The growth of corporate law firms: Determinants and outcomes of strategic decisions in New York City firms between 1983 and 1987.
Item
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Title
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The growth of corporate law firms: Determinants and outcomes of strategic decisions in New York City firms between 1983 and 1987.
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Identifier
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AAI9020819
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identifier
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9020819
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Creator
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Weisbord, Ellyn Susan.
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Contributor
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Adviser: Donald J. Vredenburgh
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Date
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1990
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Language
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English
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Publisher
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City University of New York.
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Subject
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Business Administration, Management | Law
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Abstract
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Growth processes in professional firms are not addressed in either the literature on professionals in organizations or the strategy literature and are not well understood. This study investigated strategic growth decisions in general practice corporate law firms. Historically, law firms have been closed internal labor markets, characterized by an up-or-out system of recruitment and promotion. More recently, however, law firms have started to use both lateral entry and merger for expansion.;Growth decisions were analyzed in terms of three strategies and three mechanisms. Strategies include the expansion of existing practice areas, the development of new practice areas, and the development of branch offices. Mechanisms include internal development (promotion and transfer), lateral entry (the recruitment of attorneys at the partnership level), and merger.;Data for the years 1983 through 1987 were obtained from firm records and interviews with managing or senior partners at sixty-one New York City firms ranging in size from twenty to over two hundred attorneys.;Results of lagged multiple regression analysis demonstrate the influence of organizational conditions on growth strategy decisions. Expansion of the existing practice results from a high associate-to-partner ratio, which induces promotion, as well as from small size and unprofitable areas of practice, which motivate merger and lateral entry respectively. The addition of new fields of practice is related to the breadth of the practice and also to the firm's reliance on a limited number of rainmakers, and is accomplished by lateral entry. Branch offices are opened by internal development in firms with a strong policy of promotion-from-within, though larger firms open more branch offices by merger.;Results also show that profit increases are not related to the expansion of the existing practice but are associated with the development of new practice areas and branch offices. Profit is positively related to practice development when it is undertaken by lateral entry. However, branch office development is positively related to profitability only when clients use more than one of the firm's offices.;A low R-square in many of the analyses indicates the need to identify additional variables that will more comprehensively specify the model. Additional research is also needed to extend generalizability to specialist law firms, and to other types of professional service firms.
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Type
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dissertation
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Source
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PQT Legacy CUNY.xlsx
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degree
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Ph.D.
