Owning the client dollar

September 19, 2013

The Survivalists ponders the biggest difference between partnership at UK and US firms

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Despite their failure to insert the letter ‘u’ where it belongs, a distressing inability to make a decent cup of tea and the creation of a political system so lunatic that someone like Michelle Bachmann can get elected to Congress, the Americans have bested us in almost every walk of life where our former colonists have come a’knocking.

The law is no different. Despite having, er, rather invented the common law system, we have been unable to hold onto our top spot globally (a fact the Survivalist lays entirely at the antediluvian doors of the Bar, but that’s another story…) and US firms are dominant.

Even in our heartland, London, US firms continue to grow disproportionately faster than UK firms.

As an associate you will tend to perceive US firms in various ways, usually as paying more and working you harder than a UK firm will do. But it is when it comes to partnership that the differences really manifest, and where you will need to think long and hard about your career choices. Believe me, it’s worth thinking about where you are now, on whatever rung of the career ladder you find yourself, as you may find it starts altering your behaviour. Confused? Let me explain.

Origination of the US species

US firms work on the notion of client ownership, and partner remuneration is divvied up on the basis of what are known as ‘originations’. If you originate a client instruction, you get credit for it when it comes to parcelling out the moolah, and those credits can be ongoing, reflecting this origination for years and years. As you might expect, this becomes quite an instrument of power, and client relationships are jealously guarded.

In UK firms, client relationships are much more diffused. This is partly a function of how UK lawyers work – generally more specialised than US ones – and partly a tacit or indeed overt defensive measure UK firms take to avoid having clients ripped out of them when lawyers leave. They also employ restrictive covenants and long notice periods, often including so-called ‘garden leave’, neither of which US firms bother with.

Some observers might say the US firms demonstrate a superior evolutionary model: law with a claw. Others find them pushy, say they overbill and can be tough places to work.

Get close, stay close

So why is this relevant to you? Well, because whichever firm you end up in, how you are schooled in the ways of client relationships may become highly relevant. If you are in a firm where they are diffused, and you move to a firm where ownership is all, you may find it difficult to get on. Equally, if you grow up with ownership, you might find a diffused environment bureaucratic, stultifying and annoying.

The Survivalist is a big fan of getting as close to the clients as you possibly can, and demonstrating in any and every which way you can how indispensable you are. As an associate, cultivating a junior corporate counsel client now could be the making of your career in ten years’ time when that person is general counsel of BP (or whatever).

So, if you’re at a UK firm, next time that US firm comes calling, think about how a few years in a very different place might change your view of how the world works. Even if it’s not where you’re going to stay, it doesn’t do any harm to see how differently things are done.

And if you’re already at a US firm, well, you know what you have to do: bag that client and hold on for dear life.

Stay frosty. TS

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