On Monday I suggested that giving bonuses based on billable hours is counterproductive and is actually a de-motivator. You get what you reward. When you reward billable hours you get more billable hours and you give a direct message that associates should focus on billable hours.
I received a comment from Anon that shows how lawyers who are rewarded for billable hours think. The comment makes my point, or at the very least makes the point Daniel Pink made in Drive: The Surprising Truth About What Motivates Us. When I reviewed the comment, I struggled with which came first: How Anon views being a lawyer, or how her law firm views its associates. Here is what Anon said:
How about this scenario: An associate is ahead in hours, such that if she billed the monthly-minimum she would be 300 hours ahead at the end of the billing year (which ends in four months). Her backlog could support working more than the minimum. Her firm does not pay hours-based bonuses.
Why should she work even the minimum? Doesn’t it benefit the firm greatly for her to keep working at the rate her backlog will allow? An hours bonus may not motivate her, but it would keep her from feeling like she has wasted a significant amount of time on work for which she will never be paid.
I want to thank Anon for a very thoughtful comment. It should give law firm leaders great insight into the thinking of lawyers who are rewarded for hours. The associate she writes about is focused on her pay, not on the work she is doing for clients. She is focused on her pay, not focused on becoming the best lawyer she can become. She is focused on the short term not focused on the long term. Her way of taking control of her career is to go home when she reaches her desired number of hours. It is the same mindset as a seamstress who is paid based on piecework basis.
If you don’t have time to read Drive, at least read this review: Motivating Employees: How to Spark Creativity Without Boosting Pay. To take a point Pink makes in the book and apply it to lawyers: Bonuses for hours may be effective when a lawyer is doing boring, repetitive work that she hates getting up each day to do. Law firms who base bonuses on hours billed send the message to their associates that the law firm values them only for the hours they bill–not for their creativity, their problem solving skills, their efficiency or their innovation.
Ask your clients how they feel about your firm rewarding associates for more billable hours. Your clients don’t want more hours. They want lawyers who are creative, innovative, know how to analyze their problems and they want it done efficiently, with fewer hours.
Associates paid for hours billed respond like Anon. They will bill the required hours and go home. Over time, they will resent firm platitudes about teamwork and a commitment to excellence in client service, because they will see that while the firm talks about those values, it lives by very different values.
In the best of all worlds, Anon would recognize that she could get greater satisfaction by finding ways to bring great skill and creativity into her work because it will help her firm’s clients. In fact, older attorneys who have "made it" in her law firm probably did just that. Yet, for a young associate rewarded for hours, it becomes increasingly difficult to find satisfaction that way.
I don’t believe associates come out of law school thinking their career will be focused on "getting their hours." I believe they begin their career focusing on helping clients succeed. How quickly they change in the face of pressure to get their hours. For that reason, law firms should consider restructuring how they compensate their associates in a way that shows associates that they are valued for a lot more than their ability to churn out billable hours.
If you don’t have ideas on how your firm could do this, read Drive. Daniel Pink discusses how to bring out the best using better approaches.