The Importance of Integrating Associates in Firm Mergers | BCGSearch.com

The Importance of Integrating Associates in Firm Mergers

600

Print/Download PDF

Font Size

Rate this article

79 Reviews Average: 4.2 out of 5

Long before most mergers are put to a vote, merger committees define and analyze the new firm's financial prospects, practice opportunities, governance structure, technology needs, marketing plan, and a host of related issues. Unfortunately, some firms thoroughly analyze the merger; agree to merge; but then stumble through the integration process.
The Importance of Integrating Associates in Firm Mergers

Regardless of industry, organizations face a number of hurdles when integrating after a merger. Periodically, public companies point to their failure to integrate with a merger partner as the underlying reason for a decrease in earnings, a loss of market share, and an inability to retain key talent.

Law firms that merge, but fail to integrate, can suffer the same way—synergies fail to materialize, morale suffers, and lawyers resign. For a newly merged law firm, integration priorities include ensuring clients understand how the merger benefits them; creating a sound practice management structure; developing a united marketing effort; coordinating technology infrastructure; managing multiple offices; and the list goes on.

Another hurdle, and one that is often overlooked, is how the new firm will combine the associate ranks and coordinate the associate policies of the predecessor firms.

Successfully integrating associates in a merged firm starts with communication, usually long before the merger is voted upon. Since associates are rarely involved in the merger negotiations, communicating with them during the negotiation process can help reduce their concern about merging and gain their support during the actual integration.

Timing the communication is critical. Normally, the best policy is to involve associates when it appears more likely than not that the firms will combine. Early communication usually involves identifying the merger partner, key reasons why the firm is considering merging, and how the merger enhances the firm and opportunities for the lawyers. As the negotiation process continues, communication should focus on how the firm will handle associate integration. Important integration issues that should be discussed include performance evaluation and compensation, partnership prospects, training, and practice management.

Compensation
As part of the financial analysis, merging firms usually review their associate compensation structures to project salary costs in the combined firm. Frequently, the development of associate performance standards occurs after the merger. Ideally, the standards should be set within three months of the merger effective date and incorporate the best characteristics of the predecessor firm structures.

The merger also provides an opportunity to create a new system that is significantly better than the system of either predecessor firm. The best systems, whether in a merged firm or not, ensure that associates know what is expected of them, the basis on which they will be evaluated, and whether or not they can make the jump to the partner level.

In many combinations, partners from each of the predecessor firms evaluate only the associates from “their” firm during a transition period. The benefit of this approach, which usually lasts only one year, is that associates can be comfortable that their performance is being assessed and compensation set by the partners who best know their work. By the second year, the associates should be working with partners from both of the original firms, making the separate evaluation process unnecessary.

As for associate compensation, the system that works for one firm may fail at another firm. It is common for merging firms to compensate associates differently.

For example, one firm may use a lockstep system; the other may have eliminated its associate track, and pays based on performance. In other combinations, one firm may pay bonuses while the other pays associates a percentage of their origination.

Before merging, associate compensation (in terms of gross dollars) may differ widely between the two firms. Most merging firms try to equalize associate pay scales unless the cost of living in the firms' various markets are significantly different.

When coordinating associate compensation, the combined firm needs to identify what it wants to accomplish through compensation, and then to develop a system around those goals. As with partner compensation, the firm will get what it rewards. The merged firm's associate compensation system should be announced and in place within three months of the merger effective date.

Again, the new firm's system will likely incorporate components of both firms' existing systems; communicating any system modifications to the associate groups is critically important.

Rumored changes to a firm's partnership standards always trigger a reaction from associates. Usually, senior associates are quite willing to speak out if they believe their prospects for partnership will be diminished by the combination. If management ignores their concern, they often head for the door. To ease the integration, in most cases, the firms' merger committees will identify those associates who are expected to become partners during the first one to two years of the combined firm's operations. In most mergers, the partners of the predecessor firms vote on whether “their” associates reach partner level during this initial period. This is particularly true of large mergers where not all partners will have to opportunity to work with associates under consideration. In smaller mergers, all partners often have the opportunity to work with all associates and, consequently, all partners determine whether the associates being considered reach the partner level.

Due to the prevalence of multi-tier partnership structures, it is possible that one of the merging firms will have a two-tier structure, while the other has a single tier or a different approach to the two-tier structure. Clearly, the combined firm needs one unified structure. More than likely, the merged firm will opt for a two-tier structure since it may be difficult to “place” the lawyers already occupying an income partner status in the one firm. As you might expect, associates working in the single-tier firm may balk at the idea of working their way through an income partner level before becoming equity partners. Unfortunately, there is no easy answer to this problem. Quite simply, the merged firm needs to have uniform standards for promotion to the equity tier. This may require all but the most outstanding associates to work their way through the income partner tier.

Training
Lawyer training varies significantly from firm to firm. Smaller firms often have somewhat informal, hands-on training that may disappear in the course of a merger. On top of this, when merged into a larger firm, small firm associates frequently become lost in the maze of departments and formal assignments of lawyers. To ensure that these associates embrace the large firm environment, it may be necessary to designate several partners to help the associates learn where to turn for training and practice help.

Should both firms have training programs, the programs will need to be integrated. Integration can be placed in the hands of a committee that is responsible for consolidating the two systems and eliminating unnecessary duplication. After the training systems are consolidated (and expanded, if necessary), the firm needs to ensure that all associates go through the entire training program. For some associates, this may mean that they have to go back and pick up parts of the revised training regimen that did not exist in the past.

Should both firms' training programs be sorely lacking, it may take well over a year to develop a formal training program. In the interim, the combined firm needs to have partners delegate work to associates and supervise them closely as the firm's form of training. If not already in place, the firm may want to implement a mentor program in which partners or senior associates are assigned to new associates to provide better integration into the firm, to improve training, and to enhance professional development. The mentor system can provide some training until a formal training program is in place.

Work assignment to associates after the merger may be quite different from the process followed in either predecessor firm. In the merged firm, the practice group leaders or department heads should develop guidelines for work assignment. The goals for the guidelines are straightforward—work should be allocated to ensure that client needs are met, partners get the associate support they need, associate workloads are manageable <(i.e., avoid associate burn-out), and associates get the exposure and experience they need to develop their skills.

In most firms, partners assign work directly to associates without approval from a practice group leader or department head, though there may be some firm specific limitations.

Given that partners tend to stick with the associates they know and trust, most will stick with the associates from their predecessor firm when handing out work assignments. Clearly, this is not in the best interests of the integrated firm, the clients or the associates.

In the combined firm, the practice group leaders should encourage partners to assign work to associates from both predecessor firms. It is easier to accomplish this goal in a practice management structure, which divides the practice into small practice groups within each department rather than having dozens of lawyers in one department. In addition to practice group designations, use of an expertise chart, which indicates associates talents and abilities in various areas, is another useful work assignment tool.

Precious few law firms merge without some glitches during integration. Planning and patience helps hold the glitches to a minimum. This also holds true when integrating associate groups. Advance planning for the integration before consummating the deal helps insure that the benefits anticipated in the merger are achieved. Given that associates play such a critical role in the success of any law firm, it follows that the new firm should spend the time necessary to insure that the integration goes as smoothly as possible for this important group.
 
 
Interested in Learning More About Legal Hiring? Read the Definitive Guide:

How to Hire a Legal Recruiter for Your Law Firm: How Law Firms Recruit Attorneys Using Legal Recruiters



About Harrison Barnes

No legal recruiter in the United States has placed more attorneys at top law firms across every practice area than Harrison Barnes. His unmatched expertise, industry connections, and proven placement strategies have made him the most influential legal career advisor for attorneys seeking success in Big Law, elite boutiques, mid-sized firms, small firms, firms in the largest and smallest markets, and in over 350 separate practice areas.

A Reach Unlike Any Other Legal Recruiter

Most legal recruiters focus only on placing attorneys in large markets or specific practice areas, but Harrison places attorneys at all levels, in all practice areas, and in all locations-from the most prestigious firms in New York, Los Angeles, and Washington, D.C., to small and mid-sized firms in rural markets. Every week, he successfully places attorneys not only in high-demand practice areas like corporate and litigation but also in niche and less commonly recruited areas such as:

This breadth of placements is unheard of in the legal recruiting industry and is a testament to his extraordinary ability to connect attorneys with the right firms, regardless of market size or practice area.

Proven Success at All Levels

With over 25 years of experience, Harrison has successfully placed attorneys at over 1,000 law firms, including:

  • Top Am Law 100 firms such including Sullivan and Cromwell, and almost every AmLaw 100 and AmLaw 200 law firm.
  • Elite boutique firms with specialized practices
  • Mid-sized firms looking to expand their practice areas
  • Growing firms in small and rural markets

He has also placed hundreds of law firm partners and has worked on firm and practice area mergers, helping law firms strategically grow their teams.

Unmatched Commitment to Attorney Success - The Story of BCG Attorney Search

Harrison Barnes is not just the most effective legal recruiter in the country, he is also the founder of BCG Attorney Search, a recruiting powerhouse that has helped thousands of attorneys transform their careers. His vision for BCG goes beyond just job placement; it is built on a mission to provide attorneys with opportunities they would never have access to otherwise. Unlike traditional recruiting firms, BCG Attorney Search operates as a career partner, not just a placement service. The firm's unparalleled resources, including a team of over 150 employees, enable it to offer customized job searches, direct outreach to firms, and market intelligence that no other legal recruiting service provides. Attorneys working with Harrison and BCG gain access to hidden opportunities, real-time insights on firm hiring trends, and guidance from a team that truly understands the legal market. You can read more about how BCG Attorney Search revolutionizes legal recruiting here: The Story of BCG Attorney Search and What We Do for You.

The Most Trusted Career Advisor for Attorneys

Harrison's legal career insights are the most widely followed in the profession.

Submit Your Resume to Work with Harrison Barnes

If you are serious about advancing your legal career and want access to the most sought-after law firm opportunities, Harrison Barnes is the most powerful recruiter to have on your side.

Submit your resume today to start working with him: Submit Resume Here

With an unmatched track record of success, a vast team of over 150 dedicated employees, and a reach into every market and practice area, Harrison Barnes is the recruiter who makes career transformations happen and has the talent and resources behind him to make this happen.

A Relentless Commitment to Attorney Success

Unlike most recruiters who work with only a narrow subset of attorneys, Harrison Barnes works with lawyers at all stages of their careers, from junior associates to senior partners, in every practice area imaginable. His placements are not limited to only those with "elite" credentials-he has helped thousands of attorneys, including those who thought it was impossible to move firms, find their next great opportunity.

Harrison's work is backed by a team of over 150 professionals who work around the clock to uncover hidden job opportunities at law firms across the country. His team:

  • Finds and creates job openings that aren't publicly listed, giving attorneys access to exclusive opportunities.
  • Works closely with candidates to ensure their resumes and applications stand out.
  • Provides ongoing guidance and career coaching to help attorneys navigate interviews, negotiations, and transitions successfully.

This level of dedicated support is unmatched in the legal recruiting industry.

A Legal Recruiter Who Changes Lives

Harrison believes that every attorney-no matter their background, law school, or previous experience-has the potential to find success in the right law firm environment. Many attorneys come to him feeling stuck in their careers, underpaid, or unsure of their next steps. Through his unique ability to identify the right opportunities, he helps attorneys transform their careers in ways they never thought possible.

He has worked with:

  • Attorneys making below-market salaries who went on to double or triple their earnings at new firms.
  • Senior attorneys who believed they were "too experienced" to make a move and found better roles with firms eager for their expertise.
  • Attorneys in small or remote markets who assumed they had no options-only to be placed at strong firms they never knew existed.
  • Partners looking for a better platform or more autonomy who successfully transitioned to firms where they could grow their practice.

For attorneys who think their options are limited, Harrison Barnes has proven time and time again that opportunities exist-often in places they never expected.

Submit Your Resume Today - Start Your Career Transformation

If you want to explore new career opportunities, Harrison Barnes and BCG Attorney Search are your best resources. Whether you are looking for a BigLaw position, a boutique firm, or a move to a better work environment, Harrison's expertise will help you take control of your future.

Submit Your Resume Here to get started with Harrison Barnes today.

Harrison's reach, experience, and proven results make him the best legal recruiter in the industry. Don't settle for an average recruiter-work with the one who has changed the careers of thousands of attorneys and can do the same for you.


About BCG Attorney Search

BCG Attorney Search matches attorneys and law firms with unparalleled expertise and drive, while achieving results. Known globally for its success in locating and placing attorneys in law firms of all sizes, BCG Attorney Search has placed thousands of attorneys in law firms in thousands of different law firms around the country. Unlike other legal placement firms, BCG Attorney Search brings massive resources of over 150 employees to its placement efforts locating positions and opportunities its competitors simply cannot. Every legal recruiter at BCG Attorney Search is a former successful attorney who attended a top law school, worked in top law firms and brought massive drive and commitment to their work. BCG Attorney Search legal recruiters take your legal career seriously and understand attorneys. For more information, please visit www.BCGSearch.com.

Harrison Barnes does a weekly free webinar with live Q&A for attorneys and law students each Wednesday at 10:00 am PST. You can attend anonymously and ask questions about your career, this article, or any other legal career-related topics. You can sign up for the weekly webinar here: Register on Zoom

Harrison also does a weekly free webinar with live Q&A for law firms, companies, and others who hire attorneys each Wednesday at 10:00 am PST. You can sign up for the weekly webinar here: Register on Zoom

You can browse a list of past webinars here: Webinar Replays

You can also listen to Harrison Barnes Podcasts here: Attorney Career Advice Podcasts

You can also read Harrison Barnes' articles and books here: Harrison's Perspectives


Harrison Barnes is the legal profession's mentor and may be the only person in your legal career who will tell you why you are not reaching your full potential and what you really need to do to grow as an attorney--regardless of how much it hurts. If you prefer truth to stagnation, growth to comfort, and actionable ideas instead of fluffy concepts, you and Harrison will get along just fine. If, however, you want to stay where you are, talk about your past successes, and feel comfortable, Harrison is not for you.

Truly great mentors are like parents, doctors, therapists, spiritual figures, and others because in order to help you they need to expose you to pain and expose your weaknesses. But suppose you act on the advice and pain created by a mentor. In that case, you will become better: a better attorney, better employees, a better boss, know where you are going, and appreciate where you have been--you will hopefully also become a happier and better person. As you learn from Harrison, he hopes he will become your mentor.

To read more career and life advice articles visit Harrison's personal blog.


AGREE/DISAGREE? SHARE COMMENTS ANONYMOUSLY! We Want to Hear Your Thoughts! Tell Us What You Think!!

Related Articles

We've changed thousands of lives over the past 25 years, and yours could be next.

When you use BCG Attorney Search you will get an unfair advantage because you will use the best legal placement company in the world for finding permanent law firm positions.