Rainmakers as Managing Partners?

Why is it that so many law firms are led by commercially successful partners? Doesn’t that mean that a law firm basically “loses” one of their main moneymakers to administrative tasks? Or are successful lawyers automatically better leaders, which makes them a natural choice for the top position? Let’s dive a little deeper into this question.

Key words: Managing Partner, Rainmaker, Commercial Success, Leadership

Image: Pexels / Ron Lach

Rainmakers as Law Firm Managing Partners

Many law firms are led by very successful lawyers. And when you talk to lawyers, a lot of them think that this makes much sense. After all, as Professor Laura Empson put it: «those who prove they can ‘feed’ their colleagues are also deemed to be qualified to lead them.» (Empson, 2017, Leading Professionals)

Interestingly, in the mainstream leadership literature, the requirement to have an impressive track record that could demonstrate (presumed) effectiveness in a management role is hardly mentioned (however, there are some examples such as Kouzes & Posner, who emphasize that a manager’s past achievements can indeed be a valuable indicator of the effectiveness of leaders). These authors spend much more time focusing on specific character traits or a distinct skillset – which, however, does not include specialist knowledge within their field.

Looking at Professional Service Literature

When consulting (both academic and practice) literature from the Professional Service Firm (PSF) or Law Firm environments, the results are different. Two major contrasts between the requirements for managers in law firms and other enterprises are, on the one hand, the necessity of professional competence (knowledge of the law), and on the other hand, the previous commercial success in applying this professional competence and the (internal) reputation that comes with it.

In a professional service firm, especially in a law firm, it is assumed that a leader understands the business, i.e., has the necessary expertise regarding the service offerings that the firm provides in the market. However, in law firms, it is not enough for a leader to possess the necessary technical knowledge. They should be particularly recognized by their colleagues as well as being successful in their field of expertise and in dealing with clients. Managing partners, therefore, need to be financially successful and ideally have built a reputation as rainmakers. Many partners assume that such individuals have already been able to navigate themselves successfully in the market for a long time. And who has been able to do that often commands a lot of respect with their fellow partners – something that comes in handy when leading a firm as Primus or Prima inter Pares.

Why is that? In a law firm partnership, the managing partner plays a crucial role in leading and guiding the organization. However, because they very often hold no actual formal hierarchical authority over their respective partners (after all they are inter pares or “among equals”) they need some other source of authority, which is where the commercial success kicks in. Otherwise, a managing partner may struggle to influence their peers and make meaningful progress towards the law firm's goals. Thus, a managing partner who commands respect is more likely to be able to navigate difficult decisions and situations, leading the firm through challenging times and ensuring its long-term success. Additionally, a managing partner who is or was a rainmaker is likely to be able to effectively communicate with clients and peers, to build strong relationships with clients and other firms, and attract top talent to the firm.

Asking Managing Partners themselves…

In most jurisdictions, it is generally assumed that managing partners (like all other partners) in law firms must have a license to practice law. However, as already mentioned above, simply possessing a law degree or license is not enough. In an interview study conducted with the managing partners of some of the largest law firms in Germany, Austria and Switzerland, they – to a large extent – agreed with the findings from the PSF literature: to be a successful managing partner one needs to have been an successful partner first, with “successful” meaning showing an outstanding economic performance and/or being ranked top-tier in your area of the law. One managing partner said: "You won't convince them... If managing partners are not strong in business development or don't generate sufficient revenue themselves, then they won't be able to tell the others what to do in order to be successful."

However, opinions differed when it came to how successful in terms of economic weight someone needs to be to get elected managing partner and lead the firm. While some believe that a managing partner needs to be among the top business-getters (among the rainmakers) in order not to be labelled a “fair-weather-pilot”, most interviewees agreed that having a comparatively strong performance and generating above-average revenue is sufficient.

However, while being or having been a successful lawyer and carrying some economic weight is important, as the literature on PSF and law firms suggests and the interviewed managing partners confirmed, it is by far not the only thing that a managing partner needs in order to succeed (more on that at a different time). But apart from the authority that comes along with it, a relatively strong practice has another (personal) advantage as one managing partner mentioned: "You need the assurance that if the others make you so angry [that you wouldn’t want to do the MP-job anymore], you can survive on your own with your practice. This is very important for you to remain independent and do this job independently."