“LIES, DAMN LIES, AND STATISTICS”

ALM editor-in-chief Aric Press penned a provocative article about Indiana Law Professor Bill Henderson’s for-profit venture on recruiting, retention, and promotion. (http://amlawdaily.typepad.com/amlawdaily/2010/11/pressconventionalwisdom.html) The WSJ law blog and ABA Journal covered it, too. (http://blogs.wsj.com/law/2010/11/15/on-law-firms-and-hiring-is-a-new-paradigm-on-the-way/) Henderson is analyzing why some attorneys succeed in Biglaw and others don’t.

Does anyone else find his project vaguely unsettling?

At first, I thought of the venerable computer programming maxim, “garbage in, garbage out.” That’s because he’s asking Am Law 200 partners to identify values and traits they want in their lawyers — and he’s assuming they’ll tell him the truth. But will they admit to seeking bright, ambitious associates wearing blinders in pursuit of elusive equity partnerships typically awarded to fewer than 10% of large firm entering classes? Or that such low “success” rates inhere in the predominant Biglaw business model that requires attrition and limits equity entrants to preserve staggering profits?

Then I considered Mark Twain’s reflections on the three kinds of falsehoods: “Lies, damn lies, and statistics.” It came to mind because Henderson’s researchers “pour over the resumes and evaluations of associates and partners trying to identify characteristics shared by those who have become ‘franchise players’ and those who haven’t.” Here’s what those resumes and evaluations won’t reveal: the internal politics driving decisions.

Most Biglaw equity partners are talented, but equally deserving candidates fail to advance for reasons unrelated to their abilities. Rather, as the business model incentivizes senior partners to hoard billings that justify personal economic positions, those at the top wield power that makes or breaks young careers — and everybody knows it. Doing a superior job is important, but working for the “right” people is outcome determinative. Merit sometimes loses out to idiosyncrasy that is impervious to Henderson’s data collection methods.

But perhaps the biggest problem with Henderson’s plan is it’s goal: identifying factors correlating with individual success. Does the magic formula include “a few years in the military, a few years in the job force, or a few years as a law review editor?”

If managers warm to Henderson’s conclusions (after paying his company to develop them), they’ll leap from correlation to causation, develop checklists of supposed characteristics common to superstars like themselves, and hire accordingly. Law schools pandering to the Biglaw sliver of the profession (it’s less than 15% of all attorneys) could take such criteria even more seriously. Before long, prospective students will incorporate the acquisition of “success” credentials into their life plans.

The difficulty is that today’s Biglaw partners already favor like-minded proteges. That inhibits diversity as typically measured — gender, race, ethnicity, sexual orientation, and the like — along with equally important diversity of views and a willingness to entertain them. Even today, concerned insiders are reluctant to voice dissent from Biglaw’s prevailing raison d’etre – maximizing short-term profits at the expense competing professional values and longer-term institutional vitality. Won’t meaningful diversity — of backgrounds, life experiences, and resulting attitudes about professional mission — suffer as groupthink makes firms even more insular? Meanwhile, trying to improve overall “success” rates is a futile goal; they won’t budge until the leveraged pyramid disappears.

I don’t fault Henderson, who bypassed Biglaw practice for academia after his 2001 graduation. But Press’s warning is important: “To some extent, it doesn’t matter what Henderson and Co. discover. What matters is that the inquiries have begun…If we’ve learned anything from the last decade, it’s that we can’t predict the consequences of new information beyond acknowledging its power to disrupt.”

Consider two unfortunate examples. The flawed methodology behind U.S. News’ law school rankings hasn’t deterred most students from blindly choosing the highest-rated one that accepts them. (Exorbitant tuition and limited job prospects may be changing that.) Likewise, Biglaw’s transformation from a collegial profession to a short-term bottom-line business accelerated after publication of average partner profits at the nation’s largest firms (then the Am Law 50), beginning in 1985; I just published a legal thriller describing that phenomenon. (http://www.amazon.com/Partnership-Novel-Steven-J-Harper/dp/0984369104)

The most important things that happened to me — in Biglaw and in life — were fortuitous. No statistical model could have predicted them. Still, I hope Henderson’s study answers an important question: Would his likely-to-succeed factors have led any firm to hire me?

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4 thoughts on ““LIES, DAMN LIES, AND STATISTICS”

  1. Great piece. The Henderson venture is certainly potentially very disturbing from a diversity point of view, but is anyway pretty much doomed to failure, given that there is almost certainly a disjunction between how partners believe they act (and which translate into their requirements) and how they act in reality.

    I was formerly a legal recruiter in the UK (and a legal journalist before that) and could have written most law firms’ job specs with my eyes shut. They always wanted what I used to term ‘Renaissance Lawyers’.

    These mythical individuals were always accomplished technical practitioners, entrepreneurial, ardently committed to business development, winning work and cross-selling; they would be good client-handlers and process-managers, strong ‘team-players’, and good coaches and mentors. As partners they would also be good financial managers, with a good recovery rate and low lockup, and of an unswervingly collegiate mindset.

    Until law firms face up to the paradoxes and tensions their multifarious requirements for, and judgements of, success inevitably create, the profit-motive will inveigh against the hiring of more rounded individuals, and, I believe, ironically leave law firms more vulnerable to seismic changes (Black Swan-style) in the market.

  2. You make a cogent and educational (for me, anyway) explanation of this phenomenon and, in the process, helped this non-lawyer understand things just a bit better.

    Mark Brandon’s observation of the putative hiring aspirations of BigLaw is funny, if only because humans possessing that array of skills and attributes don’t exist.

    The aspect of law firm hiring I’ve always found most surprising is that real-world work experience and marketing/sales savvy are so conspicuously absent from such hiring criteria.

    Recognizing that there will be many exceptions, if lawyers’ bios are any indicator, it appears that BigLaw is mostly populated by students who went to a top-tier undergrad college via scholarship or family means, then a top-tier law school, similarly funded, were feted by BigLaw each Summer, then joined the firm after law school for a serious salary.

    The result is that many lawyers advising companies of all sizes have spent no time in an actual job, which would explain the painful shortage of business awareness or acumen in the profession.

    In our sales training discipline, we urge lawyers to recognize what we call the Impact Ladder, which is a progression beginning with Relevance, which earns you an opportunity to demonstrate Usefulness, which if applied to a high-consequence problem yields Value, which if delivered consistently over time may some day enable Indispensability. The first domino, though, is Relevance. If you don’t know how any business operates and makes a profit, your legal knowledge comes with overhead that clients won’t tolerate anymore.

    Firms’ hiring goals will have to evolve or they’ll find their Y1-Y4 lawyers completely uneconomic, which will require them to finance their entire development out of pocket. Think what that will do to PPP.

  3. Very interesting and thoughtful, as one expects on this blog. I think I am somewhere in the middle – I haven’t studied Henderson’s metrics, and like you am a bit suspicious on the surface. That said and done, I am fairly convinced that the same cluster of personality traits that lead to success in most professions are true for law, at least over the long term of a career – but maybe not in law school. Things like optimism (although my friend Marty Seligman famously argues otherwise), social intelligence, zest, hope, persistence, grit, and resilience. These are the things I am measuring at Emory and Duke (as we have discussed), and in a private BigLaw firm and a public corporation.

    Dan Bowling
    Duke Law School

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