DLA Piper calls in PwC for overhaul of partnership model
Author: Claire Ruckin
03 Dec 2009 | 01:15 | 8 comments
Firm aims for ‘global first’ with move to update partner model
DLA Piper has called in PricewaterhouseCoopers (PwC) to help it conduct a major overhaul of its partnership model, which is expected to usher in sweeping changes to the firm’s UK and international business.
The process is aimed at dramatically improving transparency for senior lawyers, including creating clearer performance objectives across the entire partnership.
It is expected the review will consider options to more closely align career management and remuneration across the three tiers of partnership DLA Piper operates in its UK and international business.
PwC was engaged last month to aid in the review, which comes after DLA Piper set up a small working party a year ago to consider options to modernise its partnership.
DLA Piper is set to begin discussing the initiative in detail with partners in the coming weeks, with the process expected to last well into 2010.
Some partners believe the firm could move further towards a single tier of partners rather than its current model of equity partners and two bands of fixed-share partners, though the firm stressed that the initiative is in its early stages.
The move will be the first time that the firm has reviewed its partnership structure since the creation of the legacy UK national practice Dibb Lupton Alsop in the mid-1990s.
DLA Piper joint chief executive Nigel Knowles (pictured) said: “Our systems have not materially changed since we were a UK-based firm. We are now a global business. Our thinking has developed and we must move on to take account of dramatically-changed circumstances.
“This is all about alignment and transparency. We need to tie together and align roles and responsibilities, performance management and the way we reward our partners. If we achieve this it will be another first as no global firm has achieved anything like it.”
DLA Piper’s US partnership is not currently directly affected by the review, though it is currently assessing its own model. The US practice in January 2009 announced that it was asking its 275 salaried partners to contribute capital to the business for the first time in return for a direct stake in the firm’s profits.
DLA Piper’s review comes as a number of international firms are reviewing partnership structures put in place during the boom to ensure that varying bands of partners have aligned incentives during more challenging markets.
COMMENTS(TOTAL 8 COMMENTS)
Some might say...
Some might say that the partnership model could be overhauled by watching the bottom line and paying out rather more to DLA partners and rather less to PwC partners.
Some might also say that the partnership model could be overhauled by not being quite so navel-regarding and spending its spare cash on things like jobs for the Indians (or failing that a semblance of a redundancy package - see Legal Weeks passim ad nauseam...) rather than consultants to the chiefs.
Either things are really pretty bad over at DLA or this is a colossal waste of cash. Carry on...
Assistant X -03 Dec 2009 | 11:54
Re Assistant X's comments: why is it either things being really bad at DLA or a colossal waste of money. It looks like both to me.
Anon -03 Dec 2009 | 13:34
The chickens are finally coming home to roost for a firm that has less than 30% of the partners on equity - this is the business model that does not work!
Anonymous -03 Dec 2009 | 15:55
The previous posters are being bloody melodramatic. DLA has had one year of hard-sledding after 12 years of growing like crazy. They're hardly in trouble. All firms are looking at their partnership structures right now.
Hmmmmm -04 Dec 2009 | 11:17
DLA has hit big problems - overzealous expansion in the Middle East during a recession has showed up its weaknesses as a mid-market firm in Western markets. This PwC thing is a smokescreen for bigger problems. What they need to do is overhaul senior management at the board level and get a vision that suits the post-Lehman world i.e. one based in reality not PR rhetoric.
eric bowse -05 Dec 2009 | 18:03
Comment
Interesting to see how DLA Piper seems to be the continuing target of a lot of adverse posts. Reality is that it is still the world's largest firm, and the one that has most other magic circle firms looking over their shoulders. These reforms are all part of the same process, it seems to me.
anon -07 Dec 2009 | 17:12
"OTHER magic circle firms"?
McDLA is definitely not magic circle and has a long way to go if that is even one of its aspirations.
Anon -09 Dec 2009 | 05:31
DLA is one of the biggest and the most recommended firms. The market is changing so the system has to as well.
Enigma -05 Jan 2010 | 19:55
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