Bonuses = Toxic Law Firms, Pt. 2: The Billable Road To Hell

“What the hell do you mean, carrots and sticks don’t get people to work?” The motivational power of carrots and sticks are a deeply enshrined belief not just in law firms and the rest of corporate America, but in our culture. Yet, as Dan Pink writes about in Drive: The Surprising Truth About What Motivates Us, carrots and sticks only work in the long term in some fairly limited circumstances. (I talked about a few of the implications for lawyers here.)

Sure, the money can be great in Hell.

In Drive, Pink focuses on the irony that carrots and sticks, which he calls Motivation 2.0, haven’t worked for a long time in business, roughly since the end of the manufacturing economy’s dominance. A manufacturing economy, with its rote work, is one of those perfect environments for Motivation 2.0. There’s not much decision to be made about how to turn a knob, lift a lever, or push a button.

Yet despite the fact that we haven’t had a predominantly manufacturing economy in 30 years, carrots and sticks remain the primary motivational tools used in all types of business, even those that, like law, require conceptual knowledge, creative problem-solving, and application of knowledge to ever-changing situations (aka client problems—funny how they don’t closely resemble the cases we read).

The research Pink cites is fascinating. A couple highlights:

• In one study, participants were asked to play several games, such as unscrambling anagrams, throwing a tennis ball at a target, or recalling a string of digits. One third could earn a small reward, like a day’s pay, if they reached the performance target. Another third could get 2 weeks’ pay. The remaining third could get about 5 months’ pay. The small- and medium-reward groups performed about the same. The large reward group? Their performance was significantly worse than the other groups.
• In another study, visual artists submitted 10 commissioned pieces and 10 non-commissioned pieces to a neutral panel of experts. (Non-commissioned pieces were the ones that the artists did according to their own creative vision, to sell later.) The experts, who had no idea which pieces were commissioned, judged all the pieces on creative and technical skill. “The commissioned works were rated as significantly less creative than the non-commissioned works, yet they were not rated as different in technical quality,” Pink tells us.

Carrots and Sticks Sour Law Firm Environments

So let’s draw the conclusions here about law firm work, based on these studies. Law firms use the carrot of big bonuses and salary increases to motivate higher billable hours numbers. Yet billable hours are not really what law firms sell—they’ve just fooled themselves into thinking that their measurement system is their product.

What law firms sell is legal expertise and problem-solving. That’s what clients want. (Trust me, when I worked for the Association of Corporate Counsel, I heard a constant litany about the horrors of the evil billable hour, and how best to strike other kinds of payment deals with law firms.) But because of the blinders of Motivation 2.0, law firms are continually at odds with their clients over getting paid.

And by wearing the Motivation 2.0 blinders, law firms pressure everyone to do substandard, highly unsatisfying work. The pressure to bill, to produce a tangible product to bill for—like a letter, brief, or memo—means that time to engage in creative problem-solving for the client is about nil.

One part of the problem is the reluctance to bill for something like “thinking holistically and strategically about Client’s marketing program, its legal insufficiencies, and ethical ways to bring program into compliance.” But also, much of the lack of opportunity for legal problem-solving is due to the lack of mental downtime, thanks to the Crackberry and ridiculous billable hours expectations.

Motivation 2.0 Makes Lawyers Exhausted and Toxic

Tired, exhausted brains do not consistently produce high-caliber legal analysis and creative legal theories. For every person who pipes up, “but I came up with a super idea once at 3am,” I would say, “How nice for you. You beat the odds.” What you don’t see —or more accurately, partners don’t want to see—is all the times you failed to come up with something innovative, or how much longer fairly routine stuff takes, simply because you’re too tired. But the sleep deprivation studies don’t lie, and they are quite consistent.

Lawyers are already kind of challenged, as a group, on the emotional sensitivity front, what with their preference for logical thinking for solving problems, rather than relying at all on feelings. That preference gets exaggerated with lack of sleep; the end result is a very cold, unfeeling, inhumane atmosphere. In other words, it’s toxic.

But it isn’t just sleep deprivation and lawyer behavioral defaults alone that create the dysfunctional law firm environment (though those things are huge). It’s also the weird chemistry of the carrots themselves that create toxicity. In fact, the carrots create addict-like behaviors. More on that next time.

Jennifer Alvey is a recovering lawyer who coaches unhappy attorneys on aligning their work with their instrinsic motivations. She offers discounted sample coaching sessions. And, she hosts the Unhappy Lawyers Book Club about 5 times annually. Join Jennifer on Sept. 15, 2011 at 1:30 ET to discuss Drive. It’s free! Just call (209) 647-1000. The access code is 535240# (yes you need to enter the # sign). Or email jalvey@jenniferalvey.com to get on the Unhappy Lawyers Book Club email list.