An interview with Terry Pritchard and Lisa Mayhew
April 3, 2018 saw the official launch of Bryan Cave Leighton Paisner LLP. The result of a transatlantic merger between U.S.-based law firm Bryan Cave and U.K.-based law firm Berwin Leighton Paisner, BCLP comprises 1,600 lawyers, 32 offices and spans 11 countries.
The following interview is with Terry Pritchard and Lisa Mayhew, co-chairs of the new firm, and in it, we broach topics ranging from BCLP’s governance structure, to the analysis of the firms’ cultures prior to merging, to their thoughts on the verein model, and more.
On the Structure of Bryan Cave Leighton Paisner
Parnell: Let’s start by talking about the structure of the new firm. What are things going to look like? How are reporting lines going to look? Will there be any major changes?
Pritchard: Well, we are combining two firms, so there will be some changes. The reporting lines are: Lisa and I will be co-chairs for the first 20 months and then there will be another term of co-chairs for another four years and after that there will be one chair of the new firm.
We’re going to divide management of the firm into four primary major practice areas or departments, that’s what we’re calling them. So, there’ll be corporate, litigation, real estate and finance departments, and there will be practice groups under those. Primarily the structure will be practice driven and it will be global.
The whole notion really of “structure” is to operate as one-firm on a fully Integrated basis - both financially and otherwise. And also, a lot of effort is being spent having our lawyers get to know each other and know each other’s strengths and what opportunities may exist because we actually think that’s the best way to serve our clients. That’s the plan.
On Governance and Decision-making in the New Firm
Parnell: What will decision making look like, specifically, in the new entity? How centralized will the decision making be?
Mayhew: There will be a management committee which will be the executive management of the firm; that will comprise the four department managing partners - the DMPs, as we are calling them – and the co-COOs of the firm, which are the legacy COOs of Bryan Cave and BLP, and then myself and Terry Pritchard.
That will be the global management of the firm and we deliberately, consistent with the one-firm structure that Terry refers to, set that up on that basis rather than lots of management groups in different parts of the world.
Then there’s a global board which will comprise a different group of partners who are in the executive management roles in the firm who will be effectively the voice of the global partners - that will be a different group of partners whom Terry and I have asked to perform those roles. And again Terry and I will be the only consistent thread between the management committee and that board.
Then of course we have, running across the firm, vertical departmental lines and industry sectors that we intend to prioritize. So, there will be a nice unifying matrix that will serve us well in terms of uniting lawyers from practice groups and different offices and all who have a particular experience in particular industry sector. And in a non-bureaucratic way and with a more client- and externally focused way, this will also be an important part of the way we gather together in teams to work for the client.
That’s a more comprehensive view of our structure and governance.
On Consideration of the Verein Model
Parnell: Out of curiosity, did you consider the verein model when you were looking at the merger?
Pritchard: I’ll take the first shot at that. It’s not consistent with either of our historic cultures. Frankly Bryan Cave has a set of core values; the first of which we are one-firm and Bryan Cave’s model has been all about having all of our partners interested in finding the best lawyer in the broader system to address a client’s needs. So, I think the answer really is no. We, from the very beginning – and Lisa can speak to BLP – we’re interested in a model that was not a verein but rather a model that institutionalized collaboration, if you will, and rewarded teamwork and measures how many practice groups were involved in serving a client, how many offices were involved in serving a client and whether partners are really forming teams that are in the best Interest of a client.
On Evaluating and Analyzing Each Other’s Culture
Parnell: I can’t speak for you, obviously, but I’m confident when I say that generally with mergers, the analysis of the cultures can be a challenge. There’s a lot that goes into the process; cultures are fuzzy; the term “culture” can carry varying definitions. How did the firms go about analyzing or evaluating cultures and making the decisions that they would mesh up in the first place?
Mayhew: I think I’ll take a crack at that one. You’re right, there’s all sorts of analogies as you can imagine that have been used along the way, whether it’s the dating analogy or going for a job analogy and not really knowing until you start working in the new job exactly how it looks and feels. But I think the best way you can do due diligence is by having multiple contact and discussions and meetings with a good number of partners in both firms and then coming back to discuss, and you can tell at the end of the day.
In the people business, firstly, you know whether you fundamentally like each other. Secondly you know whether the way you talk about how you service your clients and how you work with one another, whether you recognize the fundamentals about those things. You can have more granular discussions around that – the client service delivery model – and you get a good sense about whether there will be chemistry.
This has been a 14-month process, so it took longer than we probably expected because of the structural issues we were determined to see through. But, frustrating as that sometimes sounds, it has the benefit of allowing more time for those meetings and experiences to take place. And I think in the final analysis, given the overwhelmingly positive report that then happened at the end of that timeframe, it was well worth it.
On Integrating the Two Firms
Parnell: OK, let’s talk about integration. It is one of the most – if not arguably the most – important part of the merger process. What does the plan look like for the next year for integrating the firm?
Pritchard: David I would say it began before the firms agreed to merge. We have an integration team which is four partners from each legacy firm, working hard on a variety of initiatives, everything from a great integration app they’ve created for all our phones, to a good old fashioned buddy system where people get paired up and have somebody they can call with what they might otherwise think are not very sophisticated questions.
We have an all partner retreat that happened in the first month of the combination. So, at the end of April all 570 of us gathered in Boca Raton, Florida for three days of meetings and opportunities for people to get to know and trust each other.
We have lots of videos and webinars happening internally so that people can appreciate the depth and breadth of the expertise that the other legacy firm brings to the table.
And we just have an awful lot of organic reaching out to each other happening by various teams and sector groups who are simply interested in finding out who their new partners are going to be and what they know and what should be done together to really grow the practices.
On Office Redundancies
Parnell: Are there any redundancies with regard to offices?
Mayhew: So, the fact that we overlap so little in terms of the focuses we’re in and the practice groups where we have people working means that it was never a part of the rationale that we would save costs. As we roll forward, might it become clear that there is some duplication in some parts, maybe, but that would be around the edges. At its core, though, it’s not part of the rationale for doing this. It’s not something that we sit here contemplating.
Pritchard: With the exception of the three locations where we do overlap, which are London, Hong Kong and Frankfurt, where we will be combining and moving into one office space.
Parnell: Let’s talk about the compensation model that the integrated firm is going to use. Were there any major disparities in the types of models that you were using pre-merger?
Pritchard: I think the approaches were quite different in the sense that BLP had what I’ll call a modified lockstep system, which is primarily a retrospective system, and Bryan Cave had a prospective system. The other major differences were that BLP had a very sizeable bonus pool – they called it their “performance fund” and we have a very small bonus pool. So, with our base compensations plus any overage that goes to equity partners - that’s really how we compensated people.
Our mantra since the beginning has really been to take what was best from both firms or even find what’s better than the best of both. And the compensation model that we’ve developed really is – I’m going to call it a hybrid of the two - it’s much more prospective looking, but we’re going from a very tiny, tiny bonus pool to one that will be much more sizeable, so people who out-perform during the year can expect a significant bonus pool.
And I’d say BLP – Lisa, jump in if I paint this wrong – but BLP is moving away from lockstep which is a significant transition for them and the bonus will be a bit smaller. So as a process matter I think it’s very different. At the end of the day when you really think about what we want to reward and how, what we find is there’s a common understanding underneath it all, which is we want to reward those partners who are driving revenues and increasing the profitability of the firm, helping grow clients and finding clients, forming teams and collaborating in doing great work, and living by the core values that we all believe in.
On Ensuring Collaboration Among the Partners
Parnell: Collaboration – which seems to be somewhat of a buzz word these days – but how do you plan on ensuring collaboration amongst the partners? I know it’s a big question, but what is your plan?
Mayhew: I don’t know why it’s a buzz word but we feel very strongly about this. I know it’s a word that all law firms use and fewer law firms can point to a structure that we feel institutionalizes, as Terry says, the kind of collaborative teamwork culture that we’re all about. So, one-firm one-team, one-culture, one set of performance principles which we’ve already articulated to the working group that comprises partners from both firms. We have clearly written down, enunciated principles about the performance standards that we expect from everybody – not just partners, lawyers, everybody – and the beauty of having a one-firm umbrella is you can have an approach that you articulate everything that you are doing.
In the part of remuneration, one of the criteria is we will bring partners who have done well at cross-selling or working in teams to bring in entirely new business that neither firm previously did, or entirely new clients, so it’s a common thread that goes throughout the firm’s structure and we think that will be part of the differentiation of the firm and also a real accelerant to its ability to move quickly to the needs of the final combining.
Also, within BLP we did a lot of research ourselves. It was about three or four years ago that we did some research on our own business about where the best trajectory was for groups that were performing better and actually you could take right down to individual partners – which groups were becoming more profitable, more successful. And we found that there was a very high correlation between the groups that were the most connected within the firm, right down to individual partners who had been connected to institutionalized client relationships - they were the most successful. And so, it was a very powerful proof point for us having done it in our own business which would demonstrate the proof of being collaborative. This is just not fluffy stuff; this is about business and it betters the business and it certainly betters clients.
Pritchard: You asked a question earlier David about verein and I think we would say our point of concerns about having chosen to structure it as a verein is that you can’t incentivize collaboration when you have separate profit pools; but you can incentivize it when it’s one profit pool and you can look at collaborative success. We hope that the structure is going to lend itself to driving collaboration in an unusual way.
About the Author
Along with being the co-founder of the Legal Institute for Forward Thinking and the founder of partner search and placement boutique True North Partner Management, David J. Parnell is an American Lawyer Fellow and a business of law author, columnist and speaker.