Making investment decisions to grow and develop new talent is a no-brainer. The return to the business on such investment is clear and easily measured. It has been a different story with those in the final phase of their time in partnership. But we are now seeing talent management strategies looking further along the career cycle and forward-thinking firms reprioritising and committing resource to support those who may only have a few years left with the firm. This article looks at why this shift is happening and what these firms are now doing.
Our research strongly suggests that the run up to retirement is a difficult and complex area for a lot of firms. There is the potential for a growing misalignment in the relationship between partner and firm as requirements and needs diverge. Open and honest dialogue can be elusive, eclipsed by the stigma attached to the admission that it might be time to move on or to allusions to ambitions outside the firm.
The reality is that there has never been a more compelling case for putting senior partner transition support in place. The highly acclaimed book “The 100-Year Life” by Andrew Scott and Lynda Gratton, outlines the challenges and choices that increasing life expectancy brings. As health and wellbeing continue to improve into later years, many now see an opportunity to overhaul the traditional view of retirement, and adopt a different approach to what can often amount to two decades more of additional work and activity. The book talks about two responses to transition, namely re-charging and re-creating. In the context of senior partners, re-charging is almost certainly a requirement after years of commitment and hard work. However, re-creation, in terms of roles, experiences and networks, is the preferred option for increasing numbers of retirees as the population stays more active and purposeful for more years than ever before.
Here at Milestones, our research has shown that there are a number of reasons why this kind of investment in your senior people makes sense: an improved relationship between partner and firm, better client handover and succession planning, and the moral imperative to value and support the most long-serving, highly-skilled people in your firm. We have spent some time looking at how various firms in the UK support their partners during the final years in the firm, as well as what retiring individuals want to do next. And there are currently a small handful of professional services firms who also believe this has become a genuine priority that they cannot afford to ignore. We went to talk to one of them to find out more about what they do, and the benefits that come with it.
After a successful career in the Army, and a two year stint as Equerry to Prince Charles, Peter Flynn is now bringing his energy and vigour to the challenges of partner career transition at PwC, where he has recently been appointed to focus specifically on this issue in PwC’s Partner Office. His role has a threefold responsibility; he has career transition conversations with UK partners in the run-up to their retirement, he is the liaison point with executive search firms for partner opportunities, and he manages the pipeline and communication of external opportunities to partners across the UK firm.
These conversations happen well ahead of time, thereby encouraging preparation and a smooth transition rather than a hard stop. Paying roles are not actively encouraged whilst still a PwC partner due to the potential for commercial or regulatory conflict, but they are possible and there are plenty of other options available too. Flynn is seeing definite trends in what his partners are looking for.
Reflecting our view that traditional NED roles are not necessarily the most appropriate or compelling option, he reports strong interest in roles which support entrepreneurship and young people, which ‘give something back’; and an increasing desire to construct portfolio careers with involvement in several different activities. A material number of current PwC partners hold such roles, but Flynn’s remit doesn’t end once the partners retire. Their network of ‘former partners’ has access to the same service. The motivation here is both commercial and altruistic. With some large consultancies reporting more than 20% of new business generated through their alumni, good relationships with those leaving the firm are critical if this revenue stream is to be exploited. And, critically, Flynn says that PwC thinks it is the ‘right thing to do’ by their retiring partners.
And what are the challenges in the role? Flynn endorses our view that a cookie-cutter solution to finding opportunities for retiring partners simply doesn’t work. ‘
The challenge is that everyone has different needs, so how can you tackle that? The answer has to be a more bespoke service.
Also, some aspects of quantitative and external input adds value, whether it is using psychometric testing, or external suppliers to coach. For Flynn, it’s a role that requires a great deal of hard work and networking, but the rewards are tangible. The PwC partner network (current and formers partners included) has a ‘family’ feel to it. And in terms of partner opportunities, it is very satisfying to be able to offer a governorship or trusteeship previously held by a former PwC partner in their late seventies to one of the existing partners within the firm.
So, we think PwC are getting it right, because the payback for this type of investment is becoming much clearer and better defined. And other professional services firms are starting to prioritise their senior partner transition strategy too.
For City law firms there is a further complication. Concern is mounting as they face the increasing threat of losing some of their best performers to US law firms in London, who offer high financial rewards and the potential to continue to work beyond the age when most City law firms expect their partners to go. So, retaining talent is a major challenge. Showcasing support and value of partners throughout their career, and not merely in the early stages, will undoubtedly give firms an advantage over their competitors.
If you would like to learn more about how we can help you, please give either Tim Musgrave or Spinny Witter a call, or email them.
Tim Musgrave 07802 481 124 firstname.lastname@example.org
Spinny Witter 07771 568 681 email@example.com