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

BE HUMAN, EVEN IF YOUR CAREER DOESN’T DEPEND ON IT

The importance of the human element for professional service providers is increasing

I recently came across Bill Fischer’s article, “The end of expertise” (HBR 2015), which questions the long-term existence of knowledge based organizations in their current form. Threatened by the increasing commoditization of knowledge and perceived expertise, and the low-cost, immediate results driven buyers' behavior, the author argues that soft skills and emotional intelligence are becoming unique differentiators for professionals and their firms. I couldn't agree more. While often undervalued, how you do what you do has always been an essential component of successful and sustainable client-expert advisor relationships.

It is undisputed that technology is disrupting the business of professional services firms. This disruption has been ongoing for the past two decades and it will most likely continue for the foreseeable future. Pricing pressure and changing business models and compensation formulas are some of the most visible immediate results of that turbulence. What it all ultimately means to expert professionals and their futures is yet to be determined…not much has been speculated or prescribed.

After spending incredible amounts of time and resources in the world of academia, professionals embark on a lifelong journey of professional development and practice, yearning to reach the coveted “expert” title. However, more and more professionals are realizing that the “expert” title has lost its luster, and all that goes with it. What are professionals and the firms that employ them do? Well, a few lucky ones, who have enjoyed the full benefits of being called and treated as experts, may retire. Others may have to re-tool themselves.

Based on the widely accepted Maister trustworthiness formula {trust= (credibility + reliability + intimacy) / self-orientation}, Fischer suggests that the variables in the trust building formula that deal with the human aspect of relationships offer the solution to the commoditization of professional services. In other words, employing and mastering the art of soft skills would be the only way for professionals to differentiate themselves and succeed in their careers going forward.

Because I’ve studied and have seen the positive results of professionals employing human skills, the “how you do what you do" has always come forefront in my teaching of professional development tips. I often refer to it as part of the notion of executive presence: how you go about carrying yourself, listening, communicating, etc. Take a deep dive into the concepts with “WHERE IN THE WORLD IS THE NEXT GENERATION OF PROFESSIONAL SERVICES FIRMS’ PARTNERS?”, an oldie but goodie I wrote on the subject about a half a decade ago. Listen to “LEADERSHIP LESSONS FROM MARGARET THATCHER”, an interview with Sir Bernard Ingham, Margaret Thatcher's chief press secretary I curated several years back. It builds upon the frameworks shared in the previous article, especially the one of personal gravitas.

Of course, we can’t talk about soft skills without touching on the subject of problem solving capabilities and its importance for professionals. The ability to ask good questions, realize and release innate assumptions and leniency to assign judgments, synthesize and re-frame points so as to communicate more effectively: all critical for professional and personal development in my view. Content and format will vary based on professionals’ and firms’ needs. Ask for best practices and recommendations.

Technology is great. It supposedly simplifies life and it does for the most part. Most professionals and firms have easily made the decision to invest sizable amounts in improving technology. However, most firms are neglecting to invest in the supposed beneficiaries of that technology. I say: it’s time to invest in the human element. Be human, even if your career doesn’t depend on it.

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

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

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.

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

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

To BD or Not To BD?

I recently launched a special series: "Oldies but Goodies" to bring back some of my favorite pieces I've written throughout the years that are still relevant today. Enjoy!

May 2010 USA

To BD or Not to BD = to focus on business development or not? That’s not even a question worth debating when it comes to leading progressive professional services firms (PSF), if you ask me. But let me spell it out: to survive and grow, business development, on a firm, practice and professional level, is not even a choice – it’s a necessity. Instead of my pun on Hamlet’s famous quote, I’d argue the real question at hand is how to go about doing it. After experiencing the recent business slow down, PSF’s seem to agree and are increasingly encouraging business development actions. And, because the question “how to BD” offers many answers, one of the fastest and quick-fix solutions contemplated by firms is hiring BD professionals. That certainly is a solution, however it might not be the most appropriate one depending on the situation at hand. So, for the purposes of this article let’s think of “To BD or Not To BD” as the PSF dilemma of whether to hire in-house BD professionals or find alternative growth solutions. Let the battle of our inner Hamlets commence.

In my experience working with PSF’s of different shapes, sizes and cultures, I’ve had the opportunity to see when bringing in BD professionals is successful and when it fails. And so, before sharing my thoughts and weighing the pro’s and con’s of hiring BD professionals, please consider the following questions… Does the culture of the firm allow for BD professionals? How would your current and prospective clients feel if they were approached by BD professionals representing the firm? Would the technical professionals accept and leverage the skills and actions of that professional or carry on doing things they've always done, which might not necessarily be the most efficient or effective, or worse yet, sit back and relax because the burden no longer lies with them? These are all significant questions, not necessarily pertaining to the growth of the PSF, but to the organizational cultural domain that is just as significant to the firm’s survival. Reflect on these and other similar culture and client related issues before moving forward, I beg thee.

Now, when the firm culture is built to accept and utilize client development professionals, bringing them on board, with the proper expectations, can be a powerful growth solution. One of my business partners likes to say that ”client development is both an individual and a team discipline” and I agree. BD professionals can “hunt” and at the same time offer leverage to the technical professional service providers (i.e. lawyers, accountants, consultants, etc.) by supporting their individual client development actions. Prospect and referral identification and research, as well as relationship building, at both strategic and tactical levels, customarily require unknown or untapped skills for many technical professionals. The right BD executive will act as a mentor and strive to enhance the talents of the technical professionals, amplifying the impact of their collaborative client development efforts. On a micro level, they will also support the proposal process: from scoping to presenting along with the technical professionals, and working along the marketing team on the presentations, in between. Because when it comes to PSF’s, the professionals are the embodiment of the firms’ brands, the proper BD executives will have the executive presence and gravitas to do just that. And so, on a macro level they will also represent the firm in the community, help build and enhance the brand and goodwill and most importantly develop strategic to growth relationships.

I don’t know about you, but I almost convinced myself that hiring BD professionals (the right ones) is the way to go…well, “almost” and the “right” being the operative words here. Before jumping ahead, a few additional to the culture concerns to keep in mind…The economic downfall has purged many PSF’s of excess and unaccounted for spending, making them more efficient and effective. Why should business development and marketing be treated any other way? So, before casting a vote on BD professionals, ask yourself whether the firm is fully utilizing the resources at hand as well as providing the necessary support systems, tools and skills. Audit the firms’ business development organization to identify any opportunities for enhancement or repurpose. The chances are if you look for improvement and leverage you will find it. When you can say - with a certainty - that all of the PSF’s internal client development resources have been tapped in and exhausted, only then would I recommend considering additional growth alternatives such as hiring BD professionals. Even then, keep in mind that ultimately buyers of PSF services buy the people who will do the actual work. In other words, having BD professionals on staff shouldn’t release the technical experts from their own BD responsibilities, nor the firm from its responsibilities to provide them with the proper support tools, systems and skills programs. However, that often is the case, and it brings a whole new set of growth challenges.

To BD or not to BD – that is the question: whether to grow the PSF with the help of BD professionals on staff. That’s your prerogative, dear reader – I only hope my comments encouraged you to consider the full complexity of the situation; one, which might call for support from experts on creating superior, lasting, predictable client development results for professional service firms.

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

Effective Client-Adviser Relationships, an FT Survey Findings 2012

Finally the notion of client-adviser relationships and its importance for the professional services industry is gaining international press. For the second consecutive year, the Financial Times (“FT”) has performed a survey sampling executive-level clients and professional service providers including law, accounting, and consulting firms. Because of my hands-on organizational development experience with services firms and overall close observation of the industry, the results do not come as a surprise to me. In fact, they support my personal remarks and recommendations. Here are the four key points spelled out by FT in its 2012 report and my thoughts.

Contribution of management

FT: The impression of whether a firm is well managed is important to clients. Sharpening internal attitudes towards clients and developing C-suite level relationships through regular dialogue are key priorities for management.

Mira Ilieva Leonard (“MIL”): When your house is not in order even your friends stay away. The same applies for professional service firms and their clients. Clients recognize when firms are experiencing turbulent internal dynamics and will stay away in anticipation of the negative effects on the management of their projects. While having the shareholders involved in the firm on a daily basis provides many challenges such as reaching consensus, etc., professional service providers should learn to overcome them and manage their firms as true corporations. In addition to building their brands, firms should focus on defining their key expertise, growing client adviser relationships at executive level and developing a consistent and collaborative client-centric culture.

Knowledge and commercial awareness

FT: Advisers need to really get under the skin of their clients’ business. Clients want advisers to provide a more commercially-savvy view of future risks and external benchmarks.

MIL: Clients are no longer expecting only a technical conversation. They want to know that their advisers understand all aspects of their business and industry, and the challenges and opportunities presented. They anticipate that their advisers can share benchmarking data and industry best practices. Professional services firms should invest in expanding their client intelligence capabilities and knowledge. Firms should equip their professionals with the skills, tools and systems to build this into a continuous process.

Added-value services

FT: Account planning and client feedback are the added-value extras that clients find most beneficial. Clients actively encourage firms to invest further in these areas.

MIL: As I mentioned in my previous post, “What can Professional Services Firms learn from the on-line gaming industry when it comes to retaining and growing client relationships?”, professional services firms need to recognize and embrace the value of feedback mechanisms and insightful thought leadership materials. FT’s reaches the same conclusion supported by data from the clients themselves. Firms must work to overcome their fear of negative feedback and get in-front of clients. Developing insightful thought leadership materials takes time and the right resources, yet again this is what clients demand now.

Supporting people

FT: Although advisers are appraised on their client service and commerciality, fewer are given adequate training and support to deliver on these competencies. Further investment in project management tools and protocols is welcomed by advisers to help deliver more profitable client service.

MIL: Some progressive professional services firms are recognizing the skills gaps and are making efforts to fill them by bringing specialists either on board or as of counsel. Others are building advisory curriculums with emphasis equal to their in-house technical training programs. These are a select few. Most firms are still undervaluing the importance of such skills and tools and are taking a haphazard approach to the issue. They are the ones that are going to find themselves in trouble in the long run.

The FT report is a must read for Managing Partners of professional services firms. Please contact me if you think your firm would benefit from implementing some of these concepts into its business strategy and culture.

Download the full FT report here.

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

GAMIFICATION FOR PROFESSIONAL SERVICES FIRMS

What Professional Services Firms can learn from the on-line gaming industry when it comes to retaining and growing client relationships

It may appear that the on-line gaming and professional services industries do not have much, if anything, in common. However, when it comes to attracting and retaining clients, professional services firms can apply the main principles behind the concept of “gamification” (“applying gaming principles to non-game applications and processes, in order to encourage people to adopt them, or to influence how they are used” according to Wikipedia). In fact, such a strategy might be just what that industry needs today to build and preserve client relationships and alleviate pressures related to cost, quality and overall management.

Let me outline some of the gamification principles, and my recommended applications to professional services firms, as discussed during a recent event held by the American Chamber of Commerce in Luxembourg titled: “Game on! Business Growth Lessons from the Gaming Revolution.”

Competence This principle helps define the ultimate objective then breaks it down into long-term and short-term goals and actionable tasks (or “levels,” in gaming language). Projects serviced by professional services firms are very often complex and require long sales cycles. Professional service firms might consider breaking the big monster of a project into smaller, less cost-prohibitive, less risky and easily digestible phases. This will help avoid getting stuck in the complex services buying decision making process, chasing multiple decision makers and sourcing from various budgets to launch the project. Once in progress, this approach will also help with the project management of the assignment.

Engagement Gamers see this principle in action by the constant and helpful communication with game providers…“helpful” being the operative word here. How are you, professional service providers, engaging your prospects and clients? How is the content you share with them of value to them (not you)? Does it educate them and help them remove frustration? Professional services firms are becoming content producing machines. In fact, I frequently ask my clients (law, accounting, advisory firms, etc.) whether they consider themselves in the information dissemination business. What business are you in? If the thought leadership materials you share with your prospects and clients don’t provide insights and answer “so what,” then you are, and you are at risk of losing their interest.

Flow This principle is closely connected to the “engagement” one and in gaming terms “being in the flow” means moving onwards in the game. Gaming companies facilitate this process by educating gamers on how to overcome challenges by providing tips and encouraging them to move on to the next level. Professional service providers often struggle to recognize when there is a gap between clients’ expectations and their processes and deliverables. One way to avoid falling in that trap is to apply “in the flow” gaming principles. Firms can do so by educating clients of their client “on-boarding” and project management processes, setting the right expectations and constantly communicating project progress. The latter is so simple and important and yet is so frequently underestimated and rarely performed. Professional service providers should also constantly consider how to innovate services and re-engineer their service delivery methodology to keep their clients “in the flow” and set themselves apart from the competition.

Autonomy As it implies, in the gaming world the principle of autonomy is the process of empowering gamers to select the pre-defined by the game paths to follow. I have often said “one size fits none” when it comes to professional services firms, their professionals, and their clients. Professional service firms should embrace this principle of guided experience and when possible, give clients options by providing several alternatives that would solve the clients’ problems, the benefits and consequences of each, and let them decide which one to take. The client’s involvement in the decision making process increases the client’s sense of ownership, and the likelihood of long term success of the project. After all, people feel much more strongly about the choices they make opposed to the ones made by others on their behalf.

Relatedness This principle of communities of like-minded individuals going through a shared experience is very powerful and explicit in the gaming industry. Players team up usually in a virtual world online, to achieve shared objectives and create opportunities for mutual benefit. These ideas are increasingly receiving attention across other industries. Professional services firms have began to apply this principle by creating alumni groups, specialty subjects internal forums, etc. I would recommend that they take this concept to the next level and provide platforms for their clients to connect and learn from each other, and even act as mentors in some cases. Firms will be surprised of the amount of knowledge and the goodwill they will build and receive from their clients.

Feedback Within the games, players typically strive for awards and achievements, while the game makers repeatedly ask for customer feedback through reviews. Each side is getting feedback as to how they are playing the game (or the quality of the game being provided). This is the feedback principle. And, it provides motivation and builds loyalty. Professional services firms have a long way to go to catch up with the gaming and consumer product industries when it comes to implementing and utilizing feedback mechanisms. Most firms are not comfortable to even distribute basic client satisfaction surveys because of their fear of negative feedback. This is no longer acceptable, especially given the current ominous economic environment. The American Bar Association Journal recently shared a survey outlining the top four reasons clients have left law firms over the last year: cost, lack of expertise, poor service and departure of key professionals. Professional services firms are missing huge opportunities to retain clients and build stronger relationships. They should get in-front of their clients before it is too late, listen and take actions to remedy negative points.

Many professional service firms are becoming dinosaurs because they are not adapting to a more competitive environment by implementing basic customer satisfaction and client retention principles. It is interesting to see how the progressive firms are re-engineering their business models to move onwards, and equally disturbing to watch other firms continue to ignore reality and fall even further behind. I hope my thoughts will provide more than just wishful thinking, but also strike a chord and encourage action. Which one of the above principles will you adopt today?

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

Where In The World Is The Next Generation Of PSF Partners?

Now that I've committed to make time for thought leadership, I am launching a special series: "Oldies but Goodies". It brings back some of my favorite pieces I've written throughout the years that are still relevant today. Enjoy!

March 2010 USA

You know how there are some people that you just can’t help but notice when they walk in a room? They tend to carry a certain air of gravitas, walk taller, speak louder (not shouting) with confidence and command immediate respect – present themselves as a proper executive. Where are these people now? I see fewer and fewer of them in the professional circles these days and most tend to be of what I’d call “old school”. Is the notion of “executive presence” extinct? And if that’s the case, what will the next generation of leadership look like?

Executive presence has always been an unwritten requirement for advancement in a professional services firm. But, now it may be unwritten, unspoken and unnoticed altogether. Living in a quick service society, especially in the US, the younger professionals we work with today appear to approach their professional life and how they present themselves in an extremely casual way. It starts with the way they dress, their preferred methods of communication and language, and most importantly, their pride-in-presentation and confidence (or the lack of both). Is this a function of the Millennium, Gen X, Y, Z (can’t keep track of them anymore) overall breeding or something else? Does this mean that the next wave of Managing Directors will text message their teams and clients instead of writing letters or meeting in-person, change the dress code to “no jacket required” at all times, and…?

Call me old fashioned, but I believe we should bring “executive presence”- and the professionalism it implies - back. We need to groom the next generation of leadership so that they are not only a generation of competent technicians but also advisors that capture their clients’ and colleagues’ confidence. I am glad to report that I am not the only one who has noticed this disturbing trend. Managing Partners and Directors are increasingly bringing the matter up during our conversations on how to elevate their professional force and make them better advisors, client cultivators and leaders. And, it all starts with executive presence. So, what do we do about it? In my experience it takes work on both sides of the equation – current and future leadership – to make a real impact. Here’s what I’ve seen work and might stimulate thinking:

Confidence comes with knowing what one stands for and having the internal strength (ego) to defend that position. Managing partners need to encourage their fresh workforce to start identifying specializations and define their professional claim to fame early in their careers. Professionals who know what they are or aspire to be “famous for” tend to carry themselves with a higher degree of confidence. Up and coming partners need to find the balance between improving their technical skills while serving senior partners and navigating internal politics. A lot of this has to do with the ability to establish and maintain peer-to-peer rapport – both with clients and colleagues – and to assert ones’ point of view with conviction yet patience and poise. Be mindful of each interaction and prepare ahead of time. I often hear from our younger clients that they tend to step back and let the senior professionals run meetings. While that’s most natural because the senior professionals most likely have the experience and perhaps the client relationship, I always encourage them to step up. It starts with a brief conversation with the rest of the colleagues ahead of time defining each one’s role during the meeting. Senior partners need to allow the junior partners equal “airtime”, encourage them to participate if not lead the meeting, become mentors and think of how this sharing of airtime supports the succession of the firm’s leadership and sustenance of its value.

Professional service providers are hired by clients for their advisory and leadership skills. Clients look for outside help, a comprehensive view of the situation and direction on how to go about solving a problem, hence leadership influence. And, in order to get a full view of the situation, professionals ought to understand it first and even before that earn the trust of their colleagues and clients so as to gain a better understanding. The latter takes time and patience which is not something junior professionals have in abundance. Yet, there are ways to get there – put oneself in place of the person across the table from you, listen actively and genuinely, demonstrate emotional intelligence. Remember the person I mentioned earlier in this article? The one that everyone notices when he or she walks in the room? That person can be either a completely arrogant jerk or someone that everyone’s attracted to because of the friendly and reasonable nature of his or her personality. Be the latter one! Radiate positive charisma and you’ll be able to lead both colleagues and clients.

So far, I’ve spoken only of what takes place between the ears of young professionals. How a professional’s thinking manifests in verbal and physical presence is equally important. I was recently in Europe for client visits and was reminded of all the small, external items that add up to make an impact. Most of the professionals I met had excellent command of their tone and language (mind you, they spoke at least three languages each), were always dressed a level up (even in casual situations) and seemed genuinely interested in conversations (made eye contact and smiled). It certainly made me feel I was working with an extremely high caliber of professionals – I am sure their colleagues and clients feel the same way as well. So, dear junior professionals, pay close attention to how you dress and carry yourself. If you’d like to move up to the next level in your career, distance yourself from the current casual fad. Communicate in a crisp and concise manner – sometimes, even, face to face rather than by Twitter - dress up (even on casual Friday’s) and build up the internal confidence to embrace stillness and eye contact.

Is there something to this or do we need not worry about executive presence? Is the power of a quick serve cultural trend too strong to overcome? Even if that’s the case, perhaps that allows you more opportunity - dear future leadership – to dramatically stand above your casual crowd of competitors – with a level of professionalism in thought, words and appearance that allows you to claim impact and influence.

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