expectations are high. as they should be.
by august j. aquila
what makes a great partnership
with the recent turn in the economy, equity partners are finding that there is no longer a lifelong tenure guarantee. senior managers and non-equity partners are wondering whether or not they even want to become equity partners.
more: how to create firm accountability | eight criteria for partnership | how to achieve partner unity | five questions to ask your partners about accountability | how you can get partners to change | the seven building blocks of a great partnership
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for the most part, firms have been selective about who they take into the partnership. however, when the economy was running hot and finding a warm body to fill spots was a real challenge, the partnership bar was certainly lowered in many firms. today, that bar is being raised again.
in large and medium-size firms there is a growing trend toward admitting fewer equity partners and more non-equity partners. i am always amazed that so many firms have not clearly articulated what is expected from someone on the partnership track. after reading this post, i encourage you to put into writing your firm’s expectations and then share them with those who have a desire to be a partner in your firm.
1. client retention and satisfaction
isn’t this the foundation of a firm’s value? so why wouldn’t it be the number one criterion for making partner? you wouldn’t want someone who is just average at client retention and satisfaction. you want the star.
before offering anyone a piece of the pie, check with their clients. are they just satisfied with the service or very satisfied? are they surprised when the invoice arrives or are they kept informed? does the individual initiate calls or does the client have to call?
2. personal production
a new partner should generate enough personal billings to cover most of her compensation. if the new partner does not cover her cost, then there should be some other critical reason for bringing the person into the partnership.
3. expansion of services
new and existing partners have an obligation to actively look for opportunities for the firm. these could be additional opportunities for the individual or for some other partner. or it could be simply participating or assisting in developing client relationships. in other words, the partner needs to bring value to the firm.
if you wait for an individual to become a partner before this criterion is talked about or emphasized, it will be too late for that person to develop the necessary skills. while we don’t expect new partners to be outstanding in all areas, we should expect them to have basic skills and be able to exhibit them.
true partnerships are comprised of professionals working together and not in silos. partners need to believe that life is not a zero-sum game and the firm needs to reward and compensate partners who build firm values as well as their individual book value.
4. leverage
all partners need to help develop the next tier of partners. if this is not done, then the firm has no long-term viability. before admitting the new partner, determine to what extent he or she has developed other people in the firm. this could be merely on-the-job training or more formal training conducted in the firm.
leverage is also critical for firm profitability. the partner who can keep five or six employees busy is not only transferring knowledge and skills but is also building confidence in these younger professionals and freeing his or her time for more valuable services to clients.
5. good citizen
firms can no longer endure the “prima donna” personality, the disruptive, abusive partner. if you have not identified the behaviors (core values) that are acceptable in your firm, do so immediately. core values are meant to be lived and rewarded. infractions to the core values may ultimately lead to termination.
6. leadership
it is true that not every partner will be on the executive committee or become the managing partner, but every partner needs to be aware that it is his or her responsibility to ensure that the firm is successful.
leadership can take on several different roles within a firm other than just firm management. an individual who is exceptionally good at collecting receivables can help others, those who are outstanding at client relationships can share their secrets of success and so forth.
7. community involvement
partners, young and old, should be seen in the community. the firm should advise and make recommendations as to the types of civic, charitable, professional and social organizations the partners should be active in. whether it is the local rotary or manufacturing association, partners should be involved in their communities. the opportunities are limitless.
the specific activities include presenting seminars, giving speeches, writing articles, being interviewed, and teaching at the local business school or adult education programs.
you may be thinking that it is going to be hard to find people to fit the above requirements and you are right. it should be hard because you are looking for the best people to become a partner in your firm. individuals who do not fit the above only create a weak partner group, which in turn causes lack of trust, bickering and poor profits.
obviously, the choice is yours to make. i know what i would do. do you?