The Power of choice architecture to influence change in professional services firms

Exploring ways to affect sustainable change

Change is challenging and even more formidable in professional services firms. It takes two willing and able participants: professionals and organizations. In my last post, I zeroed in on the fast and inevitable pace of change and the individuals' struggles, especially in the professional services domain. I also offered a few tips on accepting and embracing change individually. I received several positive comments from professionals who related to the struggles and the recommended approach. In this post, I'll focus on the responsibility of organizations to enable an appealing and successful change journey by leveraging choice architects.

Choice architecture, as you may know, is a term coined by Richard Thaler and Cass Sunstein in their widely regarded book, "Nudge." The premise is that we all make decisions influenced by the environment, and those who create the background, also known as choice architects, can influence decision-making without forcing pre-defined outcomes. I am a big fan of the concept. It can be compelling in professional services firms, where highly educated and knowledgeable professionals may push back on mandates and change initiatives. They, however, may embrace the opportunity to make their own decisions and follow a change roadmap on their terms. This framework can also be equally valuable in designing client acquisition journeys where clients make choices to fit their requirements and priorities.

The good news is that organizations have a ton of choice architects (we all are!). Inviting professionals to technical training makes you a choice architect. You are a choice architect when you create a feedback form for clients and employees to complete. I suspect you don't fully appreciate the power and responsibility of being a choice architect or leveraging such functions and the choice architecture framework to influence change. I know I need to remember at times!  

The other good news is that the choice architecture frameworks are very effective, even if simplified, as illustrated below. They enable architects to consider how to influence behavior by presenting choices simply and attractively and encourage them to think about how to package options and when and where to offer them. The process takes time and design thinking to map the specific behavior journey. They call for feedback mechanisms to provide real-time views, analysis, opportunities for potential modifications of the various choices, and an incentive system aligned with the journey and the key stakeholders. Technology can enable that process further. More on that in the next post.

For now, please reflect on some of your change priorities, who are your choice architects, and how can you and they embrace the choice architecture framework to influence change in a palatable way. The opportunity is too big to ignore.

So, you think you can't change? Think again.

This one goes to all professionals avoiding and struggling with change.

Let me let you in on a secret – things are not going back the way they used to be! It's time to accept it. I'd recommend that you own it and even embrace it because change as you see it will not stop today or tomorrow. Driven by factors outside of our control, the unprecedented volume and velocity of change we've been experiencing will only continue at an accelerated pace. Your employees are not going back to the office – you need to learn how to manage, grow and develop them in a new setting. Your clients will no longer settle for the legacy approach of transactional services exchange. They are looking for a trustworthy advisor who will proactively offer ideas, advocate for them, and look for ways to create value even when the client doesn't think there are ways to create value. Waiting for things to return to "normal" is no longer an option, so please do yourself a favor and move on. 

For the past 20 + years, I've been working with professional services firms to design and implement a culture of growth, which has meant driving change at all levels. My kindle is stacked with books like "Change or Die," "The Catalyst," "Flying without a net," and many others authored by some of the best and brightest minds. They offer a ton of tested frameworks. I love Alan Deutschman's three step process of a "relate, reframe and repeat," and I have used it successfully many times, for example. I live change. My eight-year-old reminds me that things will not pause for me to prepare for change. The proverbial train keeps going, with or without me. And, same for everyone else, so why not get on it?! 

I also know how difficult change can be for people. And I don't blame them. In his book Alan Deutschman's references how extremely challenging change can be and offers an example that often even when people have the option to change and prevent death, they still struggle. We are talking about change or die – it’s that difficult. Talk about professionals with multiple advanced degrees, especially if they've been successful in the past. Why would they consider change? I can see that, can you? Past success, however, is in no way an indicator of future one, specifically when facts and circumstances change. The universal law of survival is more prevalent today than ever – the human who can adapt, evolve, upskill the fastest are the ones who will grow and succeed. 

So, what do you do about it? To get unstuck, I'd think of it as a long-distance run, not a sprint, and approach it accordingly. Start with your responsibility. Accept that things are going to change and what's today will be different tomorrow, and you need to reframe your thinking. Please acknowledge that you may need help managing this process. Like I suggest above, there’s a ton of great thought leadership to challenge and support you. Carol Dweck’s “Mindset” is a great way to start the process. Other help may come in different shapes and sizes: a team to discuss and support one another, a mentor that's there to listen and provide feedback – find what works for you. All of this calls for reskilling. Some may be technical skills, and some may be soft ones like communication, collaboration, etc. Set goals, and work on them, taking small steps. Focus on learning. Don't get discouraged. There will be a time you fall back on the "old ways of thinking." Recognize that, and consider how else you can approach things. Challenge your assumptions constantly. Celebrate wins and the confidence that comes with them. Bring your team along. Model it for them and work through it together. Change is fun when we drive it as a team. If I can do it, you can too. As we launch into 2022, in place of new resolutions, invest in the one thing that will make you successful in both the short and long-term – develop capacity to change. 

In the next post of this series, I’ll talk about how organizations can support this endeavor.

YEARN TO LEARN...AND GROW

Adopt a new state of mind to succeed next year, and in the long run

Because I am intrigued by the success stories behind some of the most acclaimed individuals, earlier this year I picked up the highly talked about "Grit: The Power of Passion and Perseverance.” Among the numerous insightful points, the book brought up the importance of never-ending desire to experiment, learn and develop – do / be better. It turns out, these are some of the key traits of highly successful individuals. Sure enough – I see it with the professionals I know. The most accomplished ones are the embodiment of perpetual learning. They avoid complacency at all cost and look forward to understanding or better yet, creating, the next best thing. There’s much more to success of course, but the notion of learning as its cornerstone has come across my reading and work in the past.

Awhile back I wrote a blog post that alongside articles, personal observations and the book: “The Fifth Discipline: The Art And Practice Of The Learning Organization” developed the premise that in order for professional service organizations to evolve they should become learning organizations. In other words, if service firms could figure out how to inspire and scale behavior that applauds inquiry, open-mindedness, challenges existing norms and rewards learning, they would outperform competitors and thrive. As we are about to close the year and embark on a journey of personal and professional resolutions, I thought it’s only fitting to repost this article.

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SYSTEMATIC APPROACH TO BUSINESS GROWTH

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 of the challenges they face, and especially the ones related to business growth.

“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 and 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 learning organizations. Before dismissing them, I'd encourage professional services leaders to read on and 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 gives a glimpse of what lays behind the limited success of professional development programs.

Mental Models are generalizations, assumptions, perceptions, patterns of reasoning that influence professionals’ behavior and actions. Mental models can impede and bring to halt important change management exercises. The real challenge is that mental models exist below professionals’ consciousness and as such remain unexamined, hence unchanged. Keeping mental models unchallenged is less risky and comfortable. The opportunity rests with the process of acknowledging and bringing up the current mental models to the surface, testing them and building new ones. For professional services firms that means promoting a culture that calls for collaborative challenging thinking, openness and merit, and skills of reflection and inquiry…a culture that eliminates the “this is how we’ve always got things done” mentality, and asks how well that’s worked in the past and promote “how else” considerations. To create such environment, organizations should discourage reactive and mechanical thinking, accept that there is more than one way to look at complex issues and that different cultures, backgrounds and experiences will influence how professionals see and interpret facts. They should aim to shift professionals’ thinking from winning arguments to finding the best solution and to build safe climate to where professionals feel comfortable to acknowledge reasoning flaws, lack of knowledge or proper factual support. This open-minded approach is especially important to business growth and the rate of success of adopting the processes and tactical tools to support it. Such thinking needs to be encouraged beyond a two day seminar; it needs to be built-in the regular management practices.

The process of aligning and developing the capacity of a team to create the results the team truly desire is defined as Team Learning. It introduces the need to think about complex issues and innovate, the role of other team members, and mastering the process of dialogue and discussion. It brings out the reasoning behind defensive behavior and shifting blame. “Systems thinking is especially prone to evoking defensiveness because its central message that our actions create our reality,” states Senge and again, I agree. Professional services firms are staffed with professionals with multiple advanced degrees, considered experts. They exhibit confidence and believe that they know everything or are expected to know everything, and to protect these beliefs they reject alternative solutions, remain rigid and obscure their ignorance. Such organizations often nurture a culture where to have incomplete or faulty understanding is a sign of weakness, or worse, incompetence. However, it is such defensiveness that is holding professionals back from testing the validity of their reasoning and openness to exploring new solutions for their clients or organizations. This behavior is in the core of “narcissistic behavior,” which as I’ve stated in the past, limits professional services firms’ growth. To break the mold, firms should consider developing a process that calls for reflection, inquiry and dialogue.

Personal Mastery encourages curiosity and continuous yearning to development. It provides the ultimate employee drive and satisfaction, and in turn, it offers organizations the employees’ continuous organizational contribution and commitment. Professional services firms are knowledge based ones, and continual education is not only encouraged, but required in the form of CLE, CPE, and other courses to retain professional accreditation. Yet, what I find interesting is their general disregard of professionals' personal development. Firms might consider offering alternatives to the traditional career development paths and allowing their professionals to self select what they deem might suit them best. This calls for HR services above and beyond currently employed by firms. Grow people – grow business - grow organizations.

The last principle, Shared Vision, provides a sense of coherence and answers what type of organizations professionals aspire to build. While considered “soft” and often disregarded, it provides focus and energy for learning. Visions are often imposed rather than inspired and aligned with professionals personal visions (hence the issue with compliance vs commitment). They die quickly due to the lack of clarity and communication, or due to shift of focus, driven by the demands of the current reality. They focus on today’s problems rather than tomorrow’s opportunities. If long term organizational growth and development is an objective, encourage building personal visions and weaving them into a common shared vision. LISTEN. Let professionals choose for themselves.

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 sharing - 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

It's all about SALES

Over the past year I've collected, and randomly shared, a number of articles on the subject of sales: organization, process, skills and development. Here's a selection to reinvigorate your sales thinking, actions and results.

What Salespeople Need to Know About the New B2B Landscape: a Gartner study
As the sales process is shifting towards a consultative one in order to stay calibrated with the dynamic buying process, the importance of sales professionals as well as the marketing and thought leadership tools they use is greater than ever. Read on HERE to find out why and what to do about it.

What Top Sales Teams have in Common
High quality of the sales organization, a structured sales process, and accountability of the sale’s team members separates high-performing organizations from average and underperforming sales organizations. For additional criteria and details, read on HERE.

What Makes Great Salespeople
Spending more time with your clients, your colleagues, and your marketing and sales support team, as well as dedicating more quality time to selling, leads to better business growth results. Read HERE for supporting information.

What Separates the Strongest Salespeople from the Weakest
To improve your business growth results, increase the level of your communications skills, bump up your competitive streak, confidently lead your client conversations, stay positive while questioning your clients and their problems, and work with high performing business growth leaders. Click HERE for details.

How to Really Motivate Salespeople
Adopt individualized and simple compensation models, set reasonable goals and experiment with the rewards systems to find the most effective and efficient one for your organization. Click HERE to read more about motivating salespeople.

SHARE | Change and risk management tips for law firms from Managing Partner magazine

"SHARE" is the new format I've selected to post articles, tips, insights, videos, etc. of interest, authored by others

To succeed in a continuously evolving environment, law firms must accept risk management as a business growth enabler, appoint experienced business advisors to their leadership ranks, embrace change management training & establish a culture of readiness for change. See Managing Partner for details: https://lnkd.in/b9pAgQ5

IT TAKES TWO TO TANGO…AND GROW AN ORGANIZATION

The roles of the firm and the professionals in business growth

Professional service providers (lawyers, accountants, consultants, etc.) elect to join firms for many reasons: technical and administrative support, built-in infrastructure, environment of colleagueship and continual education, brand, etc. There are two main components to the partnership model - the partnership and its executive management, on the one hand, and the individual professionals, on the other. The model seems to work in most aspects of the business, but often fails when it comes to business growth, however. When implementing a growth strategy, I often see situations where management blames the individuals, and vice versa, when the firm’s growth goals are not realized. Why is that, and who is really to blame?

My strategy development projects require me to work with both firm management and its individual professionals. Over the course of the project however, I sometimes find myself working primarily with one or the other. In that role, I get a close view of the dynamics and dysfunctions of this partnership model, especially as it relates to business growth. I hear objections and complaints - some valid ones - about what’s holding back individual and firm business growth. Instead of playing a mediator or defender, I spend a considerable time explaining the business growth roles of the firm and its professionals. So, I decided to take a few minutes and spell it out: it takes two to tango. In order for organizations to experience sustainable and smart business growth, both parties – the firm and its technical professionals - should accept their business growth responsibilities and work to deliver them.

It starts with the visible disconnect between a firm strategic direction and the one of its individual practitioners…it is a recurring case, unfortunately. Firms should take individual professionals’ business growth goals and activities into consideration when developing strategic development plans. In addition to looking outwards for market trends and competitive analysis, annual retreats should become a series of strategic conversations of how partners see growing their practices over the short term, how such objectives are within the realm of the firm’s aspirations, and how the firm can support them.

Firms tend to load the marketing budget with awareness building activities and internal marketing communication. Instead, they should invest in building internal business growth organizations that reaches beyond branding activities, and cover all steps of the business growth process. They should take a comprehensive view and ensure that this internal platform offers adequate support during the awareness building, education, sales and loyalty phases. They should provide marketing and business development resources and tools, and I am not referring to the basic websites and brochures. The firm should be able to provide thought leadership materials, target intelligence, client data, and facilitate opportunities for the professionals to engage with clients, prospects and referral sources so that they can build meaningful relationships. Firms should adopt and manage systems and processes to help track and measure business growth activities, for more efficient and effective i.e. smart growth. Most importantly, firms should equip professionals with the skills how to best use all of the above. In my professional experience, firms, which have aligned their development inspirations with that of its professionals, have invested and built internal growth engines, see considerable growth results.

Professionals tend to set business growth goals based on anecdotal information (often not due to the lack of actual data) and without regard on how they might achieve them. They should take a more strategic approach and create simple business growth plans (no more than 1-2 pages long), inclusive of measurable goals and specific tactics on how they might reach their objectives. They should get to know and utilize the tools, resources and systems provided by the firm – they are in place for them to use. Equally to their continual thirst for technical knowledge, they should strive to enhance their business growth planning and implementation skills. If professionals take advantage and leverage the full support of the firm, only then can they point elsewhere for poor business growth results.

Firm leaders, professionals, keep in mind for the next round of annual reviews: "it takes two tango". Look inwards and evaluate how you are delivering on your business growth responsibilities before shifting blame and looking for alternative business growth opportunities.

© 2010-2015 Copyright Mira Ilieva Leonard / iStile All rights reserved

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

COLLABORATE TO INCREASE BUSINESS GROWTH: PART III

Practical tips for unlocking the potential of collaboration

In Part I of the series on collaboration I made the argument that professional services organizations should strive to encourage collaboration, because it leads to business growth. In Part II, I discussed the major obstacles to collaboration, and hinted on how to overcome them. In this last segment, I will take a prescriptive approach, and outline specific measures to unlocking the potential of collaboration. As in the past, I’ll also refer to the Harvard Business Review (HBR) article and study, titled “When senior managers won’t collaborate”, and some of my past writing on the subject.

A collaborative culture must originate with the leadership team. Leaders should consider and 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. Demonstrate and communicate the importance of collaborating and 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.

Leaders should define an organizational structure and compensation models that foster sharing and cooperation, again spreading throughout the firm: back office operations, technical 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. Focus on the system not the individual superstar performance. Set firm-based, common goals, which benefit the firm as a whole rather than the individual performer. For the greater good.

Leadership must adopt a “systems thinking” way to managing professional services organizations. To do so, approach problems by identifying the source of the issues: what’s the core, not the symptom. Employ all disciplines of the systems thinking theory (refer to my past article, "Systematic approach to business growth"), 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 fail; and the “team learning” one, which casts light on what's behind the “narcissistic behavior” of professional services organizations, ultimately holding back collaboration and limiting business growth.

To my delight, the HBR survey offers professional services organizations tips similar to my prescriptions. It encourages leaders to walk the talk and show first hand by collaborating with others. Create opportunities for the team to connect and build trust. Resist the temptation to bring in rainmakers, but look for individuals with demonstrated collaborative experience. Celebrate team wins. Re-consider the compensation scheme of the firm and question how much weigh is attributed to collaboration, if any. I’ve seen some of this already take place in a few progressive organizations, where collaboration has become a factor in the compensation formula. Build a collaborative culture by tracking and rewarding non-billable collaborative initiatives such as mentoring. Enhance the knowledge sharing culture. Encourage regular workshops and secondment programs, and utilize communication technology and tools to share best practices. Develop teams to lead the way. Build collaboration in the firms’ development strategies.

The HBR survey takes a segmented approach, and in addition to the above-mentioned recommendations geared towards organizations and their leaders, it also speaks directly to individual practitioners. It recommends to professionals to be persistent. Select to collaborate with a firm influencer / rainmaker. Be fair to teammates. Communicate often and openly, and deliver on promises.

Organizational development research, as also confirmed by the HBR study, shows that organizations which build and nurture a collaborative environment manage to turn knowledge into action, share best practices and drive growth at a sustainable and fast pace. So, when examining what’s inhibiting organizational development and growth, reflect on the factors outlined above and most importantly, take immediate actions to close the know-do gaps and create collaborative culture.

For a copy of the HBR article visit: https://hbr.org/2015/03/when-senior-managers-wont-collaborate?utm_content=buffer98a13&utm_medium=social&utm_source=linkedin.com&utm_campaign=buffer

© 2010-2015 Copyright Mira Ilieva Leonard / iStile All rights reserved

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

COLLABORATE TO INCREASE BUSINESS GROWTH: PART II

Why is it so difficult for collaboration to work?

Last month I launched a three-part article on the subject of collaboration. The piece is based on my past and current research and observations, and follows a recently released Harvard Business Review (HBR) study. In Part I, I and the author of the HBR article, made the case for collaboration in professional services firms and the direct correlation to business growth. In this segment, I will focus on the challenges of making collaboration work.

The study and I are in agreement: the key factors preventing professional organizations from taking full advantage of collaboration are organizational structure, compensation model and culture.

While in several of my articles I discuss narcissistic or hyped self-preservation behavior and the lack of common strategic goals and systems in professional services firms as the main roadblocks to building a healthy collaborative environment, the compensation models and culture are just as critical for that. I’ve especially emphasized on those in my piece based on the collapse on Dewey & LaBouef. The Dewey & LaBouef case clearly demonstrates that 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.

The HBR survey notes that organizational structure, compensation systems and culture in professional services firms favor individualistic approach. Most firms still value rainmakers higher. From professionals’ standpoint that’s not a bad thing, as professionals’ security is tied to their client relationships. External recognition from professional organization rankings further influences professionals and pushes them to focus on individual performance. The last notable obstacle to collaboration, according to the survey is the lack of collaboration skills. I concur. The skills in reference here are such that go beyond the usual delegation of work to junior professionals; these skills support an advisory approach to client management of asking questions, which benefit the client, and having client conversations that reach outside of the comfortable technical points and are actual business dialogues. These collaborative skills encourage giving and receiving team member feedback, allowing both jr. and sr. level professionals to contribute and learn from one another. These are the skills that most professional service providers are not equipped with…

So, what can you do about it?

After a careful study of the characters, the various circumstances and the storyline of the events, leading to the bankruptcy of Dewey & LaBoeuf, in The New Yorker piece, “The Collapse”, James B. Stewart concludes that “cooperation and mutual respect” is at the heart of successful professional services firms. That’s the culture that successful firms foster and Dewey & LaBoeuf blatantly ignored, according to Stewart. In some of my other 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.

Stay tuned for the last segment of this series, which will take a prescriptive approach and will outline tangible points to inspire collaboration(CLICK HERE).

For a copy of the HBR article visit: https://hbr.org/2015/03/when-senior-managers-wont-collaborate?utm_content=buffer98a13&utm_medium=social&utm_source=linkedin.com&utm_campaign=buffer

© 2010-2015 Copyright Mira Ilieva Leonard / iStile All rights reserved

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

COLLABORATE TO INCREASE BUSINESS GROWTH: PART I

HBR study confirms that collaboration in professional services firms leads to financial rewards

Nearly 3 years ago I launched a series of articles on the subject of collaboration among professionals from professional services firms (law, accounting, tax, consulting, etc.). I wrote about the importance of collaboration to firms’ organizational development and business growth, the reasons behind the visible resistance to it, and how to overcome such resistance and take full advantage of collaboration. Even though some of my blog entries might be considered polarizing, the theme of collaboration has repeatedly appeared in many of my articles. I am glad to see the findings and statistics of a recently released HBR study on collaboration validate my hypothesis and emphasize the importance of collaboration to professional services firms.

As a result of examining collaborative behavior of professional services firms over the past couple of years, Professor Gardner (a lecturer at the Harvard Law School) recently released her findings in an HBR article, titled “When senior managers won’t collaborate.” The key sentiment of it is in line with much of my beliefs: when professionals work together to collaborate everybody wins!

Why collaborate? In my “One for all, all for one" article of December 2012, I spelled out the benefits of collaboration. Collaboration encourages learning and development (critical for knowledge-based organizations such as PSFs), turns knowledge into action (which closes “knowing-doing” gaps), and increases the opportunities to grow business and succeed in the market place. Collaboration in PSFs provides confidence to existing clients that the firm will provide the necessary resources to support them and provide fresh 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 which 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 alleviates the burdensome stigma of sales. Working as a part of a team makes that experience less onerous, and promotes best practices sharing, while keeping everyone accountable.

Equipped with statistics and historical financial data, the HBR study backs up my words and demonstrates direct financial benefits of collaboration to the firm. When professionals collaborate, it results in the involvement of more practice areas, creates higher margin work, and institutionalizes client relationships. Thus, it becomes harder to replace an entire team of advisors and it becomes equally difficult for a departing partner to walk away with a client.

The HBR study goes on to outline the benefits to professionals as well. When team members get to know one another they become more likely to refer work among themselves. I often tell my clients: you have to work as hard to develop relationships with your internal partners as with external referral sources; they need to know you and trust you before they put their reputation on the line for you. The study has made an interesting observation here: collaborative professionals benefit from a steady stream of business even during slow periods due to their diversified skills, which further allows professionals to work on a variety of projects, and continue to collaborate. Collaboration creates a very beneficial feedback loop.

If the benefits are so overwhelmingly clear, why is it so difficult for collaboration to work in professional services firms? Stay tuned for my next article on the subject, which will examine the roadblocks to building and managing collaborative environment (CLICK HERE).

For a copy of the HBR article, click HERE.

© 2010-2015 Copyright Mira Ilieva Leonard / iStile All rights reserved

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

THE PROFESSIONAL NETWORKS MODEL: EVOLVING TO STAY RELEVANT?

A series of questions and recommendations from the leading minds in the field

Professional networks have become the norm when it comes to connecting independent professional services firms in order for them to better serve clients and offer global solutions. As I indicated in my article “Making Professional Networks Work” when both the member firms and the network have shared objectives, long-term commitments, and clear expectations, that formula can be extremely powerful. However, that’s easier said than done! Many member firms I’ve worked with are struggling to justify their network involvement and investment, and are increasingly questioning the validity of the network model.

During my extensive experience with networks and their member firms, I’ve had the privilege to collaborate with a number of forward thinking network leaders. James Mendelssohn is certainly one of them. James is a Chairman of one such network, MSI Global Alliance (MSI) and a highly sought-after consultant focused on network management and leadership issues with Firm Management Associates. I was thrilled when James recently agreed to share some of the content he’s developing - alongside Quentin Vaile, former head of the international network at the UK law firm Berwin Leighton Paisner - on the future model of professional networks. Below, please find the first several articles of the series. I hope that you will find their thoughts and recommendations of interest and will follow their writings, as this blog will.

“PROFESSIONAL SERVICES NETWORKS – A VIABLE BUSINESS MODEL FOR THE FUTURE?”

This is the first in a series of blogs that will look at the world of professional services networks; their future; different business models that can be followed to ensure their success; and what member firms need to do to capitalise on their membership of such networks.

There are some strong networks out there, and others that are struggling. There are some good member firms of networks, and others that are members for entirely the wrong reasons or with totally unrealistic expectations. We’ll be looking at all of this, and we won’t be pulling our punches. Some may find our comments uncomfortable and will undoubtedly stick their heads (even further) into the sand. Others, I hope, will accept them in the spirit with which they are offered and consider changes that may lead to the long-term sustainability of their organisations.

For the full article, click HERE.

“DO PROFESSIONAL SERVICES NETWORKS HAVE A FUTURE?”

The professional services world is changing – and probably faster today than at any time in the past. The principal reasons for this are twofold; and these converging pressures create the perfect storm for change. First, client needs are changing. One in five SMEs in the UK now trades overseas. And if you discount the high number of very small traders who are never going to look beyond these shores, then the proportion is clearly much higher amongst those businesses that many professional services firms would consider to be prime targets. Demand from clients for their advisers to be able to respond to an international enquiry has never been higher. Secondly, the professions are changing. Of course, the professions are always changing, but the pace of change within the professions at a local and national level is now having a very marked impact on the way in which firms are able to service their clients overseas.

If you take these two factors within the context of many people, in both their personal and business lives, believing that big is not always best (just look at the shift in retailing patterns over recent years), then the need both for networks to look critically at themselves, and also for those firms that either within a network or considering joining one, to review their motivation, and see whether their objectives are being met, has never been stronger.

For the full article, click HERE.

“CHANGING THE MODEL OF PROFESSIONAL SERVICES NETWORKS – ONE FIRM, ONE VOTE”

‘Partnership is not a great management approach at a single office level. And when you translate that into the international arena, it is a disaster. Democracy within the typical network business model is all very well in theory, but in practice …’ That comment from my previous blog certainly struck a chord, and so for the next few blogs, I plan to focus on various aspects of network governance where democracy sometimes emerges … but not always with the desired results.

With many networks set up as membership organisations, the concept of member participation in the governance process is often embodied in the constitution. Indeed, I know of one network where each member firm, whatever their size, gets one vote on each important decision. And, if the network wishes to appoint a new member firm, then 75% of the membership has to vote in favour. Very democratic, perhaps, but a complete nightmare. Not just because of the administrative problem of trying to get that number of firms to actually vote, but it totally undermines the position of the team whose task it is to appoint new members. What do people from the other side of the world know about a particular firm that someone who has visited and reviewed that firm do not?

For the full article, click HERE.

CHANGING THE MODEL OF PROFESSIONAL SERVICES NETWORKS – WHO SITS ON YOUR BOARD?

The ‘one firm, one vote’ concept, still adopted by many groups (largely because of their inability to change rather than a belief that this is a good model for any other than the smallest firms), may appear to be democratic, but in reality it simply hinders the logical decision-making process. Some groups have managed to vest the management of the group to a small Board of Directors, and they will normally have significant powers, with only key issues being put to the membership as a whole. And therein lies the problem. Or, in fact, two problems.

First, while day-to-day management becomes more efficient, fundamental issues of change remain within the domain of the membership as a whole, with all their diverse interests. Turkeys don’t vote for Christmas, and member firms in membership organisations are primarily driven by the interests of their particular firm, rather than the organisation as a whole. That’s fine if votes on key issues are decided by a simple majority, but I know of at least one large network that requires a 75% majority on any decision of substance.

Secondly, it is fine to vest management in a Board of Directors, but who sits on that Board? Well, almost without exception, the Board comprises senior partners from a number of the larger member firms, together with the senior employee, normally the Chief Executive or Executive Director. Whilst these are normally, I am sure, worthy men and women, there is absolutely no doubt that the most important thing in their business lives will be their own firm, and not the membership organisation of which their firm is a member. So unless the situation is well managed, there is an inevitable conflict of interests.
…
The more ‘corporate’ the structure can become, with directors who really distinguish between their different roles, the more likely it is that the network will succeed and flourish.

For the complete article, click HERE.

© 2010-2015 Copyright Mira Ilieva Leonard / iStile All rights reserved

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

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

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.

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