POSITION YOUR CLIENTS CENTER STAGE FOR A WINNING GROWTH STRATEGY

"What business are you really in?"

Tis the season when marketers and firm leaders dive deep into excel and power point exercises, as they conduct year-end performance reviews and look ahead towards 2015 planning. I wonder how many will stop for a moment and ask: “what business are we really in?” and take a different approach to short and long term strategy development.

Nearly 55 years ago, Theodore Levitt, a professor at Harvard Business School, articulated the importance of businesses focusing on clients’ needs in an article titled “Marketing Myopia,” which is a Harvard Business Review (HBR) favorite. He posed the question “what business are we really in” and provided a number of case studies, illustrating the peril facing organizations, which have ignored that question. I was recently reminded of this timeless concept not only by re-reading the re-published article, but also because I am beginning to see it more often in professional services firms in the form of marketing officers and firm leadership working together for the benefit of the client. It’s about time, one might say.

Thanks to this “clients first” concept, professional services marketing functions are enjoying a renaissance period. Professional services firms are recognizing the importance of “client centric approach” to their businesses, and thus their business growth strategies, and with that they are changing their historical definitions of marketing to encompass a more strategic and intelligent function. On their end, marketers are doing their part in raising their profiles by utilizing client data and analytics to drive growth and demonstrate their value in terms of dollars and cents. It’s a push - pull process that is leading the way and changing internal growth organizations. This trend is highlighted by the increasing tenure of CMO’s, according to leading executive search firms.

“An industry begins with the customer and his / her needs, not with a patent, a raw material, or a selling skill,” writes Levitt in the aforementioned article. Let that be a reminder that now that the marketing and strategy functions are finally working alongside, it is important to stay focused on what brought them together: the client. While it’s easy to get distracted by budgets, operations and tactics of delivering strategy and business growth plans, put your clients’ agenda first this year.

Consider changing your annual strategic planning process. Facilitate a session to answer the question “what business are we really in,” as well as how have your clients and their needs changed, and whether your business is still in line with them. Put aside the internal political minutiae. Shift your focus from developing new services or re-packaging existing ones to your clients. Expand the scope of the process to include a wider input pool: internal professionals across functions and external industry leaders, and most importantly, your clients. Think innovation, not preservation. Be prepared to reallocate resources in your budgets. And last but not least, make it a dynamic strategic planning / review process that takes place throughout the year.

If all else fails, at least go back through your client satisfaction surveys / interviews and outline just one additional initiative that you are going to undertake in 2015, which will focus on your clients’ needs. It might just help you outpace your competition and re-define your market.

By Mira Ilieva-Leonard Mira.ilieva-leonard@istile.com

© 2010-2014 Copyright Mira Ilieva Leonard / iStile All rights reserved

THE POWER OF TECHNOLOGY IN GROWING PROFESSIONAL SERVICES

How to make the most out of technology tools

Technology can and should be used to offer leverage and amplify the business growth efforts of professional services firms, both at the firm and individual practice level. As with anything else, before selecting which tools to use it is critical to have clear strategy, defined key performing indicators (KPIs) and realistic expectations in mind. Below is a list of the most popular technology tools with professional services firms (PSFs), some of their features, pros and cons as well as general best practices. Note that each of them might support different or several segments of the sales process (e.g. Lead generation, engagement, etc.) and offer different ROI when evaluated individually.

Email marketing is one of the most well established technologies in the PSF market. E-mail is still a very powerful tool notwithstanding its overuse in the marketplace, and dismissal by many BD professionals. When coupled with analytics, it can be a marketer’s go-to technology platform. However, if not structured properly, email marketing can often provide a one-way communication, with limited opportunities for dialogue with the audience. To make the most out of email marketing, try to launch a dialogue with the readers, strive to have compelling and relevant content, and focus the communication to the right audience with the right packaging.

Blogs have become very popular with PSFs because they offer very easy publication capabilities for individual professionals and content focus (e.g. industry, specific technical point, etc.). A blog can also be viewed as a bit more engaging than the one way broadcasting of emails because it invites feedback through reader comment sections. As such, it might be considered “higher” on the client acquisition value chain. The biggest challenge with blogs is following a diligent and disciplined approach to content creation. To make the most of blogs, the creator must develop a content schedule and distribution strategy regardless of whether the blog is powered by individual technical professional or marketing and knowledge teams.

Driven by easy access, low entry cost and an army of young marketing professionals very comfortable with the medium, Social Media has received a lot of attention with PSFs, undeservingly so, some might say. Not all social media tools are created equal. LinkedIn, Twitter, Google +, and others offer different value to marketing and business growth of professional services firms. I can’t emphasize enough the importance of having a clear understanding of the tools and a strategy in place on how to use them. Based on your objective, LinkedIn, for example, can be used in many different ways, e.g. as a mass communication platform, intelligence gathering tool, engagement facilitation portal with existing and prospective connections (note that there’s a difference between connections and contacts), etc. We can apply similar reasoning to Twitter; are you broadcasting or listening, and why? How do you use these tools and why?

Customer Relationship Management (CRM) has become one of the most dreaded three letter words in professional service firms, so much so that some firms have tried to use different acronyms. In many cases CRMs have become synonyms for expensive and often unsuccessful change management exercises. This “infamy” is unfortunate. CRMs offer key functionality for smart business growth such as targeting and segmentation, and have great success stories for collaboration, cross-sell and client service efficiency, as evidenced by the 2013 “Managing Client Relationships” report, produced by the Managing Partners’ Forum and their partners (you can find a copy of the full report here) The challenges presented with CRMs are many. They include data collection, input and upkeep – which can be time consuming and require discipline, adoption and utilization – which require training and firm-wide buy-in, or what typically occurs is the CRM is limited to a few administrative functions which vastly underutilize the capabilities of the system. In order for CRMs to be successful and offer positive ROI they require big percentages of firm wide use. With that in mind, having a clear strategy and reasonable expectations must be at the forefront of CRM implementation projects. This requires cross-functional collaboration between C-level Management, Marketing, IT and HR.

Marketing Automation is the latest trend in technology tools designed to impact the top line. To a big extent, marketing automation ties all of the above-mentioned tools together plus SEO’s and analytics. A few PSFs are venturing and experimenting with this tool, but the jury is still out. The main question to consider is whether PSFs can generate enough relevant content to constantly feed the marketing automation machine and get a reasonable ROI on the investment in the system and its support personnel. Marketing and knowledge teams, assisted by technical professionals, will need to work together to map the client acquisition journey (to use product marketing terminology) and develop appropriate content. They will also need to keep in mind that the decision buying process might be different for different services and clients.

There are of course other technology tools such Websites & Content Management Systems (CMS), Search Engine Optimization, Big Data & Analytics, etc. that I will not cover now because of the questionable nature of their direct impact to business growth, at least as of this writing. Websites & CMS are mainly seen as informative and credibility building tools rather than drivers of business growth. Only a select few firms thus far are undergoing investments in Big Data & Analytics, i.e., mining and analyzing the data available to them to provide data to assist studying buyers’ behavior and for productizing services. And most importantly, even fewer still are taking the next step and acting on the data analysis. The business growth opportunity with Big Data is here, but it is not fully understood by professional services firms yet.

There’s no doubt that technology tools offer business growth leverage at both individual and firm levels. If there’s one key takeaway from this brief piece is that these tools are only as valuable as the strategy of their use. Those who don’t “think it through” before trying to implement these tools may find a lot of frustrated professionals and low adoption rates within their firms. So, before jumping on the next technology trend ask yourself why, what you expect to achieve, how you are going to use it, and if you have the time and resources to dedicate to it.

© 2010-2014 Copyright Mira Ilieva Leonard / iStile All rights reserved

By Mira Ilieva-Leonard Mira.ilieva-leonard@istile.com

Clients changing the business of law

How are firms dealing with it and what it all means in practice?

I was recently invited to moderate a panel of law firm CFO’s for the Southeastern Chapter of the Legal Marketing Association, titled “The Evolution of Law Firm Finance and Its Impact on Business Development.” The panel considered the following circumstances and how they have impacted the business of law. As a result of the recent recession law firms are undergoing overwhelming change. Many of them are retooling their financial strategies by adopting alternative pricing methods, shifting operational financing, improving vendor management, and most importantly, how they go about attracting, serving, and retaining top clients. In other words, firms are modifying their way of doing business to better align with the demands of corporate America. So what does that mean for the industry in practice?

Below please find some of the key takeaways from the conversation along with my personal observations. A side note: in my experience this trend is not limited to law firms and is evident across the professional services industries. Many of the points brought up during the conversation are applicable to professionals offering consulting, accounting, and other business services.

The fact that clients today are expecting the same high quality services for lower cost worries some professionals, but hasn’t persuaded them to change their pricing model. Some cling to the notion that this is only a fad and “the good old days” of buyers’ flexible budgets will return. If neither are willing to change their thinking, both groups will soon become industry laggards.

This shift from a revenue- to a cost- based law firm business, where “profit” is the name of the game is clear. It presents many opportunities for firms ready to improve performance and leverage efficiency. However, the transition is not easy, which makes the hesitation of the above-mentioned laggards understandable. It necessitates a “one size fits none” mentality, where firms must take a segmented positioning attitude for various practices and partners, and learn both the consultative and commodity approaches of selling legal services. It requires applying new staffing and project management models, such as “the pyramid” staffing model for consulting and other deep expertise services, and / or “the diamond” model for highly leveraged, packaged services. It also calls for new skill sets: project management, financial understanding, change management, collaborative skills; and new tools: financial dashboards, collaborative index, etc.

Marketers and Billable Professionals: CFOs are your new best friends. In order to succeed in this environment, marketers and billable professionals will need to understand the business of the firm and the various individual practices. In addition to joining forces on addressing RFP’s, they will need to work with CFO’s to package services: define how to sell and deliver them in order to keep healthy profit margins, and create business models to stay competitive and win business. They will need to communicate often to identify where the systems and processes can be improved to serve clients better. They will need to track Marketing/BD spending and measure ROI, to better evaluate business growth initiatives and create more accurate budgets. Ultimately, they need to align their agendas to champion change to create and employ the supporting systems, skills and processes.

The CFO’s sitting next to me for this session might be some of the most progressive ones I’ve encountered. I was delighted to hear them speak about changing behavior, collaboration, and building a different type of organizational culture. They understood what it would take to make the transition: to meet their clients’ expectations and remain relevant.

The bottom line: change is upon us and instead of wasting time and energy fighting it, embrace it. Accept that with the new business model new compensation structures are afoot and necessary to change behavior and overall firm culture. Adopt new KPI’s (key performing indicators) such as team profitability, cross selling, and collaboration. Understand that "not all clients are created equal;” approach them and structure delivery accordingly.

It is indeed a transformative period for the legal and other business services industries. Progressive firms that will act upon this shift quickly, and put the wheels of change in motion, will stand out. Will you join them? At iStile, we work with firms to help them take advantage of such opportunities by structuring and implementing the necessary systems and equipping the management team and professionals with the necessary skills.

By Mira Ilieva-Leonard Mira.ilieva-leonard@istile.com

© 2010-2014 Copyright Mira Ilieva Leonard / iStile All rights reserved

GOT CHANGE?

Practical tips on introducing and successfully implementing new ideas, processes, etc…

For the past several years I’ve spent the majority of my time in Europe, which I discovered uses an extraordinary amount of change (coins). “Change” –whether used to mean “coins” or “transition” - is not popular nor convenient (it is heavy and bulky); it is necessary (from the most trivial to the most unexpected activities), and it is everywhere, and ultimately becomes part of one’s normal life. In many respects, Europeans pride themselves on their resistance to change through preservation of culture and traditions – and they continue to use coins for most transactions. Yet, Europe is also a symbol of political and economic change as it seeks to break down national borders and create a single currency. . . Notwithstanding the images of 1000 year old castles, and clinging to traditions, in many respects they are much more advanced than the “innovators” on this side of the Atlantic Ocean. I can’t help but think that if Europeans can resist change, and at the same time embrace it as political and economic borders begin to erode, then we need to carefully identify why some change can take hold, while other is impossible to implement.

Why is it so difficult for some kinds of behavior change to take hold? How do we reduce the amount of time fighting change and ensure high adoption rates?

In my function I often act as a change agent (I have mixed feelings about the term) and while I personally enjoy change (I thrive on it really), I am puzzled by how others behave when they are exposed to it. Because of that I’ve spent a good bit of time reading and studying change: behavioral change, change management, how to present change to increase its adoption rate, why it’s hard to change people, how to reset your brain, the latter two coming from articles and books such as: “Change or Die”, Alan Deutschman (#changeordie) and “Driving Change”, Mike Brewster (#drivingchange). They all explain that change and the perceived discomfort and the uncertainty it brings are scary for most people.

“Sixty percent of change initiatives result in failure. Change is always very hard, so choose your battles and focus your efforts…lawyers are typically more resistant to change than most,” claims a recent article in Managing Partner, a UK based publication catering to the legal industry, June 2014. I am not surprised with this number. In fact, my anecdotal research would claim that the number of failed change activities is even higher and closer to seventy-five percent across professional services organizations (law, accounting, advisory, etc.), my field of expertise.

Is it necessary to change? And, why are we trying so hard and over and over again to change people? For organizations to evolve, do we need to change? Should we just adopt the Darwin’s model and let organizations prone to change survive and let others become obsolete? Change is good and necessary. Placidity is stifling and brings conformity. The real question in my opinion is what are we really changing when we talk about altering organizations: people or their behavior? An article in the June, 2014 issue of Scientific American, titled “Good Habits, Bad Habits” talks about the complex process of building and re-programming habitual behavior. It turns out, what it appears to be a simple act of automatic behavior is not as simple after all. Multiple parts of the human brain are involved when building habits and almost as many once the habit is imprinted and is processed. Given that the majority of our daily existence is a series of habitual acts, which once laid down employ chunks of neural activity, it’s no surprise it’s so difficult to change human behavior.

All of the materials I’ve come across on the subject also talk about how to go about managing change –the traditional model of denial, the one of co-creation...There are some great frameworks to assist you in the process. Before you evaluate them and select which ones to employ I would suggest you gauge the adaptability of the organization / people. You can do so by looking at past performance, use structured assessment tests, etc. From my practical experience, openness to change equals desire to learn, so that’s usually my first clue. The organizations and professionals I’ve worked with and have had the highest rate of change management success are ones with obvious and exemplary attitude towards learning. I am referring to general curiosity and aptitude to absorb knowledge: industry and technically related, or even just generic (including pop culture, sports, etc.).

Once you have a sense of how challenging your change management task might be, multiply it by two as well as the project time and resources, and the chances are that you’ll still underestimate its complexity. Here are a few practical pointers to keep in mind through the process:

- Break the project down to small, digestible work streams.

- Articulate benefits – overall and individual (mind you that those might vary for different audiences).

- Provide a support system and tools.

- Let people process it at their own rate.

- Celebrate small wins.

- Have a failsafe plan (or a few).

- Provide constant cues and rewards in effort to build new habits.

- Equip yourself and the change management team with patience.

Progress and change are inevitable. For a sustainable change to take hold it takes time and perseverance – it’s a marathon, not a sprint. And for our European friends and their paradox – well, how it all plays out with the EU and euro in the long term will be the ultimate test of their ability to deal with change. Good luck!

© 2010-2014 Copyright Mira Ilieva Leonard / iStile All rights reserved

"BUSINESSES LEADING THE DEBATE FOR CHANGE" | 2014 EDELMAN TRUST BAROMETER

It is this time of the year when Edelman publishes its renowned annual study of the state of global consumer trust. Trust is the basis of building relationships with consumers and clients, and thus is the core of all meaningful business relationships. I’ve been genuinely interested in the findings of the survey and followed it for the past several years. For a third year, I will share key points of the survey below and direct the attention of my friends and colleagues to this insightful tool. Hopefully, you also find the subject of building and retaining trust as intriguing as I do. Please consider how the lessons from this survey might affect you and your clients’ organizations directly.

General Findings

While there’s an overall decline in trust over the past year, there are significant variations on a regional basis. There was a decline in trust in the USA, France, Mexico, and an increase in trust in the UAE, Argentina, and Indonesia, to name a few. Similarly to 2013, NGO’s and businesses are leading the way in terms of keeping the public’s trust, while governments and media continue to lose it. The trust gap between the informed and the general public is staggering, underlining the importance of constant communication and education when earning and retaining trust.

Technology remains the most trusted industry sector. The banking and finance sectors are yet again at the low end of consumer trust barometer, with those selling financial advisory/asset management services at the very bottom.

Size and location matter

While general trust in business is leveling in comparison to the past, businesses in the West have to work harder than their colleagues in the developing markets to maintain that level, reflecting the overall growth market expectations.

Diving deeper into geographical segments, it is interesting to note that Germany is on the bottom of the list of financial sector trust level, alongside Spain and Ireland. Again, I found it surprising to see Germany, Sweden and the UK on the bottom of that list in the energy sector.

A note for multinationals: HQ location matters. BRICs nations suffer trust deficit compared to Western-based companies. One might argue that governance and compliance are attributable to those results. Size also matters. Family-owned, as well as small and medium sized businesses, show a near-global advantage (except in Asia) when it comes to trust, which seems related to the overall perceptions of the companies. Family owned, small- and mid-sized companies are perceived to be more responsive to customers’ needs, more entrepreneurial and innovative.

What and who do you trust most?

Trust in media is on the decline, which should prompt us to question the communication channels used to deliver key messages. On-line search however leads as a source to turn to for general business information, breaking news, and confirmation of news about business; assess how much importance is put into SEO and adjust it accordingly.

CEO’s/business leaders are still not the most trusted source. Peers/regular employees have gained significant ground in being perceived as trusted sources, which may be attributable to the dominance of social networks and the increasing importance of "friends’" recommendations.

How do we build trust?

Following last year’s introduction of five key trust building segments: engagement, integrity, product & services, purpose and operations, this year the study underlines engagement and integrity as high-priority segments with significant opportunity for improvement. It also draws a direct correlation between certain positive behaviors, such as “pays appropriate level of tax,” “ensures quality control,” etc. with increased trust, and negative indicators, such as “unethical business practices” and “misrepresents the company,” with decreased trust levels – these are key segments of trust building.

This short article provides only a snapshot of this report’s many insights. I highly recommend that you make time to review the study and take into consideration its results in your 2014 strategic development planning.

For copies of Edelman’s 2014 Trust reports, visit the following website: http://www.slideshare.net/EdelmanInsights/2014-edelman-trust-barometer

For past articles and reports, click here: http://mirailievaleonard.blogspot.com/2013/01/where-is-trust.html

© 2010-2014 Copyright Mira Ilieva Leonard / iStile All rights reserved

IS YOUR BUSINESS GROWTH ORGANIZATION BROKEN?

It’s not always about redesigning the growth organization; it might be time to refresh the business growth process

As many professional services firms are struggling to reach their growth goals, they are questioning the effectiveness of their sales organizations. Business growth organizations are well-designed and likely to succeed as long as they have all the necessary elements aligned with the growth strategy of the firm: support tools, systems and skills, as illustrated in this simple grid.

Before undertaking the complex and time consuming process of re-designing the sales organization, I’d first look at updating the sales process, sales tools and the roles of the various business-growth-related parties, such as marketers, business developers, billable professionals and sales leaders. These upgrades are driven mainly by smarter and better informed buyers who are squeezed by constant cost cutting demands.

Much has been written and said about the evolution of the business growth / sales process over the past few years, especially for professional services firms. You’ve most likely run into a number of proprietary ones with fancy acronyms. They still follow the very traditional process of “awareness – education – sale – loyalty”, albeit the various stages being called something else or further segmented into smaller ones. One thing that’s become clear and I’ve been advocating is the shift from pre-packaged solution-based approach to “insight selling”, as coined by Brent Adamson, Matthew Dixon, and Nicholas Toman at CEB. I have been referring to it as a consultative or problem solving selling technique. Its differentiation and strength is multifold:

(i) Cultivating prospects who are most likely off the radar of competitors (because the identification criteria are different from the traditional ones of industry, size, etc.);

(ii) Gathering intelligence and developing business understanding that goes beyond the orthodox one of budgets, purchase decision maker, etc.;

(iii) Sparking dialogues that don’t steer towards uncovering already recognized needs and solutions, but leading to unrecognized problems and drafting solutions jointly; and

(iv) Building client value and long-term relationships, which facilitate future, post-engagement conversations and additional opportunities to work together.

It’s an approach that calls for upfront investment in terms of updating the roles and skills of the business growth parties, as well as the sales tools, and in return positions the organization on a different level from competitors to avoid price bidding and dictate deeper terms of engagement.

Based on extensive research, Adamson, Dixon, and Toman recently released another article on “insight selling,” titled “Dismantling the Sales Machine” (for HBR, November 2013). As always, I appreciate their professional research, which further supports the consultative approach I’ve been advocating. In this paper, the authors refer to “insights selling” as a process where “sellers challenge customers with disruptive insights into their business and offer unexpected solutions.” It no longer encourages certain “check-the-box” compliance sales process and activities, but rather emphasizes the importance of identifying the right prospects, giving professionals the freedom to make judgment calls, and expanding the use of innovation and creativity to design solutions. I wholeheartedly agree with this approach and couldn’t have defined it better myself, with one exception. Unlike Adamson, Dixon, and Toman, I am a supporter of “compliance” of the sales process and believe its value should not be understated. A couple of the statements in the article make it sound as if the authors believe that results justify sales actions, regardless the associated cost. When it comes to compliance I am not referring to supporting the use of certain sales activities, but the process, which is critical in measuring efforts and effectiveness and efficiencies of these activities. What I support is that when it comes to sales activities, a/k/a business growth tactics, one size fits none. Successful sales tactics vary from one professional to another. Compliance should ensure that there is a process in place that guides the sales professionals and ensures that activities that work for professionals are taking place.

As I’ve mentioned in the past and as spelled out by Adamson, Dixon, and Toman’s research, this new sales approach calls for updating the various business growth roles, changing team formations, skills and tools. Sales professionals (a/k/a business developers, billable professionals, etc.) should work on developing their advisory skills and use both emotional intelligence and IQ. Sales leaders (a/k/a CSO, CMO, Managing Partners, etc.) should become coaches, facilitators of information and encourage idea generation and collaboration. They should emphasize the power of individual networks and a long term view to prospects. The latter dictates a fundamental shift away from the traditional transaction oriented approach towards the one of creating value for clients and developing true relationships. In order for that to succeed, sales leaders must look for quality of their business growth pipeline opposed to velocity as key performing indicators (KPI’s) and most likely re-write the existing compensation model. Sales leaders and organizations should equip sales professionals not only with new skills, but also with tools that help identify prospects and prioritize actions, create demand and spark solution innovation, and lastly, provide decision making guidelines for making confident judgment calls.

Is it time for you to refresh your sales process, cease the bidding war with your competitors and improve your business growth results?

By Mira Ilieva-Leonard

© 2010-2013 Copyright Mira Ilieva-Leonard / iStile All rights reserved

WHAT HAVE WE LEARNED FROM THE COLLAPSE OF DEWEY & LABOEUF

An organization development case study for professional services firms

A year and a half ago I posted my piece “For the greater good or eat what you kill”, which used the much talked about collapse of Dewey & LaBoeuf to explore hypothesis behind the destruction of intelligent professional services firms, and make recommendations to avoid such a fate. It is that same unfortunate story of Dewey & LaBoeuf, told by James B. Stewart for the October 14th 2013 edition of The New Yorker that inspires me now again to share my thoughts and re-emphasize on the key organizational development factors for professional services firms.

It is a story worthy of an Oscar® nominated movie script. There are mafia connections, luxury lifestyle, disturbing emails, and backstabbing, peppered with greed and egoism. I am not talking about Tom Cruise’s movie “The Firm”. I am referring to Stewart’s recent article for The New Yorker titled “The Collapse” . For juicy details I urge you to look up the article; for the purpose of this blog I’ll focus on the key takeaways.

After a careful study of the characters, the various circumstances and the storyline of the events, leading to the bankruptcy of Dewey & LaBoeuf, James B. Stewart concludes that “cooperation and mutual respect” is at the heart of successful professional services firms. I wholeheartedly agree with the author as I mentioned in my original piece.

Building up to that conclusion and referring to industry benchmarks, Stewart talks about a number of factors that influenced, or one might say accelerated, the faith of Dewey & LaBoeuf: size & structure, compensation model, and culture. While industry and economic trends might have guided many firms like Dewey & LaBoeuf to look for alternative growth models and structures, the “vereins” have yet to be proved successful, at least in the legal industry. Vereins, defined by Stewart is “a constellation of separate legal entities doing business under a single brand.” I see how the author reaches that conclusion however, I am not fully convinced. Looking across industries to the advisory world of the BIG 4, their model, in terms of size and structure, doesn’t seem much different than the one pursued by Dewey & LaBoeuf. They, however, have seem to have managed to make it, although they have suffered a decrease in their numbers today. Therefore, while size and structure matter, I’d advocate that the compensation model and culture are the heavily weighted levers that make the ultimate difference, and the ones that lead to demise in Dewey & LaBoeuf’s case.

As seen in Stewart’s article, a compensation model, mainly incentivizing rainmaking can encourage wrong behaviors and be counterproductive. Similarly, a culture allowing for a digression from the clearly defined traditional firms’ values of “loyalty and collegiality,” often has a hefty price. Interestingly, this is where Stewart’s statements support my hypothesis of the grave and destructive effect for firms, using compensation models feeding the “eat what you kill” mentality and encouraging narcissistic behavior, as outlined in “For the greater good or eat what you kill”. This piece and blog is not about being right, but about identifying problems and applying lessons learned to solve them. And so, if compensation models that heavily weight rainmaking and narcissistic firm cultures are directly correlated to the failure of Dewey & LaBoeuf, and potentially other professional services, then what’s the solution?!

It all comes down to “cooperation and mutual respect”. That’s the culture that successful firms foster and Dewey & LaBoeuf blatantly ignored, according to Stewart. In my past articles I refer to that as collaboration and encourage organizations to reward it, because it provides for learning, best practice sharing, better solutions design and a team client approach…for the greater good. Taking a prescriptive approach to collaboration, similarly to the one in my “One for all: all for one” article, here are a few tangible points to consider when looking to inspire collaboration:

• Explore a firm development strategy with collaboration as a core attribute, or even as a sustainable competitive advantage. Take an all-encompassing approach: from recruiting and retaining talent, to growing the firm and boasting team performance.

• Define an organizational structure that fosters sharing and cooperation, spread throughout the firm: from basic operations to compensation models, as well as support and client facing practitioners.

• Employ tools and systems that encourage communication, knowledge sharing and transparency, which are some of the key components of collaboration.

• Establish functions and recruit / develop professionals who not only understand the value of collaboration, but have the necessary skills to build and cultivate collaborative culture.

© 2010-2013 Copyright Mira Ilieva-Leonard / iStile All rights reserved

ON THE TACTICAL SIDE OF BUSINESS GROWTH I: Growing the firm and the role of the marketing team

Here’s a short series focused on business growth implementation, a collection of my thoughts, popular opinions and current trends...

The importance of lead generation and what it means for marketers

New clients are necessary not only for the overall development and growth of a firm, but for its survival. Clients come and go. In a competitive world, driven by tight economics and intelligent buyers, clients’ attention is constantly distracted by multiple, smart service providers who test loyalty and threaten client relationships. Firms discounting the value of constant development of new clients are laggards or soon to be such. On the other hand, firms understanding its importance know that a strong marketing team is instrumental for the business development process and fully utilize and enable those resources.

The definition of the marketing function and its deployment depends on firms – their size, strategy, and outlook. For some firms, marketers should be focused on brand management and internal and external communications only – i.e., they facilitate branding activities, develop and distribute newsletters, maintain communication materials (websites, brochures, etc.), create client and firm events, etc. For others, marketers are a key part of the executive team in charge of leading and developing the firm, and are involved in the entire sales cycle. In this latter scenario, in addition to managing branding and communications, marketers are engaged with strategy and service development with the BD and sales teams as well as client retention, and all of the support tasks that accompany this strategic function: from gathering market intelligence, supervising the CRM systems, developing proposals, and creating loyalty programs, among others. These two examples demonstrate polar opposite views of the role of marketing in professional services firms. As long as firms realize the need for constant client acquisition they should define the marketing role to ensure it includes direct connection to growth, especially if that’s not already the case. Marketers should also realize that they have an opportunity to have a bigger impact on the overall development of the firm and provide a greater value by tying their activities to revenue generation.

In other words, marketers should consider that part of their responsibilities includes engaging, inspiring and supporting both the firm and professionals to grow the firm. So, what might that mean and look like for marketers? Managing the lead generation process...
I’d recommend that marketers start by having a clear understanding of the strategic direction of the firm as a whole, and its constituent practice groups and/or individuals to ensure proper prospect targeting. They must know what “a good lead” looks like so that they can better find them and communicate with them. Marketers must work with the rest of the parties involved in business growth (partners, business developers, etc.) to define growth objectives in terms of revenue numbers, and translate them into leads to incite actionable plans.

Measuring processes, tracking systems and reporting tools are critical for lead generation. Here marketers must look to the IT and financial teams for cross functional support. When elaborate CRM and budget tracking tools are already in place then marketers must recognize their full potential, adopt them and demonstrate their key benefits to the rest of the stakeholders. If no such systems or processes are in place, then marketers should develop and use simple practices and tools such as excel sheets. Remember: one can’t manage what one can’t measure!

A big part of managing the lead generation process is the tangible execution. Marketers must set up and run lead generation campaigns: often a combination of thought leadership platforms, social media tactics and direct outreach (see “lead generation tools” below). The objective this time is to go above and beyond the traditional awareness building campaigns. It is to identify and engage prospects into a two-way communication, which will eventually facilitate connection and develop a relationship. This is often a long and multi-step, multi-dimensional task that calls for patience and discipline.

The proper implementation of lead identification, touch and follow up with the right content and the appropriate frequency are just as important as equipping the firm and its professionals adequately in order to convert leads into an actual prospects and revenue. Marketers should communicate the value and plans of the various lead generation campaigns to the key stakeholders. They should create tools, cheat sheets, articulating value propositions and key talking points, and “how to” guides for specific thought leadership platforms. Business growth is a team discipline. Everyone in the firm has a role to play. The more prepared and the better equipped players are the higher the chances of success.

Professional services marketers today have a wide range of lead generation tools at their disposal. Industry best practice ranks thought leadership as the number one method for effective lead generation. Marketing professional services is “selling the invisible” as Harry Beckwith calls it. It is about demonstrating knowledge and differentiation, and for that knowledge-based materials are best. White papers, articles, newsletters, case studies, books and e-books, presentations – in-person and webinars, and surveys are just a few of the popular tactics employed by marketers. Properly structured and executed they can be very effective.

Growing professional services is also about building deep relationships and trust. In managing the lead generation process, it is marketers’ responsibility to tee up relationship building opportunities and put professionals in positions to demonstrate their know-how, start new conversations and earn trust. Continual education platforms such as seminars, on-line technical courses, conferences, issue-based events, community initiatives are examples of live and on-line forums, facilitating relationship building and lead nurturing. Again, it is imperative that marketers realize that the full value of these events spreads beyond building awareness and amplifying the brand to facilitating relationship creation and demonstrating subject matter expertise.

While some conventional lead generation tools such as direct outreach with call to action, telemarketing, list purchasing, contests and free trials are losing their attractiveness, social media is gaining popularity and increasingly becoming the default channel to fueling the lead pipeline. The novelty of LinkedIn, Twitter, blogs and microblogs, Slideshare, videocasts and podcasts, and infographics might evoke resistance in some firms. It is marketers’ duty to articulate their value, make the cost/benefit case to the firm stakeholders and to utilize them in a way correlated to revenue generation.

So, what’s next? Introducing and implementing new processes and tools is challenging and requires executive buy-in and support. Start small. Run experiments and learn what works and how. Build upon that to increase the number of followers. Share wins. Be patient and determined. Ultimately everybody will win – the firm and the marketers.

© 2010-2013 Copyright Mira Ilieva-Leonard / iStile All rights reserved

ON THE TACTICAL SIDE OF BUSINESS GROWTH II: Challenges facing marketers, Important data analytics for CMO'S, Relationship building insights

Here’s a short series focused on business growth implementation, a collection of my thoughts, popular opinions and current trends...

*********************************************************************************************************************************************************** "What Are The Biggest Challenges Facing Marketers According To New IBM Study?"

According to a hot-off-the-presses study conducted globally by IBM (500 marketing managers) across 15 different industries, creating growth (through the acquisition of new customers) and sustaining growth (through superior loyalty) is at the very top. 42% of respondents suggested that acquiring new customers and 36% suggested driving loyalty and satisfaction were the biggest challenges facing their organizations.

While these results aren’t earth-shattering as it is likely that a survey a decade ago would have yielded a similar pattern, what is surprising is the items at the bottom. Only 21% of the respondents suggested that measuring ROI was the most challenging problem they faced, behind branding, leveraging data, understanding and effectively using social channels, and creating positive experiences for consumers. A few years ago, measuring ROI was at the top of everybody’s list. This perhaps suggests a sign of the times – a tough marketplace, increased competition, a more global marketplace, and more savvy consumers have made growth especially challenging.

Other key findings from the survey suggest that the marketers who are driving better firm results are doing something different than their less successful counterparts. They tend to be significantly more adept at tracking, technology, and analytics and use these tools to develop more sophisticated and adaptable solutions. They are more engaged in all customer service interactions and tend to personalize marketing offers. In short, stronger firm-wide leaders are more engaged in all customer interaction, and seem to have greater competency in what is necessary to be successful today. See a summary table that compares the top performing marketer performance with the balance of marketers (from IBM 2013) below.


For details, read on here: http://www.forbes.com/sites/kimberlywhitler/2013/05/21/what-are-the-biggest-challenges-facing-marketers-according-to-new-ibm-study/

*********************************************************************************************************************************************************** "The 80/20 Rule of Analytics every CMO should know"

With all the talk about Big Data and Predictive Analytics – both of which involve complex, advanced skills and tools, driving millions of dollars in marketing – it is hard to believe in the power of simple analytics.

The truth, however, is that only 20-30% of the decisions really need the use of advanced techniques like predictive analytics. Seventy to eighty percent of marketing decisions can be judiciously addressed with simple analytics techniques, which can be learned by any marketer and executed on an Excel spreadsheet.
For the benefits of data analytics simplicity, read on here: http://www.forbes.com/sites/piyankajain/2013/05/26/the-8020-rule-of-analytics-every-cmo-should-know/

*********************************************************************************************************************************************************** "Here's How To Build A Win-Win Networking Relationship"

Here is a business-building rule of thumb: Don’t waste your time networking if you are not prepared to develop win-win relationships. Trust me when I say, I know what I’m talking about.

I am the organizer of a local business organization with a membership of over 400 self-employed women. I was shocked when I learned that most of the members attended only one or two meetings and then did not return. When I sent out a survey asking why they stopped, the majority replied that it was because they had not gotten any business.

Hadn’t gotten any business! Were they kidding me? They expected people to buy what they are offering after only a couple of visits? Hadn’t they heard that potential clients/customers need time to get to know, like and trust you? What happened to building win-win relationships?

Here’s my advice: If you aren’t networking for the long haul then don’t bother networking at all. Frankly, you are wasting your energy if you expect instant gratification. Here are five key networking tips that I share with my organization of women entrepreneurs:

1. Understand your target market.
2. Know exactly what you bring to the networking table.
3. What is your networking goal?
4. Networking rule of thumb: Give value to receive value.
5. Follow up promptly to develop and maintain win-win relationships.

For the full article, read on here: http://www.forbes.com/sites/womensmedia/2013/05/21/heres-how-to-build-a-win-win-networking-relationship/

© 2010-2013 Copyright Mira Ilieva-Leonard / iStile All rights reserved

LEADERSHIP LESSONS FROM MARGARET THATCHER

Margaret Thatcher, one of the greatest leaders of the 20th century, passed away this week. While a lot has been said and written about her policy, style and personality, not much has been highlighted as lessons to be learned by today’s leadership.

A few years back, after seeing “The Iron Lady”, a semi-biographical film, I was taken by the leadership evolution of the main character. So much so that shortly afterwards I did a good bit of research and discovered that true to the film, Margaret Thatcher had indeed dedicated time to develop her Executive Presence to become the strong leader the public came to know. Ever since, I’ve used her as a prime example of a leader exuding Personal Gravitas, when discussing its importance and development with the next generation of leaders of professional services firms (see also "Where In The World Is The Next Generation Of PSF Partners?" )

I encourage you to take a look at this 2-part interview with Sir Bernard Ingham, Margaret Thatcher's chief press secretary, and note the difference between charisma and gravitas, and the four key characteristics of personal gravitas. Which quality(ies) will you and your leadership team work on developing?





© 2010-2016 Copyright Mira Ilieva-Leonard / iStile All rights reserved

MAKING PROFESSIONAL NETWORKS WORK

Increasing the chances of success of alliance relationships

Over the past several decades, globalization and regulation have forced the creation and development of a multitude of global professional networks a/k/a alliances or associations. Their purpose is to provide a structured framework for independent local firms in different jurisdictions to come together and cost-effectively provide services to clients across borders. While the majority of these networks are found in law and accounting, they also cover industries like tax, insurance, real estate, architecture, etc. Recent research shows that these networks employ more than a million professionals and staff, and have cumulative annual revenues in excess of $200 billion. Throughout the last few years, I’ve personally worked with about a dozen networks across various industries, witnessing both best and worst practices, hence this article.

Whether it’s an extremely well structured network (like the Big 4), or one more loosely organized, for the network to function, its member firms must have shared strategic objectives that lead to strategic value creation, contributing to a feasible venture that can withstand competitive pressure and environmental change. That’s mainly manifested by the members’ ability to receive referrals from other members, the quality and reliability of firms to which they can refer, the potential to attract and of course, retain clients by being able to provide services in other states or countries, as well as the members’ capacity to exchange knowledge that can reduce risks in their own firm's operations, and access to other resources. Clients are in the heart of the member firms. The network’s purpose is to provide a platform to facilitate meeting members’ objectives by offering support like branding, market positioning, technical knowledge, etc.

As with all organizations, their success depends on shared objectives, long-term commitment and collaboration. Professional networks have to work very hard to become and remain successful. According to industry data and my professional experience, the most common challenges for networks are unbalanced relative contribution, differing short term vs. long term priorities, culture clashes, and incompatible styles and objectives of members. And what is the solution?! A reconciliation of at least two sets of the following: business systems, people, cultures and structures, plus added sensitivity to the cultural and environmental specificity of each member.

It makes sense, right? If you think of the leading, well-structured networks, they all share a common brand, business systems and perhaps people and organizational culture (although the latter might not always be the case). So why won’t more organizations adopt this model? Firms often perceive that these networks will impair their strong local brands, threaten the independence of their operations, and require unacceptable levels of data and relationship sharing. In sum, these concerns indicate a lack of trust and an unwillingness to incur additional cost.

Firms will get as much out of their network relationships as they are ready to contribute. Before joining (and during membership tenure), firms must make the cost/benefit analysis, assessing the true cost of the membership, beyond the annual dues, inclusive of the time and resources necessary to assign to the relationship. Firms must keep in mind that network memberships offer them a global development strategy at a fraction of the cost and time necessary to create such a strategy from scratch. They must clearly articulate their strategic objectives and ensure they are in line with the ones of the rest of the members. They must recognize that a network membership is a partnership and for it to work they have to get to know, like and trust their partners, at least the ones who share their strategic growth direction. They must be willing to commit and at the same time work to earn the respect of their partners. They must be prepared to compromise and be patient – networks are long-term commitments.

On the other hand, networks must demonstrate the value of its membership, and work to build and develop a collaborative environment. Many of the collaborative principles outlined in my article “ONE FOR ALL: ALL FOR ONE” are applicable here. Networks must enable relationship building and knowledge sharing. Joint training and development of professionals’ technical and advisory skills are essential. While networks must set clear expectations and contributions, they must recognize and allow for flexibility. Markets and conditions change and so will members’ circumstances. Networks must offer and maintain shared backbone business systems, and request member adoption or compatibility. This is a much less burdensome process today because so many firms are technologically savvy and more willing and able to integrate new systems. Last but not least, networks must take a segmented approach to serving its members. They must assess their capabilities, gauge their involvement interest, and engage them accordingly.

Making professional networks work is a complex process with a multi-party commitment. It can certainly be a worthwhile venture for both the network and its members as long as there are shared objectives, long-term commitment, and collaboration.

© 2010-2013 Copyright Mira Ilieva-Leonard / iStile All rights reserved

GROWING PAINS: HOW TO IDENTIFY AND ELIMINATE THEM

Focus business growth resources and attention where it counts

I often ask leaders of professional services firms “What is holding back their business growth?” Rarely do I get a clear answer. Why is it that most professional services firms do not have a grasp of their business growth process? How can they know how to solve their business growth issues, and where to focus resources and attention, if they don’t recognize the problems at hand? I often hear the excuses like “it’s the economy”, “the competitors,” and “it’s the people” but, I rarely ever hear plainly articulated points such us: “it’s converting leads into proposals,” “it is the win/loss rate”. In my experience, a leader can troubleshoot those growth pains and address them properly only when he or she has a full picture of the business growth pipeline and can clearly identify bottlenecks. Here are a few questions to help you, leaders of professional services firms, identify where you might have business growth leakage. Start by examining your business growth pipeline. Where’s the bottleneck? Lead generation, conversion, client retention rate, etc…

How are you loading your pipeline? Are you measuring the quality and quantity of your leads? If you are not, consider launching a process to help you do so. Knowing the sources of business so that you best spend your limited money and time is significant to the business growth process. Calculating ROI on marketing and BD spent is a sound, but unfortunately uncommon practice.

How often are you connecting with leads to build awareness and how? Traditional marketing dictates that in order for a message to come across it needs to reach its audience three times (3x). This conventional wisdom is challenged, as recently demonstrated by the Edelman’s Trust Study (see "Edelman Trust Barometer: Where is the Trust?”) and today, it takes a minimum of 5x for a message to resonate. It’s double the work for marketing and communication specialists. The good news is that social media is providing a cost efficient way to communicate and engage with audiences. The bad news is that social media has also created a massive clutter of data and communication apathy. Staying consistent, on point, focused on quality content and respectful is the key to cut through the information mess and connect with your audiences in a meaningful way.

What is your conversion rate? How many of your leads become actual prospects? If the number is too low, consider changing and/or increasing the marketing and BD tactics (thought leadership initiatives at this level work best for professional service firms) to better and more frequently position you in front of prospects, allowing you to demonstrate your technical capabilities, engage in dialogue and identify opportunities. What’s the velocity of your pipeline? Do you have a massive number of proposals that are not moving forward? Why are they not moving forward? Have you rushed into a proposal without fully understanding the situation: the need, the stakeholders, and the purchasing decision making process? If so, work on your advisory and problem solving skills to learn to better scope the problem, and in the process to better help the prospect and move to the next stage of the business growth process.

What is your proposal win/loss rate? What can you do to improve it? If your rate is low, question the reasons: is it pricing or is it the solution? If the latter, take a look at the pipeline velocity questions above and work on improving the problem solving skills (are we solving the right problem?) and solutions offerings (do we have the proper solution?). Professional services firms often bypass an important stage in the business growth process: education, and jump immediately from awareness to sale - this is frequently seen when a firm participates in an RFP or beauty contest. It is likely your pipeline is filled with these opportunities and therefore, whether you know it or not, you are competing mainly on pricing. This is a good place to stop and re-examine your current (and aspirational) position in the market: are you a low cost provider, or a high-end, value-adding adviser? You cannot be both successfully. There are only a select few organizations that can afford to be both and flourish in the long term. If you choose to be a low cost provider, RFP’s are a viable channel to fill your pipeline. In this case, if the win/loss rate is low then I would suggest you revisit your pricing strategies, analyze your efficiencies, and examine how your relationships are managed. You see, even with RFP’s where pricing is usually the lead selection criterion, relationships do matter. Thus, the education stage can mean relationship development.

What is the retention rate of clients? How many of your clients’ needs are you satisfying? How many of your clients are willing to try other of your service offerings and are recommending you to peers? Businesses exist because of a need or love for their services, products, etc. If you can master to win on both counts, you’ve reached the holy grail of business. Thus far, professional service providers have relied on the need of their services and have completely ignored the second, building loyalty. To sustain, if not even grow business, that approach is no longer an option. A couple of months ago I referred to the latest Financial Times survey on Efficient Client Adviser relationships and the importance of the clients’ recommendations it highlights: commercial awareness, added value services, contribution of management and people support. All of these call attention to building trust and loyalty between clients and their professional service providers. If you are having troubles expanding your client relationships or your client retention rate is deteriorating, take a closer look at those points, and better yet, talk to your clients.

Now that you have a few key questions to help you identify the bottlenecks in your business growth process, I urge you to assess your business growth tactics. Hopefully (and most importantly), your firm has a system in place to address the answers to those questions. Look for more on that and how to best leverage your assets in the next segment of this blog.

© 2010-2013 Copyright Mira Ilieva Leonard / iStile All rights reserved

EDELMAN TRUST BAROMETER: WHERE IS THE TRUST

How to go about building and sustaining it?

For over a decade Edelman, one of the largest and independent public relations firms, has been researching and publishing an annual study of the state of global consumer trust. The results have customarily been revealed during an event, called “Edelman’s Trust Breakfast.” Four years ago, while witnessing one of the most disastrous global financial crises, I had the opportunity to attend the event and hear the discoveries of the study first hand. Now, at the dawn of a very public act of distrust - the confession of one of the most celebrated athletes of our time, Lance Armstrong - I am glad to review the recently published study, titled “Crisis of Leadership,” compare it to the study from four years back, and report a few positive trends.

GENERAL FINDINGS
2009: US consumers have generally lost trust in the business sector and especially when it comes to certain industries like banking and automotive. Biotech and technology are the least affected areas due to the idea of innovation and hope that consumers attribute to both of these fields. What that meant to professional services firms (“PSFs”): biotech and technology will most probably experience the highest growth in the upcoming years and we should position our practices / industry groups for that.

2013: Trust free-fall has finally come to a halt; more than that, it is stabilizing and even improving for some countries (Germany, France, UK, France, etc.) While trust is on a rise for institutions – after dips in 2009 and 2012 – the gap in trust between businesses and governments is still significant, with NGO’s and businesses leading the way. Technology remains the most trusted industry sector. While the Automotive industry has been able to regain consumers’ trust since 2009, understandably the Banking and Finance sectors are yet again at the low end of consumer trust barometer. What that means to PSFs: True to my 2009 forecast, organizations should continue to invest in their Technology-focused strategies. Even with the low trust ratings, firms with strong Banking and Finance capabilities should stay close to their Finance clients, many of whom will need help rebuilding their images.

SIZE & LOCATION MATTER
2009: While consumers have lost trust in corporate America, they will be most willing to trust small size and entrepreneurial organizations, because they can get to know the leaders, especially those who are hands-on with the organizations and have direct control over them, and they are overall more transparent. What that meant to PSFs: look for opportunities with emerging small and entrepreneurial organizations.

2013: Small businesses are still trusted more in the West while the big businesses have the upper hand in the emerging markets. Businesses headquartered in the Southern European States and the BRICS are lagging in acquiring consumer trust in comparison to the ones based out the developed countries such as Germany, Sweden, Switzerland, UK, US, and others. What that means to PSFs: Consider how this affects your and clients global development strategy and make the necessary adjustments. Continue to look for opportunities with small and mid-cap clients in the developed economies and align yourself with the leading brands in the emerging ones. Keep in mind that the geographic location where you and your clients conduct business has become even more important.

WHAT INFORMATION SOURCES WOULD CONSUMERS TRUST?
2009: Surprisingly, internet-based information doesn’t appear to be considered as a reliable source as one might believe, even with the younger generation. Market analysts and business articles seem to be some of the most credible sources, though friends and employees follow very closely. What that meant to PSFs: Company websites providing their own information and statements are no longer enough. Include client testimonials and quotes from current and alumni employees in your materials. Give your advocates venues like websites, public events and annual reports to underwrite you.

2013: Trust in media has gone up since 2009, “as a result of diversification of options and strong coverage of scandals.” The older generation (aka decision makers) prefers traditional media in the developed markets; in the emerging ones, trust is evenly spread out across the communication spectrum – from traditional to social media. While trust in CEO’s has increased, consumers continue to consider academics, technical experts and people like themselves as the most credible sources. What that means to PSFs: These are important findings for marketing and communication experts. They should keep them in mind when selecting media delivery channels and spokespeople.

HOW LONG DOES IT TAKE TO MAKE A MESSAGE VISIBLE AND BELIEVABLE?
2009: The marketing communication norm that it takes 3x to communicate a message for it to register is no longer valid. Given the current consumer cynicism it appears it takes closer to 5x for a message to make an impact and to become believable. What that meant to PSFs: increase the frequency and consistency of your messaging. Keep in mind your statements will be questioned, so be clear, precise and consistent.

2013: Consumer skepticism carries on; majority of consumers still need to hear a message between 3-5 times to find it believable. What that means to PSFs: My 2009 prescription is still valid. Pump up the volume. Keep your messaging simple, short and to the point, articulating the value to your clients opposed to solely boasting accomplishments.

HOW DO WE BUILD AND SUSTAIN TRUST AND RELATIONSHIPS?
2009: Trust is fragile and hard to come by today. Reframe your thinking and hone in on the following trust building elements:

Diplomacy - demonstrate your corporate responsibility; take a stand on global issues like regulatory ones; get your leaders out in the community and make sure they are actively involved and offering solutions.

Social responsibility - clients and their customers will be looking for what your organization stands for and how you go about demonstrating that. If being “green” is important to your organization make sure your clients know about it, not only by telling them but also by showing them.

Shared sacrifices – “walk the talk;” communicate to your clients and prospects what your organization is doing to share their burden (i.e. instead of spending on a large client Holiday party make a donation on their behalf, etc.)

Continuous conversation – open two way communication lines with your clients via blogs, intranets, client interviews, etc. More than ever clients would like to share with you their experience, both good and bad, and in order to keep their trust you should be willing to listen and take notes.

The bottom line: service and leadership as well as authenticity and transparency will matter the most in sustaining and building relationships.

2013: The need for organizations to go above and beyond operations to build trust is clear. While this year Edelman has expanded and segmented the trust building attributes into five main components: engagement, integrity, product & services, purpose and operations, my 2009 recommendations listed above remain important and valid. Engage your clients and employees and increase the two way communication. Be transparent and take responsibility for actions. Consistently deliver quality services and exceed clients’ expectations. Shift behavior from “license to operate to license to lead” and embrace a model of inclusive management.

For copies of Edelman’s Trust reports, visit the following website:
http://www.edelman.com/trust-downloads/global-results-2/
http://www.edelman.com/trust/2009/

Portions adapted from the Series "Oldies but Goodies": The Lost Trust (first version published Wednesday March 4, 2009 by Mira Ilieva Leonard, Partner, Creative Growth Group)

© 2010-2013 Copyright Mira Ilieva Leonard / iStile All rights reserved

ONE FOR ALL: ALL FOR ONE

Collaboration: a key ingredient for successful development of professional services organizations?

Earlier in the year, after writing an article about narcissistic behavior in professional services firms (PSF’s), “For the Greater Good or Eat What You Kill”, I promised a piece on the importance of collaboration and the impact it has on the overall development of PSF’s. The subject has been on my mind ever since. Recently though, I experienced a few events which have reinforced my strong belief in the idea. One of them is a meeting with the managing partner of a mid-sized PSF who, much to my pleasant surprise, not only understood the value of collaboration, but was also able to demonstrate the direct and impressive business progress as a result of it. You see, most of the PSF’s I’ve worked with employ the “eat what you kill” mentality. If you’ve read my previous pieces you’d know I believe this mentality has mostly counterproductive effects on the development of PSF’s. My conversation with that managing partner was one of the most positive experiences I’ve had in a while. I can’t help but ask myself what’s different about that firm, its culture and its leadership team that allows them to embrace collaboration and sets them apart from the rest and, in my opinion, makes them “progressive.” That, however, is a different question I’ll leave for another time and perhaps an interview with that managing partner.

Before I move on to the other event that pushed me to write this piece, let me take time to articulate the importance of building a collaborative environment in PSF’s. It encourages learning and development, critical for knowledge-based organizations such as PSF’s, turns knowledge into action, which closes “knowing-doing” gaps, and increases the chances to grow business and succeed in the market place. To elaborate on the latter, PSF’s collaboration provides confidence to existing clients that the firm will provide the necessary resources to support them along with richer ideas and solutions; for new clients, collaboration means a stronger and deeper team and higher chances for both the client and the advisor to identify someone to connect with and build trust, and this builds stronger, better relationships between clients and advisors…after all, people like to work with people who they like and trust. When it comes to client development, collaboration helps alleviate the burdensome stigma of sales. Working as a part of a team makes that experience less onerous, and promotes best practice sharing, while keeping everyone accountable. Those are all significant factors for successful and sustainable business growth.

The merits of collaboration within PSF’s are countless. The real question is how to build and nurture such collaborative spirit. I discovered an answer that supports my hypothesis in the most unusual place. I recently stumbled upon an article in the Scientific American, from July 2012, titled “Why we help,” and this article provided the final push I needed to write this piece. The author, Martin Nowak, a professor of biology and mathematics at Harvard University, argues that contrary to what the majority of us might think of evolution and the “dog-eat-dog” concept of survival as its underpinning, cooperation is the driving force for evolution. Using the game theory paradox called the “Prisoner’s Dilemma,” the scientist runs a number of simulations to identify five mechanisms for the evolution of cooperators: direct reciprocity (the “tit for tat” concept), special selection (neighbors or friends in social network tend to help each other and develop a snowball effect), kin selection (think “The Godfather”), indirect reciprocity (based on reputation and “pay it forward” principle) and lastly, group selection (for the greater good). Nowak draws on a number of examples from the animal kingdom and makes a surprising conclusion that humankind is the most cooperative species, mainly driven by the principle of indirect reciprocity, or reputation and the ability to tout achievements. So, would that mean a bit of narcissistic thinking, boasting and peer pressure is not only healthy, but necessary for evolution and collaboration? Yes and no. The professor employs game theory again, this time a series of games called “Public Goods Games” designed for multiple players, to demonstrate that when in a group environment, even when starting with good intentions, collaboration often fails. Individuals will often act in a manner where self-benefit, rather than group benefit, becomes the individual’s preferred option, ultimately resulting in a loss for everyone. With further experiments, and to save my faith in the goodness of humanity, the author offers a solution to fostering collaboration: people need to be convinced that there’s a real problem threatening them in order to adopt “for the greater good” behavior and also be publicly praised and pressured in line with the reputation principle. One could see this sort of framework helping in many different kinds of situations – from officials trying to solve the European debt crisis or U.S. fiscal cliff negotiations, to any kind of business organization including PSF’s.

In my previous writing I suggested making the system / organization the star to build and foster collaborative environments instead of promoting and rewarding individual performance. Applying the principles articulated in Nowak’s work, I can now expand and prescribe that PSF’s constantly must demonstrate and communicate the importance of growing the organization and the danger of not doing so to the business; become vocal in celebrating client development accomplishments and equally so to learn from failures; and nurture an environment where experimenting with innovative ideas is welcomed.

© 2010-2013 Copyright Mira Ilieva Leonard / iStile All rights reserved

Got Growth: how to position your organization for strategic growth and business model renewal?

A PaperJam Business Club Workshop | January 15th, 2013 | Luxembourg

Per request, please find the framework of the workshop presentation.

Got Growth: How to position your organization for Strategic Growth and Business Model Renewal? from Mira Ilieva Leonard

Like most organizations today, you are probably experiencing increased pressure from your clients, demanding high service at lower prices. That, coupled with the global downfall and near future economic uncertainty, incrementally impacts your organization’s profit margins. In addition to these factors, requiring immediate attention, your organization also faces a more fundamental problem: the need for radical business model renewal driven by the changing regulatory environment and the diminishing value of the “Lux Factor”.

So, how do you go about turning these challenges into opportunities? Join the session and learn how to focus and become strategic and efficient in growing your organization’s business, re-energize and enhance your executive team, and prepare to transform your business into less dependent on the “Lux factor”.

During this workshop you and your fellow peer executives will receive a process for developing and executing your growth strategy, frameworks to find and seize growth opportunities for new markets, prospects and business models, an overview of the necessary internal organization and capabilities to support your growth strategy, a checklist for evaluating your organization’s existing growth strategy and related capabilities and a ”no frills attached” ½ day follow-up growth readiness assessment.

For additional details and to join me and my colleague +Marc Sniukas (Doujak Corporate Development), visit: PaperJam Business Club

© 2010-2013 Copyright Mira Ilieva Leonard / iStile All rights reserved

Systematic approach to business growth

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

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