← Back to Insights

A margin risk that's costing you right now

Blind Spot Brief cover: A margin risk that's costing you right now

Originally published on LinkedIn on 25 June 2026.

A senior associate’s output has dropped and nobody can explain why. Down the corridor, a department head is working longer hours than anyone in her team but her own billing and business development have gone backwards. Somewhere in HR, a flexibility request has been sitting unanswered for months.

Three different problems on three different desks. None of them look related but left alone, one of them will cost you a senior hire, another will quietly erode your margin, and the third is already doing both.

What nobody had connected

Rachel ran the family department. Reliable work, thin margins, never the headline but she’d run it well for years.

A few months earlier, her senior associate had asked for more flexibility around her hours. Nothing unusual the kind of request most heads of department would settle with a conversation inside a week.

Rachel meant to get to it, but she had a file that needed careful handling, a client who only wanted to speak to her directly, and a junior team member who kept bringing her drafts she ended up rewriting rather than sending back with notes. The request sat in her inbox, then sat in the back of her mind, then quietly became something she’d simply never got round to.

By the time anyone noticed, Rachel was carrying work that should have belonged to her senior associate and her senior associate had quietly concluded that her team lead didn’t think her circumstances were worth the conversation.

What the team was reading

The associate wasn’t reading exhaustion. People rarely do, particularly in someone senior to them. They read what exhaustion produces instead.

She’d raised the request once, clearly, and waited. When nothing came back, she didn’t raise it again, not because it stopped mattering, but because asking twice felt like asking for something that had already been quietly declined.

Rachel had never said no. She’d said nothing, and nothing was easier to read as no.

What this was actually costing

Underneath Rachel’s situation, three financial risks were running at the same time:

·        Talent leverage — partner-rate time producing associate-rate value, compounding for as long as the pattern continues

·        Retention — a senior associate disengaging quietly, carrying client relationships and case knowledge that don’t sit in a file

·        Capability — junior development stalling because the only person positioned to mentor them is buried in casework

None of this showed up on any single report. It all showed up, eventually, as margin.

What many firms do instead

Firms tend to address this with better benefits, engagement surveys, away days, leadership training. None of it wrong but all of it aimed at the visible symptoms. The cause is almost always an operational situation that nobody has connected to the cost, because it shows up as a productivity dip in one place, staffing pressure in another, and a HR issue in a third.

What it takes to fix it

The fix, once someone sees it, is usually straightforward: redistribute two files, answer the request that’s been sitting for months, hand the junior team member to someone with time to develop them. None of that requires a programme or a budget. It requires someone seeing the connection between three symptoms before they become a resignation, a margin slip, and a department that starts the next year already behind.

How would you know if similar situations are happening across other departments in your firm?


If any of this felt familiar, the Financial Diagnostic is a free, 15-minute exercise that shows you where these situations may be present in your firm and what they could be costing. No obligation, no follow-up unless you want it. The link is in the comments