Oleg Makarov, Managing partner of Vasil Kisil & Partners
The interview was taken by Serhiy SACHENKO from Yurydychna gazeta
Oleg, could you please tell me in brief about the history of Vasil Kisil & Partners? Did you ever think that this company would rank so high as it does nowadays?
- We surely dreamt about it. It all started in September 1987. Several students under the guidance of Vasyl I. Kisil organized an international private law society. We gathered at home to discuss things which were not found in textbooks, but which were known to our teacher from his own practical experience. It was during the first years of Perestroika that Mr. Kisil told us that in the post-Soviet countries, such as Czechoslovakia and Hungary, students organized small cooperatives thereby earning an equivalent of a second stipend for themselves. That idea took hold in our minds and we began to think: why don’t we try? Thus, we participated in setting up a cooperative called Students Service Center, which was composed of various autonomous business units. Our unit provided legal services. The first eight months of work were spent in search of the first client or at least anybody who would have some awareness of the particular services we could provide. Later on, enterprises have started to spring up all over the country and they got involved in establishing direct foreign economic relations and independently entering a foreign market. Those enterprises became our first clients. In 1988, we made our first money. At that time, it was quite decent money – we earned fees which exceeded the official salary of a dean of the faculty we studied at.
Do you remember your first client?
- Yes, I certainly do. That enterprise was called Kievpishcheremnaladka. At first Mr. Kisil joked that he could never memorize the name of our one and only client. Third month into our cooperation, he said that he finally learned the name Kievpishcheremnaladka, to which I answered: “Well, the joke is still on you because effective from yesterday, our client was renamed Agropishchetekhpromservis (laughs – editor’s note). Thus, this firm became our first client and for the first three months of providing services to it we earned 4,500 rubles. By way of comparison: in those days, an average stipend was equal to 40 rubles and a salary of, say an engineer, was equal to 180 rubles. Out of that amount we paid taxes, which seemed outrageous to us, namely a profit tax (2.5%), a social contribution (4.7%), and an income tax (13%). The remaining amount was divided among our team members.
A somewhat philosophical question: what do you think lies behind a phenomenon of your company’s success?
- I think that any firm has some distinctive features that make it different from the others: it is in a class of its own, distinctive and phenomenal in its own way. A certain organizational structure operates within it and a group of like-minded people has been formed within. This group, in turn, generates its own group standards: a certain way of communication with each other, a certain way of on-the-job interaction, a certain way of support and mutual assistance between colleagues, a particular way of setting priorities for development of the firm, and certain criteria for new staff employment... Such approach shapes the overall corporate culture. Our firm employs people of different ages, with various scope of authority, with various levels of responsibility, and various competencies. We, however, generally understand that all of us are colleagues and we work together for a common cause.
By the way, our firm’s corporate governance concept, among other things, lies in that partners, lawyers and administrative staff equally participate in the production process and make a significant contribution to the production of a high-quality end product.
How does your administrative staff influence the profitability of Vasil Kisil & Partners?
- Administrative managers, like the entire administrative staff and equally like lawyers, are full-fledged participants of the firm’s profit-marking activities. Teamwork is the first factor contributing to an added value. A team effort of professional lawyers creates a more valuable intellectual product for the clients than the one we would be able to produce if each of us acted alone. Another factor is reputation element. It is formed through years. It cannot be bought and quickly adapted. The client going to a firm with extensive experience and a good reputation is ready to pay more. The third factor contributing to the added value is the so-called infrastructural or organizational value of the law firm: its actual physical infrastructure, office, equipment and implemented business processes, as well as administrative and organizational skills of all colleagues of the law firm, both administrative staff and lawyers. Failing this third organizational and infrastructural component, the law firm would hardly succeed in providing high-quality services, or earning a good reputation, or gaining its clients’ confidence. If a modern law firm neglects the third factor, its ingenious product would hardly reach its client on time and, thus, would hardly be fairly paid for.
What did you draw your knowledge from in managing the law company at the start of your managerial career?
- We were pioneers in our field and, for this reason, I initially had nothing to draw on. Furthermore, there was no possibility to find necessary books at that time. Even John Grisham’s bestseller, The Firm, was read by me only recently.
However, during the last five or seven years, there appeared a great deal of professional literature, professional events, forums and conferences were launched and are regularly held. As far as we are concerned, first and foremost, we cross-reference with our colleagues and share our own experience at such events. It is my strong conviction that everyone has his distinctive and unique experience and his own path. It is impossible to copy or buy somebody’s corporate culture or buy somebody’s business process.
By the way, we generously share our findings. We arrived at a conclusion that an already implemented business process becomes outdated once it is implemented as life brings new challenges! And if somebody wants to simply copy the business process already mastered by us, he will implement an already outdated model. Thus, when taking advantage of somebody’s developments, a company should modernize and individualize them. We, on our part, respect the experience of our colleagues. Therefore, our developments return to us modernized and improved. We are capable of constantly evolving by helping each other.
As you see, we are not in any way “greedy” in terms of knowledge. On the contrary, we aim to develop the Ukrainian legal services market by sharing our experience. I am sure that due to such an approach chosen by most of the market leaders our national legal services providers are way ahead of the international giants.
What is more important for a partner: professional skills or administrative skills? Do your administrative functions ever come in conflict with your legal practice?
- Business law researchers claim that a partner should dedicate not more than 40% of his working time to dealing with clients. The remaining time shall be spent for practice development, personnel development, new clients search, new services creation, etc. As regards the managing partner, only 10% to 20% should be dedicated here to working with clients. However, legal practice cannot be absolutely ignored as this leads to loss of professional skills. The rest of the time has to be allocated for business development, coordination of company’s policies, interaction with partners and other colleagues, client relations development, etc. But if a partner spends most of the time on client work, this results in underinvestment into company’s future.
Each partner shall possess a number of various professional and managerial qualities and skills. However, one should avoid a common managerial “trap”: if a lawyer performs a certain kind of work better than the others, quite often this is seen as a reason to move him or her to the next level of competence. At the same time, such lawyer may not always have conceptual insight, he or she may lack some confidence in project management and may not be able to bring a broader strategic vision to the task at hand. Therefore, for example, an efficient lawyer may not necessarily make a good senior associate. Apart from conceptual understanding, further stages require relevant interpersonal skills which include soft skills related to communication with clients, subordinates, colleagues, partners and competitors. I regret to say that this factor is sometimes neglected. A good senior associate may prove to be a bad partner who, at best, may only manage a project and, at worst, could just individually handle such project.
So, answering your question, I may say that the person must possess all the mentioned qualities and skills at a sufficiently high level, paying attention to both professional and personal growth, company’s conceptual development and successful implementing of personal projects, along with contributing to development of colleague interaction.
So you apply extremely high standards in selecting a partner, don’t you?
- I wouldn’t say so. Each partner is an undisputed professional in his or her field. Naturally, a partner must also be a good manager and possess perfect communication skills. But it is never a question of being a kind of superman. There is no ideal partner or managing partner. Indeed, it is important to create an environment that would stimulate each colleague to reveal his or her best qualities and skills as much as possible, to create a team of partners with complementary merits and management ways. We are strong when we cooperate. The whole is more than the sum of its parts – this is our team’s cornerstone, a point we strive to prove on a daily basis.
Speaking about the development strategies of your company, what issues did you face in 2010?
- The essence of strategic planning consists in identification of risks to avoid and opportunities to take. A strategy is a path that a company should follow in order to succeed. It goes without saying that a good strategy is built when partners share the same vision of the corporate purpose and mission.
In terms of legal business and our insight, company’s development strategy is a strategy for development of each practice, which is the development plan for professional and career growth of lawyers involved in the practice, from junior associate to partner and head of practice. The partner’s task is to coordinate his or her personal plans with the practice development plans, and, in case of the managing partner, to coordinate the development plans of all practices, ensure interaction of all partners and other team members and to direct their joint efforts. Besides, the development plan time shall be counted backwards: where do we want to be in 2015, 2014? We must have an exact vision of what we have to achieve in the current year in order to eventually succeed.
As for 2010, I believe that we have successfully fulfilled most of our tasks: we have restored the pre-crisis volume of legal services, resumed the work of those areas which suffered due to recession hardships, developed new practices bringing them to the level of company’s essential business lines, enhanced the partner line-up, and many of our colleagues have grown both personally and professionally…
The main capital of any law company is its staff. What are the principles you follow in managing your company’s staff? How do you build interpersonal relations?
- The time of bosses and subordinates is long gone. In fact, we never had it here in our company. Now it is time for cooperation and interdependence. Those who still have not apprehended this will soon face serious losses. The ones that will succeed are companies whose partners would be the first to understand that the junior associate they hire is already their “partner”. You start peer-to-peer interdependent relations with him or her, agree on joint cooperation, desired result, rules of interaction, criteria and timeline for evaluation, the consequences to come when such result is reached or not reached, and, of course, the mutual responsibility.
Very soon our young generation colleagues will determine your company’s destiny… And possibly your destiny too…
Oleg, could you please tell me in brief about the history of Vasil Kisil & Partners? Did you ever think that this company would rank so high as it does nowadays?
- We surely dreamt about it. It all started in September 1987. Several students under the guidance of Vasyl I. Kisil organized an international private law society. We gathered at home to discuss things which were not found in textbooks, but which were known to our teacher from his own practical experience. It was during the first years of Perestroika that Mr. Kisil told us that in the post-Soviet countries, such as Czechoslovakia and Hungary, students organized small cooperatives thereby earning an equivalent of a second stipend for themselves. That idea took hold in our minds and we began to think: why don’t we try? Thus, we participated in setting up a cooperative called Students Service Center, which was composed of various autonomous business units. Our unit provided legal services. The first eight months of work were spent in search of the first client or at least anybody who would have some awareness of the particular services we could provide. Later on, enterprises have started to spring up all over the country and they got involved in establishing direct foreign economic relations and independently entering a foreign market. Those enterprises became our first clients. In 1988, we made our first money. At that time, it was quite decent money – we earned fees which exceeded the official salary of a dean of the faculty we studied at.
Do you remember your first client?
- Yes, I certainly do. That enterprise was called Kievpishcheremnaladka. At first Mr. Kisil joked that he could never memorize the name of our one and only client. Third month into our cooperation, he said that he finally learned the name Kievpishcheremnaladka, to which I answered: “Well, the joke is still on you because effective from yesterday, our client was renamed Agropishchetekhpromservis (laughs – editor’s note). Thus, this firm became our first client and for the first three months of providing services to it we earned 4,500 rubles. By way of comparison: in those days, an average stipend was equal to 40 rubles and a salary of, say an engineer, was equal to 180 rubles. Out of that amount we paid taxes, which seemed outrageous to us, namely a profit tax (2.5%), a social contribution (4.7%), and an income tax (13%). The remaining amount was divided among our team members.
A somewhat philosophical question: what do you think lies behind a phenomenon of your company’s success?
- I think that any firm has some distinctive features that make it different from the others: it is in a class of its own, distinctive and phenomenal in its own way. A certain organizational structure operates within it and a group of like-minded people has been formed within. This group, in turn, generates its own group standards: a certain way of communication with each other, a certain way of on-the-job interaction, a certain way of support and mutual assistance between colleagues, a particular way of setting priorities for development of the firm, and certain criteria for new staff employment... Such approach shapes the overall corporate culture. Our firm employs people of different ages, with various scope of authority, with various levels of responsibility, and various competencies. We, however, generally understand that all of us are colleagues and we work together for a common cause.
By the way, our firm’s corporate governance concept, among other things, lies in that partners, lawyers and administrative staff equally participate in the production process and make a significant contribution to the production of a high-quality end product.
How does your administrative staff influence the profitability of Vasil Kisil & Partners?
- Administrative managers, like the entire administrative staff and equally like lawyers, are full-fledged participants of the firm’s profit-marking activities. Teamwork is the first factor contributing to an added value. A team effort of professional lawyers creates a more valuable intellectual product for the clients than the one we would be able to produce if each of us acted alone. Another factor is reputation element. It is formed through years. It cannot be bought and quickly adapted. The client going to a firm with extensive experience and a good reputation is ready to pay more. The third factor contributing to the added value is the so-called infrastructural or organizational value of the law firm: its actual physical infrastructure, office, equipment and implemented business processes, as well as administrative and organizational skills of all colleagues of the law firm, both administrative staff and lawyers. Failing this third organizational and infrastructural component, the law firm would hardly succeed in providing high-quality services, or earning a good reputation, or gaining its clients’ confidence. If a modern law firm neglects the third factor, its ingenious product would hardly reach its client on time and, thus, would hardly be fairly paid for.
What did you draw your knowledge from in managing the law company at the start of your managerial career?
- We were pioneers in our field and, for this reason, I initially had nothing to draw on. Furthermore, there was no possibility to find necessary books at that time. Even John Grisham’s bestseller, The Firm, was read by me only recently.
However, during the last five or seven years, there appeared a great deal of professional literature, professional events, forums and conferences were launched and are regularly held. As far as we are concerned, first and foremost, we cross-reference with our colleagues and share our own experience at such events. It is my strong conviction that everyone has his distinctive and unique experience and his own path. It is impossible to copy or buy somebody’s corporate culture or buy somebody’s business process.
By the way, we generously share our findings. We arrived at a conclusion that an already implemented business process becomes outdated once it is implemented as life brings new challenges! And if somebody wants to simply copy the business process already mastered by us, he will implement an already outdated model. Thus, when taking advantage of somebody’s developments, a company should modernize and individualize them. We, on our part, respect the experience of our colleagues. Therefore, our developments return to us modernized and improved. We are capable of constantly evolving by helping each other.
As you see, we are not in any way “greedy” in terms of knowledge. On the contrary, we aim to develop the Ukrainian legal services market by sharing our experience. I am sure that due to such an approach chosen by most of the market leaders our national legal services providers are way ahead of the international giants.
What is more important for a partner: professional skills or administrative skills? Do your administrative functions ever come in conflict with your legal practice?
- Business law researchers claim that a partner should dedicate not more than 40% of his working time to dealing with clients. The remaining time shall be spent for practice development, personnel development, new clients search, new services creation, etc. As regards the managing partner, only 10% to 20% should be dedicated here to working with clients. However, legal practice cannot be absolutely ignored as this leads to loss of professional skills. The rest of the time has to be allocated for business development, coordination of company’s policies, interaction with partners and other colleagues, client relations development, etc. But if a partner spends most of the time on client work, this results in underinvestment into company’s future.
Each partner shall possess a number of various professional and managerial qualities and skills. However, one should avoid a common managerial “trap”: if a lawyer performs a certain kind of work better than the others, quite often this is seen as a reason to move him or her to the next level of competence. At the same time, such lawyer may not always have conceptual insight, he or she may lack some confidence in project management and may not be able to bring a broader strategic vision to the task at hand. Therefore, for example, an efficient lawyer may not necessarily make a good senior associate. Apart from conceptual understanding, further stages require relevant interpersonal skills which include soft skills related to communication with clients, subordinates, colleagues, partners and competitors. I regret to say that this factor is sometimes neglected. A good senior associate may prove to be a bad partner who, at best, may only manage a project and, at worst, could just individually handle such project.
So, answering your question, I may say that the person must possess all the mentioned qualities and skills at a sufficiently high level, paying attention to both professional and personal growth, company’s conceptual development and successful implementing of personal projects, along with contributing to development of colleague interaction.
So you apply extremely high standards in selecting a partner, don’t you?
- I wouldn’t say so. Each partner is an undisputed professional in his or her field. Naturally, a partner must also be a good manager and possess perfect communication skills. But it is never a question of being a kind of superman. There is no ideal partner or managing partner. Indeed, it is important to create an environment that would stimulate each colleague to reveal his or her best qualities and skills as much as possible, to create a team of partners with complementary merits and management ways. We are strong when we cooperate. The whole is more than the sum of its parts – this is our team’s cornerstone, a point we strive to prove on a daily basis.
Speaking about the development strategies of your company, what issues did you face in 2010?
- The essence of strategic planning consists in identification of risks to avoid and opportunities to take. A strategy is a path that a company should follow in order to succeed. It goes without saying that a good strategy is built when partners share the same vision of the corporate purpose and mission.
In terms of legal business and our insight, company’s development strategy is a strategy for development of each practice, which is the development plan for professional and career growth of lawyers involved in the practice, from junior associate to partner and head of practice. The partner’s task is to coordinate his or her personal plans with the practice development plans, and, in case of the managing partner, to coordinate the development plans of all practices, ensure interaction of all partners and other team members and to direct their joint efforts. Besides, the development plan time shall be counted backwards: where do we want to be in 2015, 2014? We must have an exact vision of what we have to achieve in the current year in order to eventually succeed.
As for 2010, I believe that we have successfully fulfilled most of our tasks: we have restored the pre-crisis volume of legal services, resumed the work of those areas which suffered due to recession hardships, developed new practices bringing them to the level of company’s essential business lines, enhanced the partner line-up, and many of our colleagues have grown both personally and professionally…
The main capital of any law company is its staff. What are the principles you follow in managing your company’s staff? How do you build interpersonal relations?
- The time of bosses and subordinates is long gone. In fact, we never had it here in our company. Now it is time for cooperation and interdependence. Those who still have not apprehended this will soon face serious losses. The ones that will succeed are companies whose partners would be the first to understand that the junior associate they hire is already their “partner”. You start peer-to-peer interdependent relations with him or her, agree on joint cooperation, desired result, rules of interaction, criteria and timeline for evaluation, the consequences to come when such result is reached or not reached, and, of course, the mutual responsibility.
Very soon our young generation colleagues will determine your company’s destiny… And possibly your destiny too…
Yurydychna gazeta, №8, February 22, 2011