A Firm With Partnering As Its Signature: Stradley, Ronon, Stevens & Young

Saturday, May 1, 2004 - 00:00

Editor: Please tell us about your background, how long you have been with Stradley and what are your major fields of practice?

After attending St. Joseph's University (as the whole country now knows from the recent NCAA tournament, the Hawk will never die), I passed the CPA exam and worked two years for Peat, Marwick and Mitchell, now known as KPMG. I attended Villanova Law School and began my legal career with Stradley Ronon in 1985. During my time with the firm I have been involved with a variety of matters including finance, real estate, mergers and acquisitions and non-profit work. This broad experience has assisted me in chairing the Business Department since lawyers in the department perform work in a wide spectrum of areas.

Editor: Please tell our readers about the firm's Board of Directors to which you were recently elected. Is its governance role similar to that of a Management Committee?

When I started with the firm, the management model required numerous partners to be involved in day-to-day decisions regarding the operations of the firm. Subsequently, we transitioned to a seven-person Board of Directors with staggered terms. The partners elect the members of the Board which appoints from its members a firm chairman, a managing partner and the firm financial partner. These three individuals then serve as the firm's Management Committee. We have found this to be a much more effective method of management.

Editor: What do you consider to be the most important factors in developing and maintaining client relationships?

First you must provide high quality legal service and advice. Stealing a line from Ford, "quality is job one." You must not only know the law but also how to apply it. If you simply tell the client what the law is, without giving them advice on how to develop a strategy in order to deal with the law and assist them with performing a cost benefit analysis in making decisions, you are not providing a service to them. While attorneys are generally intelligent people, their educational background is often in the liberal arts and not in business, so the cost benefit analysis may not naturally be a part of the attorney's own decision-making process in giving advice to their clients. If a dispute arises in a business transaction and a client needs to decide whether to settle or litigate, he needs assistance in gauging how much the litigation could cost, the probability of prevailing and compare that with the actual amount in dispute. Other non-monetary issues may exist in deciding how to proceed, but certain basic information is essential in making a decision. While litigation is sometimes necessary, it can be expensive. One of the reasons our firm has a nationally recognized ADR (Alternative Dispute Resolution) practice is because of our focus on advising clients in a practical way.

Another method we use in order to create efficiencies for a client is what is known in the business world as "benchmarking." For instance, if you are a national manufacturer and you are building a new plant in a certain state, you would gather general intelligence on other manufacturers that moved to the state. You would find out what they did that worked, find out what they did that did not work, and what they would do differently if they could do it all over again. You would also interview the professionals they engaged in establishing their plant. While this seems very basic, it is surprising how often this is not done. The same theory applies to the legal world when you are undertaking a particular project. Investing time initially in obtaining information on prior similar projects, regardless on whether your firm was involved, can yield significant economies for the client and increase your overall response time. Helping clients control their fees is one of the best marketing tools there is. While it may seem counterintuitive, it ultimately leads to more business and improves the bottom line.

Editor: What other factors do you consider basic to good partnering?

Responsiveness is crucial to a successful relationship with a client. When I began to practice law, if a client called with a project, you would usually have a few days before it would actually start. Now with common usage of overnight deliveries, telecopiers, e-mail, blackberries and cell phones, the expected turnaround time and time pressures are tremendous. The attorneys that best deliver high quality service in a quick fashion are the ones that will succeed and expand their client base. Clear communications and making sure you know and understand your client's objectives are also very important.

Editor: What else do you consider to be an indicia of partnering?

You must provide value-added service to the client. Hourly rates at major law firms are not low, but if you are providing additional service of extra value to the client, you can more than justify your fee structure.

In order for a law firm to provide value-added service, they must make a commitment to invest the time and they must be creative. Part of the time commitment comes with educating yourself on what your client does, its industry and its own customer base. You also need to keep abreast of general business trends and developments in the economy and the business communities in which your clients operate. One simple example I had a few years ago was where a banking client sent us a new matter involving a commercial loan to a company to be guaranteed by the principal of the company. I was not individually working on the matter but I saw it on our "New Business List." I recalled reading something about the company and the individual about six months beforehand. I did some quick research and discovered that there had been a short article in the newspaper about the individual being investigated for fraud. We relayed the information to the bank and it turned out that the real purpose for the loan was to pay attorney fees and fines associated with the fraud case. The lender did not do the loan and it was most appreciative for the information. This is an example where we expended time and effort that lead to us actually losing a particular engagement but significantly strengthening the client relationship. Sometimes, the non-legal suggestions will have merit and sometimes they won't, but the client will know that you care about their business and that you are involved. Creativity comes into play in figuring out how to best fit all the pieces of the puzzle together and how all of the information you gather and the relationships you have established can be put to use to improve your relationship with a particular client.

Other particular instances of our firm's partnering with clients in general ways are providing associates on a temporary basis when they become short handed, assisting them in locating executives to fill CEO and other positions, and assisting them in networking or marketing their particular products by making arrangements or introductions to important people in the industry.

Editor: Do you and others in the firm track business and legislative matters to keep clients informed of developments that are useful in their businesses?

We track legislation in certain industries from initial concept to passage and keep the client abreast of the legislation as it progresses. We also track amendments, regulations, enforcement actions, case decisions, etc. The activity after the enactment of legislation is crucial to clients because it provides a real world picture of the impact of certain laws on day-to-day operations.

Editor: Is Stradley Ronon flexible with fee arrangements?

As with most firms, we have a general hourly fee arrangement. We will be creative in order to customize a fee arrangement with a particular client in order to fit certain client needs. We most often find that we can have an arrangement that works for the firm and works for the client by using blended rates, project budgets and adding other efficiencies with respect to particular engagements. Some of those efficiencies evolve out of training client personnel as to how to handle certain matters so that outside counsel does not need to be involved, or providing training that would assist the clients in avoiding problems before they would ever need an attorney. These types of arrangements, if managed properly and creatively structured, help develop and advance relationships that are crucial to the continued survival and growth of a law firm.

Editor: What benefits do you see flowing from such long-standing relationships?

Often with major law firms, a majority of their business evolves out of relationships that were established decades ago and grew over the years. In many cases the firm grew with the client and the relationship with that client led to other clients. Actions that are taken in 2004 with respect to establishing new relationships or expanding existing relationships are very much worth the capital and time investment. History has shown that this investment will yield benefits years into the future. The law firm environment is just as competitive as other business environments. The firms that do the best jobs in establishing and maintaining these long standing relationships will be the firms that will thrive.

Editor: As in the case of DuPont, most notably, have you detected that corporate law departments are consolidating and converging their work into fewer firms with whom they can partner?

Every time there is a downturn in the economy, companies large and small look to improve efficiencies. This is one of the reasons they look to limit the number of relationships they have with law firms in order to better control the legal costs and decrease time invested in managing those law firms. I believe one of the reasons we have seen what is called a "jobless recovery" is because companies have made these types of adjustments and combined with an increased use of technology have developed certain efficiencies. They have become accustomed to doing more with fewer resources and thus need less manpower than they did in the past. They still may not need fewer lawyers, but they can still decrease costs and improve quality by using fewer law firms.

Editor: Have your lawyers ever entered any pro bono undertakings with clients such as the Philadelphia Homeless Projects or initiatives sponsored by the Philadelphia Bar?

Several of our attorneys serve on the boards of non-profit organizations that are dedicated to either helping those in need or in advancing the arts. Some of these include The Christopher Reeve Foundation, The Drueding Center Project Rainbow, The Make-A-Wish Foundation, Please Touch Museum and the Walnut Street Theater. The time that our attorneys dedicate to these board positions is done on a pro bono basis. We have several individual attorneys and the firm itself whose pro bono efforts have been recognized by various associations including the Philadelphia Bar Association, The Public Interest Law Center of Philadelphia and the Archdiocese of Philadelphia Office for Youth and Young Adults. We also have adopted a school; the Stoddart Fleischer Middle School located in West Philadelphia where attorneys volunteer time to mentor children.

You can sometimes join your pro bono activities with your client partnering goals. For instance, we provide legal support for charities that were established or are supported by our clients. We also support these causes by providing volunteers or financial support.

Editor: Do you give credit to attorneys for their pro bono hours?

We have a regular pro bono hour requirement in addition to the billable hour requirement. I believe most of the attorneys meet the requirement either through their board service, service to the community in general or through actual individual pro bono matters serving individuals.

Please email Kevin Boyle at kboyle@stradley.com with questions about this interview.