Sunday, May 15, 2011

Managing Cultural Risk in Professional Service Firms


"We'd like you to talk about culture," the caller said, "Over breakfast."

Why not? I thought. I've almost got to the stage where I'll talk about anything. A friend once cracked the lame joke that he'd set up a stall with me, the notice announcing The Prof Is In. Only I'd do it for free instead of charging 5 cents and in this case I was getting fed too.

The Managing Partners' Forum asked me to talk about managing cultural risk along with another social scientist from Holland, Candida Snow, a student of Geert Hofstede.

Two pieces of writing influenced my thinking for this presentation. One was Jordan Furlong's post Why do law firms exist? It helpfully goes back to first principles. The second was a paper External Agency Relationships and Agency Problems in Professional Service Firms: A Multilevel Study by Michael Lander, J. Van Oosterhout and Pursey P. M. A. R. Heugens, which examines in detail the effects of the deployment of soft versus hard controls in professional service firms. I should also mention Emmanuel Lazega's fascinating book The Collegial Phenomenon: The Social Mechanisms of Cooperation among Peers in a Corporate Law Partnership (OUP 2001).

Given that Candida and I had at best a vague brief, we wondered what we ought to say and how it would be received. We only had 15 minutes or so each. Our audience was a mix of lawyers, accountants, consultants among others. So we did what we would like and I think it went over well since the discussion ran ten minutes over time before the moderator called a halt.

I've made my presentation with fuller notes available for download.

And if you want to know how I imagined a professional services firm or law firm might look like, then it's like this

And here's what you have to do to manage one...


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