"Is Key-Person Risk Lurking at Your Firm?," South Carolina Lawyers Weekly
Posted On April 30, 2019
In an article published by South Carolina Lawyers Weekly on April 8, 2019, Turner Padget CEO Pierce Campbell provides insight on “key-person risk,” which is when an organization’s success becomes reliant on an essential employee and creates risk if that person unexpectedly leaves.
For example, some law firms’ most valuable assets may live in the mind of a single attorney, which creates numerous risks if that person suddenly becomes unreachable, whether by leaving for another firm, from illness or worse. According to Campbell, a firm may not grapple with the consequences of this scenario as well as they might think, especially if the attorney is protective of their clients.
“The risk can be great. It can mean as much as jeopardizing entire relationships with firm clients,” explained Campbell. “If someone has been the face of the firm and the voice of the firm with the client for many years, other people at the firm may not even know who to talk to. It’s a very big risk to law firms, and it’s one of the reasons why both law firms and clients’ law departments need to work on planning for the future and always having a backup plan.”
According to Campbell, the best plans to prepare for these risks are developed by incorporating the input of the firm’s clients who may have thoughts on who they would like to see matters handed off to once the key person has left. A firm should also think about the advice they would give a client who had an employee in sole possession of some of the company’s most crucial knowledge. “Oftentimes lawyers are guilty of needing to follow their own advice. They can tell clients what they should or shouldn’t do, but sometimes they have trouble implementing that into their own practice.”
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