February 15, 2007  

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News & Views

Developed especially for this issue of ALA Currents and copyrighted by Altman Weil Inc. For more information, visit Altman Weil’s Web site.

DIVERSITY MANAGERS, COMMITTEES INCREASE IN LARGE LAW FIRMS

The newly released Altman Weil Flash Survey on the Diversity Manager Position in Large Law Firms reports that 50 percent of participating firms have designated Diversity Managers or Directors, up 5.4 percent from the prior year. In addition, the survey found that 96 percent of participants report having Diversity Committees in their firms, up from 93 percent.

The survey, developed with input from the Minority Corporate Counsel Association, canvassed AmLaw 200 law firms. Survey data are based on 72 responses (37 percent) collected in December 2006 and January 2007.

“In the second year of the survey, we’re seeing an increasing number of diversity professionals in large law firms. They are also more likely to have law degrees, prior diversity experience, and a direct reporting relationship with senior firm management,” said Virginia Grant Essandoh, Altman Weil Senior Consultant. “These are all indicators that the issue of diversity continues to gain importance in U.S. law firms.”

Diversity Manager Positions
According to the survey, 67 percent of Diversity Managers are lawyers in their firms, up from 53 percent in the first survey. For 61 percent of Diversity Managers, the positions are full time. In addition, 67 percent report to firm Chairs or Managing Partners, up from 47 percent last year.

Some Diversity Managers are balancing their duties with active law practices. Twenty-nine percent of those who are lawyers have billable hour requirements, in most cases between 1,500 and 2,000 hours per year.

Clearly this is still a new role in law firms. Thirty-one percent of all Diversity Managers have been in their jobs for less than one year, and 54 percent have held their positions for between one and three years.

Roles and Responsibilities
Diversity Managers serve in a variety of roles, including involvement in lawyer/staff hiring processes (67 percent), Recruiting Committees (58 percent), Professional Development Committees (39 percent), Associate Relations Committees (36 percent), Associate Review Committees (33 percent), Compensation Committees (14 percent), and Partner Review Committees (11 percent).

The primary areas of responsibility for Diversity Managers are to develop, promote, and implement diversity goals and strategies and to promote awareness of diversity issues within their firms. Other top jobs include managing external outreach programs and collaborating with corporate clients on diversity initiatives. The lowest ranked job priority according to the survey data is establishing mentoring programs.

“While most firms have mentoring programs, apparently they are not linking them with their diversity initiatives,” said Essandoh. “This is a missed opportunity to improve job satisfaction and retention efforts for women and minority lawyers.”

Budgeting for Diversity
The average annual total cash compensation for Diversity Managers in the survey was reported at just more than $217,000. Diversity Managers who are lawyers take home an average of $255,000, while non-lawyer professionals earn nearly $150,000, or 42 percent less.

The total budget allocation to support the position (including the Diversity Manager’s salary) was an average of $513,500. Seventy-eight percent of Diversity Managers have staff support, with an average 1.6 staff positions reporting to them.

Click here to view the full report.

NOTHING PERSONAL: EMPLOYEES STILL DON'T UNDERSTAND PERILS OF COMPUTER USE AT WORK

As we mark e-mail’s 25^th birthday by exchanging more than 143 billion messages a day, it’s not all cause for celebration. A new survey reveals significant misunderstanding among American workers regarding the privacy of their personal e-mails and other computer activities in the workplace. Many do not know that even their most personal messages may be stored electronically and can come back to haunt them or their employers.

WeComply, a provider of business ethics and compliance training, recently released the results of a survey entitled Nothing Personal: 2006 Survey of Computer Use at Work. Fielded by Kelton Research, a national polling firm, the survey asked 1,000 U.S. workers whether they thought their personal computer activities at work remained personal or became business records of their employers. The survey covered personal e-mails, instant messages (IMs), Web searches, and word-processing files created on computers in the workplace.

Among the survey highlights:

• Overall, almost half of all workers did not know that personal e-mail messages, IMs, and unsent files created on work computers could become business records.
• More than 40 percent of those surveyed did not realize that personal Web searches on their work computers could become business records.
• Two-thirds of all workers did not understand that personal IMs to friends could become business records.
• Younger workers (ages 18 to 34) tended to be less aware than older ones. More than half of the younger group (55 percent) didn’t understand that sending an e-mail to a friend created a business record, compared with 39 percent of those over age 55.

“While we’ve seen more and more companies issue ‘appropriate use’ policies and monitor their employees’ computer activities, we wanted to find out if employees really understood how the policies applied to them – especially to computer activities they considered personal in nature,” said David Simon, WeComply’s Founder and President.

Concerns about electronically stored information (ESI) are especially high in view of amendments to the Federal Rules of Civil Procedure. The amendments establish new procedures for an orderly exchange of ESI early in the litigation process, thus making it all the more likely that inappropriate e-mails, Web searches, IMs, and other ESI will come to light in pre-trial discovery.

“The better employees understand what winds up as a business record, the less likely they’ll be to use their work computers in ways that jeopardize themselves and their employers,” Simon said. “But these survey findings show that there’s still a long way to go.”

For more information or to request a copy of the survey report, visit WeComply’s Web site.

Management Innovations

GETTING A HANDLE ON MULTI-TOUCH TOUCH SCREENS

One of the coolest features of Apple’s new iPhone is its touch-screen interface, which allows the user to easily zoom in and out of Web pages by squeezing the screen with two fingers. Technology watchers identify several approaches to multi-touch screens, which ideally could be used by groups gathered round a large, table-sized screen to collaborate on projects. Perceptive Pixel, based in New York, is rolling out its version made of clear acrylic with light-emitting diodes attached to the edges that illuminate the slab with infrared light. When a finger or other object touches the acrylic, the light defuses at the point of contact, scattering outside the surface. A camera behind the surface captures the light and simple image-processing software interprets it as discrete touches and strokes.

The innovative interface is welcomed by technology design guru Don Norman: “For almost two decades, we’ve been trapped by the tyranny of the screen, the mouse, and the keyboard. It’s nice to think we’re breaking away from that and going toward touch-screen manipulation in the real physical world.”

Technology Review, January 18, 2007

SOLID-STATE PCs: VIRUS KILLERS?

Solid-state PCs, which are already being developed in Asia and South America, do not have hard drives, and the operating systems will be burned onto chips, making malware manipulations and viruses problems of the past. These devices are entirely feasible to develop, say experts, although issues linger with booting from Flash RAM (random access memory).

“Solid-state PCs are a natural progression of existing technology,” said Ken Steinberg of Savant Protection, which has been experimenting with improving operating system security for such devices. The trend toward this new type of PC is driven, in part, by security worries and a push toward Unix/Linux operating systems. Today’s operating systems are vulnerable to viruses and other intrusions because they live on devices that permit write-only access, Steinberg said.

The core component in the Windows operating system (OS) is not locked down, but Linux’s can be, making it the OS of choice for solid-state computers. In fact, it is already possible to produce a solid-state PC that uses Linux, but a Windows version will take another two or three years.

The computer industry is also on the verge of seeing solid-state replacements for the aging spinning hard drive technology, said Consultant Robert Hoffer. “The time is right to move forward with Flash RAM storage because spindle drive capacity is at the end of its possibilities for greater storage.”

Tech News World, December 21, 2006

Building Buy-In

SELLING VS. BUYING-IN
By Paul Trout

Right now, you’re probably thinking one of three thoughts:

1. “What is a column on selling doing here?”
2. “I don’t need to read the rest of this column because I don’t sell.”
3. “I’m not a ‘sales guy’ and don’t want to be one!”

No, I’m not the Amazing Karnak. I am, however, someone who understands your perspective because I’ve worked with your kind for many years. You…

• work harder than most;
• value security for yourself and your family; and
• seek knowledge to improve yourself so you can get ahead.

Surprise! Legal administrators share two of the three traits in common with salespeople. Maybe you’re more like them than you thought, after all.

The only difference is in the third bullet, and it’s a nuanced one: how “getting ahead” is defined by both groups. External salespeople are almost always judged on the amount of revenue they’ve brought in as a result of successfully persuading a prospect to trade money for goods and/or services. The higher the amount, the more the external salesperson (or Sales Manager, or Vice President of Sales, or CEO, or company) has “gotten ahead.” The health of a company is largely judged on how large sales numbers are and where they are trending. People get fired if the numbers are not going up as fast or as much as others would like.

Legal administrators have a different definition of “getting ahead.” Knowing exactly what to do to be granted more power or compensation in your firm can be very difficult, amorphous, and sometimes frustrating. Certainly the outward signs of “getting ahead” are similar: you are granted more power and more money. But you are judged by different (and often frequently changing) metrics than “money brought in.”

It’s my observation that in order to continually succeed at achieving goals, you must become better and better at persuading and influencing others – or “getting buy-in” – within your firm to act in ways your goals have been defined to achieve results.

Guess what the word in the outside world is for persuading and influencing others? Sales. As someone who seeks to gain buy-in, you are an internal salesperson, whether you realized it or not.

To be sure, there are contrasts between you, the internal salesperson, and the people down the hall focused on bringing in new clients. Here are the most evident:

1. Prospects
   1. External salespeople pursue prospects outside the company they often have no history with.
   2. Internal salespeople pursue prospects inside the company they may have known for a long time.
       
2. “Products”
   1. External salespeople offer defined products or services over and over again, hoping to “sell.”
   2. Internal salespeople offer ideas, sometime only once, hoping to gain “buy-in.”
       
3. Situations
   1. External salespeople have fairly predictable, identifiable processes and communication tools to achieve results.
   2. Internal salespeople have few or no identifiable processes or communication tools to achieve results.
       
4. Measurements
   1. External salespeople are (and always will be) measured by money brought in.
   2. Internal salespeople are measured by anything else important to the company.
       
5. Roles and Training
   1. External salespeople have chosen their roles as salespeople, and have often (but not always) been trained to excel in sales.
   2. Internal salespeople choose not to be salespeople and have rarely (but not always) been trained to be more persuasive.
       

But external salespeople and internal managers have much more in common – and possibly the most important issues – that can set the stage for cross-learning and mutual appreciation. Here are the “ties that bind”:

Wants and Needs
People are people, and they have base wants and needs. Whether they are clients, your Managing Partner, your peers, or your staff, people will always have unfulfilled desires waiting for solutions.

Stakes and Consequences
Generating “buy-in” and/or selling well means gaining increased power in your organization. Failing to do these well has the opposite effect. What’s at stake is the arc of your career, the balance in your checkbook, and your ability to create and direct bigger and better things. The stakes couldn’t be higher.

“Yes”
The focus for both internal and external sales is getting to “yes,” whether it means exchanging money for goods/services, doing something new, changing course, or ending activities or initiatives.

Tools That Work
External salespeople have ample sales training programs available that provide them tools that generate sales. This column (and series of columns) will give you – the internal salesperson in your law firm or legal department – the tools you need to learn how to get “buy-in” more efficiently, leading to more power within your firm.

The wide perceived chasm between managers seeking buy-in and salespeople selling the may not turn out to be vast at all. The main difference is that one is proud to call himself/herself a salesperson, while the other is embarrassed. Perhaps it’s time to lay down the word games and call a spade a spade: Each one of us wants others to buy what we are selling, whether it’s products, services, or the next good idea.

You don’t need to be a mind reader to know that’s true.

Paul Trout is a Partner with Akina – a firm that helps clients improve their sales, marketing, and leadership effectiveness. This column is an excerpt from a book he is writing on Building Buy-In. He encourages readers to submit case studies, learnings, or questions about Building Buy-In, which may become part of the book and appear in a future column. Contact him via e-mail or by phone at (312) 224-8028.

Caucus Insights

This section features condensed versions of recent discussions in ALA’s Large Firm Administrators Caucus ListServe, which is exclusively for people working in firms with 100 attorneys or more.

THE TOPIC: Limits on Partner Spending

What limits do you place on individual partners’ abilities to charge to firm expenses for marketing activities and employee morale (such as taking associates to a sporting event)? For example, can they spend freely up to certain dollar amounts, do they have annual limits, must they seek approval from their practice groups or office heads in each circumstance, or do you monitor the process in some other way?

We have generally provided a lot of partner autonomy in this area, but have regularly published for all partners a record of each partner’s expenses of this type. We are now considering implementation of more specific policies rather than relying on the self-regulating effect of open reporting.

SELECTED RESPONSES:

1. We require approval by the Practice Group Leader (PGL).

2. We also require PGL approval. This year, for the first time, we instituted practice group budgets for CLE, business development, dues, and practice group activities (dinners, meetings, retreats, etc.). After agreeing to a pre-determined budgeted amount for each category, the PGL now has budgetary guidelines coupled with approval authority for timekeepers in his/her practice group. The approval authority is not new; the budgets for spending are, as is the monthly reporting. It’s a continual work in progress, but individual partner autonomy has diminished significantly in the past few years.

3. All attorneys prepare PDA (Practice Development Activities) budgets that are reviewed and approved by their practice heads. Also included are any “morale” expenditures. The budgets are then sent to the Marketing Department to incorporate it into the firm total. Only unexpected expenses go back to the practice heads for approval. It has been about four to five years since we instituted this system, and it works well.

4. Every fiscal year, each partner is allocated an “expense account” that is equal to two percent of his/her projected income (yep, some can be quite large). That account pays for business development expenses and certain others (such as employee gifts/morale, CLE, etc.). As long as the expense matches with our long lists of dos and don’ts and he/she can provide the proper receipts, partner approval is all that is necessary. We have a watchdog in accounting who reviews items at the time of reimbursement requests, and if something seems out of line, it’s brought to my attention.

5. Partners need advance approval from the team leader or department head for expenditures greater than $500. Any expense for client relations or business development in excess of $1,500 also requires advance approval from the Managing Partner.

6. We provide each attorney with a marketing allowance (approximately ¾ of one percent of the person’s prior year earnings). Attorneys can spend these funds as they see appropriate. Beyond that the department managers have a budget that can be accessed with prior approval. Lastly, each partner has another allowance of 1.5 percent of the prior year’s earnings that can be spent on any business-related (marketing included) expenditure.

ALA’s Legal Management Resource Center (LMRC) also has several articles related to this topic. Click here to learn more.

Special Note: ALA members have free access to the ALA Reference Desk. Send any question on legal management issues to infocentral@alanet.org. Staff will conduct personal research on each question.

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