Strategic Hiring in a Down Market

by Marcus Ollig

Hiring, after 1100 attorneys nationwide lost their jobs last Tuesday? I know what you are thinking: "He runs a search firm - of course he is talking about hiring, but the reality is no one is hiring" You're right - I run a search firm and as such get the opportunity to talk to clients and contacts around the country. My thirteen plus years of experience in the employment business, conversations with law firm leaders over the past year, and our own recruiting efforts on behalf of clients have taught me several valuable lessons about our current downturn and the best practices of firms who seem to be thriving. Please let me know if the commentary below corresponds with what you are seeing, or if you disagree. I would welcome the opportunity to hear about what you are seeing in the legal marketplace.

While terrible, the down economy is providing some opportunities and lessons that can help us thrive even during the recession. For all of the news of layoffs there is still strategic hiring going on - often from the very firms laying off attorneys and staff. Some observations:

The best firms are opportunistic: They hire and recruit strategically in this down market. They add areas they have had trouble adding in booming economy. These firms are flexible; they are looking to change the focus of down areas like mergers & acquisitions and often expand into areas that are currently thriving or where they have had a historic need. We are even working with firms looking to add to or bolster specific offices. The opportunity to add a strong lateral partner or practice is better than any year in recent memory. With several major firms failing last year, partners are increasingly looking to move their practices to well-managed firms. We get daily calls from partners who are looking to see if they can move to a firm that is better managed, gives them more financial security (including lower overhead) or will appreciate them and their practice. You heard that last one right - more than ever as firms make painful cuts, even superstars can get overlooked. Hiring the right lateral can be tricky, however.

Increase due diligence and in depth screening of candidates. At a time where there is a seeming plethora of talent out there looking for work, the job of effectively screening that talent is more important than ever. Past lateral hiring mistakes can be your guide. How carefully did you check lateral hire practice portability - did they bring what they said? How well did you transition past hires? But it is not just whether or not they panned out economically as anyone who hired a bad cultural fit can attest. Cultural mistakes can be even more expensive as they hurt morale, client relationships and potentially cause defections among your best performers. Lateral partner hires in our experience are the most visible mistakes, but ask yourself which future partners left in this downturn and why? Every lateral associate hired is a huge opportunity. Anyone let go within two years represents a significant failure in screening or transitioning. Turnover is expensive.

Additional Resource: Effective Hiring Article

Stay close to your high performers. Your best and brightest are restless. The public failures of Heller Ehrman, Thelen and most recently Thatcher Profitt & Wood have made partners examine their own firm's management more closely. We are receiving an increasing amount of calls and talking with more partners who are looking to move to firms they deem have a quality advantage over their current firm. The best firms are staying close to key talent, rewarding those folks financially and emotionally. Letting people know they are valued, needed and have a future at your firm is more important than ever, especially if you are having to enact cuts. Below I have listed five things to keep your key performers happy through this downturn.

Manage costs intelligently and share information. The best firms are watching costs more closely - you know how to do this. One word of caution – cut where it doesn't impact growth or high performers. This is not the time to cut rainmaking budgets, but maybe you can scale back the partner retreat, or look at appropriate staffing levels, for example.