Is there a quick way to sustainable business growth and organizational development for professional services firms?
I like to challenge my own thinking and so, after writing my last articles, “Creating a Culture of Business Growth” and “For the Greater Good Or Eat What You Kill?” I questioned whether it is necessary to address the full business growth system – strategy, support tools, and skills - in order to make sustainable business growth progress. After all, many firms claim to be successful by focusing on only a select few of those business growth related segments. Or, are they? And how have they defined “success” and more importantly, how will they define it going forward?
The ultimate question comes down to the aspirations of firms and their stakeholders. Are you looking to build organizations for the long run? Or, do you only seek short term success with a measurable self-centered economic benefit? If the latter represents shareholders’ objectives, then the non-systematic, “band-aid” approach - as I call it - might be considered success. However, if the professional services firm leaders are focusing on long term gains, then I am afraid the long and systematic approach to building or enhancing business growth platform is the way to go.
A selective segment approach to business growth might have worked in the past for some firms due to extraordinary external market conditions. Those, blended with the young and entrepreneurial spirit of newly formed organizations often lead to quick success, but is ultimately unsustainable I am afraid. That opportunistic viewpoint takes a linear approach without seeing the full picture, and focuses on a sliver of information and limited events. This approach tends to address symptoms instead of curing problems, identifying trends, and thinking long term. It employs reactive tactics and doesn’t provide fundamental and sustainable systems support to track and measure performance and return on business growth investments. There is no investment in developing skills and sufficient support tools to allow the executioners to utilize the tools that fit them most (“one size fits none” when it comes to business growth tactics) and ultimately, to execute on strategy.
If that’s how you are running your organization, and you consider the last paragraph to be the “right approach” and you do not have strategic long term aspirations then stop reading here. This will be the top of the bell shaped curve for you. Don’t waste your time learning how to develop a systems-based approach to help you build sustainable business growth platform and move your organization up the S - curve.
When I went back to research, looking to rebuff my own systems theory and to find a quick and easy way to help professional services organizations increase the velocity of their business development, one of the sources I reviewed was an old favorite business read: The Fifth Discipline: The Art And Practice Of The Learning Organization. Reading it was yet again an eye opening experience. Instead of rejecting my theory, the book helped me reaffirm that a systematic way of approaching sustainable business growth is necessary. It provided me with answers of why some of the short term linear approach business development projects work briefly, but not in the long term. More than that, the book gave me possible answers for some of the narcissistic behavior I observed in “For the Greater Good or Eat What You Kill?”, which I determined limits change in professional services firms, and I have been so desperately looking to decipher. Most importantly, the book illustrated that a comprehensive approach to business growth spreads beyond the segments allocated to Marketing, Business Development and Sales. To make a significant and sustainable business growth impact, leaders should employ multidisciplinary approach.
In his book, the accomplished Peter M. Senge, draws on extensive management research and experience to argue that the traditional management approach is not optimal and in order for organizations to survive, continuously adapt, innovate products and services, and overall develop, they should strive to become learning organizations. According to the author, the process of building and running learning organizations rests upon five pillars: systems thinking (the cornerstone), personal mastery, mental models, shared vision, and team learning. And while the majority of examples he uses do not come from professional services firms, I am convinced that applying some or all of the principles from the learning organization model will help firms manage many the challenges they face, and especially the ones related to business growing.
“Systems thinking is both more challenging and more promising than our normal ways of dealing with problems,” says Senge. I agree. It is about seeing the whole, interrelationships and processes. It helps executives absorb increased amount of information, manage complexity and accelerate change. In business growth terms, it clarifies why when marketing is creating powerful lead generation campaigns, there will be limited if any business growth results if the professionals (or the sales force) are not equipped with the necessary advisory skills, sufficient tools and the system to turn those leads into actual business; why when the professionals bring in new clients, these clients will consider such work commodity and as soon as another service provider comes along with a better value offer they’ll be ready to jump ship, if the organization is not ready to commit the resources to support the new clients beyond technical solutions to build strong relationships and loyalty.
Here is another example of the importance of systems thinking which will resonate with most leaders of professional services organizations. If a firm doesn’t pursue business growth and provide opportunities for growth for its junior professionals (directors, associates, etc.), after a period of time it faces high chances of losing its talent, which it has invested in developing over the years. The question often asked is: do we invest in attracting, developing and retaining new talent (HR), or do we invest in building a solid business growth engine (Marketing / BD) to provide for business continuity. I’d argue that the real questions here are how to balance those two processes, and what are the forces that increase or decrease their progression.
To adopt a systems thinking method, the author recommends that executives start to approach problems by identifying the source of the issues: what’s the core, not the symptom; the forces that support accelerating or decline growth processes, and the sources that would bring stability and resistance, as well as identifying organizational behavior patterns limiting growth, shifting the burden of blame, and others. I would recommend that firm leaders do the same to build and manage sustainable business development platform.
Mind that, as the name of this principle implies, this is not a one-time event. A comprehensive and systematic approach to organizational development and business growth today must be constantly monitored and calibrated, as a slight adjustment of one segment might skew another. To use an already mentioned example, a series of successful marketing campaigns might generate extraordinary amount of sales leads, which the organization, this time manages to convert in new projects, albeit scarce capacity of execution resources. If the capacity issue is not addressed, in the long run professionals will resist further marketing initiatives of fear of overload. I’ve witnessed a multitude of such vicious circles and how liner approach might bring a short term relief, but not long term solutions. As you see, employing such systems thinking is critical for firms.
The rest of the disciplines of learning organizations outlined in the book are easily discarded by most firms because they are considered soft, hard to measure, and often threaten the established order. Each of them however offers important supplement to the systems thinking principal and are critical for building strong organizations. Before dismissing them, I'd encourage professional services leaders to consider application to their firms, especially the ones of mental models, which among other things, explains why change management exercises and introduction to new business growth systems and programs might fall short of success, and the team learning one, which casts light on what's behind the “narcissistic behavior” of professional services organizations, ultimately limiting their growth. Contact me for a full copy of this article, articulating the value of all the principals of learning organizations and their function in professional services environment.
Pressured by economic forces and the evolving model of the professional services industry, firms’ leadership should consider innovative management frameworks. A systematic way of approaching professional services organizations is necessary for their survival, it is critical for their business growth, and inevitable as we live in environment moving towards systematic interconnected sharing culture - open source, social networks, etc. To develop a long term sustainable business growth platforms, firms should learn to utilize such comprehensive approach. They should avoid the temptation to employ quick, short term solutions, addressing individual segments (strategy – systems – skills) of the business growth platform and think how specific changes will impact the entire platform and organization.
Special thanks to the author of “The Fifth Discipline: The Art And Practice Of The Learning Organization” for his extensive research, insight and clearly articulated management frameworks. I would encourage the leaders of professional service firms to pick up a copy of the book and think about applying the principles of the learning organization, beyond the points outlined above.
© 2010-2013 Copyright Mira Ilieva Leonard / iStile All rights reserved
Tuesday, November 20, 2012
Friday, November 9, 2012
Enhancing Business Growth Planning For Superior Results
Learn from past growth strategies and close knowing-doing gaps to achieve your business goals
As a new year approaches, most organizations prepare to set their goals for 2013 and draft Marketing and Business Development plans to reflect their renewed aspirations. Progressive organizations ensure that part of that process involves performance evaluation of past plans and close appraisal of what has worked, what hasn’t, and most importantly, why or why not. Let’s focus on the latter as in my experience it is the most constructive part of this practice. To make intelligent and educated decisions about future growth strategies, one must first evaluate the success or failure of past ones by questioning the entire strategy development and delivery chain – from the viability of the adopted strategy, to the selected support tactics and their implementation. Judging end results only is short-sighted, unproductive and insufficient. “It didn’t work - let’s discard it and move on”: it is certainly the easiest and fastest approach to strategy review, and no blame is attached. While there is something to be said about this quick, back of the envelope exercise, I would encourage professionals to dedicate time to go through a thorough cost-benefit analysis, employing objective and tangible metrics.
In doing so, and prior to drafting a sound future business growth plan, there are a number of key questions one must answer. I’d recommend starting with the strategy itself. Was the growth strategy feasible? Had the organization dedicated the necessary resources and time to properly execute it? Had the organization allowed enough flexibility in the strategy for it to absorb sudden and unavoidable internal and external changes? A critical strategy development criterion is that a strategy is viable and consistent with the internal characteristics of the organization (structure, systems, people and culture), as well as supported by the necessary financial and human resources. These questions here are critical regardless of the outcome of the strategy as their answers provide learning points and a platform to develop not only enhanced future growth strategy, but also other key segments of the organization.
Once the strategy is evaluated, consider whether the firm’s tactics had supported the strategy. Had the organization utilized the proper mix and balance of tactics such as general awareness building (branding, PR), engagement (social media), thought leadership (articles, surveys), and targeted relationship building? What is the ROI on the various initiatives and at what level should the organization continue to invest in them, if at all? The second question begs another more fundamental question: does the organization have the proper measuring mechanisms in place to help executives evaluate the effectiveness of the business growth strategy? Have you ever heard the popular saying “You Can't Manage What You Don't Measure”? It is very true and important in determining the efficiency of the business growth platforms employed. The “new normal,” dictated by economic uncertainty and tighter financial margins, no longer allows professional services executives to make decisions on soft and anecdotal data. Today, if an organization is not equipped with systems to track and measure performance tied to certain financial commitments, the leadership team will struggle to justify business growth spending and obtain budget approvals.
Last but not least, consider what percentage of the past business growth plans had been put in action. The chances are there is a substantial gap between the plan and practice. The “80 / 20 rule” rears its ugly head: unfortunately, most firms see 80 percent planning and 20 percent doing. Because this is where “the rubber hits the road” I would encourage professional services organizations and their executives to ponder the reasons for such discrepancy and look for ways to bridge or decrease the plan–do gap. One of the most frequently encountered reasons for such disconnect in the professional services market is the mismatch between the organizational / professionals’ strengths and weaknesses with the selected strategy delivery tactics. This is something easily amendable but often underestimated. Organizations and professionals have different inclinations and strengths when it comes to business growth; firms must foster and leverage those with well aligned tactics instead of introducing uncomfortable ones, leading to resistance and avoidance of plan implementation.
Other reasons attributable to the lack of action and the development of “the knowing – doing gap” deal with timing (talk happens immediately and actions, leading to results, much later), organizational culture (unconditional acceptance of implicit and inherited mental models), management practices and compensation models. The latter two, especially when expressed by fear inducing management and internal competition policies, are often mistaken for motivation and drivers of action. Organizational development research shows the contrary. Organizations which build and nurture a collaborative environment (not internal competitive one) manage to turn knowledge into action, share best practices and drive growth at a sustainable and fast pace. So, when examining what’s inhibiting implementation of past business growth plans and overall, the organization, reflect on the factors outlined above and most importantly, take immediate actions to close the know-do gaps.
To ensure that a comprehensive overview of past business growth strategies is complete and productive I would recommend that executives identify and address at least 3 points for improvement, perhaps one of each of the stages outlined: strategy, tactics and delivery. Once equipped with the knowledge obtained from the review process the team can then develop a new, and improved, strategic business growth plan. Good luck!
© 2010-2013 Copyright Mira Ilieva Leonard / iStile All rights reserved
As a new year approaches, most organizations prepare to set their goals for 2013 and draft Marketing and Business Development plans to reflect their renewed aspirations. Progressive organizations ensure that part of that process involves performance evaluation of past plans and close appraisal of what has worked, what hasn’t, and most importantly, why or why not. Let’s focus on the latter as in my experience it is the most constructive part of this practice. To make intelligent and educated decisions about future growth strategies, one must first evaluate the success or failure of past ones by questioning the entire strategy development and delivery chain – from the viability of the adopted strategy, to the selected support tactics and their implementation. Judging end results only is short-sighted, unproductive and insufficient. “It didn’t work - let’s discard it and move on”: it is certainly the easiest and fastest approach to strategy review, and no blame is attached. While there is something to be said about this quick, back of the envelope exercise, I would encourage professionals to dedicate time to go through a thorough cost-benefit analysis, employing objective and tangible metrics.
In doing so, and prior to drafting a sound future business growth plan, there are a number of key questions one must answer. I’d recommend starting with the strategy itself. Was the growth strategy feasible? Had the organization dedicated the necessary resources and time to properly execute it? Had the organization allowed enough flexibility in the strategy for it to absorb sudden and unavoidable internal and external changes? A critical strategy development criterion is that a strategy is viable and consistent with the internal characteristics of the organization (structure, systems, people and culture), as well as supported by the necessary financial and human resources. These questions here are critical regardless of the outcome of the strategy as their answers provide learning points and a platform to develop not only enhanced future growth strategy, but also other key segments of the organization.
Once the strategy is evaluated, consider whether the firm’s tactics had supported the strategy. Had the organization utilized the proper mix and balance of tactics such as general awareness building (branding, PR), engagement (social media), thought leadership (articles, surveys), and targeted relationship building? What is the ROI on the various initiatives and at what level should the organization continue to invest in them, if at all? The second question begs another more fundamental question: does the organization have the proper measuring mechanisms in place to help executives evaluate the effectiveness of the business growth strategy? Have you ever heard the popular saying “You Can't Manage What You Don't Measure”? It is very true and important in determining the efficiency of the business growth platforms employed. The “new normal,” dictated by economic uncertainty and tighter financial margins, no longer allows professional services executives to make decisions on soft and anecdotal data. Today, if an organization is not equipped with systems to track and measure performance tied to certain financial commitments, the leadership team will struggle to justify business growth spending and obtain budget approvals.
Last but not least, consider what percentage of the past business growth plans had been put in action. The chances are there is a substantial gap between the plan and practice. The “80 / 20 rule” rears its ugly head: unfortunately, most firms see 80 percent planning and 20 percent doing. Because this is where “the rubber hits the road” I would encourage professional services organizations and their executives to ponder the reasons for such discrepancy and look for ways to bridge or decrease the plan–do gap. One of the most frequently encountered reasons for such disconnect in the professional services market is the mismatch between the organizational / professionals’ strengths and weaknesses with the selected strategy delivery tactics. This is something easily amendable but often underestimated. Organizations and professionals have different inclinations and strengths when it comes to business growth; firms must foster and leverage those with well aligned tactics instead of introducing uncomfortable ones, leading to resistance and avoidance of plan implementation.
Other reasons attributable to the lack of action and the development of “the knowing – doing gap” deal with timing (talk happens immediately and actions, leading to results, much later), organizational culture (unconditional acceptance of implicit and inherited mental models), management practices and compensation models. The latter two, especially when expressed by fear inducing management and internal competition policies, are often mistaken for motivation and drivers of action. Organizational development research shows the contrary. Organizations which build and nurture a collaborative environment (not internal competitive one) manage to turn knowledge into action, share best practices and drive growth at a sustainable and fast pace. So, when examining what’s inhibiting implementation of past business growth plans and overall, the organization, reflect on the factors outlined above and most importantly, take immediate actions to close the know-do gaps.
To ensure that a comprehensive overview of past business growth strategies is complete and productive I would recommend that executives identify and address at least 3 points for improvement, perhaps one of each of the stages outlined: strategy, tactics and delivery. Once equipped with the knowledge obtained from the review process the team can then develop a new, and improved, strategic business growth plan. Good luck!
© 2010-2013 Copyright Mira Ilieva Leonard / iStile All rights reserved
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