Kim Johnson of Quarles & Brady discusses Legal Innovation, Succession Planning, and Offers Future Firm Chair Advice
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I interviewed Kim Johnson of Quarles & Brady, partner and Firm Chairperson. Today we started out discussing topics her executive committee highlighted during their annual retreat. They discussed growth, how to work better together, what their firm should look like in the future, what does the middle market need, succession planning, and more. We discussed also how she brought in a law professor and 3 tech CEOs for their all partners meeting last year and how they formed a Innovation Committee. We talked about how the affects of the new White House administration on law firms and their clients as well as in Trusts and Estates. I asked her what advice she would give future law firm chairmen and persons. We talked about what blogs she reads regularly. What metrics she uses to measure and monitor the law firms and who her heroes are. Toward the end we discussed what are her hobbies and what’s left on her bucket list.
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As many of you know, we interview corporate defense law firm leaders, partners, legal consultants and I believe general counsel is soon to come, you are listening to Episode number six of the Law Firm Leadership podcast.
Welcome to the Law Firm Leadership podcast, I’m your host Chris Batz, with the Lion Group. Today I have the pleasure of speaking with Kim Johnson of Quarles & Brady. Kim presides over the firm’s Executive Committee and became Chair Person in 2013. She received her JD from the University of Florida, Levin College of Law, and her LLM in Taxation, from the University of Miami. She’s been practicing trust and estate law for more than 30 years and continues to. Accolades that follow her is the Florida Achievement Award from the Florida Commission on the Status of Women. Top 50 Women, Florida Super Lawyers, Florida Trend Magazines, Florida Legal Elite and named several years for Five Star Best in Client Satisfaction with Wealth Manager and finally Kim, you were the eighth named female to lead an AM Law 200 Law Firm in the United States.
Welcome Kim to the Law Firm Leadership podcast, I’m delighted to have you as our guest.
Kim: Thank you Chris, I’m honored to be with you.
Chris: Kim, so before we started recorded we were talking about some things that I’m quite interested to learn more, as your feel comfort, but let’s talk about your yearly Executive Committee Retreat that you had and the hot issues that were discussed, that you guys were focusing on in 2017. What was that number one issue?
Executive Committee Retreat & the Hot Issues
Kim: Before the retreat I asked my Executive Committee to make a list of issues and then we voted on them and the number one issue that the firm was interested in is growth for this fiscal year.
Chris: And with growth, I mean it seems like that’s everyone’s number one issue, how did you guys conclude on the retreat what that might look like, or I imagine it’s not just a one-year focus, but it probably is a multi-year focus?
Kim: We decided to take a deeper dive in growth. We’re going to do some analysis, some other research and get back together in July with some recommendations. So, growth is, where should we be in the market? Are we in the right space? Growth is, do we need to add different niche areas, different practices? Are we in the right cities, the right locations, does that make a difference? So, growth encompasses many different aspects.
Chris: So it’s not necessarily growth for growth’s sake, but it’s very strategic in order to, I guess, allocate time and resources.
You mentioned another topic that came up, which I really appreciated, which is, how do you work better together? Can you tell me about that?
Working Better Together
Kim: We hired a psychologist, a recovering attorney, Dr. Larry Richard, he came the first day and prior to meeting together, he administered a test to all the Executive Committee and our four Chiefs, the head of HR, IT, our CFO and our Client Relations Business Developer, marketing person, to better understand our personality traits. So we all agreed to share those personality traits, so that we would understand each other better in how we communicate with each other.
Also, going forward in the future, as we’re establishing sub-committees, to try and make sure that we have personalities that work together. So we want diversity of thought that’s very important, but we want to understand how we best communicate.
Chris: I’d love to be a bug on the wall on that, I mean, that would be fascinating to have a bunch of lawyers talk about their personalities and how they relate. Was that fun, was it awkward, was it revealing?
Kim: There was more laughter the first day than there was the second day. Lawyers tend to be outliers, and we talked about those outlier personality traits, you know lawyers are known as being very independent, very skeptical and it was just interesting to see different people in the room that may have thought they were one way and actually, under the 18 traits, they ranked differently. But I think everybody was skeptical going in, obviously the lawyers, going into this really, but I think everybody found it to be very interesting.
I guess we all have blind spots, maybe not really understanding our personality, so that was part of the beauty of it, understanding your own blind spot, so that maybe you tone it down in certain situations when it doesn’t work for you.
So one of the 18 characteristics is urgency. So, a lot of people on the Executive Committee had a high sense of urgency, which is great, as far as getting things done, but if you’re constantly urgent that means you’re probably not a very good listener, and there are certain settings as a leader where you want to listen. So, if you have that urgency, very high in your personality trait, you need to learn how to tone it down, so that you have the benefit of listening to others.
Chris: You had brought up another topic that you guys discussed on the retreat which was, future size and shape of the firm. Can you share a little bit about what you guys were considering or how that discussion was going?
Kim: Well, what does a law firm of the future, what does it need to look like in order to serve our clients? Do we need more staff attorneys, to make sure that each group has some succession planning, so as the baby boomers retire, we have the right people behind them? Do we need more part-time attorneys, do we need more paralegals, more patent agents? What should we look like to best serve our clients?
It’s a very changing legal market and I think we’ve been doing a fairly good job on the succession planning, is that each partner in the firm to actually do a succession plan, so that we make sure there’s someone behind them and that the client understands the bench-string, so that they’re not just being served by Partner A but they understand that Partner A has a team.
Chris: Yeah, you know, succession planning is such a huge issue, to continue to deal with the class of aging partners who may not want to retire or hand over their clients. I mean, does your firm have mandatory retirement?
Kim: We do.
Kim: It’s at 66 and then with the permission of the Executive Committee, you can stay until you’re 70.
Chris: Okay, is it assumed that those clients become institutional at that point, when they transition to the firm or are they already institutional? That process seems fascinating with some firms that have, eat what you kill compensation and cultures.
Kim: Yeah, we’re definitely not an, eat what you kill. So, I would say for the larger clients, the first couple of years after somebody transitions, it stays a firm client and then it transitions to the person that’s really assuming the responsibilities for the client.
Chris: Yeah, so that sounds fair and it sounds like on a case by case basis?
Kim: Well, I think it’s something that we try to work out ahead of time. You know, we spend time with the partners as they’re getting ready to retire, we talk about the team, we make sure that they are transitioning, we make sure that the client feels comfortable. You know, sometimes we think the perfect, what we refer to as CRL, as the person responsible for the client would be X and the client says, “You know, I would really rather work with A.” So, what the client thinks obviously matters.
Chris: Yeah, I would assume and I think it’s very smart and intentional of you guys to be pulling the client in those conversations, versus assumption. It’s been known that a lot of firms just kind of assume what the client wants and needs and makes those decisions without calling them in the conversations.
BTI and Client Feedback Surveys
Kim: Right, sometimes from our side it looks obvious, “Oh, they really want to work with Partner X,” but when you sit down and talk to them, that’s not always the case.
We hire a BTI, which is third party vendor to interview our clients, and I also do chair visits for our clients, and that’s one of the things we’re trying to find out is, from the client, “What do you want? What do you like? What do you think our strengths are? What are our weaknesses? What are the best practices you see with other firms and how can we improve?” You get a lot of information that way, sometimes surprising information, good and bad.
Chris: Yeah, how long have you guys been doing it with BTI?
Kim: I think we originally started in 2011 and then we’ve made it a more regular practice for the last, I think, 3 years or so.
Chris: And the clients appreciated that process?
Kim: A lot of them do, yes. Some of them resent the time, although it’s really not that much time, but the clients that are so busy, with their hair on fire, and they don’t want to do it, we obviously don’t make them do it. But I think we do find out enough information that we can then come back and improve and modify our behavior, that it ends up being a win, win for everybody.
A Law Professor and Three Tech CEOs on Innovation
Chris: Yeah, that’s excellent. I want to move to an interesting meeting that you had described, where you had said you brought in a law professor and three Tech CEOs. Tell me more about what that looked like inside of the partners of your firm.
Kim: So, we had a Partner Retreat last June in Phoenix and we brought in a professor and we had a panel of three individuals who are doing software, innovative software and then we also brought in a General Counsel. She talked about how she used the software and how artificial intelligence is impacting what she’s doing and it really created quite a buzz in the firm, people were very excited about it.
The professor did an overview of all the different companies that are entering the legal business, and I think you know that our industry is basically flat as far as law firms stand, but it’s actually growing with some of these tech companies and third party vendors.
So what’s very interesting, I think to our partners, is to understand the innovation that’s going on in the industry.
So, out of that we diced to form an Innovation Committee, which one of our partners in Phoenix is heading, with the thought that we would become more innovative for our clients and more effective and more efficient.
Chris: Without giving away too much of the secret sauce, what does that look like for a law firm to be innovative and effective and more efficient? I mean, what would that look like?
Kim: One thing that we working on, that other law firms have done, is the decision tree. So, if this happens, you do this, and kind of go down the tree and you can make that into an app and give it to the client, although a lot of the firms that are doing this in Europe are licensing it, I don’t think the US firms are doing that. But you provide the app to the client, so if they have an issue in this area, they’ll have the app and it lists some questions, that is this happens, do this. The bottom question is, ‘call your attorney’ but, it gives them a lot of benefit in the meantime.
Chris: It’s interesting and you mentioned that the European firms were licensing. That’s another source of revenue.
Kim: It is, it is and I don’t think that would apply in the US, I think there’s an expectation that you’re partnering with them.
Chris: Yeah, so what the professor and the Tech CEOs, what were they challenging you with or what were they discussing that other, say non-legal entities are doing, maybe in other industries, but what’s happened there for firms to emulate?
Kim: There’s some technology that you can buy, that you can see how a judge rules in certain situations. So, if you’re doing an RFP for a client, and let’s say it’s IP litigation and you know you’re going to be in this circuit, that software can tell you what you’re most likely going to have these two judges and these two judges, maybe the predominant case has four factors in it, but Judge A, really relies on factor four. So, if you’re going to have a trial in front of him, you really want to emphasize factor four, versus the other judge. And the clients really like that because it gives you some inside information. You know, you’re more likely to win if you do this. So, it’s amazing what you can find out with the technology.
Chris: And I know that artificial intelligence seems to be really the hot thing, were they encouraging firms to get into that?
Kim: The software companies were basically trying to sell their software and I will say that we had three there and we’re looking into buying two of the software, because we feel like, you know, it’s giving you a competitive advantage.
Chris: Absolutely, and when we think of AI or artificial intelligence, I mean, how would that play? I mean that wouldn’t necessarily be the decision tree, would it? I mean, how would that work inside of the practice of a law firm?
Kim: So, one of the software’s related to a due diligence when you’re doing a deal. So, by certain key words and scanning in the document, it can cut the cost of the due diligence down and that could save the clients hundreds of thousands of dollars.
Chris: That’s a big deal. So, that goes along with what you were saying as far as efficiency?
Chris: Okay, fascinating. I wanted to just give you an opportunity to share a little bit more about Quarles & Brady’s law firm philosophy of culture. Would you take a couple of moments and just kind of describe what makes you guys unique or how your culture works?
Kim: I do think we’re different than other firms, we’ve always been much more inclusive. We had the first African American to chair an AM Law 200 firm and then I followed that, as you said I was number 8, as far as women chairing a large firm and I think because we’re more inclusive, it creates a very collaborative team-based environment, that I think works well for our clients.
Trust & Estate Changes in the Trump Era
Chris: We have a new president, we have a whole new administration that’s a bit more unorthodox than what we’ve seen over numerous decades within our country, what are you anticipating with this new administration, for just the legal industry, for law firms and also, I’d love for you to speak into how it might affect trust and estate law.
Kim: Well I think with change comes opportunities for businesses which could produce growth, which will produce more legal work. In the trust and estate’s area, he has specifically said that he wants to repeal the estate gift tax and GST tax. So, I think for the very high network clients, there will be some opportunities if that happens, to create long-term trust to gift because now you’re not going to have any gift consequences to remove those from the system. I mean, if he serves two terms, a lot of those people will still be alive when another person comes in and you never know that the tax may be reenacted. So, I think they’ll be lots of opportunities in many different areas of the law.
Chris: I know that he’s doing a lot to reduce regulation. I think high regulation has good business for law firms, do you see the other side of the coin with less regulation?
Kim: Well, I guess with less regulation, it would free up other businesses to get started and expand and there may be opportunities there as well. So if their business is growing, that should create more legal opportunity.
Chris: Yeah, so for acquisition, M&A and probably more opportunities for litigation.
Advice for Future Chairmen and women of Law Firms
Chris: Okay, with this podcast really being directed towards law firm leaders, I wanted to give you the opportunity to share, maybe your top piece of advice for future chairmen or chairpersons of law firms.
Kim: To understand, A; how time consuming it is, but B: to really be effective I think you have to spend a lot of time listening, not only to the partners, the associates, but your staff and then determine a variety of different ways to communicate. So that’s what we’ve been doing this past year is, trying to communicate in all kinds of different ways, so that people hear the message.
Chris: And what does that look like, I mean, we’re an interesting world of technology and it seems like there’s a gazillion ways to communicate something to somebody and you’re dealing with numerous, at least three generations, how does that work within your firm, to communicate what you’re trying to communicate?
Kim: We do use email, but lots of busy lawyers don’t like email. We have an internet site, some of our constituency doesn’t like to go the internet site. So, it’s just really a writing way. We’ve changed the way we do our Partnership Meetings. When you’re a multi-office law firm, it’s very difficult to have a Partner Meeting with question and answer, the bigger offices tend to dominate, the smaller offices then don’t feel like they’re involved in the meeting, they feel like they’re viewing it.
So we started doing something where we have maybe a 20 or 30 minute program on a certain topic and then we turn the videos off, we have discussion leaders in the various offices, with a prescribed set of the same questions and then they lead a discussion in their individual offices and then we report back. So that way we get to hear from the partners about what they want, what’s important to them on a certain topic and that’s gone over very well, based on that they’re valued and they feel like they’re heard.
Chris: That’s excellent. How much time do you spend going around listening? I know you said that’s really key.
Kim: I spend two weeks on the road. I do a lot of the chair visits, meaning I go to see our clients and then I spend time in each individual office.
Preferred Blogs to Read
Chris: Okay, as a law firm leader, it seems like most, if not always, it’s just kind of expected to read a lot. What blogs do you find yourself reading as a chairperson?
Kim: I read Eric Presser’s blog, he does a great job and the BTI one and then there’s a couple more that don’t come to mind.
Chris: Are you a big news reader, do you check certain news channels or are you trying to say away from those?
Kim: No, the American Lawyer, I get three or four a day, I read those to try and understand what’s going on in the legal business and then obviously trying to understand what’s going on in the economy, so that we can position ourselves in perhaps new areas, is something that I do as well.
Chris: Do you like having paper in your hand or are you big on using tech, like an iPad or something like that?
Kim: No, because I travel so much, I use my iPad on a regular basis.
Chris: As a law firm leader I know, having summarized information is really helpful. What key metrics do you try to keep an eye on to manage the firm?
Kim: We look at a lot of different metrics. We’re trying to increase the number of clients that pay us more than $1million a year, just because we understand those clients better, we can add more value and we have more attorney’s working with them.
We also look at revenue per lawyer, I think that’s a great measurement of how healthy we are as a firm. Obviously that’s a number we want to continue to increase.
Obviously we look at billable hours, obviously you look at the financial.
On Being a Mom
Chris: And Kim, is there any, and you can take a minute to think about this, are there any instances in your life, experiences, stories that you feel you’d like to share that made you who you are today, as far as a leader? Something that was formative, whether in leadership or as a lawyer leading an AM Law 200 firm?
Kim: I think a lot of the skills I used were ones that I learned when I was a young lawyer practicing law, raising three sons, and I know that probably isn’t the answer that you expected, but you learn how to balance, how to juggle, how to understand what’s really important and what’s not, and really to focus.
Chris: No, I think being a mother is an incredible, a very important skill and I personally have outrageous respect for my wife. So no, I think there’s a lot of credence that should be given to that and I appreciate you sharing.
So kind of positioning and going into the personal questions I like to ask when I do interviews, tell me about heroes, who are your heroes today?
Kim: I would say one is a lady that used to work for us in our Phoenix office named Nancy Fillipe. She ran our Diversity Program for a number of years and she was always doing something for somebody else. She started a program that we still do in our Phoenix office and actually some of the other offices as well, with law and economic schools where we go in and read to them. She’s raised money for them, but she was just always about other people, always giving back. So, really a wonderful person.
Kim’s Hobbies and Travels
Chris: So tell me about hobbies, I imagine as a law firm executive that you’re very busy and a lot to do, but how do you do downtime, how do you rest?
Kim: I’m an avid reader, although I read less since I’ve chaired the firm. I took up golf but I’m a terrible golfer, but I do like to golf and I find that very relaxing. And then we scuba dive, but I only get to scuba dive once a year, we try to take one big trip. This year we’re going to Palau, which I’ve been to one other time and I’m very much looking forward to that. So, I’ve had the opportunity to really dive many places all over the world and our oceans are very beautiful.
Chris: Oh my goodness, tell me about some other places you’ve dived in.
Kim: One place that we used to go to on a regular basis was Bonaire and there you can do shore diving, which is kind of fun, so you don’t have to be on a boat. The Cayman Islands are pretty… we went to Fiji which is pretty far away. Two years ago we went to Yap to go diving with those large manta rays that have the 12 or 14 foot wingspan. Just really beautiful creatures.
Chris: That’s amazing. So, I have to share my travel ignorance. Bonaire and Yap, where are those places?
Kim: Yap is a very, very small island, very poor. Bonaire is off of South America.
Kim: It’s part of the ABC Islands, Aruba, Bonaire.
Chris: Okay, very fun. And then this will probably coincide with the last question, what are some items left on your bucket list?
Kim: To get my golf score better, that would be terrific. I don’t know if that’s ever going to happen once I take some lessons, but we’ll see. I’d been fortunate, so I’ve been to all seven continents and there’s a lot of places I’d still like to travel, I think that would be fun.
Chris: What other places are ‘must do’ before you can’t travel any more?
Kim: I’d like to go to New Zealand, I’ve heard really wonderful things about New Zealand from many clients, so I’d like to do that. I’ve never been to Ireland, so that’s another place I’d like to go.
Chris: Kim, stealing this questions as I always do on each podcast from Kai Ryssdal of Marketplace, in five words or less, what is your job?
Kim: To help our clients.
Chris: That’s great. You did it in four. Kim, it’s been a pleasure and an honor and I just really thank you for your time. I know the legal community is a better one because of your leadership and your firm. So thank you for your time today.
Kim: Well thank you very much Chris.
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