I often recite the story of an 80-year-old lawyer who held on too long running his firm and wouldn't retire.
He was a great lawyer and continued to be a great lawyer at 80. He was mentally sharp and physically fit. He could handle his workload, the firm was running smoothly and he wanted to work. He controlled the firm, the relationships and every aspect of the practice. Clients loved him.
That’s what ended up destroying the firm.
In truth, when I tell this story, I'm not talking about one firm. It’s a story I've seen repeatedly, and it always ends poorly. At some point, the managing partner must move out of the firm, and he’ll want to sell or pass the clients on to someone else — but he can’t. The firm has no value and no way to transfer the relationships.
So the firm dissolves, and decades of dedicated relationship-building lose all value. That’s the cost of the generational divide.
I don't think I’m spoiling anything by pointing out that our lives are finite, and no career lasts forever.
When you are 80 years old, everyone in the firm knows it. They know that the clock is ticking.
The next generation of lawyers is rarely content to sit around, wait for the inevitable, and pick up what's left. They’ve worked for the rewards and opportunities of leadership and want autonomy, more significant equity percentages and a long-term future for themselves.
They won’t see a future if the current leadership won’t step aside and make room.
So, a firm's best lawyers, the ones building business and interested in leadership, leave. Their leaving creates a capability and experience gap. The firm ends up with the aging partner (or partners) at the top and young, hardworking lawyers starting their careers at the bottom, while nobody in the middle moves into leadership to ensure a solid future.
We call this gap the generational divide, and it's not due to a lack of talent or a desire to stay with the firm; it's a direct result of leadership's inability to pass the torch. Hardworking, dedicated lawyers will want opportunities. If they can't get them at their current firm, they'll move to the next one.
Law is a relationship business. Clients trust their lawyers, and this trust is built over time. An introductory lunch — no matter how fancy — won’t cut it. Transferring a relationship can take years.
I do know of a specific example of an older partner falling ill at a firm. He hadn’t planned for retirement and didn’t want to leave, but he was physically unable to practice law anymore. So, he wanted to sell his practice quickly.
The problem was that he had nothing to sell. He had owned the relationships and never did anything to transfer them to someone else, so the firm evaporated along with his income and expectations of a buy-out.
Because he didn't plan, he couldn't control the situation.
The alternative is to plan early for a graceful exit. The exit can include continuing to practice law or bringing clients to the firm in some capacity. It doesn’t mean you have to leave the law entirely.
But you must promote, support and transfer control to the next generation. That’s the only way they will stay and the only way to avoid the generational divide.
“Law is a relationship business. Clients trust their lawyers, and this trust is built over time. An introductory lunch — no matter how fancy — won’t cut it. Transferring a relationship can take years.”
Once you have a plan and know your future, you can start the long process of transferring relationships. You introduce your successor(s) and gradually have them take on more client work and responsibilities as you fade out.
The process of letting go and transferring ownership is very hard for many successful managing lawyers who've built strong practices. As hard as it may feel, though, letting go and transferring ownership is the only way to retain the option to continue practicing (or not), earn an income, and have something to sell when the time comes.
The difference between those who do and those who don’t plan their legacy is stark. It’s the difference between determining your fate and losing it all. Successful lawyers tend to believe they've got it all under control. But they aren’t in control of the next generation, client’s preferences or the importance of relationships.
So, instead of waiting for the inevitable to happen, decide what you want for the future, put a plan in place and nurture the next generation. It will require some letting go, but it is the only way to ensure you get what you want.
