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Harvard Study: Law Firm Collaboration Pays Off

March 3, 2015, 5:02 AM

Heidi Gardner, Distinguished Fellow, Harvard Law School’s Center on the Legal Profession

Today’s law firms face a paradox: they attract more loyal and profitable clients when partners break through internal siloes to provide cross-practice, cross-border service, but the individual partners often ask, “What’s in it for me?”

Even for those who value the camaraderie of collaboration, the performance pressures in many firms leads them to prioritize short-term, more certain gains over long-term, more speculative returns from collaborative work.

Our research at Harvard Law School’s Center on the Legal Profession takes an empirical approach, guided by social science, to examining this problem. The research uncovers some of the barriers to collaboration among law firm partners, quantifies the potential upside, and proposes some practical ways to move forward.

By analyzing millions of timesheet, personnel and financial records from multiple firms over a decade, we can show that the more practice groups that are involved in serving a client, the higher the revenues. Similarly, client projects involving offices in several countries are significantly more lucrative than single-office engagements.

These rewards flow to the firm, as expected, but we demonstrate how – and how much – individual lawyers benefit from teaming up to serve clients.

For example, average partners in my study got a new client referral within a year from one in every six colleagues they teamed up with, and such referrals were each worth about $50,000 more realized revenue. One trick, however, is finding the right balance between executing work that others originate versus originating work oneself, and a future article here on Big Law Business will reveal ways that partners can avoid falling into a “service partner trap” that limits their prospects for generating new business.

Rainmakers who systematically involve other partners in their work benefit, too. The more colleagues in other practices that a partner involves in client work she originates, the more the rainmaker’s book of business grows in subsequent years from both their existing clients and from new clients.

The risks of involving fellow partners in highly prized client relationships are non-trivial, of course. A future article here will explore some of the barriers to collaboration – both real and perceived –and discuss ways to overcome them. For further reading at this point, check out results of this study that were recently published in Harvard Business Review.

I will publish a book based on this research with Harvard Business Press next year. Right now I’m developing a Board of Contributors to periodically review preliminary ideas from the manuscript and provide input, critiques, and examples. If you’re interested, please contact me. Otherwise, stay tuned – we’ll be back soon with the latest findings.

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