Having a leadership role in any organization is difficult, regardless of the industry. Leaders of professional services firms, in particular, have a herculean task. Law, accounting and other professional services continue to face unprecedented levels of change, bringing forth seemingly insurmountable challenges, but also incredible opportunities for those who are open to embracing the evolving landscape.
For sustainable success in the long term, leadership must reflect on and analyze past performance while planning for future opportunities and challenges. In addition, strategies for maintenance and growth of the business cannot be done in a slapdash manner. Improvements must be measured so they can be adequately evaluated, and what is identified as a relevant measurement must be tied to the firm’s overarching goals.
To help you stay the course of success this year and in the long run, here are five strategies firm leaders should consider.
1. In marketing, haphazard tactics lead to haphazard results.
One of the best things you can do for your firm is to create a marketing plan, and it’s fairly easy to do if you know where to start. The key is to identify your marketing goals for the year — whether they’re related to brand recognition, lead generation, events, etc. For the greatest impact, you have to set specific, measurable, actionable, relevant and time-bound (S.M.A.R.T.) goals, and then commit to working on them.
Once your plan is in place, build a budget to fund these activities. Many firms do this in reverse, budgeting first and then setting course, to their detriment. Setting a budget without a roadmap for your marketing strategy is no different from quoting a fee for a case when you haven’t taken the time to figure out what’s involved, what kind of skills you’ll need or whether you can even do the work.
2. Figure out what you need to measure. Then, actually measure it … and report on it!
Key performance indicators (KPIs) provide firm management with the information needed to make intelligent decisions, including a course correction if necessary — but no one data point tells the whole story. Instead, your KPI dashboard should reflect data about the performance metrics that not only matter most to your practice but also tell the most-complete story about whether your entire firm is meeting its goals. We recommend a dashboard with six to eight KPIs to get the best picture about your firm’s overall performance.
This leads to a golden rule of data-driven marketing and business development: You can’t measure what you don’t track. After identifying your KPIs, the next step is to look at the data that are already available in your firm’s practice management and financial systems. Make an inventory of the data being collected, and determine whether there are any gaps between what you have and what you need.
If you don’t already have a dashboard, a good marketing or business development consultant can help you figure out the right combination of data points to tell you what you need to know. Ideally, your firm is using systems that are integrated with each other, so customizing your data collection and building the reports you need is a bit more streamlined.
3. Find ways your firm can actually innovate and then leverage these differentiators.
There’s no denying that innovation — whether it’s in delivery of service, technology or practice management — makes it easier to grow, regardless of the size of your firm. What many firms fail to realize is that innovation, in and of itself, isn’t a differentiator. It is how the innovation transforms your practice or the client experience that becomes the differentiator.
Take law firm diversity initiatives as an example. Having a diversity initiative is not innovative, but one law firm client flipped the concept on its head. Instead of touting the existence of a diversity program, they executed an initiative to interview and accept only diverse candidates for their summer associate program. For most firms, summer associate programs provide a pool of talent for hiring eventual first-year associates. By instituting a diverse candidate profile for summer associates, the firm was innovative in the way they ensured a pipeline of diverse talent for their first-year associate class. They also didn’t just do it — they celebrated it and used it to differentiate themselves from every other firm that merely touted the existence of a diversity initiative.
The point is this: Innovation comes in different forms for different firms. Embrace what works for your firm, and then celebrate it so you can stand out from the crowd.
4. Fill your pipeline with rich business development opportunities.
One of the biggest challenges for any professional is bringing in new business, so building an active pipeline for business development can make the difference between a great year and a so-so or bad year. The pipeline (sometimes called the sales funnel) is where all of your marketing, public relations and branding efforts come to fruition by bringing business leads “in the door.” While today’s firm, big and small, have become more savvy about developing and refining their brands, logos, websites and marketing collateral, many still ignore the pipeline, which has to be filled with leads that represent opportunities for new business.
Put plans in place for a strategic and concerted effort to not only grab the low-hanging fruit from existing clients, but also identify where your new business opportunities are coming from. In a multi-practice firm, it’s critical for each practice to identify their list of targets for relationship expansion and for new business. Firm leaders and business developers can help bridge the gap to get practices working together, especially when they have common business targets.
5. Ask the hard question: Is it time to stop practicing and focus on the business?
Believe it or not, this is an important question to ask. Many firm leaders, particularly in small firms, are also the firm’s rainmakers or primary practitioners. That model may work well during the firm’s formative years, while the headcount is small and the client base is manageable, but for any firm with designs on growth or acquisition of market share, this governance model is not sustainable. Firm leaders who seek to grow their firms must embrace the new normal: The firm must be run more like a business. This is difficult for many firms because the managing partner still has to be compensated, but the compensation model is structured around hours and client acquisition. Administration and governance typically aren’t factors.
With the Big Four nipping at your heels (and this is true across the board, regardless of firm size), you do your firm a disservice by not removing the burden of practicing from your leadership. There are newer and better ways for your leadership to be compensated. Do yourself a favor and focus on the business.
All firm leaders, regardless of their firm’s size, recognize the delicate need to balance their professional responsibilities as practitioners with their leadership responsibilities within their firms. By giving these five keys a little love and attention, you’ll improve the likelihood of long-term success.
If you are struggling with your business development or marketing strategy, reach out to Terry M. Isner, at email@example.com