As client issues become increasingly complex, working collaboratively to provide solutions is critical. But Professor Laura Empson and David Morley ask: can leaders maintain a collaborative culture in the world of remote working?
Client issues tend to be sprawling and messy – all the more so as the world becomes more complex and uncertain. In finding solutions to complex problems, individual professionals need to bring together people with complimentary skills and perspectives to get the best results.
So, many law firm leaders regard having a collaborative culture as one of their most precious assets and crucial to the future success of their firm.
And while many partners regard their compensation system to be critical to that culture, it’s evident that collaboration can thrive under a variety of reward systems. So what else is essential to building and maintaining a collaborative culture?
That’s where the latest episode of our podcast – Leading Professional People – takes us, as we ask how can leaders create and preserve a collaborative culture?
To discuss this, we were joined by Kirsten Edwards-Warren, EMEA deputy head of the economics consulting firm, Compass Lexecon.
Compass Lexecon is not only one of the biggest and most successful consultancies in its field with 900 people worldwide, but is also a highly collaborative one, in spite of the fact that it is not a partnership and has an ‘eat what you kill’ remuneration structure.
Just before lockdown it sought Laura’s advice about how to maintain its collaborative culture as it grew rapidly. So, one year on, we returned to the company to find out how it had been faring in lockdown.
Where does that commitment to collaboration come from?
Kirsten puts it partly down to the founder of the firm and its managing partner, Jorge Padilla, who in the earliest days put a massive emphasis on creating a culture of working together and on developing people. Culture is something that is talked about all the time, she says, and it is a critical issue as the firm grows, especially around deciding on lateral hires.
But why has the idea stuck so fast?
She identifies two reasons. First, though people are well paid in Compass Lexecon, most colleagues’ overriding ambition is not to maximise their income. Economists who want to do that tend to go and work for investment banks.
Secondly, there has been a collective realisation that collaboration helps to ‘grow the pie’, because your advice is far more sought after by clients if you can bring more than one brain to an issue – better still if you can bring several.
How people are compensated doesn’t present a problem, Kirsten insists. Colleagues negotiate the split of fees rationally – it helps to be economists used to modelling competition and collaboration in a rational way. And those who do not want to play the collaboration game tend to self-select themselves out of the business.
But there are two other values that, for Compass Lexecon, underpin the collaborative culture – integrity and excellence.
Where integrity is concerned that is not just about an approach to client work, but about the quality of relationships between colleagues. Here, the willingness of Kirsten and Jorge to share personal perspectives and stories is also essential.
She tells of one recent incident where a junior colleague challenged her about the tone of an email she had sent. She read the message, realised that he was right, apologised, explained what she meant to say and how she should have said it, and they were able to put it behind them.
Rather than complain to colleagues behind her back, or fester resentfully, he dared to risk an uncomfortable conversation by challenging her directly – and that reaffirmed the trust between them. She now knows that this colleague will challenge her honestly if he feels she is getting things wrong.
Excellence, of course, is all about the shared commitment to do work that is of an equally high standard, recognising that what individuals produce reflects on everyone else in the organisation.
Thinking about Kirsten’s experience, three intimately interlinked things struck us about the firm’s success in building a collaborative culture.
First, it’s about the work it does and its success in the market. The work is technically complex, requiring highly skilled specialists. It is also so abundant that the experts have to work together to get it all done – there is too much work for lone rangers to handle.
The second is around how it negotiates compensation in an ‘eat what you kill’ environment.
As economists, they can understand this in terms of game theory – a system of interaction based on a series of infinitely repeated ‘games’ under conditions of scarcity.
In other words, there’s a strong onus on negotiating a careful and fair split of fees. If you don’t, you will struggle to find someone to collaborate with on your next project. This is a long way from lockstep, but it seems to work.
The third is the solid role-modelling the leadership provides as a benchmark for the kind of culture it wants to nurture and build for the future.
Compass Lexecon has yet to fully decide how the world of work will change once the pandemic has gone – no one has. But it is undoubtedly true that remote working has become an increasing feature of life for professional firms and their clients since the global financial crisis.
Ten or 20 years ago transactional lawyers were used to the ‘theatre of the deal’ – huddled in close quarters with teams of advisers, working long hours to complete the transaction. More recently, much of that work is done by videoconference.
Now leaders in many sectors are thinking about where all this goes next.
That’s a difficult challenge, but a good one. It will force us all to think not just about when and where we work, but also to fundamentally rethink how we work. As we do, many leaders are likely to conclude that collaboration is an even more prized asset than in the past.
Click here to listen to their latest podcast, ‘Empson & Morley – Leading Professional People’, where Professor Laura Empson and David Morley discuss the local-global conundrum with Kirsten Edwards-Warren.