You’re driving down a deserted road when your car hits a pothole and the engine cuts out. The car slowly rolls to a halt by the side of the road. 

I have one really great knife in my kitchen. 

I have lots of other knives that are good, but this knife is exceptional.  I received this knife as a gift from a friend after he tried to use one of my knives to cut something.  He was surprised at the sad condition of my knives, but he was shocked that I was completely unaware of the problem. 

I knew something was seriously wrong when my client’s newly hired CFO called to say he was “voiding” my last invoice. Well, he had promised the client’s management team that he’d be aggressive in managing costs. I had no idea he’d start with me.

It may be too early to be certain, but many economists are now suggesting that the recession may be coming to an end. 

"Three different integrators visited me this week” says a corporate CFO, “trying to sell me upgrades for my ERP and my desktop operating systems.

My response: “I’m not going to spend a penny with you unless you can show me that every dollar I spend generates an additional dollar in benefit.”

“And I showed all three of them out the door.”

I’m writing this article as a follow up to my last article - “Designing Deliverables for Efficiency”.

A question that is often asked by sales and project management executives is what information should be exchanged between a CRM application and project management software, and what are the benefits of connecting these two enterprise software applications?

Professional Services Consulting companies come in all different sizes:  small, medium, large, and enormous.  Unlike other markets, though, the size of the consulting company has little impact on the expertise, bill rates, or geographic coverage. 

When a client calls you about an issue or problem, it’s natural for you to ask questions, including why the client needs to address the issue. But as you proceed through the sales process, you’ll find that one question in particular, asked at just the right time, can open up your sales conversations and lead to new insights for you and the client.

Every service delivery manager focuses on profitability. In an increasingly cost competitive marketplace, a couple points of margin can mean the difference between a good quarter and a bad one. Effective project execution and tight control of overhead costs are the most common practices for managing operating margins. 

We’ve all heard the classic children’s story about The Tortoise and the Hare and how “slow and steady wins the race”.  That may be true in Aesop Fable’s.  But I’m sure that dear old Aesop never had the task of selling professional services in a down economy.

Face it-in tough times, the temptation is to sell whatever one can to whomever one can. When opportunism drives sales; strategy unravels. Even worse, the longer term repercussions from such opportunism can actually cost the company revenue.

The buyers of professional services and complex solutions are seldom the same individuals who purchase products. Usually at least one and often several levels above the normal product sales relationships, these busy executives have different issues, expectations, world views, and mindsets to take into consideration when trying to influence their buying behaviors.

You may be tempted to tune out of this article because you think it’s an easy answer. Simply have incredible skill, be maniacally focused and ultra competitive and bingo, there’s the magical Tiger Woods formula. Right? Not so fast.

"Acquiring a new customer can cost 6 to 7 times more than retaining an existing customer. In fact, businesses who boosted customer retention rates by as little as 5% saw increases in their profits ranging from 5% to a whopping 95%.” (Grey Marketing Solutions)

Absolutely.  While most professional services firms do both projects and staffing to varying degrees, it is essential that you choose one as your core delivery approach and that it supports your corporate strategy and vision.  The decision impacts every aspect of your company internally and externally from leadership through back office support.

The most challenging aspect of running a Professional Services Operation (PSO) is managing the utilization of people.  While there are many important aspects of managing a PSO, managing utilization of human capital is fundamental to making a profit.  Unfortunately the majority of PSO’s in the market today do not achieve their full potential when it comes to fully utilizing human capital.

In today’s economic situation, much has been made about the need to automate business processes to cut overhead costs and accelerate services to the marketplace.  This can prove difficult for any organization due to a variety of mitigating factors including cash flow issues, executive support, and unexpected variations to your project plan.

I’m not sure anyone ever said ‘when I grow-up, I want to be a project manager’.  It’s the type of job that is critical in many companies but not one that necessarily is anyone’s dream job out of school. 

After years of attempting to build practice areas in my consulting organizations, I have come to the point of being able to present to others some of the things that have worked.  In this article I will discuss ten of my lessons learned.

Software as a service (SaaS) products have many advantages over enterprise software. With no hardware and software to deploy, SaaS customers benefit from lower start up costs and a lower total cost of ownership (TCO). 

We all know the old saying in the media: “If it bleeds, it leads”.  The fact is, bad news still makes good headlines.  And today’s headlines are all about the economy. 

What attracts the best talent? How do you keep them? If you want to make your life easier, then do a better job of delivering the five things that your people want, expect, and deserve.

2008 was an eventful, prosperous year for the project management practice, project management service and solution providers:

- Several independent vendors merged with larger entities; many more new small companies with innovative technologies emerged onto the scene. 

BACKGROUND

Professional Services Organizations are often quite proud of the technical expertise of their personnel - and deservedly so. 

Anyone who knows me, knows I am not often at a loss for words. I must admit, that with all of the negativity and erosion around us, it is hard to know what to say. 

One of my favorite words in professional services is “deliverable”.  It captures the transformation from abstract thinking to tangible result.  It says, “Ideas were floating in the air between us, and now they have become something.”

You can’t turn on the TV or the radio, or pick up a newspaper anymore without hearing another doom and gloom scenario about the economy.  Sure, times are tough right now, but remember - nothing lasts forever… not even economic downturns. 

All services executives and professionals are challenged with how they should track and measure utilization.  Utilization is a pertinent issue to all services organization, whether it is a consulting firm, software vendor, or other project based organization. 

Spring time.  The snow is melting and it’s a time of renewal. The first buds are appearing on the trees, golfers in the Midwest and East Coast are getting in their first muddy rounds and the sounds of the crack of the bat and the ball thumping into the catcher’s glove can be heard loud and clear across Arizona and Florida.

In December’s article “Maintaining Your Clients through Tough Economic Times,” we investigated Web 2.0 means to maintain communication and engage your client base throughout the recession so you and the value of your services are top-of-mind when those clients emerge at the recession’s end. (Yes, Virginia, it WILL end.)

What is the most effective way to communicate with your team and your organization?  Probably one of the most classic questions asked with no best answer other than “it depends”. 

If you’re a services executive at a product company, and you sell through channel partners, then I have a story for you. 

See if this sounds familiar.

One of my favorite contributions in the book Tips from the Trenches: The Collective Wisdom of Over 100 Professional Services Leaders is Tip #54 by Matt Jacobson. Matt starts by saying:

”Blame it all on Sales - That usually doesn’t work so you better keep reading!”

According to TechCrunch’s Layoff Tracker, nearly 120,000 employees in the tech sector have lost their jobs since August 27, 2008. And the number is growing. 

I am constantly asked by services leaders and sales executives what must be done to turn box pushers into effective services sales professionals.  Based upon my personal experience over 20 years, here is what it takes.

With the economic winter affecting all areas of business, it may seem like a time for consultants to hibernate.  Now, however, is the time to engage your clients, maintain communication, and perhaps be ready to assist as a consultant in new ways.

If you’re anything like me, you have a growing stack of “must-read” books on consulting, business leadership, personal success, misplaced cheese, and ancient Asian military philosophies - all piling up and waiting for your attention on the next available flight or sleepless night. 

Many PSOs start as small organizations.  In small organizations, PS executives hire “experts” or employees develop into experts by necessity as there is no one else around to do the job.

As a long-time practitioner managing large-scale, service development teams for product companies, I can safely
predict that a well produced service offering will help sell and consistently deliver quality solutions to customers. 

"It was the best of times, it was the worst of times ...”

Those words by Charles Dickens open his classic novel, A Tale of Two Cities, about the French Revolution.  And just as sinister Madame Defarge sits knitting her ominous visions, we, too, are seeing visions of uncertain and troubling times ahead.

Are you considering connecting your systems to remove that double data entry overhead?  Where do you start?

The most logical starting place is what data does the receiving system need that the sending system can deliver.  Break down the low level details fields and perform a mapping exercise to determine what type of programming is required. 

Managing Expectations - It’s an art .... not a science

In the 1982 Academy Award winning film Gandhi there is one scene that will tell you everything you ever need to know about managing expectations.  The year is 1917 and Gandhi is visiting remote villages in India where famine and poverty are the rule not the exception. 

I dreaded conference calls for years. Finally I decided to stop complaining and do something constructive. To my surprise, I discovered that with a few simple changes conference calls become highly effective meetings. 

It is fair to say that the most unflappable, were phased recently, as we patiently watched what seemed to be an unraveling of our financial system. I think I must have over heard the question “What are we going to do now?” a million times if I heard it once. 

Over the course of my career I have observed that both consulting companies and IT organizations generally do a horrible job of marketing, selling and communicating. 

Although growing trends illustrate that enterprise corporations are moving towards on-demand Software as a Service (SaaS) solutions, traditionally this platform has been most popular with small to mid-sized businesses (SMBs).

As of the writing of this article, the top headline on Yahoo! news is Oil soars on dollar, Energy Dep’t report on falling supplies. The top video is Floods threaten economic disaster in Midwest. Dow down 1.4%. Nasdaq down 1.9%. 

Recessionary times can be tough on the consulting community, but you may find that there are more opportunities now than ever - if you are willing to consider another path to delivering your skills. 

In working with many companies regarding process definition and efficient operational tool usage, I’ve come across a Catch-22 of sorts: 

• process driving tool selection and usage
• tool features and limitations driving process

Just two years ago, more than 75 percent of our implementation work was done on-site and face-to-face across the globe in places like New York, Sydney and London.  Higher gas prices, increased airline fees and travel hassles have made it far more challenging to fly or to commute long distances to deliver projects.

Are your recruiting methods keeping pace with rapidly changing needs in human capital management for today’s professional services?

Professional Services Automation (PSA) systems have many potential benefits to Professional Services (PS) organizations but realizing the full benefit has its challenges. PSA systems are the “ERP” for PS organizations in that they can encompass selling and forecasting business, managing deliverables and resources, time and expense management modules to name a few. 

Every boater knows the feeling, the queasiness in the stomach that comes the instant you feel you are no longer in control--stretched (literally) between where you have been (the dock) and where you’d like to go (the boat). 

Once upon a time, I imagined that clients would tell me exactly what they wanted. It hasn’t happened yet.

I’ve learned that many people don’t know what they want until they get something else. Then their disappointment reveals what they really wanted. 

Every boater knows the feeling, the queasiness in the stomach that comes the instant you feel you are no longer in control--stretched (literally) between where you have been (the dock) and where you’d like to go (the boat). 

As leaders of large groups of people, it is all too easy to get caught up in the tales of the charming few - The Can’ts.  This can be time consuming and costly not only to you, but your organization - because if you are caught up in it, you can bet a lot of others are too.  Can you say unproductive?

As leaders, we have all taken responsibility for an organization that “isn’t running optimally”.  The initial goal when assuming ownership of the sub-optimal organization is to determine how sick the patient is. 

Teamwork among individuals is a fascinating dynamic in the consulting world.  Webster defines Teamwork as:  “work done by several associates with each doing a part but all subordinating personal prominence to the efficiency of the whole.”

It is my belief that the saying “minding your P’s and Q’s” did not come from a bar owner’s tally of the pints and quarts for a bar patron, as often is believed.  Instead, I heard it is how owners of such establishments looked after their enterprise utilizing this statement, and help them remember and keep track of its various components. 

in·te·grat·ed [in-ti-grey-tid]

-adjective

1. combining or coordinating separate elements so as to provide a harmonious, interrelated whole.
2. organized or structured so that constituent units function cooperatively. 

Have you ever wondered why people in professional services rarely seem to network? It’s a mystery. A great mystery when you consider how the same people will work all hours for their customers; they’ll travel great distances and give up much of their private time to get there;

Politics and religion are two topics my mother told me to avoid unless I wanted the conversation to end in an argument. However, given that politics is the “topic of the year” (and was also in the forefront for the better part of last year!) it provides an interesting framework for discussing an issue of critical importance for all leaders: meaningful communication.

You’ve successfully sold the project - now let’s look at how you can focus on the consulting that is your real value-add, rather than get wrapped around the axle with project accounting management. 

This article discusses the merits of assigning a metric to your consultants for utilization and driving accountability via governance of that metric.  I’ll start by declaring my bias for doing this, although there are certainly those who would suggest otherwise.

Throughout my career I’ve been on the technical side as a programmer and the managerial side as a project manager, team manager, and now company owner.  What has been interesting is seeing the different professional services business models across the various commercial companies I’ve crossed paths with - namely pure consulting organizations and product companies with services.

So, you have been offshoring for a while.  If your experience is similar to most companies, issues begin to creep into your offshore operation; expectations do not continue to be met consistently; and some in your management team may even question the wisdom of offshoring.  How do you address this situation? 

During my years of managing services delivery organizations for enterprise software companies, I have had contact with many great customers across a wide variety of industries.  The customers have been both large and small and have been located all around the world.

The effectiveness of a professional services organization (PSO), whether a professional services firm or an internal service organization, depends on its ability to fully leverage its collective skills and expertise to efficiently generate business and deliver work product of the highest quality.

Last year my friend Mark led an effort to reinvent his professional services group. The exercise was a success, but the outcome may surprise you. I asked Mark to share this extraordinary experience, and this is his story. 

AFAB (A-fab) noun:

1. a sale of “anything for a buck” in order to generate revenue and keep billable employees busy
2. a business situation which can impede company growth, differentiation and/or profits
3. in more mature firms, a symptom of lack of focus on specific product or service offerings

There is no time where mentoring may be more important within Professional Services. As many firms have cut back on tangible expenses such a professional development and training, it takes little if anything from the budget to foster a strong mentoring program. 

Best practice is defined by the American Society of Quality (ASQ), the world’s leading authority on quality, as “A superior method or innovative practice that contributes to the improved performance of an organization, usually recognized as best by other peer organizations.”

Many professional service organizations today depend on outside vendors and partners to carry out their service delivery activities. The decision to use partners to deliver services can be influenced by any number of factors including financial, resource, geographic or product related circumstances. 

In a rapidly commoditizing technology market, Professional Services have become the glue between disparate technologies and clients. Until now, little if any research examined Professional Service strategies and benchmarks within the context of a rapidly maturing technology environment. 

Getting your services marketing efforts “up to the nines,” may be easier than you think. The following proven maxims are aimed at helping you reach the highest degree in services marketing.

What is a “Be-Back”?

Some time ago, I was on a routine sales call with the PS director of a global product company.  Once we were finished with the opening chit-chat, I asked the customary-and-generally-accepted-ice-breaker question:  ‘So, what keeps you up at night?”

Where is the focus in a software company?  Marketing and selling the product.  In a perfect world, revenue splits would be 80/20 product/service.  But you have to have a very mature/stable product - when was the last time you worked anywhere the product was mature AND stable?

Services engineering is a complex discipline, encompassing several distinct processes that often get intertwined in the minds of PS professionals. These processes include services development, services packaging, go-to-market (GTM), and portfolio management--

1) The Right Way to Give a Critique

The worst thing you can do if you want to get somebody to listen to you is to criticize him or her. As human beings, we hate being criticized. When attacked we attack back. And we attack even when we are in the wrong. Right or wrong has nothing to do with it.

Project margin is a key metric to manage in a services business.  Nothing gets to the issue of services profitability as quickly as project margin.  Often, project margin is measured and analyzed at Director levels and above. 

The Case for Packaged Services

Create powerful differentiation for your company while making the job of resource management easier at the same time - sounds like something worth doing! 

In my twenty-five years in professional services, I’ve seen plenty of troubled projects, dissatisfied clients, and burned out teams. And I’ve never seen a project where expectations got set perfectly during the sales process, and clients got exactly what they thought they would get. 

Face it - we consultants really want to develop deep relationships with our clients - and keep them coming back for more of our services.  One key way to do that is to develop industry best practices - demonstrating real depth in the industry of our clients. 

I’ve been thinking about integrity. Especially about how I handle those times when I haven’t accomplish what I said I would. I think of these as integrity breakdowns.

Right now I’m managing a project team, and we haven’t fulfilled several of our commitments. We’ve had a lot of slippage. I’ve been feeling anxious and frustrated because the slippage has continued, despite my best efforts.

When my wife and I saw “Lost in Translation,” she liked the movie, but didn’t like seeing it with me.  Now that’s not usually the case, I might add.  It’s just that I seemed to find parts of it funny (and laughed out loud) when no one else did.

As a veteran of the corporate climb I grew up, like most of you, on hard work and little advice.  Early in any career you survive on pure will or youthful ignorance to succeed. 

For organizations offering complex services and solutions, no one has more impact on getting and keeping customers than the technical expert.(1)

INTRODUCTION

The technology professional services business is starting to mature.  Signs that the industry has moved from “birth” to “adolescence” or even “adulthood” are everywhere. Gone are the days of the “ants” - Viant, and Scient, with huge market capitalization but limited profits. 

Q:  How do you eat an elephant?
A:  One bite at a time.

In a world of increasingly complex projects, constant competitive pressure, and diminishing margins, today’s Services leaders face unprecedented pressure to improve every facet of services delivery to drive profitability. 

According to CIO Magazine, “Companies worldwide are growth-oriented as never before. Their strategic priorities have shifted decisively over the past three years from controlling costs to pursuing new opportunities for revenue growth.”

Recently there was a story in the press about a Silicon Valley software company pulling the plug on its Indian operation. They decided to close their entire development operation and bring it back to the U.S. Some others have closed up shop quietly.

You can’t manage time. You can only manage yourself. Successful people manage to get a lot more out of their time. Here are nine things that you can focus on next year to make the most out of your time.

If I had a nickel for every time a professional services organization told me it needed marketing support but just wasn’t getting it, I could retire. Okay, perhaps not retire, but at least I could buy a round of macchiatos at Starbucks for everyone in the office.

Growing competition fueled by globalization of the economy is putting unprecedented pressure on service providers to rapidly innovate in many aspects of service delivery. 

Now that you’ve decided to deploy Professional Services Automation (PSA) software, you can be sure that your service projects will run efficiently and be more cost effective, right? 

To achieve results, focus can be a good thing. But I know that sometimes I get so focused on results that I don’t notice what’s going on around me. I get such tunnel vision that people begin to show up as obstacles, not as sources of help.

A while back I was having lunch with a former client who had become a colleague and friend. We were discussing a project we had both been involved in when the conversation turned to one of the consultants who was working on the project and had been requested by my former client to be removed from the project.

A recent Gartner study revealed that a full 66% of large scale projects fail to achieve their stated business objectives, are delivered late, or are substantially over budget.  That’s a pretty amazing statistic - but one that’s easy to believe for anyone with a few years experience in the Professional Services arena. 

One of the most powerful loyalty drivers available to professional services organizations comes from a situation most of us dread--screw ups--the implementation that never worked or the problem fix that never stuck.