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In focus: Role of the partner

Author Jo Larbie
Author Heather Townsend

by Heather Townsend and Jo Larbie

21st-century partner

For the older partners in professional services firms, who may have been there for a long time, things have changed considerably.

In days gone by, clients tended to stay with one professional advisor for life, probably from the firm their family had always used. When this partner retired, the next in the pecking order would be promoted, inheriting the portfolio with clients happily moving forward with the next 'safe pair of hands'. Being trustworthy and working for a good amount of time within the firm were the main criteria to making partner, and new partners were rarely chosen from outside the existing company.

Things have moved on: Today's client is a far more fickle beast, ready to compare price and service at the drop of a hat, and, as a consequence, move professional services firms if they see there's a better deal to be had elsewhere. For partners, this means the emphasis has shifted from someone who looks after existing clients, to someone who has to run a business while building a profitable client portfolio.

The role technology plays
Technology has had a big part to play here, with the internet and videoconferencing enabling firms to extend their geographical reach, potentially to a global audience. For accountancy firms, this means that many clients now require their professional advisors to handle requirements across international borders, with opportunities for even the smallest organisation to attract clients with designs outside of the UK.

With more firms, particularly accountancy ones, adopting practices from the corporate world, some of the 'power' of partners is being dispersed and their role more solely focused on performance. These practices can include, for example, employing a chief executive to run their firm for them, freeing partners to focus on finding and servicing clients, paying partners a fixed salary and giving them a bonus dividend, dependent on the firm's individual performance, bringing in outside investment and floating on the stock market, and delegating key decision making to an executive or management board.

Over time, it remains to be seen whether the partnership structure will further 'corporatise' itself, or retain its unique collegiate culture and attributes.

Are you 21st-century partnership material?
Professional services firms in the 21st century need 21st-century partners to run them. The primary focus here is business acumen, not technical ability. First and foremost, you need to bring in clients and make a positive contribution to the bottom line.

The following are key ingredients to making partner: You have to be client-centric because the client is king, and this dedication to excellence needs to start with the partners and then permeate throughout the entire firm. Partners also need to be good a bringing work through the door, which means good relationship-building skills and no room for underperforming, because profit generation is key.

The ability to push the 'work as a team' strategy is another necessary trait - it is every partner's responsibility to identify and agree a motivating firm strategy. If individual partners don't want to grow the firm, it can be difficult to make them do so.

Being a financial risk taker is also desirable, because partners' incomes are linked to the performance of the firm. Thus, in lean years they may earn less than some of their employees. The press like to regularly inform us how many millions some of the partners are making in some of the biggest firms. What they don't tell us is how little some partners are making, and how much of their own money they may have to provide to stop their firm getting into financial difficulties.

If you are able to take and implement tough decisions and courses of action, then you have another trait considered important. With the title of partner comes a responsibility to your employees to ensure the long-term health of the firm, which means potentially hard calls, such as making redundancies.

Lastly, every member of the partnership is bound to abide by a majority vote, regardless of how they personally feel about a matter. Sometimes, if a partner does not agree, their position can become untenable and they have to resign from the partnership.
Competition on the rise

The marketplace for any business is more competitive than it's ever been, which means there is no place for complacency. Good firms and their partners will constantly monitor performance to ensure existing clients are happy, new ones are being found and modern technology is being utilised to its best advantage.

Partnership is no longer a given for time served, and if you want to make this grade in a 21st-century firm, you need to prove your contribution to profitability. This may sound daunting, but there is a way to do this while still having a life.

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