I reflected recently on a conversation I had many years ago with the CEO of a global professional services firm. At the time of our initial meeting, this forward thinking leader had already worked out that her firm would only prosper in the future if their strategy for winning business moved from reactive to proactive.
Systematically, they set about developing their processes and the skills of their people to create a proactive business development culture – a culture that would give them the comfort of having a forward pipeline of profitable income. A pipeline not solely reliant on hoping that inbound phone calls would provide enough revenue to pay the bills!
In 2017 this firm is still growing and remains one of the world’s most successful in its profession, by design, not chance!
Over the years that we have worked with professional services firms, we have seen for ourselves the success achieved by those whose leaders championed and led a culture of proactive business development. These are leaders who recognise that business development activity is as valuable as today’s fee earning assignments.
Whilst most firms today have some form of proactive approach to business development, we remain surprised as to how much of the future is left to chance – “the phone will still ring” – hopefully!
I recently worked with a specific practice of a global firm. Great people, great solutions, great clients (who keep coming back to them) and significant top line fee income – enough to pay for the substantial salaries and impressive office.
Looking more closely at the performance it became quite apparent that, whilst this is currently a successful practice, the revenue over the last few years was at best static. Revenue was also concentrated in a number of key clients that had been using the firm for 10 years or more. Proof of the talent and value of the services provided by this firm and the loyalty of satisfied clients.
To their credit, the equity partners in this practice (motivated by an unavoidable and imminent loss of a $1m dollar client) recognised the clear and present danger that their reactive approach to business development would be insufficient to secure a profitable future. This practice will prosper, because I know they are taking action now, before it is too late
Consider your own firm’s performance and ask yourself these questions:
- Is your income (and profitability) increasing year on year?
- Is your growth achieved from winning incremental business (as opposed to acquisitions)?
- Is your income safely spread across a client base where there is no danger of over exposure to single or small number of clients?
- Are you growing additional income from existing clients by introducing new services or do they just buy what they have always bought from you?
- Have you won an appropriate number of new clients over the last 12 months?
- Are you confident that you have enough people doing the right quantity, quality and focus of business development activity to deliver your revenue targets for 2018 and beyond?
If you are able to answer a confident ‘yes’ to the above questions, you are likely to be one of those firms that has a proactive business development culture at the heart of its strategy. No matter what the world throws at us, your success is likely to continue by design and not by chance.
If your answers are negative, here are some recommended actions based on what we have observed and supported in those firms that no longer rely on the ”wait for the phone to ring” strategy.
- Segment your existing client base and recognise the difference between key and valued clients.
- Develop a practical action-driven protection and development plan for your key clients.
- Instigate a client review programme to help ensure you are exceeding client expectations.
- Have a clear vision for your desired client base in 2-3 years. Communicate the vision to everyone in your firm.
- Set standards (provide training if required) for client service for every employee including Administration, IT, Security, HR and Accounts, not just client facing professionals. Clients judge us on ALL contact points.
- Identify enough people in the business to be responsible for proactive business development activity – provide coaching and training for those who lack knowledge of the processes, skills and behaviours required to win profitable business.
- Develop a robust approach to selecting the most attractive and likely responsive target clients for your firm. Make individuals accountable for developing relationships with these targets on the journey to winning the first fee earning assignments.
- Develop a marketing and promotional plan aligned to your proactive business development plans. Aim to ensure every pound of your marketing spend and minute of your time is aimed at motivating existing clients to keep buying the same services from you, to consider additional services and to motivate new clients to want to engage with you.
- Have a business development leader on your leadership board.
- Develop appraisal and remuneration systems that support business development behaviours.
- Identify an appropriate number of ‘sales leaders’ across the firm to ensure business development happens, even when you are busy.
- Lead business development from the top and ensure everyone in the firm understands their role and contribution to securing a profitable future.
If you action the above, you will be proactively securing a profitable future for your firm.
By the way, if you are truly exceptional at delivering valuable services to your clients there is a high chance the phone will still ring too! But who wants to leave the future to chance?