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| Jolie Balido |
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| Tina van der Ven |
Senior partners are recognizing that success requires relying less exclusively on intelligence quotient and giving equal priority to emotional quotient as it pertains to everything from law firm management to client retention.
For the highly disciplined creatures of habit that many high-powered lawyers tend to be, change — especially during this tumultuous time — can be tricky to embrace because it requires a significant departure from tradition. However, not doing so may become a luxury that firms cannot afford, costing them some of their most valuable assets: their clients, lawyers, business staff members and reputations.
Historically, the formula for managing clients, selecting law firm leaders, hiring attorneys and making everyday decisions has been heavily rooted in IQ-based factors that include well-established firm procedures and consideration of attorneys' legacies, pedigrees, Ivy League educations, billable hours, books of business, etc.
COVID-19 has further underscored the inescapability of embracing EQ, as lawyers are now having to deal with a new set of issues associated with working in today's new normal. This includes everything from establishing effective virtual home offices to retaining their firms' morale and client confidence in one of the most uncertain times in recent history.
What does all this mean for BigLaw? First, let's take a step back and consider the definitions of EQ and IQ.
EQ, a measure of emotional intelligence, refers to the ability to perceive, evaluate, manage and express emotions. Researchers such as John Mayer and Peter Salovey, and noted writers like Daniel Goleman, have made it a hot topic in business management, and helped shed light on the importance of understanding how others feel, controlling one's emotions, relating to others, and using emotions to enhance communication. On the other hand, IQ represents such abilities as reasoning, memory, knowledge, and visual and spatial processing.
Over the years, research and studies have helped transition emotional intelligence from a semi-obscure topic of academic journals to a widely discussed term. Today, parents buy toys to help boost their children's emotional intelligence and enroll them in social and emotional learning programs. A growing number of U.S. schools are making social and emotional learning a curriculum requirement.
Years ago, IQ was perceived as the key factor for success, and people with high IQs were assumed to be destined for greatness. However, researchers began realizing that high IQs were no guarantee, and IQ was too narrow a measure of ability and knowledge.
While IQ is still recognized as a factor in success, experts today say that emotional intelligence is an equally significant determinant, particularly in business. Increasingly, companies have been requiring emotional intelligence training and have been using EQ tests in hiring. Research confirms that the strongest leaders also are more emotionally intelligent.
As it pertains to client acquisition and retention, EQ also plays an important role. Nobel prize-winning psychologist Daniel Kahneman found that clients or customers would rather work with people they like and trust, rather than someone they don't, even if that means paying more for a service or product they know is inferior.
Today, as law firms are having to furlough or terminate employees, maintaining firmwide morale and a positive community presence is making EQ particularly relevant. Without a doubt, handling these tough conversations requires a high degree of psychology, strategy and tact to help ensure the remaining lawyers and business staff stay loyal to the firm and its brand emerges untarnished.
EQ is also critical as law firms look for ways to survive today's financial crisis and position themselves for success when business does return to normal. For example, news and other reports are showing business leaders in other industries having the vision and courage to continue investment in their companies and their people during today's troubled times, rather than cutting back.[1]
Beyond wanting a sense of professional and financial stability in this uncertain environment, lawyers are seeking supportive, collaborative cultures that offer a flexible work-life balance, fair and reliable compensation structures, transparency, diversity, succession planning, professional camaraderie, as well as meaningful investments in human capital programs, including mentoring.
At the same time, clients are increasingly hiring law firms based on the firms' diversity, minority and community involvement data. And, particularly as companies look to minimize costs in today's pandemic, clients are demanding more flexible fee structures than ever.
The challenge for the legal industry: Creating these workplaces requires adopting new EQ-based approaches to better connect with stakeholders and meet their needs. A more evolved mindset and a real capacity and commitment to embrace change is critical.
While these dynamics can create challenges for law firms of all sizes, they are particularly tricky for larger firms. Typically, any measure of change at larger law firms occurs more slowly, if ever, due to the rigidity of their deep-rooted traditions and values, management structures, internal politics, and bureaucracies.
So, where should BigLaw go from here? What steps should law firms take today? While every firm requires a custom-tailored approach, following is some general guidance for consideration.
1. Promote EQ within the firm.
Studies confirm that EQ can be strengthened. Making EQ a part of firmwide culture by providing webinars, research and open-forum discussions can help enhance EQ within the firm.
2. Accept and embrace the necessity of change.
Change requires recognizing the inherent issues and taking the necessary measures to rectify them. Denial will not yield progress. Law firm leaders must be willing to forgo the perceived safety of the status quo and learn to feel comfortable with being uncomfortable.
Change is often difficult because human beings, particularly those who have achieved success based on consistency and discipline, tend to feel safest when doing the same things they have done for years. Fear of unknowns causes them to cling to the perceived safety of predictable outcomes — even when they recognize those outcomes are not in their firms' best interest.
3. Keep a close pulse on stakeholders.
Keeping law firm members and clients engaged during a pandemic is more challenging than ever. Routinely survey and speak with lawyers, business staff members and clients with a goal of fully understanding their thoughts and feelings during this turbulent time, as well as the internal and external perceptions of the firm.
Really listening to these individuals — and identifying constructive ways to address their concerns — requires true focus and EQ-based dialogues. This is a marked departure from intelligence-based approaches that do not create an opportunity to separate our own emotions from issues and instead, see issues through the eyes of others.
4. Foster communication.
As the global health crisis continues to unfold on a daily basis, it's critical to encourage ongoing open dialogue with stakeholders to ensure law firm management is prepared to address emerging issues in real time.
In a departure from intelligence-based approaches that typically neglect to take a deep dive into anything much beyond the business of the day, it is important to conduct routine phone and videoconferences with key players that offer constructive platforms to openly discuss obstacles and opportunities for improvement. Videoconferences — because they enable visual communication and eye contact — promote collaboration and provide a better opportunity to read people and connect with them in comparison to phone calls.
5. Conduct research.
Following legal news and reports and collaborating with colleagues can provide valuable information on the current challenges and the corresponding solutions being implemented industrywide. Firms can use this information and best practices to further develop their own strategies and tactics.
6. Develop an action plan.
Work with trusted consultants to develop customized strategies for crisis communications, firm management challenges and client retention. The plan must be pragmatic and actionable, especially in light of the various sensitivities, financial uncertainties and fears lawyers and clients are encountering. In developing the action plan, law firm leaders must deploy emotional intelligence in an effort to more fully understand their people and clients at a deep level and respond to the current challenges accordingly,
7. Implement programs and initiatives with a focus on mental health and wellness.
ALM's recent Mental Health and Substance Abuse survey reveals a staggering number of lawyers today suffer from depression, anxiety, substance abuse challenges and suicidal ideations. Additionally, 73% of survey respondents said their work environments contribute to these issues. Many said they are unaware of what their firms are doing to address the challenges.
Firms should put real muscle behind impactful initiatives, such as mental or substance abuse assistance, treatment and recovery, mindfulness coaching, counseling and other resources that further support work-life balance, especially in the virtual office setting.
8. Align with the right minds.
Firms should hand-select diverse internal committees that are empowered to develop the plan in collaboration with external consultants. Outside experts can provide unbiased perspectives to ensure the firm's strategy is on point.
9. Get internal buy-in for the plan.
Prior to implementation, make sure the plan is reviewed by key stakeholders to secure support upfront and avoid unnecessary opposition along the way.
10. Empower your people.
Give your stakeholders the ability to be heard and to effectuate meaningful change. Conduct routine surveys and meetings encouraging open feedback. Actively listen. Be open minded. Take notes. And follow through.
The ability to truly empathize and connect with others requires significant EQ. Why is this important? Nothing is more disenchanting than feeling like your opinions don't matter and promises are broken. Retaining top talent and clients is all about actively listening, following through on your deliverables and commitments, and ensuring their satisfaction.
11. Make change!
An action plan that's developed and completed with much fanfare, but inadequate execution and follow-through, is worse than no plan at all because it causes people to lose faith in the firm. So walk your talk and keep your promises. Remember, people do business with people they know, they like and they trust. Ignore this tenet, and you can lose something more precious than money: people's faith and respect.
Conclusion
If law firms fail to incorporate more holistic views that give equal priority to decision-making based on EQ, their ability to attract and retain lawyers and clients will remain uncertain, and their futures could be significantly compromised along with their cultures and reputations. Beyond BigLaw, the entire profession is losing lawyers due to the same stressors. The daily reports of lawyers switching to boutique firms, setting up their own shops, or quitting the practice of law to pursue entirely different careers further evidences this point.
Forward-thinking firms can use this work-from-home period to refocus and emerge stronger than ever. We are at the early stages of a seismic shift with the potential to redefine the legal profession. It is time to embrace change. We are in this together.
Jolie Balido and Tina van der Ven are co-CEOs and co-founders of NewStar Media.
The opinions expressed are those of the author(s) and do not necessarily reflect the views of the firm, its clients or Portfolio Media Inc., or any of its or their respective affiliates. This article is for general information purposes and is not intended to be and should not be taken as legal advice.
[1] https://www.washingtonpost.com/business/2020/04/02/some-companies-are-pledging-not-lay-off-employees-now/
https://www.inc.com/justin-bariso/instead-of-laying-off-20-of-his-company-this-ceo-made-an-unusual-decision-its-a-lesson-in-emotional-intelligence.html
https://justcapital.com/news/capitalism-meets-coronavirus-how-companies-are-responding/
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