Divider
Divider


Jennifer Wilson
What’s your firm’s path to partner?

Here are 12 questions you need to answer for your rising stars.

November 12, 2012
by Jennifer Wilson

I shared a meal recently with a group of the best and brightest from a great firm. During our time together, we talked about a number of topics, but one subject stood out. These young up-and-comers are passionate about their careers and their firms, and they wanted to know: What can I expect on the path to partner?

This is a common theme with the managers, senior managers, and principals I meet, and it should be no surprise to anyone. Star performers are valuable because they rise above others in initiative, intention, and investment. They are driven to seek the next level in their careers. And while firm leaders value their up-and-comers’ ambition, most do not feed it with a clearly defined path to partner. Why is that?

According to the AICPA 2011 PCPS Top Talent Survey, top performers place the most value when it comes to retention on compensation (95%) and career growth opportunities (93%). Yet, the economic downturn resulted in flat revenue growth for firms, stalling new partner admissions and flattening raises and bonuses. Now, as the economy starts to rise, firms run the risk of having their most valuable people (MVPs) leave to seek meaningful career growth and financial opportunities elsewhere.

It doesn’t have to be that way. Differentiate your firm by providing clear answers to the dozen most pressing questions asked by top talent. Failure to do so raises the risk of you losing your best and brightest young stars.

  1. What do you see as my future with the firm?
  2. What do you expect the timing of my admission to partner to be?
  3. What specific deliverables or results do I need to produce to be a candidate for partner and by when? (Note: When answering this question, refer to my previous CPA Insider article “Do You Have What It Takes to Become a Partner?” July 30, 2012, for guidance.)
  4. How do I stack up compared to others I might perceive to also be in the queue? For instance, do you see me leapfrogging or bypassing others who you may have “parked” at a level beside or above me? (Don’t expect your people to know this. If you have people who are above them in title who seem to be in line to make partner, they may wrongly assume they have a long—perhaps too long—wait. If this isn’t the case—tell them!)
  5. What programs or activities should I expect to participate in to help me develop and prepare me to act as a partner?
  6. What are the differences in the levels of partner? If we have a nonequity partner or principal, how does it differ from equity partner in terms of compensation, governance, authority, participation in partner-level activities, client ownership, and other areas?
  7. Will I be admitted as a nonequity partner or principal or an equity partner? Do we always admit new partners one way, or are there variances? If there are variances, what causes them? (Some will ask this question because they want to go “straight to the top.” Others will want to ease in, especially if they are still raising a young family or have other commitments that give them pause about making the big equity push forward. Ideally, your path will allow for options, but for your superstars, consider “tying them up” with direct admittance.)
  8. When you admit me as a partner, what are the specific buy-in requirements? How will my buy-in be calculated? How will it be funded? Should I be saving for this now? Will the firm “gross up” my earnings to help offset my buy-in, or do we have a loan program through the firm or a banker?
  9. How does the buy-in process compare to other firms?
  10. If there is a buy-in to become a partner, has the firm modeled the equity buy-in process along with the equity buy-out or retirement buyouts, so that I can see this model and understand what I am committing to in terms of funding the current partners’ future retirements?
  11. What agreements will I be asked to sign as I become a partner? When can I read these agreements to better understand what I am being asked to commit to?
  12. How will we monitor my progress toward partner? Who will shepherd me to make sure I am making progress and know where I stand?

To make these path-to-partner discussions happen, start by sitting down with your partner group, or in a larger firm, your management committee, and documenting your current answers to these questions to ensure consistency and buy-in among your firm’s leadership. Recognize that your answers are based on your firm’s current state. You should date any documents and revise them at least once a year, because the answers will change as market and firm conditions shift.

Then, identify the firm’s rising stars with partner potential and assign a partner-level “shepherd” to begin a dialogue with each. Read my “Engage Your Best and Brightest” article for more information on how to approach this step.

Shepherds should first explore each of their assigned rising stars’ thoughts on becoming a partner. If the rising stars express interest, take them through a discussion of the firm’s path-to-partner process, explaining that this is the firm’s best definition today—but that it is fluid. Encourage the rising stars to give input.

Then, stay in close communication as the rising stars progress so you remain up to date on their continued interest, progress, and plans and also keep them apprised as the firm evolves its admission process.

Please don’t wait until your firm’s path is perfectly paved with the “right” programs and processes. Engage your best and brightest in a dialogue centered on these 12 questions and secure your firm’s future today!

Rate this article 5 (excellent) to 1 (poor). Send your responses here.

Jennifer Wilson is a partner and co-founder of ConvergenceCoaching LLC, a leadership and marketing consulting and coaching firm that helps leaders achieve success. Learn more about the company and its services at www.convergencecoaching.com.