Firm Culture

Culture Murders, Decimates and Destroys Strategy

You may be familiar with the expression, “Culture Eats Strategy for Breakfast,” a quote from Peter Drucker. As the title of this post implies, I not only agree with that sentiment, but I believe that it is drastically understated.

Back in 1987, I attended my first partners’ retreat. We had the mandatory big-name, expensive consultant fly in from the U.S.  He led us through several days of brainstorming ideas, writing them on large pieces of paper, and taping them to the walls. Then we ranked our goals, developed our firm values, and agreed upon a mission statement. In short, we did all of the management consultant stuff that was popular at the time.

And where did it get us? Quite far, actually, at least in theory. Driven by the partners with the biggest books and billings, who all happened to be in the real estate department, we decided that we would be the premier real estate law firm in Ontario.  We would be known for doing all types of real estate work. We would do corporate work for real estate developers and we would be leaders in real estate litigation. When you thought of real estate, you would think of us.

Had we ever implemented this brilliant strategy, we would certainly have been bankrupt within a few short years when the real estate market went to hell.

Luckily for us, our strategy was doomed from the beginning because our firm culture was such that we could not implement ourselves out of a paper bag. Sure, we talked a good game, but our Partners were only interested in changing the ways of the Associates and staff, not their own ways, and then only when it was not inconvenient. Of course, anything that frittered away billable hours or might reduce short-term profits was bloody inconvenient.

Many years later I was speaking to my friend Maria, who is an expert in human resources, about changing compensation systems in law firms. I expressed the view that it would be difficult to do this in an existing firm where the values are entrenched and there is always someone who will fight it because they will be disadvantaged by a change. Maria corrected me and said that it would be almost impossible in most firms.

As I reflect on the many times in my career that I was involved in strategic initiatives that ultimately failed due to a dearth of support from the stakeholders, I have come to realize that Maria had nailed it. No strategy is going to get anywhere if it is banging up against a culture that does not want it to happen.

So, if you are looking to change the way your firm operates, I suggest that you first determine how your strategy fits with the existing firm culture. If there is a conflict, do one of the following:

  1. Figure out how to resolve it; or
  2. Quit and join another firm or start your own.

If you refuse to do one of the above but try to implement your strategy anyway, you are an idiot. Just like I was.

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