|
| Execution |
 |
Look around and you'll find lots of advice for getting your practice through the recession. Most often, that advice offers marketing and selling tips for landing new clients in tough times.
I'd say that retaining your current clients is at least as important as acquiring new ones, especially when clients are squeezing their consulting budgets. Finding ways to hold on to your existing clients is essential to the long-term health of your business.
Since a key ingredient in client retention is the top-notch execution of your services, now is a good time to examine your service delivery strategy, and to strengthen relationships with your clients. Do you see any opportunities for delivering more value, more quickly, without adding risk?
Many consultants mistakenly believe they have mastered the service delivery process, so it can be a challenge to answer the above question objectively. If you're not sure, ask your clients how they would rate your service delivery. They'll often give you an insight or two that boosts your value to them and enhances the relationship.
It also helps to review your client relationship strategy by asking yourself three questions: Are there any relationships you've let slide that you should attend to? Do you have any relationships you should take to the next level? Are there any new ones you'd like to forge? It's a rare case when consultants take a hard look at the state of their client relationships and fail to uncover opportunities to build on those relationships and sell new work.
When times are tough, superior execution of your services can help retain a client who might otherwise choose to put off new work until times are rosier. Be sure you're delivering your services in the most efficient and high-value way possible. If you can't find any potential improvements in how you execute your services, chances are good that you're kidding yourself.
Pay particular attention to your relationships now. Your focus on serving your clients and cementing your relationships will help you retain them. And that will make the job of acquiring new clients a lot less stressful.
Enjoy this month's issue.
And send me an email if you have comments.
Mike
McLaughlin
Editor
Management Consulting News is a publication of MindShare
Consulting.
|
| MCNews 12 Index of Professional Services |
 |
US Economic News |
|
McNews 12 Index |
|
It could have been a lot worse.
As the first quarter wrapped up, the overall market and the MCNews 12 Index both showed some signs of life. Even with the uncertain economic conditions, the S+P 500 rose more than 14% last month, paring its year-to-date loss to less than 7%. Meanwhile, the MCNews 12 picked up 8.5% last month, in spite of the bad news about job losses, industry bailouts, and global recession.
Troubled consulting firm BearingPoint (BP) finally filed for Chapter 11 bankruptcy protection. The company, which began as the consulting arm of KPMG LLP, struggled with accounting problems and a probe by the US Securities and Exchange Commission. The firm has been laboring under heavy debt brought on by acquisitions the company made several years ago.
Since the initial bankruptcy filing, BP agreed to sell a large portion of its public services unit to Deloitte for $350 million. BP executives also signed a non-binding letter of intent to sell a substantial part of its North American commercial services business to PricewaterhouseCoopers (PwC) for $25 million.
BP filed bankruptcy with a prearranged restructuring plan so the process can be completed quickly. Overseas operations were not included in the filing, but PwC's Japanese unit is reportedly in negotiations to buy BP's consulting business in Japan. Additionally, BP has said it is in the late stages of discussions with local companies interested in acquiring its European and Latin American practices.
In spite of all this news, a BP spokesperson made the preposterous claim that, "The company plans to operate business as usual."
|
MCNews 12 Index |
YTD
Change |
S+P 500 YTD Change |
| Mar 2009 |
660 |
-3.0% |
-6.7% |
| Feb 2009 |
608 |
-10.7% |
-18.6% |
| Jan 2009 |
641 |
-5.8% |
-8.6% |
The MCNews 12 Index reflects general investor sentiment about the state of the global professional services industry.
The twelve publicly-traded companies included in the MCNews 12 Index account for roughly $80 billion in combined annual revenue, and serve clients around the world.
Learn more about the MCNews 12 Index 
|
| Interview:
Steve Zaffron |
 |
 "The driving force for human beings is the way they see the world--their perspective on it, what they think about it, and what they emotionally connect with."
Steve Zaffron is CEO of the Vanto Group and an internationally respected authority on competitive advantage, organizational change, and transformational leadership. He's also the coauthor of The Three Laws of Performance: Rewriting the Future of Your Organization and Your Life.
We asked Zaffron about his new theory on what underlies breakthrough results.
Read
our interview with Steve Zaffron
|
| R&D in a Recession |
 |
Research and development efforts remain a strategic priority for many executives, even these days, according to a recent McKinsey & Company survey. McKinsey's researchers asked survey respondents about the relative importance of R&D in their companies, the changes those companies have made to R&D spending and strategy in 2009, and the expected results of the changes.
Forty percent of respondents report that their companies are actively seeking to reduce R&D costs. About 34 percent of the executives say that R&D budgets are lower in 2009 than they were in 2008.
Furthermore, in response to the uncertain times, a majority indicate that their companies are changing their approach to R&D. Many are taking on shorter-term, lower-risk projects, or focusing on minor changes to existing products.
This cautious behavior is understandable, but it may lead your clients to overlook longer-term opportunities to innovate--and to emerge from the downturn in a stronger position.
Naturally, clients will look to maintain shareholder value, and R&D costs can be an obvious target in an attempt to shore up the bottom line. But it may be worth helping clients figure out if the short-term gain from R&D cuts is a reasonable trade-off for potential long-term value.
|
| What's Happening with Marketing? |
 |
The state of the economy is causing most organizations to reassess their marketing budgets. They want to make sure that their limited marketing funds are used for the most productive initiatives. According to analysts at Aberdeen Group, 82 percent of companies have reallocated their marketing spending in reaction to current economic conditions.
Aberdeen researchers found that many leading organizations are shifting resources from high-cost channels like TV advertising to low-cost channels like email. Using sophisticated marketing tools, organizations can generate highly tailored messages based on each customer's profile, purchase history, demographic information, and other factors.
Given the ease of measuring email marketing effectiveness, it's not surprising that 47 percent of top performing organizations have boosted spending on this option. Email marketing has quickly become one of the top strategies for today's market.
|
|
The Benefit of Employee Benefits |
|
One outcome of the current economic situation is that many employees are taking a greater interest in understanding their employee benefits, according to a new study by insurance giant MetLife.
The study, which included interviews with more than 2,500 managers and employees, shows that 41 percent of employees "consider workplace benefits to be the foundation of their personal safety net as they awaken to current realities about their financial security." That number jumps to 52 percent for workers in companies that employ 2,500 people or more.
Given that 50 percent of respondents report that they have only enough savings to miss two paychecks, the attention to benefits is understandable and warranted.
This study confirms that employee benefits strengthen the bond between companies and workers. The top factors employees cite for loyalty to an employer are pay, health care, retirement, and all other insurance benefits.
Employers have an opportunity to reinforce that bond with employees by highlighting benefits programs well beyond the point that someone is hired. Many employees want more information about their benefits, and they're especially concerned that companies may cut those benefits. So making the effort to have a continuous dialogue about employee benefits will be time well-spent.
|
| Are You Chasing Prospective Clients too Long? |
|
In a recent poll by Miller Heiman, almost half of sales professionals reported that they never abandon a sales prospect. You read that right--never. That means that many sellers are chasing leads and using scarce resources on opportunities that are unlikely to result in sales.
In the consulting business, it pays to stay in contact with prospective clients over the longer term. But sometimes you have to realize there's not going to be a sale, no matter how much you want it and think it would be right for the client. Granted, most of us can tell at least one story of a seemingly hopeless situation that turned into a successful sale, but that's the exception, not the rule.
Too often, consultants cling to unlikely opportunities because they don't have a reliable process for qualifying leads. Every sales situation you face is different, but it pays to answer three questions about every opportunity as objectively as you can: First, what is the likelihood that the project in question will ever be awarded to anyone? Second, does the client's business case offer a compelling reason to undertake the project? Finally, do you have reasonable access to the decision makers?
Your answers to these questions can help guide your thinking about how to invest your resources in any sales opportunity. There is a time to stick with it and a time to walk away. Successful consultants know when to do both.
|
| Coming
Attractions |
|
 "Trusted client partnerships are made, not born, and it's up to you to make them."
Next month, we welcome back Andrew Sobel, a leading authority on the skills and strategies for building enduring client relationships. He is the author of Making Rain and Clients for Life. His latest book is All for One: 10 Strategies for Building Trusted Client Partnerships.
We'll ask Sobel how we can use his market-tested strategies to deliver extraordinary value to clients and personal satisfaction and profitability to our practices.
Look for the next issue of Management Consulting News on May 5, 2009.
|
