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Know the Four Key Objectives Behind Bonus ProgramsThe firm’s incentive compensation system should support four basic organizational objectives:
Each objective facilitates achievement of the firm’s goals. Following is a brief rationale for each objective. Encouraging excellence in client service: Clients are the lifeblood of the business of law. Each member of the firm must know the firm’s clients, understand their needs, and work diligently, effectively, and efficiently on their behalf. Encouraging teamwork: The practice of law today is a complex endeavor that requires interdisciplinary efforts and coordination among lawyers, legal assistants, and administrative and support staff. Teamwork must be demonstrated among the members of the firm. The success of the individual is dependent upon the success of the firm as a whole. Encouraging productivity: It is imperative that the resources of the firm are put to their highest and best use. Review of firm processes must occur with the objective of improving and streamlining those processes to ensure the most timely and cost-effective delivery of legal services possible. Efficiencies will ensure that (1) each employee’s skills are utilized, (2) responsiveness is as rapid as possible, (3) duplication of effort is eliminated, (4) automation is used to enhance productivity, and (5) redundant and unnecessary work is eliminated. Retaining talented employees: There is a significant cost associated with underutilized and discouraged employees: the loss of talented employees, and the need to replace their skills and knowledge of the law. It is incumbent upon the firm to ensure that employees are treated well and compensated appropriately and competitively. The firm’s bonus program assists in that objective. From Compensation Plans for Law Firms, Fourth Edition ABA Law Practice Management Section |
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