Articles Posted in Talent

UPS’s law department has working for a number of former operations personnel now practicing law, because the company paid for them to attend law school and pass the bar (See my post of Jan. 25, 2007 on UPS.). From CanadianLawyer InHouse, Vol. 1, April 2006 at 18, here’s another technique for self-help when its hard to hire good talent.

The Dutch-based international bank ABN Amro has had a tough time finding qualified lawyers who do derivatives law. To fill the void, the department created a formal program to train its own finance lawyers based in Hong Kong, London and New York on derivatives law. “To help make it happen, the Bank contracted with Clifford Chance, a UK based law firm, to do the training reportedly at a cut-rate price. Good for the law department; good for the firm.

According to Jeffrey Pfeffer and Robert I. Sutton, Hard Facts, Dangerous Half-Truths & Total Nonsense: Profiting from Evidence-Based Management (Harvard Bus. School Press 2006) at 128, the extrinsic incentives bias is the “tendency to over-estimate how much employees care about extrinsic job features such as pay and to underestimate how much employees are motivated by intrinsic job features like being able to make decisions and have meaningful work.” For corporate lawyers, titles and the layout of offices are extrinsic job features, while challenging work, autonomy, and professional growth are intrinsic (See my post of Feb. 16, 2007on Maslow’s hierarchy of needs.).

As to one particular form of extrinsic incentive – bonus awards – Pfeffer and Sutton come down hard. “[W]hen work settings require even modest interdependence and cooperation, as most do, dispersed rewards [differential bonus awards] have consistently negative consequences on organizations,” (See my post of Jan. 15, 2007 on three pernicious effects of bonuses.).

Some general counsel might like to try a do-it-yourself survey of employee satisfaction. Angela Stevens describes one, the Job Satisfaction Survey (JDS), in “An Examination of Job Satisfaction and Creative Work Environments,” OD Practitioner, Vol. 38, No. 3 2006 at 36. JDS is a well tested, non-copyrighted instrument that is widely used, and managers can them on their own, instead of having to hire a consultant or vendor.

The JDS measures employee perceptions of five core dimensions of their jobs: Skill Variety, Task Identity, Task Significance, Autonomy and Feedback. When you combine the scores on those five dimensions, each person has a Motivating Potential Score, which indicates satisfaction with his or her job. According to the JDS’s creators, high motivation translates into increased performance and decreased turnover and absenteeism. A general counsel might use this tool for a discussion topic at a retreat.

At one point, and probably even now, Shell Oil’s legal department required outside law firms to include on their bills the race and gender of each attorney who worked on its matters. According to a roundtable on diversity in California Lawyer, Oct. 2004 at 49, 52,the law department of Wells Fargo likewise required outside counsel to include that demographic information.

Guy Rounsaville, the former general counsel at Wells Fargo who initiated that bank’s policy, later moved to Visa International where he followed the same practice. Rounsaville said at the roundtable that his law department would go further: it would obtain diversity information on the lawyers who get credit for the work the firm does for Visa. Credit and origination fees point to the powerful partners at firms, the ones who can bring about diversity.

A one-page job posting seeks a lawyer to join the 170-professional legal function of Philips has three references to “job rotation.” The opportunity to mover around within a law department may have some appeal to some lawyers, mostly very junior ones, but three proclamations about rotation opportunities makes too much of it.

“We also promote excellence and career development though constant quality control and scheduled job rotation.” Thirteen lines later: “Our job rotation program allows our lawyers to gain insights into many aspects of our multi-national business.”

And, in case a prospect missed those two references, the legal function, “an ‘open, dynamic learning organization’ that offers extensive opportunities for constant skills enhancement,” is “looking for people who value the prospect of job rotation.”

TransCanada is one of Canada’s biggest energy companies, has more than 130 staff in its legal department, including about 40 lawyers. Its new general counsel has a wealth of business experiences (See my posts of Dec. 15, 2005 on “tours of duty” by general counsel; and April 18, 2005 on the failure rate of lawyers who move to the business side.).

As recounted in an profile of its new general counsel, Sean McMaster, Canadian Lawyer Inhouse, Vol. 1, Aug. 2006 at 17, states that in the late 1990’s McMaster moved out of the law department to the corporate executive side, eventually rising to become president of TransCanada’s unregulated businesses. Later, before his appointment to the top legal post, McMaster served a year as vice-president, corporate development.

Years ago, a sociologist, Abraham Maslow, constructed a taxonomy of human needs. Maslow labeled some of those needs – such as for status, security, work conditions, and supervision – as “hygiene factors.” Hygiene factors are necessary for people’s contentment, but once met, they don’t add additional units of satisfaction. Having washed your hands, doing so again right away doesn’t make your day.

Higher up the scale of human needs are Maslow’s “satisfiers.” Satisfiers include advancement, responsibility, the work itself, recognition and achievement. Satisfiers are the higher-level gratifiers of a person’s life. Unlike hygiene factors, satisfier needs are never satiated; they always motivate people, especially professionals.

In-house counsel, as professionals with extensive training and an inculcated creed, want to become better at their craft. They like the pat on the back from their colleagues and flourish in autonomy and task accomplishment. For managers of corporate lawyers, Maslow’s hierarchy gives useful insights in several areas of talent management.

The general counsel of Petro-Canada, Alf Peneycad, admitted that his department has had difficulties hiring lawyers. In Canadian Lawyer Inhouse, Vol. 1, June 2006 at 7, he mentions that “the former Crown Corporation recently made 11 offers before landing a single hire.” To fare that poorly should be cause to worry (See my post of Oct. 1, 2006 about the gains from a speedy hiring process; and Jan. 3, 2006 about hiring experienced paralegals instead of junior lawyers.).

To cope with the disappointing yield, the 30-lawyer team, which includes three who were added in the past six months, also has nine contract lawyers. That ratio of close to three full-time lawyers for every contract lawyer is remarkable. Peneycad explains that Petro-Canada “treats its contract lawyers in the exact same manner as it does its full-time people” but he doesn’t use them in the company’s more sensitive areas, such as securities work.

As put by the Economist’s The World in 2007 at 104, “The demand for talent-intensive skills is increasing relentlessly.” As part of the support for that Cassandra warning, the article cites McKinsey research that found “over the past six years the number of American jobs that require a high level of judgment has grown three times faster than employment in general.” Worse still, in many developed countries fewer young people – future lawyers – are in the pipeline: “by 2025 the number of people aged 15-64 is projected to fall by 7% in Germany, 9% in Italy and 14% in Japan.”

Law departments, many of which face a near-term exodus of baby-boomer veteran lawyers, stare down the wrong end of the demographic barrel. The competition for talent in the coming decade will intensify and law departments, to cope, will need innovative arrangements, such as with law firm secondments, more reliance on technology, a turn toward client self help, and other ameliorative steps (See my post of Jan. 25, 2007 about UPS paying for operations employees to go to night law school and then join the law department.).

The Economist’s The World in 2007 at 126 jarred me. Ponder modafinil, a drug for narcolepsy and sleep disorders that is also “a hit with healthy people who want to improve their concentration.” Or think about ampakine, a drug that improves the memory of rats by stimulating brain growth. Cogitate on a smart new world where today “More than 40 other cognitive enhancement drugs are under study.”

A rough beast slouches toward Bethlehem. Resumes will list the cocktail of brain enhancers that a lawyer has taken. Law departments will circulate statements of ethics regarding law firms whose lawyers drug start their brains, despite medical and ethical concerns. Firms will promote themselves as “brain-propellant free” but offshore firms with fewer scruples will think rings around them. In-house counsel will decide whether they themselves will seek legal genius through juice. Drug tests will be mandatory before Supreme Court arguments. The mind reels higher and higher in the widening gyre.