Q&A: Nick Nichola – "What's important is to have people within the firm who understand that the really critical thing is how they behave as human beings"

In this Q&A, K&L Gates Australia managing partner Nick Nichola discusses the firm’s growth prospects, the importance of innovation, and why he’s happy that the firm’s brand is aligned with the Australian Open tennis tournament.

What’s your impression of the state of the legal market in Australia?

“I’ve been around for a while and the legal industry in Australia is the most competitive I can recall. However, I take the view that competition is good for markets, and the legal services sector is no different. Clients benefit from such competition, but law firms ultimately benefit as well because it forces them to deliver quality legal services. In Australia, most firms have done that for many years – now they have to deliver those services in the most efficient manner possible.”

Your firm has been active on the recruitment front in recent times, notably with your energy, infrastructure and resources teams. From where do you expect growth to come?

“Infrastructure is an area where we’ll see growth both domestically and courtesy of our major international trading partners. That won’t be a surprise to anyone. The Australian Government has publicly made commitments to major infrastructure investments, and President Trump is on a stated path of wanting to invest significantly in infrastructure in the United States. That will create opportunities for Australian companies and, of course, some are clients of ours. Then there’s China’s ‘belt and road’ infrastructure investment plan. We have also noticed a significant uptick in sectors such as agribusiness and financial services, and the technology that increasingly drives such industries will also create investment opportunities in Australia. Other growth areas include fintech, education and hospitality. We’re pretty lucky in this country.”

As you seek to keep current staff and recruit new talent, what sort of culture are you trying to create at K&L Gates?

“The simple answer is to say that we’re looking for commercially oriented and entrepreneurial lawyers. Our lawyers obviously need to be able to relate to their clients as people, not just as lawyers, and to have the capacity to respond to the various  business and legal challenges our clients are facing. In terms of culture, though, our focus is on good people. People who have a high degree of emotional intelligence and who are aware of how their behaviour impacts those around them. People who care for their clients and each other, and who look out for their clients and each other. Unfortunately, the pressures of the job are significant for lawyers and it’s a profession which on the whole hasn’t dealt very well in the past with the welfare of its people. So our firm focuses a lot on wellbeing and we take the view that legal skills are somewhat of a given for our people. It’s not really a differentiator to say ‘I’m a fabulous lawyer’. What’s important is to have people within the firm who understand that the really critical thing is how they behave as human beings.”

What specific things does K&L Gates do to promote better mental health within the firm?

“There’s no silver bullet. Leaders and managers within law firms must be mindful of the external pressures their lawyers face. Those pressures are often client driven, and if you’re a litigator you’re bound by timeframes that courts impose on you. It’s a very high-pressure environment and partners and leaders of the firm need to be able to spot the signs when those stressors are becoming too great. It’s important to have the appropriate training and support in place.  Our HR team is trained in ‘mental first aid’ and assists our partners in handling such issues.  We regularly conduct seminars on physical and psychological well-being, awareness sessions for staff and managers and participate in various campaigns such as R U OK? Day.  In addition, we provide access for staff and their families to a confidential, external employee assistance service. So it behoves leaders and managers to try to set the example; to continue to remind people that they have other aspects of their lives and they need to find work-life balance and not require people to stay logged on to their devices late into the evening.”

To foster future leaders, K&L Gates has a Path to Equity Partnership Program. Can you tell us about that initiative?

“We’re trying to be holistic so we don’t just focus on legal skills. We think the approach we take is a little different in the sense that the program is a comprehensive platform for cultivating future leaders within the firm. The program integrates our four main partner competencies – client development, practice management, business management and leadership. These are the skills that support the development of our young leaders and give them a path to equity partnership while underlining the ownership mentality and ethics that drive behaviours within the firm.”

What do you think of the pipeline of young leaders coming through the legal system?

“Just looking at K&L Gates first, we are all about intergenerational excellence and succession planning – and from what I see of our future leaders I’m tremendously excited about the future of the firm because they are such talented people. They’re diverse, motivated and flexible, and they think very differently. You need to think differently nowadays because the challenges for law firms are different to what they were 10, 15 and 20 years ago. So I’m very encouraged and excited about the future, and I believe that applies across the board with many firms.”

K&L Gates has just launched a new Innovation Committee. What are you trying to achieve though this group?

“The committee has representatives from all levels of the firm. It is focused on fostering a culture of innovation within the firm and finding new and improved ways to deliver legal services and meet client needs. The key is to improve internal efficiency and productivity and deliver a competitive advantage. The philosophy underpinning the Innovation Committee is that no one individual, and no category of individuals within the firm, has a mortgage on innovative ideas. It encourages innovation from anyone in the firm; it then evaluates those initiatives and processes them while working with the proposer of the idea to further develop the concept to a point where it can be put to people like me for consideration. People must feel comfortable that they can put these ideas forward and that someone will take them seriously.”

Part of your firm’s innovation comes on the marketing front, including a quirky ‘Court to Court’ campaign as the official law firm of the Australian Open tennis tournament this year. What was the thinking behind it?

“We’ve been sponsors of the Australian Open for many years and its preferred legal advisor for many years. So we’re proud to align K&L Gates with the Australian Open brand – it gives the firm great branding opportunities and the sponsorship also provides excellent client entertainment opportunities. With the marketing video, the staff members involved asked me if I’d trust them to do something. And I thought we’ve got to live the ethos of innovation and give people the chance to come up with their own ideas. So I stepped right back from it and said, ‘Go ahead, do it, I’ll trust you’, and basically I agreed to see the campaign for the first time when it was launched. So it was a leap of faith, but I thought it was terrific. The campaign was all done in-house and it was a bit different from what people expect from ‘conservative’ law firms. They had a lot of fun doing it and came up with something that resonated with people.”

As a managing partner, what are the main challenges you face?

“We need to evolve our business processes and models to keep pace with client-driven changes, which since the global financial crisis have irreversibly altered the market for legal services in Australia and elsewhere. It is critical that we innovate to improve our internal efficiencies and find ways to keep costs down, to pass on those efficiencies to clients and at the same time ensure that our business remains profitable. At the end of the day we need to derive profits so we can keep investing in our firm and our people’s career development. If you asked me, ‘What’s the big thing that keeps me awake at night?’ I’d say attracting and retaining talent, and attracting and retaining clients. Our former chairman and global managing partner, Peter Kalis, used to remind us that when our people leave the office every day and go down our elevator, there’s no guarantee that they’ll return the next day. We have to do everything within our power to make sure they do come back.”

Through your leadership of the firm, do you draw on any particular management philosophies or rules?

“One of my very early mentors said that the best thing you can do is to try to stay true to your own values and principles and to be authentic. If you’re not authentic, people can pick it straight away. One of the key lessons I gained out of a Harvard leadership course some years ago is that all professional services firms the world over face exactly the same challenges. One of the key themes of the course was to determine how to harness highly intelligent, highly motivated, highly ambitious and often headstrong people and get them to pull in the one direction. A firm that can do that will always be successful. All people who occupy leadership positions in professional services firms will always face that challenge.”

Before the merger with K&L Gates you had a long stint as managing partner at national firm Middletons. How is it different having a leadership role at a global firm?

“It’s an evolution to go from a domestic national firm to now being with a truly global player and thinking globally and realising that there’s a big wide world out there beyond Australia. One of the things I’ve really enjoyed and loved about the merger, which happened five years ago, is that it exposed me to a diversity of talent in all its forms. Of course, we had diversity at Middletons, but not to the extent that it exists at K&L Gates – gender, ethnicity, career background, ambitions, you name it. It has been fabulous to deal with brilliantly talented people from diverse backgrounds. That to me has been the most exciting thing.”

What separates K&L Gates from some other multinational firms?

“I would say it is that the firm is one of the very few that is a truly financially integrated firm globally with a single governance system. Internal structures mean nothing to clients, but the reason I mention it is because we have built a firm with no internal barriers to cooperation and collaboration among our lawyers. It’s important because clients then benefit from true global and seamless service. At a firm level, one of the undeniable differences is the access to substantial bench strength and knowledge from all around the world that we can now offer clients. Our fully integrated global platform means we can now offer world-class legal advice across five continents and across a vast array of sectors. As a national firm, we were not able to do that. Finally, opportunities now exist for our people to interact with peers globally, work on matters of international significance and scale and experience working in overseas locations.”

Digital disruption is seen by many as a threat to the legal profession. What’s your view?

“I’ve never been too concerned about any form of disruption being seen only as a threat. Disruption also presents opportunities. There have always been disruptive forces in our markets and it’s a bit of a furphy to say that it’s only now that the legal profession is facing disruption. The legal profession has always been subject to disruptive forces. It’s just that it hasn’t been so openly discussed in the past. The Big 4 accounting/consulting firms; they previously built a legal presence and they’re building it again. That’s an example of disruption. Global firms entering the domestic market; that’s disruption. The plethora of alternative providers; that’s also disruption. Of course, there’s digital disruption now, too. I don’t think it’s something to be feared; it’s something to be embraced. New technologies – the likes of which we can’t even dream about yet – will be the cornerstone of an innovation culture in the future. Our challenge as leaders is to provide the tools that will help firms respond to clients’ needs and demands, but also to respond to employees’ needs and demands.”

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