[This article was written by Tricia McGrath. Tricia is a Director in Lateral Link's New York office.]

Law firm economics have changed substantially over the past decade. Law firms are now run like “businesses,” in corporate America parlance. This year, many associates at top firms who had thought that they were “on track” for partnership were unexpectedly passed over. Unfortunately, market conditions suggest that many more will be passed over in future years.

As a recruiter, I frequently speak with senior associates who were on the wrong side of partnership decisions and, as a result, realized the “out” side of the firm’s up-and-out policy. Many of these overlooked associates are now wondering how the train went off the track so quickly. Don’t the years of solid billables and strong reviews account for anything? For most of these associates, their best-case scenarios are a new position at another big law firm with a three-year partner look–often going in to their new firm as a fifth- or sixth-year–or an in-house position at (in most cases) significantly less compensation. Often, neither of these options is particularly attractive.

How can you protect yourself from becoming a senior associate who has been passed over, has no business, and has limited job prospects? It is not difficult, but you should take action early. As a fifth-year associate, you should take critical stock of your career and your location on the partner track. Admittedly, there is a certain intangible required for making partner that is not easily explained. An honest assessment will help you handicap your chances at partnership more effectively. None of these factors is rocket science, but it is surprising how few fifth-year associates have thoughtfully analyzed them.

More after the jump.

The following factors suggest that the firm views you as partnership material:

- You are the most highly regarded associate at your level in your practice group.

- You have flawless reviews.

- You have very close relationships with the partners in your practice group who have firm-wide “political capital.”

- You have good exposure in the firm outside of your practice group.

- You have positive relationships with partners outside of your practice group.

- You are in a practice group that routinely makes partners.

- You have been working to develop a book of business and have prospects for business in the next year.

- You have very strong billable hours each year.

- You are selected to work on firm-wide programs, including the associates committee or summer associate programs.

The following factors suggest that you may already be out of the running for partnership:

- You are in a highly cyclical (bankruptcy, real estate) or support (tax, employee benefits) practice.

- There is a glut of strong senior associates (2002+) in your practice.

- You are unknown to partners outside of your practice group.

- Your firm is very conservative in naming partners.

- There is a “superstar” in one of the two practice group classes beneath you.

- Your firm has been more severely hit by the recent downturn than other comparable firms.

- Your firm has recently undergone a merger, or is rumored to be a merger candidate.

If partnership is your ultimate goal, you should make certain that, by your sixth year, you are employed at a firm where you can make a run at partner. You want to ensure that you have enough time to become well-known and well-regarded within both your practice group and the firm. You’ll need to demonstrate that you’ll be a positive addition to the business of the law firm and that you’ll be able to contribute in significant ways. It isn’t an easy challenge, but it can be done!

Make sure that you do not linger at a firm where your partnership prospects are slight. A move only becomes more difficult as you become more senior. There are many eighth- and ninth-year associates who are regretting their decision to remain at their firm, only to be passed over. Of course, if you are a fifth-year at a firm where you honestly believe that you have a shot, put your head down and make the run!

If your honest analysis dictates that your partnership prospects are dim at your current firm, there is an option. One strategic play is go to a lower-ranked Am Law 100 firm as a mid-level, work hard to make partner and develop business, and then make a lateral move as a partner to a higher-ranked firm (if your goal is to be partner at a very strong firm). Lateral partners with solid portable business are always marketable.