Eric Fletcher:
Conversation is one of the threads that serves to define who we are and who we are becoming. This is true whether you're talking at a personal or an institutional level, and whether we're having a conversation with a close friend or a partner, or a closely knit team or tribe, or even a broader community. In conversations of the highest order, change, improvement, and even innovation have an opportunity to take hold. On an average day, the average adult engages in more than 30 encounters that last multiple minutes. This doesn't count the number of conversations that we might be prone to have inside our own heads. So our goal here is to break away from the same old conversations and to explore the idea of having better conversations. What do they sound like? How do we nurture them? And how do we move from better conversations into action? Welcome into Chasing Better Conversations.
Roger Hayse has spent more than 35 years closely advising law firm management and legal service providers. His career is highlighted by consistently providing the council and the leadership that's necessary to successful law firm transitions. A handful of benchmarks from Roger's career include having managed multiple large-scale law firm mergers or acquisitions, advising and facilitating implementation of new compensation programs, directing the smooth divestiture of non-performing offices, and maybe most notably, leading the most successful out-of-bankruptcy wind down of an AmLaw 100 firm in history, including the transition of lawyers to new offices and the resolution of liability issues. I know you're going to enjoy today's conversation with Roger Hayse.
Today's a special day for me because our guest is a longtime friend and colleague, Roger Hayse. Roger and I worked together for several years back in the early two thousands at a law firm based in Dallas, Jenkins and Gilchrist, and have maintained a working relationship and a friendship. And Roger, thanks for joining us today.
Roger Hayse:
Well, Eric, it's great to see you. I think it's been a while since we've seen each other. The last time I think we were together was the Austin City Limits Festival down in Austin, which was a great time, great music, and we had a lot of fun together, so it's good to see you.
Eric Fletcher:
And as we record this, we're missing South by Southwest.
Roger Hayse:
Well, you can't have everything.
Eric Fletcher:
So Roger, you are about to take more than just a little walk. Tell us a little bit about that before we get into some other topics. You're about to hit the Pacific Coast Trail. How long is the trail? How long will you be gone? Tell us what led to this.
Roger Hayse:
Yeah. Well, first of all, the trail is called the Pacific Crest Trail, and the trail begins, I guess depending on which direction you're going, whether you're going north to south or south to north, goes from Mexico to Canada. So I will be starting on the border of Mexico just about an hour east of San Diego and hiking 2,650 miles north to the Canadian border or just across the Canadian border. And if all goes well, the hike will take me about five months, so I'm really excited about the hike.
Eric Fletcher:
Five months. And you're going by yourself?
Roger Hayse:
Yeah, I'm going by myself. The hike requires a long-distance permit, which is issued by the Parks Service, and so it's a little difficult to get two people leaving exactly on the same date. But notwithstanding that difficulty, I couldn't find another person that wanted to give up five months to hike with me anyway, so it didn't really matter.
Eric Fletcher:
So what's a day like in these five months?
Roger Hayse:
Well, every day is different in some ways and every day is the same in some ways. Certainly, the scenery and things and people you may run into vary from day to day, but fundamentally, every day is also the same in that you get up in the morning, get a little something to eat, pack up your tent, get everything packed in your backpack, and then you walk the rest of the day until at the end of the day you unpack your backpack, put your tent up, get a little something to eat, go to bed to get ready to do it all over again. So that's your typical day.
Eric Fletcher:
Average day, how far will you walk?
Roger Hayse:
I think I'll probably average about 20 miles a day. Probably start a little slower than that and probably do a little more than that once I can get as far north as Northern California or Oregon. Those days may be 25 or more mile days.
Eric Fletcher:
So you're leaving in mid-April?
Roger Hayse:
I'm leaving in mid-April. I'm going to go out to San Diego. My youngest son lives out there and my wife and I are going to go visit with him for a few days, and she will take me over to the southern terminus of the Pacific Crest Trail and I'll start hiking from there, wave goodbye to them, and I'll be off and running.
Eric Fletcher:
So I'm glad you corrected me. I have been calling it, since I knew you were going to do this, the Pacific Coast Trail, which tells you how schooled I am in all things related to these long walks.
Roger Hayse:
Well, it is on the Pacific Coast, so in some ways you were right.
Eric Fletcher:
So this podcast about conversations. You're about to enter five months where, will you have conversations?
Roger Hayse:
It's an interesting thing. I would expect I'll have stretches where there'll be a number of days where I literally won't see another person. And then there'll be other days in which you run into other hikers or I'll get off the trail for a resupply and talk to people at the resupply locations. But a lot of the time is going to be all by myself.
Eric Fletcher:
Well, it's fascinating. And before we sign off today, we'll give you the opportunity to tell people how they might be able to follow along or at least keep up with progress as you make it. Switching gears to professional matters, if I'm not mistaken, if I remember right, you went to work for a law firm right out of school. Is that right?
Roger Hayse:
Yeah, that's right. My final year of college, final semester of college, I was up in Illinois and I thought I was going to go to work for either a finance company or a CPA firm or brokerage firm, somebody directly in the financial industry. And I had, I've forgotten exactly how many now, but 12, 13, 14 interviews with those kind of firms lined up in Dallas. And one of those firms who didn't need any help at the time knew of a law firm that was looking for their first controller. And that firm contacted me and said, as long as you're going to be in Dallas, why don't you come by and visit with us? And I did that with zero expectation. I'm not sure I even knew such a thing as a law firm existed at the time and had no expectation that that's what I would end up doing. But after visiting with all of the public accounting firms and financial services firms and that law firm, I was most intrigued by the law firm and in particular was sold by the people that I interacted with during the course of that interview. And so yeah, I ultimately made the decision to go to work for a law firm straight out of school.
Eric Fletcher:
And you alluded to the fact you thought you'd get a job in finance. Your training or professional training was as a finance guy?
Roger Hayse:
Yeah, finance and accounting, both, is what I had studied and what I thought I was going to do. Yeah.
Eric Fletcher:
So looking back on that experience, are there any conversations that really stood out? You mentioned it was the people that attracted you to the law firm. Were there conversations that stood out and were there conversations that you've selectively forgotten?
Roger Hayse:
It's interesting. I remember well the interviews and the discussions I had with that law firm, and I'll get back to that in a minute. But at the other end of the spectrum, one of the CPA firms I interviewed with, I knew I didn't want to do audit work, and I told them I didn't want to do audit work, but they spent the entire time in the interview explaining to me why I really wanted to do auditing work and how happy I'd be doing auditing work in their firm, and that's the only thing that they had available was as an auditor. So I didn't find that all that compelling. But on the other hand, I was really, really struck by the family orientation of that law firm and just not only how warmly they interacted with me, but how they interacted with one another, and the organization just screamed of a family or family-oriented organization. And I was really attracted to that, and was really never sorry that I decided to do that versus trying to convince myself that I wanted to be an auditor.
Eric Fletcher:
And you stayed in the legal arena your entire professional career?
Roger Hayse:
Yeah, I stayed in. I held a variety of positions from controller, administrator, chief operating officer, all inside the law firm environment. And then, gosh, when was it? It must have been 2004, I decided to start a consulting practice. I wanted a little more flexibility in my life and wanted to be on the other side of the table and advise law firm leaders on issues, business issues principally, that I knew that they were having difficulty with and that I was interested in working with them on.
Eric Fletcher:
So really, that just documents your bonafides. You've spent your entire professional life in the management side of law firms and consulting with other professional service organizations. I'm curious, are there a couple of conversations that are missing as firms today look at the marketplace? Notwithstanding maybe economic uncertainty that looms at the moment. We'll come to that more specifically in a minute. But given your experience, are there conversations that ought to be taking place that just aren't?
Roger Hayse:
Yeah. One of the things that we see that is so often not clear within an organization is what are we seeking to be? Who do we want to be? Who are we? Really at the core of an organization, to use some business consulting terms, what are their values? What do they believe in? Where are they trying to get and how do they intend to get there? And those conversations, interestingly enough, very often don't occur among partners in law firms. And the organizations have a tendency to continue to evolve and grow without bringing clarity to those really, really important issues.
Eric Fletcher:
Would you speculate on why the conversations don't take place much?
Roger Hayse:
Yeah, I think to some extent it's a lack of awareness. By and large, lawyers are really, really bright people, but their orientation isn't based in business. Very rarely do you find a lawyer that's establishing their own firm or coming together with some colleagues to create a new firm that have been directly involved in the running of an organization of any type, and so I think it's just a lack of awareness in many cases.
Eric Fletcher:
You mentioned the attraction of the conversations that the firm seemed family oriented. That was attractive to you. Is there anything on, for lack of a better term, the human side, the HR side of the discussion where conversations aren't taking place?
Roger Hayse:
Yeah. Again, I think it's a matter of bringing some definition to who you want to be, and it evolves a little bit into some economic issues in the current environment. But what kind of employer do we want to be? And I guess there's not a right or a wrong answer to that question, but the spectrum ranges from we are very, very disciplined and careful about people that we bring into our organization and we will do what we can do to treat them like family members, almost no matter what the organization is facing. That's a type of organization. There's also organizations that are driven almost exclusively by the bottom line. How much money can we make, no matter the consequences? And so bringing a little definition to where you and your firm are on that spectrum of types of organizations I think is really important, particularly as the organization begins to experience the stresses of change, whether those are internally driven changes or changes that are forced on you by the economy or your clients.
Eric Fletcher:
Yeah, so let's talk a little bit about the current economic realities. There are frequent headlines these days as we record this about firms that are taking measures that may be preventative in nature, but reductions in force, a number of different approaches. Are there conversations that aren't taking place in that context that would be helpful, do you think?
Roger Hayse:
Yeah, I think again, in my experience, the majority of the law firms that you read about that are downsizing because either they're seeing a short-term restriction in the volume of work that they're seeing, or in other cases just fear that that's where their business base is headed, they're fearful of a falloff in revenue. And the knee-jerk reaction in a huge percentage, maybe 90 plus percentage of the time, is, gosh, things look like they may be getting tough. Let's reduce our expenditures. And the quickest way to reduce expenditures in a law firm is to reduce your headcount, and so you see them starting to terminate associate lawyers, counsel lawyers and staff personnel, all in a hope to prevent what might be a very short-term blip in revenue.
And I think in most of the cases, what never occurred preceding those decisions is there was never a conversation among the partners of, in the event that things look like they're going to turn down, or in the event that things do turn down, what kind of employer do we want to be? Do we want to put money in front of relationships? And if so, to what extent? Or do we want to avoid that to whatever reasonable cost we can avoid it? And if so, bring some definition to that discussion as well.
Eric Fletcher:
Yeah. So maybe there's a right and a wrong, maybe there's not a right and a wrong, but in any case, what you're suggesting is some intentionality, some specific direction, making decisions based on a direction that you've chosen.
Roger Hayse:
Yeah. Unfortunately, I think the choice was never made. What kind of organization do we want to be? And given that, how do we want to handle the potential disruption in our business base? Instead, there is more of a knee-jerk reaction without really, I think in many cases, understanding or having an appreciation for the collateral damage associated with those short-term decisions.
Eric Fletcher:
This bleeds into a topic that's fascinated me for years, and that is part of the reason there is the pressure, at least, correct me if I'm wrong from the cheap seats, part of the reason such intense pressure is felt by law firm management is there's rarely a cushion to fall back on. In January and February of 2023, looking out at uncertainty, how many firms had much of a cushion that would allow them to make decisions for the long term as opposed to the short term? Am I right there? Or correct me if I'm wrong.
Roger Hayse:
Yeah, I think there's two ways to look at that question. One is what I would call capital. What's the capital reserve that a law firm has over time, the investment that they've made in their firm, to weather fluctuations? Those fluctuations may be growth. Growth is expensive. Or a downturn like we've been talking about. And as a general rule, the capital base in a law firm is thin. In many cases, very, very thin. The other question is that as a firm looks forward and is facing decisions today, to some extent, they may look at their capital base as a short-term answer to weather the storm and maybe decrease the collateral damage that they may be causing from layoffs and that type of thing.
But the other option they have is to say, we collectively made... Pick a number. We collectively made a million dollars a partner last year or $700,000 a partner last year, and it looks like there may be some economic disruption, and given the kind of firm we are, we're willing to suffer a, pick it, 10% reduction in that in 2023 rather than lose valued employees. So that's the two options. The money's got to either come from the near-term paycheck where the money's got to come from capital. And as I mentioned, capital bases are traditionally very thin.
Eric Fletcher:
Yeah. Have we exhausted that or is there any other facet to that conversation that you think would be helpful? Because I suspect there are management teams having this conversation right now.
Roger Hayse:
Well, I'm certain that management teams are having the conversation about what are we going to do to reduce expenses, either because they're seeing a decline in revenue or they're fearful of a decline. That's happening today with certainty. Whether they're also talking about how do we feel about that as it pertains to our people and the commitment we made to them when we hired them, I don't think that conversation's happening very often.
Eric Fletcher:
Yeah. This is a little bit off-topic maybe, and maybe not. Do you think there's conversations to be had around products and services and the way we take them to market that could be more profitable and help mitigate some of where we might be looking at a decrease in gross revenue, if we go to market in a slightly different way, we can offset that?
Roger Hayse:
Yeah. That's another conversation that I think should occur, but I believe rarely occurs, and I don't want to come across like I'm down on or critical of lawyers as a group. My entire career has been associated with lawyers and they're by and large great people, those that I've known. And they're good at what they do, and there are some common things among lawyers, but as a group, I don't think you would call them innovators. Lawyers, as a general rule, are not innovators. It's one of the reasons you've seen the development of services coming out of the third-party service providers in the legal industry, typically not driven by lawyers, but by business people that see the issues that lawyers are facing and are coming to market with superior, more cost-effective solutions. So again, I think it's not likely you're going to see that conversation generated internally unless the leaders of that organization seek outside help to look at packaging what they do in the talent they've got and how it can be brought to market in a different way to help address the problem.
Eric Fletcher:
Yeah. Yeah. I will echo the desire to not come off bashing.
Roger Hayse:
Yeah.
Eric Fletcher:
I worked for great lawyers and some great firms and appreciated the experience completely. The purpose, what we want to do here, is entertain... I believe innovation begins with a new conversation. Progress begins with conversations that aren't the same conversations we've always had, so that's our goal here, and I appreciate you bring a wealth of experience that I think our audience can learn from. We talked a little bit before we turned on the recorder, but anything else on this general topic that we haven't touched on that you had walked into the room thinking you wanted to talk about?
Roger Hayse:
Yeah, I think maybe something that to the extent your listeners are lawyers and law firm business leaders, a thought to be entertained is there are no professionals in any profession in the world that own all the knowledge and intelligence associated with how to successfully grow any business. And I would encourage all law firm leaders to reach out and get some assistance in facilitating, as you described it, the need for a new discussion. Are there different ways that we can approach the marketplace that will help us be more successful? To get some third party help to drive that conversation is something I think all smart business leaders should consider.
Eric Fletcher:
Yeah. Yep. That's a good note for us to conclude with. I want to thank you again for taking the time to sit down today and share with folks who are listening and who are interested in a better conversation inside law firm management. If folks want to keep the conversation with you going, and in particular over the next five months plus, how can they do that?
Roger Hayse:
Yeah, a couple of things. One is I'm easiest to reach through our website, which is haysellc.com. That's H-A-Y-S-E-L-L-C.com. But I've also got a YouTube channel that people can go to, and it is Roger on the PCT 2023. Again, that's Roger on the PCT 2023, and I'm going to be putting up videos with any luck at all weekly, starting probably the first or second week of April, and I'd encourage all of you to follow along.
Eric Fletcher:
We will follow with bated breath.
Roger Hayse:
All right.
Eric Fletcher:
Thanks again, Roger.
Roger Hayse:
Thank you, Eric. Take care.
Eric Fletcher:
I have three takeaways from our conversation with Roger today. Number one, better conversations may begin when we are willing to come to grips with the idea that we don't have all the answers. To expect that leaders in any situation have the breadth of experience and knowledge base to come up with all of the answers to every challenge is blatantly ridiculous, so better conversations begin when we acknowledge that. Secondly, having acknowledged that the key to better conversations, maybe to ensure that we are bringing in people with a breadth of experience in the areas where we are maybe not quite as strong. And then the third takeaway is Roger's conversations for the next five months will be very limited as he enjoys the solitude hiking the PCT, and it will be fun to follow him. Thanks very much for joining us for Chasing Better Conversations today, and we'll see you next week.
