Do partner reviews, reward discussions and decisions fill you with dread?
In the third and final of my short posts designed to help leadership teams improve process and outcomes, I provide some tips on how to approach evaluating “broader” partner contributions. Those “hard to measure” contributions that fall outside short-term client service commitments and don’t show up in your financial reporting, but which have a profound effect on long-term and sustained business success.
“If we value the present much more than the future, then we’re less likely to make the necessary investments today to reduce risk tomorrow.”
In his 2020 Reith lectures* Dr Mark Carney distinguishes between: (1) the short-term focus and commitment to client service and relationships that are critical to a businesses’ current fortunes, and that tend to be the driver of individually focused remuneration models; and (2) the sort of contributions that amount to “investments in long-term business success”.
As a leader at your firm, you recognise your partners’ laser-like focus on short-term client service and relationships remain critical to your fortunes. You also agree with Mark Carney that the “broader” contributions they make are fundamental to the sustained long-term success of your business.
But you have a problem. At your firm, in common with many others, “broader” contributions are given little, or no, actual recognition or value when assessing partner performance or setting remuneration. As a result, you struggle to get partners to focus on and deliver these meaningful broader contributions to the extent you’d like them to.
To ensure the sustained and stable success of your firm, you want to change this state of affairs. You want to direct at least some of your partners’ focus towards broader business critical tasks and initiatives, as well as to client service and relationships. So, here are some tips to help you do just that.
Define it – Define what you want partners to contribute in each of these broader contribution areas. Make sure the descriptions support your strategic aims and reinforce positive cultural alignment. For example, by setting out the type of collaborative intent and action you expect partners to demonstrate. Typical areas of broader contribution might encompass: People & Talent , Risk & Ethics, Firm Leadership & Culture, Technical Excellence & Knowledge Sharing.
Get your partners to help you with the definitions – they’re good at this. Ask them to describe what the best partners in a given area do and how they do it. Also ask them what they’d expect a baseline level of partner contribution to look like. Then fill in the gaps.
Value it – As noted in an earlier blog, give an explicit value to each area of broader contribution. This helps indicate where, and to what extent, you expect partners to direct their focus, time and energy and it ensures that contributions in “broader” areas have evaluatory and remuneration consequence. It also means that you are making good on any assertions that your culture ensures that client-facing financials are not the only thing that matters at your firm.
Evidence it – Go looking for, and start to build, a data set that can act as supporting evidence that your partners can use to demonstrate what they have been delivering. The data is out there and it doesn’t take long to identify it – but it’s not just sat in your Practice Management (Financial) System. So go looking in your HR System, Client Contact System, Document and KM Systems, telephone and email records, risk register and management reports. But also ensure the data you use links to the definitions of expected contribution you have put in place (see 1. above) and not just what is easy to collect.
Contextualise it – Take input from your subject matter experts – Chiefs of Finance, HR, BD, IT, KM, Risk. They have a wealth of experience and in depth knowledge of partner behaviours – good and bad. Have them curate, interpret, contextualise and report against the supporting evidence data set you’ve built. But take care to ensure the their input is provided on a structured, well understood and consistent basis, otherwise their input and the data will be easily undermined.
*The Reith Lectures 2020: How We Get What We Value – From Moral to Market Sentiments