MAKING ROOM AT THE TOP
The Surprise Announcement
It was his sixtieth birthday party.? The hotel ballroom was filled with his family, friends and the partners of his firm.? After the cake was rolled in and he blew out all sixty candles with the help of his three young grandchildren, there were calls for, “speech!? speech!”? Along with the perfunctory gratitudes and some often repeated anecdotes of his college and professional years, and fueled by the open martini bar, he announced his intention to retire in ten years, when he reached seventy.? “And you’re all invited to that bash, too,” he concluded in a flourish.
There was silence.? A few gasps.? Then respectful applause.? Later, as he was awaiting the ambulance, he returned to that moment and wondered about both the pause and the gasps.? Was there disbelief that he would ever retire?? Was he sensing disappointment (perhaps also from his wife) that he was intending to work another decade?? The ambulance medics concluded he was suffering from acute heartburn, not a heart event at all.? He asked them to put that conclusion in a letter so the insurance rates on his firm stock buyout policy would not increase.? In a few days he was finally able set aside that initial medical scare but could not stop thinking about the reaction to his impromptu announcement.
The subject of when and how to retire had become a common one among his peers.? Those that had already retired took one of these paths:
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Going Out on Top
As one of the original founders of the firm and the managing partner for the last 10 years, he had dissuaded several attempts to establish a fixed end to employment.? He’d retire when he was ready, as long as he was still capable.? He expected his fellow older partners felt that same way, too.
The phrase, “as long as he was still capable,” interrupted his chain of thought.? Perhaps the unexpected reaction at the party was to a perceived decline in those abilities that he was too close to recognize,? Or possibly, they anticipated a diminished contribution was likely to happen in the next ten years, maybe sooner than later.? Based on over three decades of success in his profession, he suspected that even at 80% capacity he was still outperforming of most of his colleagues.? His list of clients was legendary, contacts that the firm would miss (and maybe lose) whenever he departed.? These were exactly the arguments he presented to a longtime friend and colleague, about 15 years his senior and 8 years into retirement, when they met for lunch the following Friday in honor of the birthday.
“Most top performers look to quit when they are on top,” his lunch companion offered.? The younger man liked the allusion to being thought of as a top performer.? He could think of many sports champions who retired soon after they had peaked, and of others who kept playing as their physical skills diminished.? Some kept on competing to attract respectful fans wanting to see a legendary player, or to maintain an income from product endorsements.? He suspected that sports figures in decline mostly suffered from a sharp mind but an unwilling body.? Sitting at a computer and communicating on a cell phone did not require much physical exertion from him.? It was a poor analogy for his professional standing, he decided.
“How do your younger partners feel about your plans?” was the next question.? He had not considered that, any more than he would seek those partners’ approval of his family vacation plans.? He had felt he had just about everyone’s support for his role as managing partner, producing healthy profits that were fairly shared.? Many of those associates were now well on their way to creating their own retirement nest egg, plus the ever increasing value of their shares in the firm.? He shared his suspicions with his friend that most partners were pleased to ride this “gravy train” and not be bothered with firm management.
“But not all?? Wouldn’t you want to know?” was the response to his explanation.? “Say you were in your late forties, early fifties and wanted the experience, maybe even the prestige, to be the firm’s general partner.? You’ve just been told that there is a 10 year wait, maybe more if the boss changes his mind, until you have a shot at that spot.? If you were thinking of retiring in your early or mid-sixties, it would be doubtful you’d be elevated to managing partner with five or less years of practice to go.? Would you at, say, 50 years old, want to give up on that goal of being a managing partner?? I’m sure not.? You brought on many of your junior partners because they were driven and ambitious.? Are you honoring that?”
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Including the Retirement Stakeholders
Over the weekend, he gave a lot of consideration to the wisdom that had been shared.? He also realized that the health scare was still on his mind.? On Monday, he called an emergency partners meeting, unusually not posting an agenda.
“Most of you were able to attend by 60th birthday party, and heard me proclaim that I intend to stick around for another ten years,” he began.? “That wasn’t the time or the place to detail those plans.? But this is the time.? Please be assured that I do not plan to be retiring as managing partner in ten years.? My hope is that well before then we’ve made a full transition to a new managing partner.? I see this as a group effort among those present, not my decision to stay as long as I want.? It’s up to you all to decide where the firm should now be headed, and then how to make that happen and who should lead us to that new status starting when.? And keep in mind I have a vested interest in this firm’s success after I am no longer managing partner, just to make sure I get an outrageous value for my shares when you all buy them back!”
This elicited some laughter, relieving any remaining tension in the room.? It also initiated a process of strategic planning, moving the firm into new areas over several years that he realized, frankly, he had not been willing to invest his own time.? He was easily convinced to amend the bylaws to require sale of shares at age 65, with current partners with over 10 years of tenure exempt.? There were also plans developed to hire an administrative director to allow the next general partner to have more time for professional activities, as well as a marketing director to relieve the partner who was solely responsible for those efforts.
He found out a few weeks later that several of his younger partners had been in the process of breaking away to start their own firm, just as he had done in his thirties, for many of the same reasons that had compelled him then.? This opportunity to rethink the firm, building on its reputation and client base, convinced them it was better to stay and see what happens.? He agreed that he was more excited about the firm’s future than he had been in a long time, perhaps interested enough to hang on past his 70th birthday.? That, however, was a thought he kept to himself.