How Investing in Firm Morale Improves the Bottom Line

Inside a tall, downtown building on a Tuesday afternoon, sitting at a conference table with an almost surreal view of Mt. Hood, one Barran Liebman associate introduced herself at an event by saying, “I work at Barran Liebman, the Happiest Place on Earth, where we represent companies in employment and labor law matters.” Her introduction was certainly good for firm image and publicity, but did it really say anything about firm success? Does being the Happiest Place on Earth have any impact on a law firm’s bottom line?

In a post-recession economy, many law firms may not consider the value of creating a workplace that is rich in culture and morale. Investing in employee happiness has no quick, tangible or measurable return on investment. Birthday celebrations, baby showers, holiday lunches and happy hours will not single-handedly bring clients in the door and may even be viewed as unfavorable to a time-equals-money business model because they detract from time that could otherwise be spent working. However, one common theme shared by all successful businesses is that they are staffed by happy, valued and engaged workers.

The reasons behind this commonality are multifold. Zappos CEO Tony Hsieh is an emphatic advocate that “employees perform best when they’re happy.” The numbers back him up. Gallup found that increasing an employee’s level of engagement can improve performance by 20 percent or more. On a larger scale, this individual performance boost can have a huge impact on the company’s performance as a whole. The companies named to the 2014 Fortune 100 Best Companies to Work For list saw revenues increase by an average of 22.2 percent the year before they were named to the list. Happy employees indeed tend to be more productive than those who are unhappy.

Another reason to focus on morale is that keeping employees happy keeps employees in their jobs. Staff who enjoy where they work are much less likely to seek alternative employment. The Corporate Leadership Council reports that a high level of employee morale and engagement reduces an employee’s probability of quitting by up to 87 percent, which in turn saves firms from taking on the costly process of onboarding and the risky process of firing. Statistics on the cost of replacing a departing employee vary widely, but most range from a price tag of $3,000 to $18,000 to recruit, hire, train and onboard a new employee, not to mention time spent by managers and mentors during the process that could have otherwise been spent on work for a client, or developing new business. When employee turnover is limited, the costs associated with a revolving door are kept down and productivity soars.

Investing in employee morale also can be viewed as a non-traditional form of compensation. During the recession, and even moving into recovery, many firms were forced to decrease or forgo altogether regular, annual merit increases for staff. But while you may not have the budget to raise staff salaries by 3 percent each year, you likely can scrounge up the funds to throw a staff appreciation happy hour or thank each team member with a bottle of wine on his or her anniversary with the firm.

Let’s get back to the Happiest Place on Earth. At Barran Liebman, we take staff happiness seriously. So seriously that we allocate an annual “morale” budget and take full advantage of it. With monthly birthday celebrations, happy hours or lunches for all major holidays, a Staff Appreciation Week instead of Administrative Professionals Day, and surprise Starbucks mornings, we make it a priority to treat our team members well. As a result, the average tenure of our current staff members is a decade. Barran Liebman is named annually to the 100 Best Companies to Work for in Oregon list and counts two first place wins amongst its triumphs. Our low departure rate means that our staff members are extremely skilled at what they do, well-versed in office customs and protocol, and are efficient workers. We hire infrequently, saving us time and money.

Employee happiness doesn’t exist in a bubble, and an investment in morale can serve multiple purposes. A huge side benefit of creating a cohesive, happy work environment is that time spent team-building can also benefit the community. We find that bringing firm members together by supporting local nonprofits—from packing meals at the Oregon Food Bank to running 5Ks in support of legal aid—and including our family members in the experience helps create more positive, genuine internal relationships. Those relationships are a key piece of the operations puzzle that helps our firm run so well. When people are given the opportunity to really know their co-workers, both inside and outside of work, they work together more seamlessly and gain a better understanding of how to utilize each other’s strengths, such as asking for help when faced with a tight deadline or scheduling conundrum. After all, friends help friends—they care more about one another’s successes and are more willing to go the extra mile when asked for assistance, like covering a desk for a parent to tend to a sick child or staying late to help finish a big project.

On-boarding and keeping talent is just half of the equation; developing each individual’s potential is required for long-term success. Although good training offers a palpable advantage, its value is sometimes questioned. Some firms are hesitant to bestow upon their staff the complete range of knowledge that would enable them to perform their best work, out of fear that once highly-trained, these individuals might leave the firm to join a competitor. This viewpoint is, sadly, all too common. It’s also limiting, hindering firm potential and employee satisfaction.

At Barran Liebman, we take the opposite viewpoint. Training folks to be “the best” is what our reputation is built upon and what our clients deserve. We are guided by the quote: “What if you train your people and they leave? But what if you don’t, and they stay?” We believe that helping our employees achieve their fullest potential is our duty to ourselves and our future. Employees crave a meaningful workday—one where they feel valued and a part of the bigger picture. Equipping our people with tools to learn and grow while encouraging them to push themselves saves us from being the Initech of the legal world. Peter Gibbons from Office Space sums it up when he says, “Human beings were not meant to sit in little cubicles staring at computer screens all day, filling out useless forms and listening to eight different bosses drone on about mission statements.” People need a purpose that extends beyond a paycheck. Employees want be fulfilled and motivated to give their time, energy and effort to a firm. If the investment of a little time and money can accomplish that, and all of the rewards that accompany it, why hesitate?

About the Authors

Traci Ray
(left) is the executive director and Anneka Nelson (right) is the business development manager at Barran Liebman LLP in Portland, Ore.

(Image Credit: ShutterStock)


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