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05.31.18

How to Deal With an Underperforming Partner
Kalman Shiner

All firms have productive partners and partners who underperform, but what about those partners who were once top notch and now seem to phone it in? No managing partner likes to deal with this situation. However, the sooner you do, the less damage there will be to your firm’s profitability and relationships.

Defining an underperformer

What constitutes underperformance depends on your firm’s written and unwritten expectations, its criteria for evaluating performance, and the terms of your partnership agreement. Increasingly, older partners are being labeled as underperformers not because their contributions have changed, but because their firms and the legal marketplace have raised their standards.

To prove underperformance, a firm needs to define it. In general, underperforming partners consistently bill fewer hours than their peers and are unable to manage engagements and projects profitably or to the client’s satisfaction. In addition, they fail to develop a self-sustaining practice, which includes introducing new clients and engagements to the firm. These partners also cannot (or will not) adapt to a more competitive and demanding legal marketplace, the firm’s changing values or new technologies. Finally, they show signs of burnout, exhaustion, anxiety or boredom.

Note that unethical behavior or misconduct generally is not considered evidence of underperformance. You should address such situations separately.

Computing the cost

Some firms may ignore struggling partners and hope that they will find their own way back to productivity or leave the firm. Neither scenario is likely. Most underperformers are well aware they have a problem, but they do not know how to fix it. Additionally, few people willingly leave a secure job, even one that offers increasingly diminished returns.

In the meantime, underperformers cost your firm in the form of lost work, weakened client confidence and lower staff morale. The partner may even stand in the way of a deserving associate’s promotion, recruitment opportunities or a successful merger with another firm.

If possible, quantify these costs and present them to the attorney during his or her compensation review or in a more casual one-on-one meeting. Do not blame or accuse the partner, but instead express concern and ask how you and other partners can help get the underperformer back on track.

Setting future goals

If the underperforming partner is willing to accept help, develop a performance management plan. Start by setting specific and measurable objectives, such as increasing billable hours by a set percentage or engaging a specific number of new clients in the next year. Then provide the partner with the support he or she needs to achieve them.

Support can include:

  • Mentoring by your firm’s top rainmaker;
  • Continuing legal education;
  • Networking, financial management or computer courses;
  • A personal organization or career coach; or
  • If the primary issue is burnout, a vacation or short sabbatical.

Make sure you meet regularly with the partner to assess progress and discuss possible obstacles.

Exiting gracefully

Not every underperforming partner is capable of or interested in being rehabilitated. In such situations, make sure the partner’s exit is handled sensitively.

Passive techniques, such as reducing the partner’s share until he or she is forced to quit, can be as detrimental as aggressive ones, such as giving a partner the boot on short notice. Both can damage firm morale and your reputation with clients and prospective hires. Also, unless the partner is guilty of misconduct, you owe this formerly trusted colleague courtesy and respect.

Next steps

Try to be flexible and patient as you work with an underperforming partner. However, it is important to know when to cut your losses. If the partner exhibits little progress or commitment to change after a predetermined period (a year is typical), it is probably time to ask him or her to leave. Although asking a once productive and admired colleague to step aside is a tough decision to make, it is in your firm’s best interest to move forward with those partners who are productive.

For more information, contact Kalman Shiner at kshiner@orba.com or call him at 312.670.7444. Visit ORBA.com to learn more about our Law Firm Group.
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