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Practice Management

The best way to handle a succession transition (and mistakes to avoid)

Advice from two associate general counsels (AGCs)

At any law firm, changes and transitions in leadership are inevitable. One of the biggest challenges that firms facing leadership changes must overcome is how to avoid major disruptions to client relationships.

According to Bill Crosby, Vice President and Associate General Counsel at Interpublic Group, and Susan Garcia, Associate General Counsel at Thomson Reuters, law firms should take steps to ensure that clients play an integral role in the succession process. In this post, they share their thoughts and preferences regarding the extent of client involvement and how, with a little planning, firms can avoid common pitfalls.

If you know in advance, tell clients in advance

Clients don’t like to be surprised. This includes news of a partner’s departure—especially in situations where the firm knew well in advance of informing clients. Both Crosby and Garcia agree that a succession process should take years, not weeks. Says Crosby, “I would look disfavorably on both the firm and the lawyer if I was told a month ahead of time that my partner was retiring. There should have been a transition plan years in advance to that retirement.”

Another key point that both attorneys stress centers on the importance of finding a successor that fits a client’s needs. As Garcia explains, “Make sure that any succession plan is started early and that proposed successors are introduced to clients as soon as possible so that you can identify any issues early on. Don’t let the selection of a successor that doesn’t fit get to the point where the relationship with the firm is impacted.” Crosby adds, “It really goes to the whole point of having as much time and involvement as possible so that if things don’t go well with the first selection, there’s time to revisit it and make some type of an alternative selection.”

Should clients have a say in a successor’s selection?

In some instances, it may be appropriate to take a client’s wishes into consideration when selecting a partner’s successor. For example, if the client has a highly-specialized matter or a strong working relationship with a mid-level partner.

In general, however, Garcia and Crosby don’t expect to be involved in the selection process. “The relationship partner should be aware of my key concerns,” Crosby explains. “So, I would tend to allow them to do what they need to do as an enterprise to allocate the resources appropriately, understanding what our needs are.”

Garcia agrees. “I would not expect to be involved directly with the succession planning of a relationship manager. It’s more subtle than that. It goes to that advance planning and making sure that it’s an iterative process to find the most natural successor.”

Another thing they agree on is making sure the successor is a good fit for the general counsel’s (GC’s) entire team, not just the GC or AGC that will manage the outside counsel relationship. Garcia says, “One of the things that I would strongly advise is that firms go to that next level of leadership within the client’s organization to make sure that you’re showcasing the talent that you’re bringing on board to handle their matters.” Crosby adds, “That’s a real lesson for a firm, to make sure that they’re not just focused on that general counsel relationship, but really focused on who else on the team is closely involved and making sure those people are involved in the process for transition.”

Has a partner exclusively handled specialized matters for a client? Start preparing a successor now.

Both Garcia and Crosby commented on the risk of a firm losing a relationship if the retiring partner was the exclusive provider for a particular type of matter. “If it’s a specialist who’s leaving, then that’s probably going to be the end of the relationship with the firm, and we’ll have to find an alternative,” Crosby said. Garcia highlighted the risk of not having a succession plan in place for specialists. “I think that all law firms should think about succession planning for all of their practice areas,” she said. “The risks are especially high for those real niche specialty areas where there may not be an obvious successor. That niche business is most at risk when there is no succession plan in place.”

Now is the time to start working on your succession plan

From a client’s perspective, succession planning is something that is expected from outside counsel. “Succession planning is not something that should be a nice to have or a check the box exercise,” Garcia said. “It’s something that I think firms really need to look at on a regular basis. Reach out to clients, and keep that communication line open.” Crosby added, “It is inevitable that people will move on. Firms should be preparing for it and should be doing it seamlessly from day one of the client relationship. From the second that they first get the assignment with the client they should be thinking about, ‘What do we need to be doing to make sure that we hold onto this relationship as long as possible?’”

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