What Stops MPs From Being Real Leaders?

Virtually no MPs went to “MP school” or received mentoring and training to be an MP.  So it’s understandable that many MPs struggle to be real leaders.

MPs should be groomed and trained for the job at least 3 years prior to assuming the position.  Serving on the firm’s Board is a great training ground.

Aside from the fact that there’s no formal “training” for the position, other factors can adversely affect the MP’s ability to lead. Here are some of the most common hindrances we’ve noted:

The other partners refuse to follow.  Herding cats and holding partners accountable ‘is arguably the most difficult part of the MP’s job.  If the firm’s culture allows partners to do whatever they want whenever they want to, it’s almost impossible for the MP to be a real leader.  Establish a culture of holding partners accountable for their performance and behavior.

The other partners are complacent.  Partners reach a point where they have attained a client base and compensation level to make them fat and happy.  If you ask them “are you complacent?” they will say no but they are thinking “maybe.”  Partner comp systems should have built-in factors that prevent partners from coasting on past accomplishments.

The other partners are reluctant to compensate the MP at a high level for managing the firm.  Foolishly, they expect the MP to maintain most if not all of his/her large book of business in addition to spending 500-1000 hours a year managing the firm.  This results in the MP failing to make the firm his/her #1 client.  All new MPs should be required to give up a meaningful amount of their clients to free their time up for management duties.

Failure to separate management from admin.  Both are important, but management more so.  Admin should be done by a high level, experienced COO or firm administrator, not the MP.    If the MP finds it irresistible to do admin tasks and/or if the firm under-hires the FA/COO slot, the MP will be bogged down in the day-to-day, unable to focus on the big picture.  Hire the best COO you can find.

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For an exhaustive examination of the role of Managing Partner and other firm governance issues, order our Monograph CPA Firm Management & Governance.