GSM 6015

Formal Case Assignment

BRAINARD, BENNIS AND FARRELL

Assignment
Brainard, Bennis and Farrell is a well-established law firm in Stamford, Connecticut. Founded in
1963, the firm gained an exceptional reputation and enjoyed years of success under its founders
and its Executive Committee. Recently, however, financial performance has declined and
divisions have arisen amongst the partners. This has come to a head with disputes over the
point system used to allocate firm profits to partners. Richard Kincaid, Chairman of the
Executive Committee, must allocate the firms profit pool in a way that is best for the firm, and
he must be prepared to defend his allocation decisions.
You have been hired by Kincaid to suggest and justify a point allocation system based on its
potential impact on the firm in the future.
Requirements
This assignment is worth a possible 100 points.
Prepare a memo for Kincaid that includes:
Your interpretation of the firms objectives. (20 points)
The links between the firm objectives and the compensation system. (30 points)
A description of the allocation system you recommend, together with justification for
why you think it is best for the firm. (30 points)
An Exhibit (20 points) that details how your proposed allocation system would allocate
216 points out of the firms 1,000 total points (i.e., $2.635 million out of the $12.2
million in the partner profit pool) to each of the eight partners described in Exhibit 2 of
the case.
Assume that the eight partners are a typical cross-section of the partnership in terms of
performance, skills, and backgrounds. Definitions for selected items in Exhibit 2:
o billable hours worked: number of hours worked on client issues
o nonbillable hours: number of hours worked on non-client issues (e.g., mentoring
junior attorneys, service on firm committees, administrative work)
o dollars managed: total dollar value of clients managed
o write-off performance: amounts billed but subsequently not collected (i.e., written
off as uncollectible)
o unbilled dollars: time spent on client issues (expressed in dollar terms), not yet
billed to clients but will be in the future
o collections performance: amount of time to collect amounts billed to clients
o origination credits: credit for bringing client into the firm in the first place
Format requirements for memo: So that everyone has the same space in which to convey their
ideas, the body of the written memo (excluding the exhibits) has a 2-page maximum length, in
12-point Times New Roman font, single-spaced, with a minimum of 1 margins.
Please use proper memo format; see https://owl.english.purdue.edu/owl/resource/590/1/ for
guidance, if needed.

Page 1 of 2

GSM 6015

Formal Case Assignment

Besides a short introductory paragraph describing the purpose of the memo and a brief
concluding paragraph, suggested subheadings for this memo are: Firm objectives, Links between
firm objectives and compensation system, Explanation of process to determine allocations,
Recommended allocations.
Please bring a copy to class for your use during class discussion.
The following questions are intended to guide you in the identification of important case
issues.
1) What are the firms strategy/objectives? What must the firm do to thrive in the current
and future legal environment?
2) How did the firm get into this situation?
3) What are the objectives of the firms compensation system (i.e., what should it
accomplish in the way of furthering company goals)?
4) Can any of the issues raised on page 9 of the case be addressed in the allocation system?
Are there some that cannot be addressed?
5) Are some of the factors in Exhibit 2 more important than others? Should all factors be
incorporated into the point allocation system? Some factors? Different factors?
6) Should the allocation system be subjective, formula-based, or both? If subjective, how
can it be justified? If formula-based, what formula should be used, and what should be
done about qualitative factors that cant be quantified?
7) Is your proposed allocation system consistent with the firms strategy/objectives?
8) Is your proposed allocation system fair? How should fair be defined for the firm?
9) How will you justify your proposed allocation system? What are some of its positive
aspects? What are some potential negative side effects, and can the firm live with those
negative side effects?
10) What is the impact of your proposed allocation system on the firm in the future? How
will it affect the attraction, retention, and motivation of associates and partners? How will
it affect the firms ability to grow in a manner consistent with its strategy?
Additional guidance
No compensation system can possibly resolve all problems a firm may be facing, and no
compensation system can please everyone in the firm. Your point allocation system can't do
so, either.
Don't get overly focused on your description of the allocation system and its application to
the partners. That's an important part of the case, but it's even more important to describe the
firm's objectives and the links between the two. If you do a thorough job of thinking through
and describing those issues, a possible allocation system will naturally fall out of your
thinking and will relate back to those objectives.
When describing your point allocation system, be sure to say why you did design the system
the way you did; you do not have to explain why you did not include particular measures.
There is DEFINITELY no one "right" allocation system, and in fact there are LOTS of
possibilities! There are WRONG allocation systems, though. It's important that the solution
you develop is consistent with the issues raised in other parts of the memo.

Page 2 of 2