• Compensation: Compensation, while the most obvious (and often cited) variable, is not the number one factor in the career decisions of professional services professionals, as long as the compensation is within 10
percent of the market rate. If an employee’s compensation is far below market, he or she will, however, seek alternative employment (or possibly reduce his or her efforts).
• Opportunities for promotion: Most professional staff have ambitious interest in career advancement. The firm must ensure that there is a clear promotion ladder to satisfy these goals. The firm should also ask individuals to perform at the level of skills the promotion requires before receiving the promotion. This procedure ensures that staff who are
promoted do not fail because they could not handle the rise in skill level required.
While compensation often receives the most attention as a determinant of staff satisfaction, simply increasing salaries is rarely the right answer. The preceding inventory of satisfaction determinants indicates that a well-planned career track for professional staff, as well as other noncompensation-related factors, is equally important. This chapter, along with Chapters 9 and 11, addresses these issues.
Career Tracks
A critical tool for managing professional and administrative staff in a services firm is a well-defined career path. A given firm will have a variety of titles and roles assigned to various professionals. An important distinction should be made between two major categories of employees in a professional services firm. First, professional staff are those who are directly responsible for the delivery of the services and overall management of the firm (attorneys in a law firm, doctors in a medical practice, agents in a real estate firm,
220
Attracting and Retaining the Best Professionals
consultants in a consultancy, and so on). The second category, administrative staff, is composed of those who are charged with supporting roles within the professional services firm. These employees are usually working on administrative duties (secretaries, assistants, receptionists, paralegals, or coordinators) or functional areas (human resources, finance, marketing, or information technology).
This distinction is made because there are usually important differences in firm compensation, career path, recruiting, roles, and responsibilities between the two types. Professional staff members are expected to focus their attention on building and executing the business of the firm, with an eventual path to management and perhaps equity participation. Because the majority of the employees in a given professional services firm are professional staff, this chapter focuses on career tracks and policies for those employees.
The promotion path of administrative staff is usually determined by the firm on a case-by-case basis and follows the traditional patterns for these professionals.
The legal profession characterizes three key roles played by individuals in professional services firms as “finders, minders, and grinders.” This assessment is a fairly accurate description, particularly for consulting and legal services. Finders are charged with identifying new clients, identifying needs at existing clients, and selling new engagements based on existing or new service offerings. Minders, usually mid-level managers, are charged with ensuring that the execution of the projects or assignments is proceeding smoothly. Grinders, usually analysts, consultants, or entry-level professional staff, execute the work and perform much of the analysis or heav y lifting during a project.
The specific titles for these roles varies from firm to firm and industry to industry. A list of the typical titles for each role follows:
• Finders: Partner, director, managing director or managing partner, vice-president, senior vice-president
• Minders: Senior associate, principal, director, manager, senior manager
• Grinders: Analyst, associate, senior associate, consultant, senior consultant
As would be expected, the ratio of finders to minders and grinders is a critical component of firm profitability and varies depending on the type of firm, specific services offered by the firm (type of work), and profit goals of the firm. David H. Maister, a leading thinker in the field of management consulting and author of numerous books on the topic of professional services firm management, provides an excellent overview of leverage approach in Chapter 1 of his book Managing the Professional Services Firm (see Resources section). An overview of leverage ratio benchmarks can be found in the benchmarking chapter of this book as well.
Career Tracks, Compensation, and Professional Development 221
The leveraged professional services model creates a pyramid organization structure, as shown in Exhibit 10.1. Chapter 9 covers the potential ways in which a professional services firm may structure itself in more detail.
Elements of a Career Track
The critical components of a career track include well-defined levels, roles and responsibilities at each level, promotion criteria, and compensation plans for each level.
LEVELS.
Each level within the firm (associate, senior associate, principal,
partner) should carry a specific and clear title. As a firm grows, particularly across multiple geographies, it is helpful when a manager has the same set of expectations and responsibilities across offices and practices. Many firms, particularly those that grow through acquisition, have a wide range of titles assigned for a given role. A manager in one area group may be a senior associate in another and a technical lead in yet another. Setting the titles clearly and consistently is a critical element in bringing order to career tracks.
ROLES AND RESPONSIBILITIES. For each level, the typical roles and responsibilities should be clearly documented, including client delivery work, as well as internal firm administrative duties, operations work, and business development efforts. This means inventorying the skills, experience, education Partner
tion
promo
Principal
each
for
Manager/Senior associate
level
per
Typical points of entry
Associate
for new professional staff
years
2–3
Consultant
Exhibit 10.1
Representative Professional Services Firm Structure
222
Attracting and Retaining the Best Professionals
profile, and detailed job duties for each staff position in the firm. Ill-defined roles and responsibilities leave ambiguity about what is expected of professionals at each level, as well as conf licting titles and compensation structures.
Having defined roles and responsibilities properly sets expectations as to the appropriate skills required at each level.
The roles and responsibilities should be clearly linked to the organization structure (practice, firm, specialty group) as outlined in Chapter 9, as well as the levels mentioned earlier. Inconsistencies will make staff management, promotions, and appraisals unnecessarily difficult, case-by-case challenges for firm management.
The following attributes should be part of each level definition:
• Position title
• Role within the organization (position on the organization chart)
• Reporting relationships (direct reports supervised by this position and where this position reports)
• Job requirements: professional skills, educational background, work experience, company tenure
• Documentation of day-to-day, ongoing responsibilities, organized by area (e.g., client work, firm operations work, marketing/business development, firm direction setting, staff management)
• Priorities for responsibilities, how time should be allocated
• Objective and subjective measurements of success in the role
• Promotion criteria
• Success criteria or objectives
This information can also be used by internal or external recruiters as a hiring specification, as well as provide the evaluation criteria during the annual employee review process. The information also serves to emphasize skills required for advancement at each level and expectations for professional staff as they progress through their career with the firm. Exhibit 10.2
outlines the typical career responsibility progression in a professional services firm.
PROMOTION CRITERIA. For each level in the firm, the criteria for promotion to that level should be outlined. These criteria are most often related to knowledge, capabilities, and experience of the staff, as well as other factors such as project types or tenure. The specific requirements will vary according to firm type, size, service offering, and existing customs and practices. In every case, the firm will benefit by the perception (and reality) that an objective standard exists for promotion. This sends the message that promotions are based on merit and establishes a level playing field for staff competing for
Career Tracks, Compensation, and Professional Development 223
Partner
• Establish
Principal
new clients
• Maintain ex-
Manager
• Manage en-
isting client
gagements
• Structure
relationships
Associate
• Cultivate ex-
work effort
• Develop
isting client
proposals
• Gather data
• Manage
relationships
• Sell engage-
Consultant
• Perform
projects
• Recruit and
ments
analyses
• Assess staff
retain pro-
• Document
• Develop
• Lead client/
• Lead client
fessional
processes
new service
consultant
teams
staff
• Gather data
offerings
teams
• Oversee
• Build
• Perform
analyses
• Steer overall
intellectual
analyses
direction of
capital
firm
Exhibit 10.2
Typical Career Responsibility Progression for Professional Staff
advancement. The promotion and appraisal process (discussed later in this chapter) should also establish what levels in the firm are responsible for determining when promotions are handed out (e.g., principals are responsible for determining consultants promoted to senior consultant).
COMPENSATION.
A range of compensation (base salary, bonus, other
perquisites, and benefits) should be established for each level. Inevitably, compensation information is shared within the firm as well as outside. Compensation equity within a role will help minimize any dissatisfaction in the ranks of the professional staff. A set of policies regarding compensation will also reduce the amount of human resources effort that goes into setting compensation for each individual staff member.