In the ever competitive ‘Big Law’, lateral recruitment serves as a strategic avenue for growth. However, ensuring the right fit goes beyond resumes and interviews. Enter Third-Party Due Diligence (DD), a tool aimed at supplying law firm leadership with a comprehensive appraisal of a partner candidate or lateral team. Too often law firms have recruited talent that, on paper and during the interview process, seem right but simply do not end up being right. This, we feel comes down to a number of manageable factors. The level of investment from clients in hiring laterally goes far beyond the purely financial with cultural and reputational risks being attached to any lateral hiring process.
Simply put we aim to de-risk the hiring process and in turn help our clients make informed decisions around their lateral talent, saving their time, money and, most importantly, their reputation.
The Process Simplified:
- Scope Definition: We take instructions on DD where we have not been the search partner involved in procuring candidate/team or where the firm has been in direct communication with the candidate/team. As with all our services we take conflicts very seriously and we will not, under any circumstances take on a project with a conflict. We step in after the candidate has submitted their Lateral Partner Questionnaire or Business Plan material and the hiring partner or sponsoring partner have completed all internal business planning material.
- Data Collection: We engage with former colleagues, peers and clients. We target those individuals that have intimate knowledge around the candidate. The Fides advantage here is that, as a search firm, we are regularly engaging with key stakeholders in the market. This enables us to ask the right questions, whilst simultaneously maintaining discretion, when engaging with sources.
- Comprehensive Analysis: We meticulously analyse data to assess, amongst others, relevant market insights; legal skills & technical ability; business development skills; leadership and management skills; value-add and wider firm contribution; personality & culture; and integration recommendations.
- Review: Findings are presented either verbally, or in the form of an executive summary to be shared with internal stakeholders.
What’s Tested and Asked?
- Relevant Market Insights – the context behind the investment
- Legal Skills & Technical Ability
- Business Development Skills
- Leadership and Management Skills
- Value Add and Wider Firm Contribution
- Personality/Culture
- Integration issues/recommendations
Conclusion:
Third-party Due Diligence is essential in ensuring the right fit in lateral recruitment within law firms. By providing a comprehensive assessment beyond traditional methods, it enables firms to make informed decisions and mitigate risks.
Law firms are frequently hiring applicants who have a limited scope for growth within the firm, are not properly vetted, or who make promises that are not inline with reality. The lack of a robust hiring procedure raises concern amongst stakeholders, exposes leadership to selection issues, and may impact the wider perception of a firm in the market, discouraging future prospects. While the exact cost of failed lateral hires is difficult to determine, it is estimated that firms sustain considerable financial losses each year as a result of underperforming partners, ranging from seven to eight figures, with many being lateral hires.
Conversely, strategically chosen lateral personnel can make a significant contribution to a company’s future success. Thus, the risk can be worth it, but reducing risk requires the development of appropriate systems and procedures.
To read more: Due Diligence – Fides (fidessearch.com) or contact Edward Parker at: +44 (0) 7803 788 086 or eparker@fidessearch.com