schön. “The new technological possibilities (legal tech) will change the way professionals work together. This will also have an impact on leadership style.” Such change processes in the direction of “agile working” can already be observed in industrial companies. Classic pyramidal hierarchies are abolished. Instead, the employee is assigned the team leader for the project that is best suited to the task. Seniority and status no longer play a role. Cross-departmental work is also becoming increasingly important. “It is much more important to throw the ball to each other in the law firm,” believes Schön, but this requires a new management model in many places and the fee models would also have to change. “If the bonus and the next career stage depend on the number of ‘Billable Hours’, hardly any employee will get involved in a business development project,” says Schön.