A multi-stage model of governance in ... - Cass Knowledge

Cass Centre for Professional Service Firms – Working Paper 004 - 2010
genuinely committed to resolving the professed issue of Exclusion and to replace
the Founder-focussed style with a more Collegial style of governance, their actions
repeatedly undermined their protestations. They were unwilling to hand over
sufficient levels of responsibility or ownership to satisfy their employees and took
decisions without consultation. This ultimately provoked a severe organizational
crisis. Eventually the founders and employees concluded that an acquisition was the
only way to resolve their intractable problem of governance.
From Delegated to ‘Corporate’: the Disconnection crisis, explores another
aborted change in governance. In this case the senior management of a longestablished
large global partnership (MegaPartners) were thwarted by the partners in
their attempts to introduce more ‘Corporate’ governance systems and structures.
Although the partners had Delegated authority to the management group, the senior
management group became increasingly Disconnected from the partnership and a
revolt by the partners led to the election of an ‘anti-management’ Managing Partner.
The rhetoric of partner inclusion and the reversal of certain decisions helped to reestablish
trust in management. Presented with a different business context and a
different management rhetoric, the partners ultimately accepted that a more
‘Corporate’ style of governance was an acceptable consequence of their desire for
growth.
From Founder-focussed to Collegial: the Exclusion crisis
BoutiqueCo was established by three entrepreneurial individuals who had grown
frustrated working within a global and relatively commoditized professional service
firm. They left the firm in order to establish their own innovative practice. Their
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