Dynamic Business: Russell McVeagh CEO Jo Avenell on transforming during a crisis

Russell McVeagh chief executive officer Jo Avenell.

Commercial law firm Russell McVeagh was deep into a major transformation programme when the Covid-19 pandemic hit.

Chief executive officer Jo Avenell says the law firm’s response to the Covid-19 crisis proved to be a real test of how far it had come on its transformation path and a test of its culture reset following Dame Margaret Bazley’s report.

“We feel positive about the year and the outlook for next year because we feel like our culture has stood up and has been tested and we’ve come through that,” says Avenell.

Like many other businesses operating in Auckland’s CBD, Russell McVeagh had a short practice run for the pandemic.

In October 2019, a fire at SkyCity — at the International Convention Centre which was under construction — saw streets closed. Fire officers asked workers to stay away from the area.

“It tested our ability to work remotely,” recalls Avenell.

“We could see if our technology and remote working tools were fit for purpose. This included broadband networks and even simple things like making sure everyone had their laptops and took them home at night.

“We didn’t waste the SkyCity crisis. The combination of learning from that and having already invested heavily in our culture meant that by the time Covid-19 came around, we were in good shape.”

Early this year Russell McVeagh invested in Zoom video conferencing technology. “We installed it in all our offices, meeting rooms and on the laptops. The power of that was it allowed us to keep everyone connected and close,” she says.

“Teams were having daily catchups. I had firm-wide calls once a week. It was a more effective way of communicating with the whole firm than sending emails when you couldn’t meet in person. “This shift to embrace technology in all its guises and learning how to successfully work remotely has been a clear positive from Covid, not only for Russell McVeagh, but for the industry”.

Soon after the level 4 lockdown began, Avenell had a discussion with her board. “We looked at how we wanted to emerge from the crisis and decide on the most important priorities. It was easy to react to events.”

We didn't waste the SkyCity fire crisis. The combination of learning from that and having already invested heavily in our culture meant that by the time Covid-19 came around, we were in good shape.

Jo Avenell

“At the time things were changing fast and there was a great deal of pessimism,” says Avenell.

“Then came news about businesses cutting jobs, cutting wages and forecasting substantial revenue reductions. The context was fear and uncertainty.

“We were clear that we wanted our people to feel we had done the right thing. We wanted our clients to know we were there for them. Our business remained in good shape. We wanted to hold our heads up high. This formed the backdrop for all our decision making.”

Choosing not to take the government wage subsidy was an easy, early decision. “We just said this isn’t designed for us. It’s there for other people who need it much more than us. Our people and our clients acknowledge that.”

Avenell says Russell McVeagh wanted to go further “by preserving everyone’s roles as long as we could.

“We have some people who were vulnerable, they wouldn’t be able to do their jobs during lockdown. They were kept on at full pay. We didn’t reduce anyone’s hours and we didn’t reduce anyone’s pay. We felt we were doing the right thing by our people and we were also doing our bit for New Zealand.”

Avenell says this paid off in terms of trust. Internal measurements of employee engagement are very positive.

Trust is central to Russell McVeagh’s transformation programme.

The previous two years have seen the law firm invest in a far-reaching programme designed to rebuild trust in the firm’s reputation and its leaders.

Along the way it has changed its culture and governance. It has also changed its technology and its way of working.

Shortly before the pandemic, Russell McVeagh set up an extended hours policy. There had been a series of workshops with all the company’s staff to design the policy. “It’s a critical part of the response to Dame Margaret’s report because it gets to the heart of the company’s culture. One of the issues was junior lawyers working long hours.”

Avenell was brought into Russell McVeagh from NZ Post to lead the firm’s transformation programme.

She says when she joined the law firm, it wasn’t clear if long working hours was a systemic issue or, as Dame Margaret’s report suggests, a matter of poor management practices by a few managers.

There are always times in a legal practice where some extended hours are necessary: legal cases or commercial transactions might have tight deadlines. To get a better understanding of the issue, there was a push for people to record all their time.

Avenell says it all came down to wellbeing. “If we’ve got people working long hours, we now have visibility of that. It means we can actively manage people’s workloads and share the work around. If other people are not working long hours, they pick up some of the slack. When people have to work long hours, we give them recognition, we record the hours worked and, more importantly, once the transaction or case is finished, make sure they take that time off.

She says the trial could have been put on hold until after Covid. But, it was more important to have visibility while people are working at home.

“We carried on with the trial and it’s been a great success. We think we’ve got something that’s really different out there in the market: recognising and valuing people’s time. We’ve now got checks and balances to manage that better. People are getting recognition and are taking the time off.”

In the last six months of the trial, partners, staff and human resources have started having new conversations like: ‘do you really need to work those hours?’

There’s been a move to only allowing it when the demand is client-driven and if it isn’t, people are told to go home.

Human touch
A side-effect of the switch to remote working during the Covid-19 pandemic has seen Russell McVeagh become more humanised and less hierarchical. Avenell says Zoom meetings meant that people got more insight into their colleague’s lives.

The video conferencing cameras showed people’s homes and their living rooms. Inevitably that meant meeting colleague’s children, seeing their pets.

This is something that would not otherwise have happened. It brought people within the firm much closer together and introduced an element of empathy for what others have to deal with on a day-to-day basis.

For Avenell this was the silver lining in the Covid pandemic, it helped build relationships within the firm.

“Often work can feel cold and impersonal, you can forget you’re living in everyday reality. With Zoom, the first conversation people would have at the start of the call centred around questions like ‘how are you’. Having our partners, senior leaders and myself sharing some of the challenges of lockdown created a level playing field.

“We realised we are all just human beings having a shared human experience. It meant sharing vulnerability and coming at work matters from a more compassionate lens. This strengthened our connection”, she says.

Recruitment
Pandemic pressures meant that many Russell McVeagh clients were asking for more senior lawyers and partners to work on their projects and willing to pay for the experience. CEO Avenell says over time this could change the firm’s business model, it could mean there’s a need for more senior lawyers, fewer juniors.

Yet she says the company has long had a practice of nurturing young people. “We decided to keep our scholarship programme going. We’ve taken our summer clerks on this year as we always have done. We will need to see how this works over time and how it might change”.