On Becoming A Partner – Does Performance Matter?

Thanks to this blog for the image.

This post is in process…

I am in sunny California this week for a special project. I have a long drive each morning from my hotel to my client’s plant on Terminal Island, near Long Beach… This morning I listened to an hour and a half of grilling by the Senate Judiciary Committee of US Attorney General Alberto Gonzales on the mass firings of US Attorneys last December. Live streaming of the hearing can be heard here.

It seems that the Senators and Attorney General Gonzales are not in agreement or clear about whether US Attorneys, who are appointed by the President and confirmed by Congress, can be fired or replaced “at will” or if formal job performance factors should be considered when deciding if they will continue to serve. The Senators are trying to hold the Attorney General and his approach to a standard that we have come to expect in the private sector but is clearly not what we have in this case.

I heard Attorney General Gonzales testify that there had been special process to review some US Attorneys and decide if they should continue. This review, delegated to one of his deputies, was a performance type review. However, the Attorney General is not in favor of implementation of a formal performance review process and there is no formal performance review process in place now. He feels that a formal process would not allow the President to have the ability to unilaterally change who serves him. There is a Peer Review process (in the Justice Department called EARS) that allows subordinates, peers, and others to weigh in on each US Attorney every three or four years.

This whole discussion reminded my of the performance review process I went through at PwC last year. Although due to legal reasons, (that is, fear of employment litigation), most companies have some type of performance review process that helps their management make decisions on promotions, raises and other performance counseling, employee performance review processes are more or less detailed, more or less subjective, and more or less rigorous (or “fair”) depending on the company.

However, the Big 4 has been slow to adopt formalized processes. This is in part due, in the Big 4 in particular, to the slow, halfhearted pace of implementation of rigorous, standardized processes for their administrative functions, especially with regard to the technology necessary to support them. But it has more to do with the nature of partnerships. Partnerships, whether accounting firms, law firms, engineering firms or other similar professional services companies have a reputation for being more subjective, less rigorous, and less detailed. This is because, after all, Partners typically believe should be able to decide who they want to join their ranks and who they want in “their Firm” without outside interference or the pressure of facts or details or subjective criteria.

At least this has been the situation until litigation started to affect them, too. The Big 4, as has been mentioned many times before, are partnerships in a legal sense, but are really large global companies, subject to the laws, regulations and customs of the locations they operate in, whether they like it or not. And they employ many people who will never be Partners and that work for the firm in administrative areas and other support functions like they would in any other company. Nowadays, many professionals would also like to work and have a career in the firms without having to be “Partner Track”, since Partners have special obligations and potential liabilities that come with the monetary and other privileges. Not everyone wants these obligations or liabilities nor can they often afford them personally or professionally.