Many professional service firms have up-or-out policies, meaning that any professional who is passed over for promotion twice is asked to leave the firm. The firms exercise this policy most strictly on promotions to partner, where the stakes are the highest for the young professional. By that time she has invested heavily in the firm in unpaid overtime, lost time with family and friends, and a more general loss of balance in her life. If she gets promoted, she reaps the status and financial rewards of partnership. If not, she’s out of a job.
Though a few professionals might make partner purely on the basis of their technical competence, the overwhelming majority must demonstrate commercial success to get the nod. In short, they must show that they can bring in work to get and keep the title of partner. The financial logic of the firms dictates this requirement.
Other firms state explicitly that they do not have an up-or-out policy. At these firms a professional may opt to stay at a less-than-partner level for a career, if they are willing to forgo the benefits of partnership. In a boom economy, this lack of up-or-out mentality allows a firm to keep talent sorely need to get the work out the door.
But when the economy turns, there isn’t enough work to go around. The company must then decide whom to let go. The professional who will never make partner and who, due to longevity, is near the top of her pay grade, may not be the first to be laid off. Come the second round of cutbacks, she is a ripe target. In other words, firms that do not have an up-or-out policy exhibit up-or-out behavior when times get tough.
This is just a long way of saying that anyone seeking a career at a professional services firm should take statements that her potential employer isn’t an up-or-out firm with a large grain of salt. Management means it when they say it. They simply find it impossible to hold to it in the face of financial stress.
If you want control over your own destiny, stay in touch with your former clients, build your network and bring in business. If you can do that, you will have a do well at your current firm and have more to offer another fimr, if you choose to move on.