Wednesday, March 16, 2011

Finally, a great article

Stephen Harper at the American Lawyer deserves some serious credit for cutting through the crap that Howrey's official sources have given for the demise.

Stephen, thanks for a great article.

10 comments:

  1. "If he's referring to firms that have lost cohesion and a shared purpose beyond a myopic focus on current profits exceeding the last year's, he's right. But that culture exists for a reason. Aggressive lateral growth produces partners who don't know each other. Firm allegiances become tenuous; the institutions themselves become fragile..."

    Here Harper illustrates the overarching reason for Howrey's end, but he might have tied it back even deeper in the firm's DNA. Not just lateral growth, but the personalities at the center of the firm. It started to visibly unravel in the late 1990s when Savarese began passing power to Ruyak. Over time the partnership lost desire to work for the collective good. Ruyak was never alone in causing this, but he was passive/silent when he needed to be active/loud. There was no dialogue as the firm rapidly expanded, only talk of year over year profitability. The partners turned inward when they needed to face one another and communicate on difficult topics. Each challenge Howrey faced was manageable, but almost nobody was willing to put up a fight. Ruyak remained silent through the end.

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  2. Pretty much on the bullseye I am afraid. Ironically, it was a complete failure of actual leadership from Ruyak that did in the firm.

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  3. Are we done yet?

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  4. Moll to Cadwalader. Abrams to Baker Hostetler.

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  5. The only thing I disagree with is the characterization of the NoVa office. I think both the writer and Ruyak is off the mark. My experience as of 3 years ago was that the NoVa office although set up to bring all things e-discovery-related in house, wasn't getting beat by vendors in terms of cost, but rather capability. I'd call telling them that I was sending over 50 gigs of data that need to be culled using keywords and the response would be "uhhhhhhh, we can't do that." In fact, they couldn't handle the majority my e-discovery needs. There was always the promise that they would have the capability in the future. The problem was the management blew its wad in terms of saying that NoVa was up and running and that we should use it. Several others, like me, tried and hit a wall because NoVa simply was not ready. Then several others, like me, went back to their outside vendors and never looked back because we did not want to waste any more time and the firm was left with an underutilized multi-million dollar investment. It's actually a nice case study of the larger issue illustrating the disconnect between the firm's management and reality.

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  6. I sort of agree with @10:34 - but still fail to see how the NOVA office was not profitable. 1/2 the people there were/are IT and records people that would have to be in DC (with higher rents, etc) even if there was no "ediscovery" center there. So that saves money.

    Then you have the reviews that go on. If Howrey gets a cut from the contract reviewers, that is all profit. Even if they don't then they bill out the Staff Attorneys that Howrey employs at a much higher rate then they are paid. And staff Attorneys are much cheaper then Associates - no development cost, no pro-bono hours, etc.

    I agree that it was not a comprehensive full service shop that it was promised to be, but unless I am missing something (and I have not seen the books so I might be) how could the NOVA office have not made money when there was work?

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  7. I have not seen the books either, and I don't dispute that NOVA was profitable, I just think the margin would have been MUCH greater if Ruyak and co didn't put the cart before the horse by encouraging us to use NOVA before they were ready. But in the end, pointing to NOVA as a factor in the firm's demise is pretty absurd regardless of its profitability.

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  8. As a former NoVa IT staff member, NoVa had work and the current IT Leadership team was trying to get up to speed and bring Howrey into modern times, however as it was my understanding while I was there, projects like SAP became so customized that even SAP didn't recognize it let alone want to claim it. The SAP project was started before I got there and was a HUGE moneypit. My first year of being there is when SAP FINALLY went live after having been a 5 year plus project.

    Various other applications and softwares were in desperate need of being updated but when money and time is being allocated to projects like SAP and partners are upset that nothing seems to be happening as promised, of course outside vendors were used thereby circumventing IT.

    Seems that Ruyak and that team never wanted to just let IT handle their jobs and get things done. There is/was a great IT leadership team, but when you're being told that xy&z is needed but you aren't getting ab&c funding or assistance how can you move forward with what is needed to help the partners, attorneys, and associates do their jobs properly?

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  9. I think that one problem at NoVa was that the strategists in DC seldom went out there and then ran back downtown as quickly as they could.

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  10. NOVA should have never been pitched as an in-house vendor equivalent. It would have required an enormous outlay of money that would have never been recouped. That's the reason you use vendors -- they have the economy of scale -- and you can use NOVA's services in other ways than in straightforward data processing. You're never going to be able to find an in-house solution to data processing: the data gets too large too quickly, the software is constantly advancing, and the infrastructure is constantly being tested to the limits.

    Nonetheless, there were plenty of cases and circumstances were NOVA was and would have been extremely useful.

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