The Role of a COO in a Law Firm
A Chief Operating Officer (COO) in a law firm is appointed to oversee the law firm’s ongoing business operations, including the strategic management of the firm’s administrative functions, to ensure it is operating as effectively and efficiently as possible to protect firm profitability. Law firm COOs serve as trusted advisors to their senior leadership team, putting them in direct control of key resources, including people, time and money. Keeping a firm functioning smoothly to maintain top-of-the-line client service is a COO’s top priority at a law firm.
While there is no single path to the legal industry for a COO, there is a general consensus on what to expect from a COO in a law firm setting.
Law Firm COO Responsibilities COOs are responsible for the evaluation and implementation of new technology, hiring and training of non-attorney professionals, budgeting, billing and collections, marketing and business development, vendor coordination, and other administrative and operational topics. For some firms, this means overseeing all aspects of a well-funded and fully-staffed Technology Department and Human Resources Team. For others, it could mean everything from forming a Research and Development team to investing in a robust Five Star Wellness Program versus contracting with a vendor for spa days.
COO Oversight A COO is directly responsible for hiring one or more individuals who manage specific firm functions. These department heads typically report directly to the COO. In larger firms, department heads may include a Chief Financial Officer, Director of Business Development and Marketing, Director of Information Technology, Director of Recruiting/Talent Management and Director of Facilities.
Each department head is responsible for overseeing the individual roles in their department and making overall recommendations to the COO about the direction of their area and any necessary changes . The COO will make final decisions on hiring, compensation, and the direction of the practice areas, depending on the firm’s organization.
COO Law Firm Impact Because of the COO’s involvement in all major planning and decision-making for the firm, it is critical that they have an understanding of the firm’s history and future goals. COOs are constantly evaluating and interpreting the data they receive regarding the firm’s financial health and usage of resources to make immediate and long-range budget decisions. COOs are evaluating internal processes and policies to ensure compliance with changing laws and regulations, as well as the firm’s strategic direction. COOs are expected to make difficult decisions regarding the firm’s staff, as well as the processes and polices that impact each of the firm’s operations.
A successful COO is responsible for the analysis and management of the firm’s information resources, including the research and development of new technology, marketing initiatives, human resources and the firm’s policies, including the evaluation of the firm’s success or failure in implementing these policies and whether changes to the system are necessary. A COO is often the one to bring new tools and ideas to the firm’s attention to get buy in from their executive management team.
A COO’s ability to manipulate the firm’s resources to generate and maintain profitability cannot be understated. They have access to and manage a wealth of information, have the discretion to determine the most effective means of using this information and are responsible for a firm’s bottom line. This requires a COO to anticipate the firm’s needs and make sound recommendations for the betterment of the firm.
Skills and Qualifications Needed for a Law Firm COO
The qualifications and skills required for a law firm COO can vary widely based upon the size and goals of the firm. However, there are several core elements common to many COOs in the legal sector. A COO typically has a bachelor’s degree in business administration or a related field; some firms may require an MBA or similar advanced degree. Coursework related to the legal sector may be a plus, but is by no means a requirement for a COO opening.
Given the highly sensitive nature of legal work, experience in the legal industry is essential. An ideal candidate for COO will have previous employment history in senior management roles in a law firm or extensive experience with a firm providing consulting or outsourced COO functions. Most likely, a COO has direct experience working with attorneys in a law firm environment.
Organizational, leadership and strategic planning skills are among the most essential for success as a COO. A COO must also be a self-motivator with the ability to encourage and motivate others. Strong communication is required, as the COO serves as the company’s chief liaison to attorneys and senior management.
The COO is one of the most critical management roles in a law firm, but the position can be wildly different from one firm to the next. It is among the most hands-on and dynamic roles in the legal sector’s C-suite. The COO position is not among the most predictable roles, but can be among the most rewarding as well, providing the right candidate for the role.
Typical Responsibilities of a COO in a Law Firm
On an everyday basis, the COO in a legal environment has a broad range of responsibilities. Below, we try to cover as many of them as we can.
Overseeing Operations: The office of COO in a law firm requires that you oversee all operations of the firm. This includes overseeing the human resources department, the IT department, marketing and business development departments, office services, and the continuing education training programs for lawyers and staff. You are the overseer of the people that keep the firm running, and you have to lead them to growth and success.
Managing Budgets: One of the most important functions you have is the management of the budgets of the various departments in the firm. Not only do you need to manage the existing budgets, but you have to create new budgets and proposed action plans to implement them. Your job is to do more with less, to grow the firm into a more productive entity that can withstand any economic condition.
Implementation of Long-Term and Short-Term Strategic Plans: As COO, you will work with the financial committee to both create the strategic plans, and implement them. These approaches allow you to take critical action that will create success for the firm now and in the future. You then turn those strategic plans into action.
Common Issues for COOs in Law Firms
Law firms are no different from other business enterprises in that the COO and the firm he/she serves face a consortium of internal and external challenges. Simply put, the COO is a change agent who develops metrics and systems to measure and monitor all aspects of a law firm. The COO also develops business plans and models, while working through effective incentive programs that motivate law firm lawyers and support staff. Therefore, the COO must be an integral part of the law firm’s deliberative and visionary decisions. Change management is perhaps the most vexing challenge faced by the chief operating officer. Law firm founders, senior partner-managers as well as managing partners have all found change management particularly difficult. When conflict between partner-methodologies occurs, neither the COO nor the partnership can deliver the necessary training, programming or direction that are critical for institutional buy-in. The most common war of words revolves around immovable partners who use their positions to retard change. Often, this happens in the context of technology or another substantive issue where a "code of conduct" or written standard must be developed and adopted by the firm. When that occurs, law firm COOs are not serviced as widely as they should be. Another common COO challenge involves risk management and compliance . Not so long ago, in-house attorneys ruled the roost and purchase price for a law firm with in-house counsel grew by multiples of four, five and more! Therein, lies a great COMPLIANCE caveat because failed compliance could lead to a law firm’s failed check and often leads to a dramatic loss in value. COOs also must face the enormous task of improving business processes and operations, including everyone in the institution. Law firm cultures and histories are major impediments to process improvement for COOs. COOs, who tend to work from an enterprise-wide perspective, are faced with a culture that actually prefers conflict and prefers that each partner manages her or his own issues independently. The incentive programs have both an internal and an external component. Everyone in the organization must be compelled to "sing from the same songsheet!" That means that the COO must craft incentive programs that apply both to partners and to non-lawyer professionals. It is obvious that law firm COOs are challenged to perform in an environment that is constantly shifting, and shifting without notice. It is equally obvious that COOs are an important part of any law firm partnership. However, more law firm partnerships are being challenged to deliver unanimity to their COOs. This transition will come slowly over time, but the transition will come as law firm COOs are able to demonstrate their mana-gement capabilities.
Impact of a COO On the Growth of the Firm
A COO can have a tremendous impact on the growth and development of a law firm. A COO will work closely with the managing partner and/or the executive committee to better define the law firm’s vision, mission and strategy to facilitate the implementation of priorities that support the strategic plan. The COO will be instrumental in developing a well-designed and implemented operating plan and annual budgets supported by short and long-term pro forma financial statements. Driving accountability to that plan is key to the COO role. COOs will focus on aligning the firm’s resources to best achieve its goals. In this case, resources include people, space, technology, capital and brand. Compensation strategies are an example of how a COO can impact realignment of resources. Firm leaders often look to the COO to help create the right compensation strategies to attract talent and incentivize its people to stay focused on the firm’s strategic objectives. The COO will work with the managing partner and/or the executive committee to develop incentives for performance outside of just traditional compensation plans. Craig Swugart is the COO at Baker Donelson. Craig brings a unique perspective to his position, as he spent years as a practicing attorney before taking on the COO role. It was through these years of practice and leadership that he started to question why a law firm did not act more like the businesses that they were advising their clients and find ways to do things differently than the traditional way. Baker Donelson is committed to diversifying its practice and focusing on additional areas for growth. This is instrumental to Baker Donelson’s strategy. Knowing where the firm wants to go backs into the operational planning that needs to be developed to get it there. The COO will help align the firm’s people, practices, and resources to get there.
Becoming a Law Firm COO
Education in business, finance, human resources, and law are all strong credentials for a law firm COO. The most common career path to becoming a COO, including for a law firm COO, is to have worked your way up the ranks of a company into this second-in-command position. For example, you might start in the sales or finance department, "work across departments" in roles with increasing levels of responsibility, then finally land an opportunity as COO by impressing higher executives with your leadership skills. Because becoming a COO is such a high-level achievement, COOs usually have years of business experience, often 10-15, before they reach this position.
Lateral moves are also common paths to becoming a COO in a law firm. Lateral moves involve moving to different positions within the same company or firm , or even changing companies. If you work at another law firm that is similar in size, structure, and/or reputation, and you get a chance to take a COO position there, this may be a good opportunity for your career. For example, if you are Director of Operations for a small 1-partner law firm, you could consider moving to a similar position at a 2-partner firm.
experience that can help include:
The more diversified work experiences and management experiences you have, the better. Translated, that means studying hard and performing well, networking, getting high-level degrees, working your way up, and being open to new opportunities when they arise.
