TLT’s managing partner talks about expanding the national firm in a recession and learning from other sectors.
The bottom of law firm TLT’s home page resembles a neat version of a well-loved restaurant’s street-facing window. In place of rosettes and mentions by Michelin, Harden’s and the RAC is a line of awards from the legal press, well-known executive networks and other bodies.
From left to right, there’s ‘National/Regional Firm of the Year 2013’, ‘Best Adviser 2012, CSR’, two from the 2013 Managing Partners Forum – ‘Best Managed National Firm’ and ‘Best Community Engagement’. Then there is ‘Best Legal Employer 2012’, ‘Workplace and Diversity Awards 2012: Winner’, ‘Best Company 2011’, and ‘Top ranked – 2013 Leading Firm’.
The list is kept neater than a restaurant window by the awards that have been allowed to fall off the end – including more than one ‘managing partner of the year’ award for David Pester, the corporate finance lawyer who has been at the helm since 2002. The intervening period has taken TLT from a single office in Bristol to a UK-wide firm, with a small shipping law office in Greece.
Turnover has more than tripled in those 11 years. Forecast income for 2012/13 is around £50m and last reported profit per equity partner was £274,000. More than 65% of the firm’s turnover is from its chosen industry sectors, which include financial services, leisure, retail and consumer goods, technology and media, housing, renewables and the public sector. Headcount has climbed to around 830. And for four years running, the firm has been judged by the Financial Times to be among Europe’s top-50 most innovative law firms. Phew.
That such expansion continued amid economic turmoil, and with 40% of the firm’s work dependent on the troubled financial services sector, makes it all the more noteworthy.
In the league table of commercial lawyer cities, Bristol comes after London, Leeds and Birmingham, and a presence in the city is seen as a precondition to success for any firm in the south or south-west that has serious growth ambitions. Pester describes it as a ‘vibrant market’ with a ‘good talent pool’, and it remains the firm’s largest resource – an office where all departments have grown, even as TLT has merged with firms in other cities.
But the ambition, Pester recalls, from the 2000 merger of Bristol firms Trumps and Lawrence Tucketts, was to create a national firm that had more investment capacity, with ‘deep expertise’ and a clear idea of the diversified clients and industries its lawyers would ‘populate’. It is a vision, he says, that is ‘still at the beating heart of the firm’.
Those were the firm’s strategic considerations, though articulating them is hardly indiscreet; many firms’ leaders say they aim for similar things. What Pester can point to is a record of successful planning, his reputation for which is well established.
‘We tried really hard to predict where things might grow in the future,’ he adds. That included a willingness to recruit ‘good, available people’, such as several notable additions to the restructuring team that preceded the financial crisis and recession.
Another pillar is the attention paid to client feedback. Even with the significant management demands that have come with the additions to headcount and offices, Pester spends a lot of time meeting the firm’s key clients around the UK. That is in addition to a structured framework that includes regular client and post-transaction reviews. Most importantly, Pester says, ‘we have to be seen to act on that feedback, unless it absolutely doesn’t fit with our business proposition’.
It is a combination of client feedback, and to a degree the availability of those ‘interesting, available people’, that has driven the opening and then expansion of other offices. Feedback from financial services clients, to the effect that they would give the firm more work if it had a London base, led TLT to acquire niche financial services practice Lawrence Jones in 2005, followed by another London firm, Constant & Constant, in 2007.
In London, that has taken the firm from a small operation in the pre-renovation Sea Containers House on the South Bank, to shiny top-floor offices in the City on Gresham Street, surrounded by retail and investment banks. Within the past 18 months, there has been the creation of TLT Scotland Ltd – the result of a merger with commercial firm Anderson Fyfe – and the opening of TLT NI in Belfast. An office in Manchester, built around two lateral hires from DLA Piper and Pinsents, followed this summer.
Logic dictates that TLT’s prime resource remains Bristol. The firm’s principal infrastructure is in the city, and whereas the work of the financial services team overlaps with the London office, Bristol’s lower cost base makes business sense. The logic of the London offering is, Pester says, that ‘to get the practice experts, you need to be based in London’.
Client needs in Scotland, a separate jurisdiction, led renewables and licensing lawyers to be added to an existing financial services and property team.
TLT’s strategy, Pester explains, was formulated every three years, a period shortened to two years in 2008/09 in response to a fast-changing economic outlook. On each proposal, its executive asks a series of questions: What competitive advantage do we get from doing this? How does it improve what we do? And will the client experience an improvement?
After the executive, discussion goes to the wider partnership, as one would expect, but then also to staff and clients. In reviewing progress, Pester wants to know if the firm has secured not just a place on coveted panels (the firm is, for example, on several Barclays panels), but also if TLT has managed to increase its share of the work sent to panel firms.
Through periods of rapid change (‘TLT was not a brand in 2000,’ Pester reminds the Gazette), internal communication is as important as telling the world what you are about. ‘When it comes to your people, you can’t overestimate the need to communicate,’ he says. ‘You have to communicate.’
BORN Christchurch, Dorset
EDUCATION University of Manchester; Guildford College of Law
KNOWN FOR Managing partner, TLT
ROLES Corporate finance partner, Lawrence Tucketts; deputy chair, Bath Spa University board of governors
Pester describes growing a successful firm as a ‘team sport’, and the emphasis on managing people well is given prominence in the TLT recruitment material. This highlights the ways the firm has dedicated time and resource to achieving recognised standards from ‘Investor in People’ status to recommendations from student guide The Lex 100, the management awards mentioned above, and disability commitments. The firm supports Bylaw, a network and support body for lesbian, gay and bisexual people working or looking to work in the legal sector, and was recently awarded the ‘Disability Symbol’ by Jobcentre Plus for the firm’s approach to creating a diverse workforce. The most popular voluntary activity among staff is reading support for local school children.
Growth has brought challenges for the firm’s ability to get the most out of those people. In a bigger firm, more systematic ways are required to ensure that new ideas are captured, Pester observes. This is a process he contributes to by, among other things, looking at sectors other than law. ‘I’ve often dipped my toe outside the sector to get an insight into how other industries approach business,’ he says, looking at how others approach the question, what do we want to be famous for?
‘People will often be generous with their time,’ he adds, including accountants, who Pester has found to be willing to talk openly about what did (and did not) work as they set about building their businesses. ‘They’ve instilled a professional management ethic that was lacking 10 years ago, and which law firms are now trying to put in place,’ he notes.
Pester hopes those values are evident when the firm considers new hires: ‘We want to know, are you a good communicator, and are you good at listening? We always ask, can you develop a business line? Can your practice knit with our business plan? Can you collaborate?’
Supporting the firm’s way of working is heavy investment in IT and ‘knowhow’, where headcount has grown from two to 40. ‘Although a lot of the systems we buy are “plug in and play”, the innovation – the value – is in how we use them, and whether we’ve made time to allow them to change the way we work,’ Pester says.
That is an approach he believes will take the firm to 20-30 people in Manchester, and build on the 70-plus lawyers in London, 21 in Belfast, and 47 in Scotland. TLT was the result of that merger of equals back in 2000, and Pester is in no doubt about the work needed to enable mergers and acquisitions to bed down. ‘It’s not just about scale,’ he cautions, ‘but we don’t rule out further acquisitions.’
Eduardo Reyes is Gazette features editor