Having been tagged separately and independently by J. Craig Williams and by Gerry Riskin to contribute to the meme launched by Stephanie West Allen and Julie Fleming Brown to participate in the "Lawyers Appreciate..." round-robin, I feel it incumbent upon myself to respond before the midnight Dec. 31st deadline, so without further ado:

Lawyers appreciate professional management at senior executive levels of their firms.  Lawyers are not taught, and by and large don't care to learn about:

• competitive strategy
• management 101
• finance
• marketing
• IT, or
• human resources.

Erego those functions should be left strictly under adult supervision.  Hire worldly-wise and savvy strategic advisers, Chief Operating Officers, Chief Financial Officers, Chief Marketing Officers, CIO's, and heads of HR, and get the lawyers out of their way.

What lawyers do care about is professional excellence, a collegial and fulfilling atmosphere, and above all else the ability to serve appreciative clients with impeccable legal counsel.   Lawyers appreciate being able to focus on that to the exclusion of all else.  Let them.

To start, there could be no better introduction than this discussion of the interplay between his most famous work, obviously, The Wealth of Nations, and its predecessor by 17 years, the relatively unsung Theory of Moral Sentiments.   The piece takes off from Adam's Fallacy: A Guide to Economic Theology, written by Duncan Foley of New School University in New York, which is described as "a beautiful little book. It contains some of the most lucid exposition of the core ideas of economics that I have ever read."  (The reviewer is David Warsh, author of Knowledge and the Wealth of Nations, which I will soon be reviewing here; Warsh is a former Boston Globe columnist.)

The "fallacy" of "Adam [Smith]" is this:

"So what exactly is Adam's fallacy? According to Foley, it's "the idea that it is possible to separate an economic sphere of life, in which the pursuit of self-interest is guided by objective laws to a socially beneficent outcome, from the rest of social life, in which the pursuit of self interest is morally problematic and has to be weighed against other ends." This abstraction of an economic sphere from the messy complexity of real life is indeed the kernel of present-day economics.

But this entirely overlooks Moral Sentiments (for the 18th-Century phrase "moral sentiments," substitute today's more apt "conscience," and your understanding will increase), which opens thus:

"How selfish soever man may be supposed, there are evidently some principles in his nature, which interest him in the fortune of others, and render their happiness necessary to him, though he derives nothing from it except the pleasure of seeing it.... The greatest ruffian, the most hardened violator of the laws of society, is not altogether without it."

And here he describes "the man of system," who "seems to imagine that he can arrange the different members of a great society with as much ease as the hand arranges the different pieces on a chess-board; he does not consider that the pieces on a chess-board have no principle of motion besides that which the hand impresses on them; but that, in the great chess-board of human society, every single piece has a principle of motion of its own altogether different from that which the legislature might choose to impress upon it."

Indeed, these extra-homo economicus considerations are not just competitive with rational, gimlet-eyed, calculating analytics, at times they overwhelm "reason" altogether:

"What is it that prompts the generous, on all occasions, and the mean, upon many, to sacrifice their own interests to the greater interests of others? Is it not the soft power of humanity, is it not that feeble spark of benevolence which Nature has lighted up in the human heart, that is capable of counteracting the strongest impulses of self-love?"

Now, for some reason, the received wisdom handed down over 200 years later about Adam Smith is that he abandoned these views with publication of The Wealth of Nations.  Well, I'll spare you the academic arguments, but suffice to say there's not a scintilla of evidence that was the case.  Indeed, the better reasoned side of the debate, able to marshal far more evidence in support of its view, is that Smith intended a third and possibly even a fourth volume (cut short by his death, and his mandated destruction of all his unpublished manuscripts) reconciling and extending Moral Sentiments and Wealth of Nations by adding to the mix a treatise on the theory and impact of law and another on science and the arts.

So where are we left here in the 21st Century? 

Economics, a somewhat feckless discipline for the last few decades (there you have, in a nutshell, why I never entertained the notion of pursuing a Ph.D. in economics), has opted to "model what it can at the expense of ignoring what it cannot," and "moral sentiments" are famously unsusceptible to modeling.

One of my fonder, if milder, hopes is that my beloved discipline of economics will come to grasp more strongly the world as it really is with all its human complexity and contradiction, and return from its exile in the arid, mathematically intricate "blackboard economics" domain of homo rationalis economicus.

Happy New Year.

CIO Insight, in partnership with Baseline Magazine, is featuring a year-end review of nearly 230 case studies done over the past five years to distill out the "Top 10 Lessons for IT Project Success."  Reading that piece in conjunction with "Top 10 Project Pitfalls You Can Avoid" is a fascinating exercise in realizing how the obvious sometimes bears re-stating and—I am quite confident this perspective is entirely unintended by the writers—also gaining insight into why so many IT projects do, indeed, fail spectacularly:  Because many of the top 10 "do" recommendations are perilously similar to many of the top 10 "don't's."

But first, let's rehearse what we really do seem to know about IT projects:

• Technology cannot set the agenda; business processes must.  For example, while Toyota relies heavily on technology at its manufacturing facilities, one senior VP at the Boston Consulting Group who has studied Toyota observes "What strikes me about Toyota is, if you were to ask them if they have a technology strategy, they would probably say no, we have a business strategy."   The result of that insistence on the primacy of the business objective?  Merely that Toyota is the most efficient, highest-quality car manufacturer in the world.  To be sure, there are some valuable cultural overlays to this—including just-in-time supply chain management and, famously, kaizen, or continuous improvement; but my favorite of them all is genchi genbutsu, which literally translates to "Go and see for yourself."  In other words, at Toyota you're not permitted to just hear about a problem and try to act at a distance; workers, team leaders, and executives alike are required to go see the problem directly and work collectively  on a solution.  My recommendation?  Steal this practice.
• Track IT projects across the entire enterprise. Unless you're doing this, you have no hope of ensuring that your IT resources (human and financial) are devoted to the highest-priority, biggest-payoff projects.  Don't let IT descend into the chaotic pit of "emergency response central."
• Get everyone who matters in one room.  Or else the "solution" you design and start to build, at great cost, will irritate, offend, or simply not work for some critical constituency.
• Clean up your data—and keep it that way.  This seemingly obvious statement actually covers an entire landscape of IT project failure modes, including:
  • tolerating aging and incompatible systems which do not communicate with each other and cannot be integrated
  • the dog-chasing-its-tail syndrome of trying to retroactively fix erroneous information after it's been propagated across multiple systems
  • living with systems that routinely disclose bad information outside your firm
  • and recognize that one reason data gets dirty or noisy to begin with is poor design—of the screens, prompts, language, and choices available to users entering or updating data.  A confused user confronting an ambiguous or unclear choice cannot be counted on to read the developer's mind.

Now we get to the fun part:  How much family resemblance is there between the "do's" and the "don't's?"  Turns out, a lot.

#1:  "Get everyone in the same room" (do) but "Projects are impeded because they require approval across multiple divisions" (don't).

#2:  "Biting the bullet and migrating off an older technology can pay off" (do) but "A project's scope is too monolithic and gargantuan" (don't).

#3:  In one of my very favorites,  we have duelling "do's":  "The easiest solution isn't always the best" vs. "Don't use complicated, expensive software when a clipboard and pencil will do."  (I told you —how juicy is that?)

#4:  "Give users what they want" (do) but "Access rights are undocumented" (don't).  How are these at odds?  Simply in the intrinsic way that security and convenience are almost always at odds.

So that was fun, but what can we take away from all this sport?

Lesson One:  There's a reason the IT landscape is littered with the corpses of expensive projects.

And, far more important, Lesson Two:  If you're about to dive into the deep end of the IT pool, don't imagine for a second that you can rely on staff or vendor reassurances, untested assumptions, user omniscience, or management's heedless assent to pave the way.  You are in charge:  Navigate with crystal clear eyes.

So when the Harvard Business Review features "Grooming Next-Generation Leaders," I pay attention.   This is its jumping-off point:  Harvard Business School has a program with the unnecessarily long name of "Program for Leadership Development: Accelerating the Careers of High-Potential Leaders," which they mercifully abbreviate to "PLD," and the article is a discussion with the two professors who lead PLD.

PLD stands outside the MBA curriculum in that it's an "executive" program, available only to relatively senior people with at least 10-15 years of experience.  One of the professors confesses how different it is:

"Yet at the same time, compared to the average MBA class, the PLD class has richness. There are decades of experience in each class. People share contexts; they live many of the problems. It's exciting in that manner in how it is different from an MBA class. I just thoroughly enjoy it."

The key challenges are:

• For starters
  • identifying
  • training, and
  • retaining
    the top people
• Then helping those nascent leaders actually have an impact on the firm, and
• Enabling that "firm-wide" impact by making sure the leaders' training transcends their individual group, practice area, or expertise, and instead reflects a broad understanding of the organization—globally, if that's where your firm is.

True for corporations, but increasingly true for law firms as well, are the forces of (a) globalization; (b) fast commoditization of many products and services; and (c) unprecedented levels of competition.

Given those realities, which are not going to lessen and certainly are not going away, how do we deal with them?

In a word:  Breadth.

Our good professors admit only that "people often have a true deficiency in finance and quantitative methods" (could this be true of lawyers??), but their real focus is on training, encouraging, and rewarding people to ask not just what this or that means for their specific function or practice area, but what it means for the firm in the world.   As they say, a pharmaceutical researcher could spend a 30-year career working on a class of compounds only to see zero products actually reach the marketplace before their retirement.  Unless that person can either understand what their work contributes to the organization as a whole, or can re-envision it to make a marketable product feasible faster, they won't be a leader.

Another aspect of leadership is, inevitably, context. By this I (and they) mean:  How you lead depends on who you're leading.  We all know that we need to react to different client audiences differently, or for that matter differently to our spouse than to our children, but do you behave differently among your colleagues depending on who they are and at what particular communication frequency, at what bandwidth, they're most comfortable? 

But not everyone can be a leader, you're saying at this point?  Well, yes, and no.  Not everyone can be Jack Welch, or Firm Chair, or even practice group leader; but everyone can lead change in their area, can lead ceaseless improvement, can lead responsiveness, can lead excellence, can lead delivering clients surprise and delight.

Finally, leaders need to ask themselves this, confronted with a problem:

• What do you want to do?
• Why?
• What reservations do you have about that course of action?

The what requires decisiveness.

The why tells people if you have a vision, or or are just reacting spasmodically.

The reservations enlist genuine support, changing "We're going to do this so shut up and get on-board," to "We're going to do this so long as...."  It makes  your decisiveness and your vision realistic, in other words.

And, surprise, admitting things might not be perfect enlists support.  You're not omniscient, and claims to the contrary alienate rather than attract.  Decision; vision; reservations; speaking each individual's language.  Leadership.

we have, according to Robert Reich (Secretary of Labor under President Clinton and now Prof. of Public Policy at Berkeley), the challenge of "the economics of people" for the next few decades.  

I would probably not be the first to observe that Reich, famously short at 4'10", has generated more controversy per inch than almost anyone since Napoleon (and even CIO Insight, the magazine interviewing him, calls him one part "polemicist"), but he's saying something important here, reasonably well divorced from his ideological premises, and it's worth pondering.

Reich's first observation is that "globalization" is less about trade than it is about direct investment.  The result is that it's not just IT, help desks, and such that are being "outsourced," but rather that "all management is becoming globalized: Wherever something can be done cheaply and at the right level of skill, it will be done there."

Now add in technology, which permits, enables, and ultimately compels the following:  "In the future, anything that can be done routinely or can be reduced to software code will not be done by a person. And software is becoming ever more sophisticated."

Last is demographics:

"The baby-bust generation, people born in the U.S. between 1965 and 1990, will be in relatively short supply. Companies will have to worry even more about recruitment and retention than they do now. Immigration will become an ever more contentious issue."

In law firm land, still after all these years measuring contribution by hours worked, the "baby bust" statistics combine with the anti-workaholic attitudes of Gen Y to wreak a double whammy:  Fewer people, who are each inclined to work less, given their druthers.  Reich cites both "recruitment and retention," and "immigration" as germane to this.  The first is self-evident, but I want to highlight the second.  Instead of (just, or only) moving document production to India, should your firm start looking at importing Indian lawyers to New York, San Francisco, and Chicago? And training them as you would Harvard, Stanford, and Yale grads?

If you haven't thought about this already, my prediction is you will—or at any rate, your competitive set will.

Over the next few decades, as technology and globalization make it increaingly irrelevant where work is performed, and as "direct investment" (vs. trade) grows in importance, the competitive differentiator for firms will, more and more, be the sheer level of their talent.   Being down the block, or in the same time zone, or in the same country—out the window.

Reich expresses it this way:

"The competitiveness of any place in the world, including a place called the United States, depends less and less on the profitability of companies headquartered in that location, and more and more on the capacity of the people that live there to add value to this increasingly integrated global economy."

If you believe that (I do, in spades), you will know intellectually and rationally what I hope you've long known emotinally and in your gut:  Your firm's only irreplaceable asset is its people.  It's not capital assets, which scarcely exist and certainly aren't material, and it's not even client relationships, although this could be sounding heretical.   High-quality professionals will attract clients; high-quality clients will not suffer mediocre professionals.  (And I recently learned of a study finding that some typical AmLaw 100 firms lost 1% of their client billings per month through personnel changes, attrition, and the general effects of entropy:  This may not sound like a lot, but I characterize it as one-fourth of your client base every two years, you might have a different view.)

Is there any good news in what sounds like an increasingly Darwinian, not to say jungle-esque, landscape?  I think so:  The good news is that if you have those highly talented professionals, they can build your firm's reputation off each other.  Reich puts it this way:

"Relational capital is one of the most important and yet most neglected areas of capital formation. Companies need to utilize IT so that everyone in an organization can take maximum advantage of everybody else. It used to be called knowledge management. It's more complicated than that, as we've all discovered. But because all other entry barriers are dropping so fast, we need IT systems that rapidly connect the right people to each other so that there are real synergies."

Today I was privileged to see a prototype of a new KM system at the New York headquarters of an AmLaw 10 firm, and Reich's comment about "rapidly connect[ing] the right people to each other" could be taken as the design thesis for this system. (I hope to be able to report more on this in the near future.)

So it comes down to:  Intelligently deploying technology to deal with the ineluctable onrush of globalization and thereby to surmount the challenge of demographics. 

Here's the problem:

"According to a study by Sylvia Ann Hewlett, president of the Center for Work-Life Policy in New York, 42 percent of female lawyers take time off -- apart from maternity leave -- in contrast to 30 percent of women in business and 21 percent of those with medical careers. Lawyers, the study found, stay out of the work force longer -- an average of three years compared with just over two years for other professionals. And while only 7 percent of all professionals leave for six to nine years, 24 percent of female lawyers leave the work force for that length of time. "

Before I tell you what the cure for rustiness might be, permit me to editorialize a moment about the magnitude of the personal and economic tragedy that the high attrition rate of women lawyers constitutes.   I've witnessed, as I'm sure have you, the personal crises and long-term anxiety women confront as they try to "balance" (horrid, despicable word) our intense, client-service profession with the call of family and marriage and the expectations and demands of newborns and toddlers.  You have heard, as have I, the female friend now 25 years out of a top-three law school, whose practice, in the ascendancy at an AmLaw 5 firm, ended 18 years ago, for keeps, when the first of her two children was born:  And I quote, "I wasted my education, and my career!"

The economic tragedy is one we also know too well:  As expressed by Arthur Field, retired corporate partner from Shearman & Sterling:  ''Firms have a big investment in this group because they have trained them,'' he said, ''while the individual lawyers have an enormous investment in their education. Those who want to come back will work harder. If it's just a dollars and cents decision -- which it shouldn't be -- why wouldn't you hire more highly motivated people who have left and want to come back?''

Now, about that cure for rustiness I promised:  It's "Back to Business Law," a pilot program under the auspices of the ABA which was launched here in New York in April to provide, as they put it, "continuing legal education programs and informal networking opportunities for attorneys who temporarily leave active practice in law firms or corporate settings (including women who leave for a period of months or years in order to care for children) but remain interested and engaged in business law issues."

It's not nearly as dry as that makes it sound.

The goal of "BBL" is nothing less than providing intellectual engagement, stimulation, and feet-on-the-ground encourage to talented, bright, and energetic people who are temporarily on the sidelines, in the not-unreasonable hope and expectation that they'll understand they, too, can get back in the game—and with a minimal level of fluency with the latest developments.  If you know of a more imaginative, creative, hopeful way of dealing with the deplorable rates of attrition we see today, then you know more than I.

I had the good fortune of being able to attend their latest event, held last week at Proskauer Rose, on "Structured Finance:  The $7 Trillion Industry," with a featured presentation by no less than the GC of Standard & Poors, Petrina Dawson.  This is not your standard hotel ballroom CLE yawner.  Other topics they've covered over the past nine months read like a Greatest Hits of early 2000's Big Corporate Law Issues:

• Professional Responsibilities: Challenges and Pitfalls of the Corporate Lawyer, featuring E. Norman Veasey, former Chief Justice of the Delaware Supreme Court

• The Delaware Chancery Court Considers The Business Judgment Rule, presented by Edward P. Welch, who heads up the Wilmington office of Skadden, Arps, Slate, Meagher and Flom LLP

• The Issuance And Trading Of Securities: The Changing Regulatory Framework In America, courtesy of Roberta Karmel, who was the first woman to serve as a Commissioner on the Securities and Exchange Commission

• Sarbanes-Oxley: What You Need To Know, from Marni Lerner, a partner at Simpson, Thacher and Bartlett, and

• Open Source: Corporations Taking Notice:  Increasingly, intellectual property and intellectual technology issues are central to business. David Hudanish, a leading attorney in this area, will describe the "open source" movement and explain why the movement has gained the attention of corporate America and its lawyers.

After attending the event, I had the unusual opportunity to interview Linda Hayman, a Skadden partner and chair of the ABA's business law section—who spearheaded creation of "BBL"—as well as her partner Kayalyn Marafioti, chair of the Advisory Board for the project.  Linda and Kayalyn were gracious, forthcoming, and transparently enthusiastic about the program.

The program relies, they told me, on the generosity and public-spiritedness of the speakers they've been able to recruit and on the support of firms who contribute lawyers' time, and their space and support, to get the program launched and to watch it thrive.  To be sure, there are (we hope!) countless small networking groups among temporarily-sidelined lawyers around the country, but this is to my knowledge the first launched with the ABA imprimatur and, more importantly, with the backing of major-league firms as opposed to a loose confederation of individuals.  Certainly the members of their Advisory Board come froma veritable Murderers' Row of name-brand firms, including:

• Akin Gump
• Cadwalader
• Cahill
• Cleary Gottlieb
• Cravath
• Davis Polk
• Debevoise
• DLA Piper
• Fried Frank
• Gibson Dunn
• Jones Day
• Latham & Watkins
• Mayer Brown
• Milbank
• O'Melveny
• Schulte Roth
• Shearman & Sterling
• Simpson Thacher
• Sullivan & Cromwell
• Willkie Farr
• Weil Gotshal
• Winston & Strawn

Based on all of nine months' experience in New York, their next ambition is to launch a similar program in Washington, DC, and after that they're targeting Chicago and San Francisco.  I laud them and foresee great success if energetic backers will step forth.

So here's my call to action:

• If  you're in Washington, Chicago, or San Francisco—or are in another major metropolitan area and want to try to steal a march on those cities—contact Arthur Field and he'll explain the New York "template" and what you need to do to attempt a launch locally; and
• No matter where you are, reach out to and tap your firm's alumni network to let your talented "graduates" know about the "BBL" opportunity and enlist their interest.  The feedback received from audience members and participants (which the CLE qualification requires be collected) is 1,000% positive.  We'd like to expose many more people to the opportunity, but we need to find them or they need to find us.  Help.

Thanks in advance for any interest you might have in pursuing this.  The career you re-launch could be your spouse's.

It's not every day one is quoted in The New York Times, and I will not feign false modesty.  (The context was my 2¢'s on what the Kirkpatrick & Lockhart Nicholson Graham/Preston Gates and Ellis merger may have to portend about regional powerhouse firms.)

In a piece in this month's American Lawyer titled "Turning Point," Dan DiPietro, the head of the Citigroup Private Bank's Law Firm group, provides quantitative financial support for a theory I've long held, that our industry is not just "consolidating" or "globalizing," but that a fundamental and soon-to-be unbridgeable chasm is opening between firms who are dominant winners and the rest who fail to establish critical mass in terms of either scale or prestige.

First, a recap of Dan's analysis:  It's drawn from Citigroup's ongoing survey of 250 firms, including 91 AmLaw 100 and 65 AmLaw second hundred firms.  Essentially, the survey finds that while "average" revenue, productivity, "inventory" (a/k/a "work in progress," or accounts receivable), and margins, are all showing healthy year over year growth, there's an underlying sense of unease among a significant cohort of managing partners—unease over whether these happy trends are sustainable for their firms. 

What's going on?  This sums it up nicely:

"A look at the trends behind these statistics indicates that such anxiety is not unfounded. It shows that the "average firm" is becoming more and more of a fiction. Since 2001, the range in performance among firms has become wider, with a sizable group of highly successful firms outpacing the rest of the industry, and a smaller, but still significant, group underperforming the average. In other words, although the average firm seems quite healthy, fewer firms today are average."

And when you look at the three primary cohorts of firms represented in the Citigroup survey, you find a direct correlation between size and financial health:

• AmLaw 100 firms
  enjoyed stronger across-the-board revenue growth, as well as productivity gains;
• AmLaw "second hundred" firms, by contrast, saw expenses increasing faster than revenues (decreasing margins) as well as higher growth rates in the ranks of equity-partner; and
• Finally, the non-AmLaw 200 firms relied almost exclusively on improved collection cycles for financial health; this is great so long as you can do it, and at a non-trivial level it's merely sound financial hygiene, but it also falls into a category of developments nicely described in the words of my New Jersey-accented high school physics teacher:   "You can't play dis game fuh-evah."

Other changes are afoot in the industry, primarily driven from the client side.  These include "convergence," a/k/a the DuPont Legal Model, a/k/a cutting the roster of law firms a company relies on, as well as the increasing commoditization and concomitant price sensitivity of certain practice areas.  As Dan drily puts it, clients are both becoming more demanding in terms of service quality and exerting higher price pressure:  "It is unusual for these two factors to happen concurrently." 

If any single number encapsulates the industry's increasing bifurcation, it's this:  Taking the 45 firms out of 153 tracked over the past five years that had profits per partner over $650,000 in 2001:

• The top performers have grown PPP at a compound annual growth rate of 16.2%
• Average performers have a PPP CAGR of 9.6%
• And underperformers scored just 3.3%.

And then there's this, speaking to our dear friend, globalization:

• Top performers had, on average, 18% of their lawyers based outside the US by 2005
• The average performers had 16% abroad
• And the underperformers just 8% abroad.

Here we must especially beware confusing correlation with causation.  If your firm is sub-optimally managed, driving a flag in the ground in London or Brussels or Hong Kong is not going to vaunt you into the top tier; but if you are extremely well-managed, you may be better-positioned to navigate the atypical, unforeseeable, unanticipated, and multi-dimensional challenges of operating internationally on a meaningful scale. 

And indeed, doesn't so much of what we're witnessing in this shockingly fascinating period for our industry boil down to the quality of management?  Or, should I say perhaps more wisely, to the quality of leadership? 

I believe the quality of leadership will, over the next decade or two, increasingly distinguish the high-performance firms from the laggards.   Who within your firm is up to it?

The confluence of two stories, one the cover story of last week's New York Times Sunday Magazine, and the other from the current issue of CIO magazine, compel me to share with you a proposal I made to an AmLaw 30 firm eighteen months ago designed to overcome the two barriers to KM cited above.  (Nothing immediate came of the proposal, although the firm and I are still best of friends.)

The Times piece, titled "Open Source Spying," highlights some of the fundamental reasons our national intelligence agencies famously failed to "connect the dots" prior to 9/11—and, one has the stomach-wrenching suspicion, still can't or don't.   In a nutshell, the reason is they're using "1995 technology," and the solution is bringing them into Web 2.0 as of 2006:

"Indeed, throughout the intelligence community, spies are beginning to wonder why their technology has fallen so far behind — and talk among themselves about how to catch up. Some of the country’s most senior intelligence thinkers have joined the discussion, and surprisingly, many of them believe the answer may lie in the interactive tools the world’s teenagers are using to pass around YouTube videos and bicker online about their favorite bands. Billions of dollars’ worth of ultrasecret data networks couldn’t help spies piece together the clues to the worst terrorist plot ever. So perhaps, they argue, it’ s time to try something radically different. Could blogs and wikis prevent the next 9/11?"

So frustrated was the CIA with its inability to connect "subject matter experts" in real-time that it sponsored a competition called the Galileo Awards: Any employee at any agency could submit an essay describing a way to improve intelligence sharing, and the best would receive prizes. "The first essay selected was by Calvin Andrus, chief technology officer of the Center for Mission Innovation at the C.I.A. In his essay, “TheWiki and the Blog: Toward a Complex Adaptive Intelligence Community,” Andrus posed a deceptively simple question: How did the Internet become so useful in helping people find information?"

"The Wiki and the Blog" has now been published on SSRN, where you can read the whole thing, but this is the key predicate:  "US policy-makers, war-fighters, and law-enforcers now operate in a real-time worldwide decision and implementation environment. The rapidly changing circumstances in which they operate take on lives of their own, which are difficult or impossible to anticipate or predict. The only way to meet the continuously unpredictable challenges ahead of us is to match them with continuously unpredictable changes of our own."   And wikis and blogs, he proposes, are the answer.

But isn't this all a little airy-fairy?  When you're talking about national security—forget that RFP for the new client that you thought was a big deal—you're really going to trust a "blog" or a "wiki"?!  Well, we have a case study:

"[Andrus] was particularly intrigued by Wikipedia, the "reader-authored" encyclopedia, where anyone can edit an entry or create a new one without seeking permission from Wikipedia’s owners. This open-door policy, as Andrus noted, allows Wikipedia to cover new subjects quickly. The day of the London terrorist bombings, Andrus visited Wikipedia and noticed that barely minutes after the attacks, someone had posted a page describing them. Over the next hour, other contributors — some physically in London, with access to on-the-spot details — began adding more information and correcting inaccurate news reports. “You could just sit there and hit refresh, refresh, refresh, and get a sort of ticker-tape experience,” Andrus told me."

Need I add that some of the best coverage of challenging events, from Kosovo to Baghdad, has come from local bloggers-on-the-ground? 

Blogs and wikis have another stunning advantage, one nicely captured by a Sun Microsystems Senior VP who commented from a deep reservoir of chagrin and skepticism that they didn't depend on massive enterprise-wide system upgrades and extensive user training:  "They're like pencils and paper;  people just know what to do with them."

From the perspective of eliminating the daunting IT challenges of installing a Google-like search that hooks into the dozens and dozens of incompatible databases your firm doubtless has, or even rolling out "Lotus Notes" for 1,000 people, blogs and wikis are also unbeatable.  As a friend of mine counseling a severely technophobic head of a small firm said, when asked how someone as Luddite as he could possibly set one up, said, "If you've got half an hour and a credit card, you're there."

We all recall the FBI's massive effort to overhaul its case management software, finally culminating in 2005, after $170-million spent on the project, in its decisive abandonment because it had proven simply too complex and bug-ridden to salvage. 

Which brings us to the CIO article, called "Knowledge Management 2.0." 

It starts from the premise (which I resoundingly endorse) that conventional "big iron" approaches to KM have been remarkably unsatisfying:

"So why haven't enterprisewide knowledge management tools caught on like wildfire? There's one main problem, says Gartner VP of Research Jeffrey Mann: Users and IT administrators hate them. Sophisticated KM products like EMC Software's Documentum put the burden of management on the users, who must take additional steps to access documents and register them with the system. And some IT departments dread the arrival of Microsoft's more user-friendly SharePoint because of its hunger for in-house server and support resources."

Northwestern Mutual, not normally thought of as an "early adopter" in any sense of the term, decided that a blogging platform provided by iUpload (which archives content in a particularly friendly manner, necessary for regulatory purposes)

Or consider this case study from P&G, which emulates the experience of Dresdner Kleinwort Benson (which uses wikis to coordinate its globally-spread bankers' work on pricing deals, with a 90% reduction in email traffic):

"One of the driving forces behind Web 2.0 is the virtual office—teams of far-flung experts collaborating online to create a whole greater than the sum of its contributors. When Denise Senter-Loyola, a principal with business consultancy Milestone Group, needed to get her virtual marketing and sales team members to collaborate on creating some key documents, she first used a Web-based intranet for document management. That failed as content grew and folder hierarchies became cumbersome. Soon, team members stopped contributing content. "People gave up because they had to log on and make all of the decisions about categorizing," Senter-Loyola says.

"Finding the most recent version of a document required extra work as well—resulting in productivity losses and missed deadlines when team members mistakenly worked from the wrong version of a document. She found a better take on Web-hosted document management in Koral, a newly released Web-based tool that lets users share and collaborate on documents from any location. Koral is notable because it does much of the heavy KM lifting for you, categorizing documents and notifying collaborators of new versions automatically.

"When you upload files to your team's private Koral workspace, the service searches them and suggests tags—categories you'll use later to find documents relating to a particular subject. And borrowing from another Web 2.0 buzz technology, Really Simple Syndication, Koral doesn't wait for you to come looking for documents it knows you're interested in. Subscribe to a particular document, and Koral notifies you when it is updated. Subscribe to a team member (or a person with expertise similar to yours), and it notifies you when that person publishes new documents to the workspace.

"Because of the nature of our work, it caught on virally."

And guess what?  Just as the days of top-heavy, intricate, heavy-maintenance IT "solutions" to KM may be in danger, so is the need to exhaustively present binder upon binder of ROI analyses to senior management to get buy-in. 

The business section of today's New York Times front-paged an article discussing mandatory retirement ages at large law firms, and noted an Altman-Weil survey that found about three out of five firms had such policies.

Now, we always knew such policies existed, but for them to be in the majority of firms strikes me as barely this side of outrageous.    Before elaborating on that view, let me rehearse the reasons defenders of mandatory retirement advance:

• We need to pay younger partners handsomely, there's only so much money to go around, and so we have to cut off senior partners.
• We need to make room for younger partners to take over client relationships.
• Beyond a certain point, senior partners are markedly less productive.

Re: Pay    Let me draft into service as a spokesman for this position one John C. Hendrickson, the regional lawyer for the E.E.O.C. in Chicago, who's spearheading that agency's notorious case against Sidley Austin on behalf of 32 former partners demoted or forced to retire in 1999 because, as the E.E.O.C. contends, of age discrimination:  "I think as the legal profession has become more like a business, the younger people who are coming up are more anxious to get a bigger piece of the pie and the way to do that is to get rid of the elders."

This is fallacious on so many levels one hesitates before the embarrassment of riches, but let's be kind and keep it brief:

• Now that firms operate "more like a business," my personal reaction is to sound the trumpets of long overdue praise, but my second observation is that that implies, and Mr. Hendrickson presumably would concur, that they are more profitable, not less.  In other words, there's more to go around, not less.  If yesterday's obsolete, inefficient firms could afford to keep "the elders" around, why cannot today's sleeker, richer firms?
• If the younger want "a bigger piece of the pie," that doesn't mean the older have to be shoved rudely away from the table and onto the floor.  They might even be happy to take the same size piece they got last year given that the pie has grown.
• Since when have "the younger people" not been "anxious?"

Re:  Passing Clients Along  From time immemorial, or more accurately since the late 19th Century, large law firms have enjoyed institutional clients with generations passing the baton on both sides of the table, firm-side and client-side.  We humans understand this viscerally:  There are the up-and-comers, the rock solid mid-career performers you can count on for responsivenss and flawless execution, the wiser and more sagacious seniors who can distill a career's worth of experience, and lastly the true elder statesmen.   Lawyers understand this; clients understand this.  No individual relationship is forever, but for firms to unilaterally and, I might add, somewhat brutally, sever this relationship before its time is an unnatural act that serves no one's interest and which most clients, if administered truth serum, would probably confess they find baffling, inhumane, and just plain odd.

Re:  Underperforming  The very very short answer to this one is that we know how to deal with underperformance, be it at age 25 or age 75.  And if you don't, we need to have an extended conversation about a lot more than mandatory retirement.  If this is the pretext, your firm is using a grossly blunt instrument to deal with a problem it evidently refuses to face more directly.

So much for the defenses advanced to support mandatory retirement.  More interestingly, what are the reasons for doing away with mandatory retirement?

• You've bought and paid for this wisdom; now's the time to get the most of it.  The young, jejune, and energetic have their own virtues; the older, seasoned, and reflective have theirs as well.  Your firm needs both. 
• If your firm posits that no one has any value past (say) 65, I will posit that no one has any idea what they're really doing until (say) age 30.  Can you imagine a policy against hiring anyone under 30?  Then why does the over-65 make sense?
• Older partners can serve other functions and perform in other roles than they did when they were 35, 45, or 55.  They can mentor, train, help transition client relationships to younger people, operate as ambassadors for the firm to important constituencies (lateral recruits, potential merger partners, law schools, even governmental and regulatory agencies).   They can, in other words, "dial back" while still providing valuable service to the firm—service you might not want to sacrifice the high-priced billable hours of others to perform.
• We all trumpet our invaluable "cultures."  I have news for you:  There is no more powerful cultural transmission mechanism on earth than the personally imparted wisdom of elders.  They've seen it all, and they basically don't give a damn.  So they call a spade a spade.  (I'm assuming you like your culture and want it transmitted onwards.)

Finally, there's the simple inhumanity of mandatory retirement.  You are taking people presumably about as wise as they're ever going to be, and kicking them overboard when the arbitrarily set alarm clock goes off.  Does this make sense?  Is it good business?  Does it help your clients?  Does it make your firm provide wiser counsel?  And most important:  Is it any way to treat someone who has presumably more or less devoted their career to you?

Last year, with base salaries for first-years at $125,000, associate bonuses at top New York firms ranged from $30,000 for first-years to $60,000+ for senior associates.

This year, the news just broke that with base salaries for first-years at $145,000, associate bonuses will again range from $30,000 to $65,000—at least assuming everyone falls in line behind Milbank, who just announced first (and the falling-in-line is a pretty safe bet).

My reaction?  Given the 16% increase in base salaries over the past year, shouldn't we have expected lower bonuses in absolute dollars?  Maybe, but that overlooks the fact that most firms had very strong results in 2006.  As Mel Immergut, chair of Milbank, put it:  “We are expecting our profits per partner are going to be up double-digits.”   Trickle-down economics?

Update:  Monday 11 December:  Bloomberg now has the story, incorporating some of my remarks.

The best example I've seen, which I just learned of this week, is Drug and Device Law, which is—yep!—about pharmaceutical and medical device product liability.  Its founders and co-hosts are Jim Beck, with Dechert in Philadelphia, and Mark Herrmann, with Jones Day in Cleveland.  (Careful readers will recognize mark as the author of The Curmudgeon's Guide to Practicing Law.)  Their goal for the site?  As Mark put it to me, "Jim and I would be quite happy with a "fit audience, though few": inside counsel at drug and device companies and sophisticated lawyers who act as outside counsel for those companies."

Why is this different than, say, a three-ring binder treatise on the same subject?

Look back up at my bullets under "Web 2.0:"  The potential is for "Drug and Device Law" to become essentially home-base for a community of practice, exchanging ideas, analyses, and even briefs (well, OK, we could start with string cites).  Now imagine trying to replicate the robust functionality of that same potential community in the off-line world.

I rest my case. 

So Happy Zero Birthday to Drug and Device Law.

Those of you who know or have worked with me are aware that I'm pleased to have a "best friends" relationship with the principals of Edge International, founded over twenty years ago, and a group of wonderfully talented people who are also fun and deeply edifying to be around.  (I also am proud of my strong relationships with individuals at Hildebrandt, at Altman-Weil, and elsewhere in the industry, but those are not topics for today.)

The announcement:  As of December 1, an outstanding group of people from Edge have combined with Alan  Hodgart, based in London, and with Tim Leishman, based in Toronto, to form Kerma Partners. 

I wish the best of luck to both the new venture and to Edge, both populated by good friends of long standing. 

Which brings us to today's lesson from Harvard Business School's Working Knowledge.  Titled "How Hospitals Adopt New Technology," see if this doesn't ring true to you if applied to lawyers:  The piece considered adoption of:

"competing treatment methods for coronary artery disease and discovered a tough battleground brewing for a new technology called PTCA, or percutaneous transluminal coronary angioplasty. Not only was PTCA going up against an established and effective procedure known as coronary-artery bypass grafting (CABG), but also against the surgeons and other interests in hospitals invested in the older procedure."

And the findings?  In a nutshell, the more powerful and influential were cardiac surgeons, the less frequently PTCA was used. 

Why did the HBS professors choose a hospital setting to examine the social and cultural aspects of technology adoption?  Because:

• They are full of highly trained professionals working in teams; and
• Physicians are typically not employed by the hospitals where they work.

Although the second characteristic does not map with one-to-one correspondence to law firms, in your heart you feel the same.  Partners are certainly not "employees" of their firms in a technical, legal sense, but neither do they see themselves as employees psychologically, or were they to draw a free-association organization chart of the firm, nor if they have a tasty book of business.

What, then, do we learn?

For me, one of the more fascinating aspects is how learning to adopt the new technique depends less on the 800-pound gorillas than on the entire team.  Our professors put it this way:  " Most people think that the skills of the individual surgeon are the most important driver of success, but we found that what really mattered was how the entire surgical team was managed and how it prepared for the adoption."

If you're not thinking "practice group management" at this point, you should be. 

Moreover, the more that teams approached adoption of a new technique in terms of the concrete repercussions it had for the role of each team member, and for overall "organizational learning," the more successful it was.  By contrast, if the new technique was viewed as merely a technical change, adoption lagged or failed.

Lastly, adoption accelerated if the team operated in a zone of "psychological safety," where underlings were encouraged to speak up and the leaders gave the team  permission to discuss matters openly and, as I've put it elsewhere, "think out loud."

And the bottom line?  The key challenge for managers is to deploy their understanding of the social context of the firm to "prevent turf battles from hindering adoption" and give the new technique a chance to improve productivity and achieve state of the art results..

In medicine, of course, this can be a matter of life or death.  Although we often act as if our matters and decisions were similarly fraught, of course they aren't. 

But sub-optimal techniques, indulged over a long enough time frame, can be the death of your firm.