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.  You’re alone, there’s no cell phone reception and there’s no building for miles.  You have the choice of trying to fix the problem or sitting there alone for a very long time.

With an hour until sunset, you decide to take a stab at getting the car running. 

You recall that the engine stopped suddenly, with no loud bang or grating noise, so you conclude that the problem is probably not mechanical.  There was no spluttering of the engine, the power cut out immediately, so in all likelihood it’s not a fuel problem.  You’ve just eliminated two of the variables.  That leaves only the electrical system.  So, you check the battery and that seems fine.  Then you follow the wires into the guts of the car, tracing their progress toward the spark plugs.  There’s a mass of wires and cables that comes out of the harness and you see one wire is not connected; it must have come loose when you hit the hole in the road.  You reconnect the cable, turn the ignition key.  Bingo.  The car starts and you’re on your way just as the sun dips below a nearby hill.

About a month later, the same thing happens. You hit a pothole and the engine stops abruptly - just like it did before.  This time you open the hood, look at the harness, and see the same loose wire.  You re-attach it, start the engine, and vow to get the problem permanently fixed sometime in the near future.

In the first instance, the problem was new to you; you’d never encountered it before and therefore an analytical process was employed.  In the second, you used prior experience to go straight to the cause. You took a heuristic approach to identify the problem and then fix the engine.

Heuristic techniques are frequently used as a rapid-fire way of making decisions, especially in the world of business.  In a small anecdotal survey I recently conducted amongst business acquaintances, I found that heuristic processes were used about ten times more frequently than analytical ones.  Business people generally make a quick assessment of the situation and then seek data to support or refute the initial take.  Think about a typical call to your I.T. support desk. It’s not unusual to hear something like, “That sounds like a corrupt data file; let me run a fix and call you back”.  Rather than exploring a full set of analytical processes, the support person is often able to focus in on a probable cause, test the assessment and initiate a fix.  It saves a lot of time.

In all aspects of our work, we constantly switch between heuristic and analytical problem solving techniques: the gut feel and the data gathering.  And so do our sales prospects and clients. Yet, in many interactions in the sales process, the tendency is to dwell almost completely in the analytical realm.

Most sales presentations, webinars and seminars are data-fueled pitches that fill the audience’s heads with all kinds of facts and stats.  They start with the “features”, move on to the “benefits”, and end with a crescendo of “advantages”. There’s talk about time to benefit, TCO and ROI.  There are graphs, pie charts and magic quadrants.  The analytical input is overwhelming.

The audience is seen as passive pawns.  Give them the right information, show them how your products or services are faster, better, cheaper and bigger than your competition, and they’ll buy.  Unfortunately, it doesn’t work that way.  Chances are that your clients don’t have the time or interest to wade through the information that is being thrown their way.  While you’re delivering that well-crafted pitch, your prospects’ attention is probably wandering, fading in and out, depending on their level of interest or concern.  You may often see them fidgeting through a presentation or prematurely thumbing to the end of a handout.  And in the case of a webinar, you can’t actually see them at all - but chances are your audience is spending as much time Googleing the internet and cleaning up emails as they are listening to you.

This happens to even the best presenters and best-prepared presentations.  Why?

You’re hitting your audience at an analytical level, while they’re operating heuristically.  Think back to the stalled car.  It cuts out and you have a feeling that it’s that darn wire that’s worked loose again.  You need someone who can fix the problem so that it doesn’t happen again.  Instead, your mechanic is saying: “Well, let’s first check the fuel and see if the tank is full, and then let’s see if the carburetor is blocked, and then, and then...”.  It becomes an exercise in frustration, akin to the way your audience feels during your nicely crafted presentation.  While you’re explaining some well researched statistics, they’re thinking:  “I get it already!  But will it solve my problem? , How much will it cost?  How fast can I deploy?  What are the risks?”

So how do you hit your audience at the heuristic gut level with something that captures their attention? For that, let’s turn to the world of politics and take a lesson from the professionals.

In his book “Don’t Think of an Elephant”, George Lakoff talks of building frames - the mental structures that shape the way we see the world.  Hearing the simple statement, “Don’t think of an elephant, whatever you do, do not think of an elephant!” people will find themselves thinking of an elephant.  It’s impossible not to.  The word elephant not only generates an image of the animal, but also a frame related to its appearance, its habitat, its migratory patterns and like - a structure within which new data can be presented.  New information offered into this frame is received as it relates to the mental image of an elephant.  Facts make more sense when presented within the concept of a framework.

When the Bush administration linked the words “tax” and “relief” they delivered a visceral message to the American people.  Use of the word “relief” - an easing of pain or distress - with the word “tax” created a frame in which tax is an ailment.  In the 2004 Presidential debates, John Kerry found it almost impossible to respond to this powerful metaphor.  Kerry’s position was to engage in a long-winded and unconvincing defense of his position on tax, based on facts and figures.  But although they were compelling facts in support of Kerry’s position, they were presented within a frame built by Bush.  Kerry couldn’t win.  His failure to modify the frame of the discussion before presenting his arguments reflects the way many companies sell today.  They focus on raw facts and figures, data and analysis, proof points and cost benefit without establishing a frame.  When the data you’re presenting is outside of your audience’s heuristic frame it is not effective.  And you’re certainly facing an uphill battle when you’ree throwing data at an audience that has already accepted a frame created by your competition.

Here’s another example of how powerful frames can be.  It’s taken from George Lakoff’s book. The 2003 California recall election set in motion the end of Grey Davis’s term as Governor of California.  His challenger - Arnold Schwarzenegger.  In focus group meetings, California labor unions presented their members with both Davis’s and Schwarzenegger’s positions on a number of topics and asked which of these positions their members agreed with.  Most union members chose Davis’s positions on a host of topics.  But when asked how they were going to vote, most selected Schwarzenegger.  While union members agreed with Davis on the issues, they identified with Schwarzenegger at a gut level.  The rest, as they say, is history.

In sales we need to build strong heuristic frames before presenting our data.  We’re seeking to get our prospects to react to what we have to sell at a personal and almost emotional level.  We want them to personally identify with our products or solutions.  Customer loyalty depends on how much a person identifies with a solution - how that solution helps or hinders the personal and professional success of that individual.  You’ve heard that old saying, “no one gets fired for buying IBM”” Now that’s a strong metaphor that has served IBM for years.  You’ve also seen how a CIO who implemented SAP at his last job, if given the choice, will most likely pick SAP in his new role.  This is especially true if that CIO has adopted a frame that links SAP to his professional success and his identity as a successful CIO.

A lot of the work that I do with my clients is focused on building sales frames that resonate with target prospects.  Using the Solution Selling pains sheets is often a great place to start, but you need to dig deeper than the pain sheets’ basic constructs:  critical issue, cause, impact and vision.  You’ve really got to get to the things that keep people awake at night - the things that frustrate a person’s ability to achieve professional and personal career success.

There are many ways to do this. One exercise I run is to have the work group compose an imaginary email that’s written by a target prospect in the middle of a sleepless night: “The 4-AM Email”.  This exercise often pinpoints the prospect’s most pressing and painful business issues - the stuff that keeps people tossing and turning in the wee hours of the morning.  Many times we’re able to take real-life examples of emails written during times of pressure, stress and frustration and discover the core issues that may plague our sales prospects.

Another method is to make use of social media sites such as Linkedin, or internet based communities and associations. In these discussion groups and blogs, your potential customers are often discussing their most pressing and immediate issues. 

Once these core issues are understood, it’s then possible to architect the frames and the messages that we need to launch sales cycles.  To create a frame, I use three components:

• The Probe
• The Pitch
• The Provocation

The probe captures the prospect’s attention: it’s an immediate and personally relevant issue.  The pitch is your company’s response to the probe; the solution you offer.  The provocation highlights the urgency to act now (regardless of whether or not there’s budget).  From these components we can build interest-inducing frameworks, and from these frameworks we can start to hang our facts and figures and the process of selling products and services can begin.

Let’s take another look at the “tax relief” frame artfully created by Bush’s people and break it down into these three components. 

The probe: You’re personally paying too much tax on the income that you’ve worked so hard for.  That’s money that could be spent on your family, on enjoying yourself, or saving for the future. 

The pitch: I have a plan to put more of your hard earned money back in your pocket. 

The provocation: Vote for me at the next election so I can implement this plan.

Did this message get people’s attention?  It certainly appeared to.  How could Bush’s competition argue against that message without crafting another frame?

Regardless of your political persuasion, you’ve got to build an emotional response to your products or services to get your prospects and clients to identify with what you’re offering.  By creating a position that hits at an immediate, attention-grabbing, gut-level frame you have earned the right to present all the facts and stats you want. And your prospect will probably listen.

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.

The first time I sliced a tomato with the new knife, I instantly understood the difference.  My tolerance for the other knives in the kitchen evaporated.  I would only use the special new knife and I treated it with loving care, washing it gently with warm soap and water and carefully drying it before putting it away in a special protective case.

Eventually, I forgave my old knives and began to use them again.  It’s not that the new knife wasn’t better, but not everything requires an exceptional knife.  About a year later, my friend once again found himself in need of a knife in my kitchen and, once again, he was outraged at the condition of my knives, but this time it wasn’t about the quality of the instrument.  It was me.  That day, I learned that you have to sharpen your knives regularly.  Even the best knife will lose its edge over time.

The same rule applies to consultants.

Make Training A Priority

In this economic climate, Practice Managers (quite rightly) devote the majority of their time to chasing down new business and keeping their existing customers happy.  Unfortunately, this means that we don’t have time to give individual attention to each consultant or to provide coaching and mentoring to keep their skills sharp.  We’re too busy working with unhappy clients, overdue projects, billing problems, and the myriad of other issues associated with professional services.

The problems are multiplied when skills development and training are neglected.  Excellent consultants get too comfortable or develop bad habits.  Mistakes and oversights occur.  Relationships break down.  Quality slips.

Create a Program

I’ve worked with some of the best, and even the best have a bad day.  But the gradual disintegration of skills is different.  It takes place over time and is often hard for the manager to recognize.  The person himself has no idea at all.

In a perfect world, consultants would work more like high-tech machines than like kitchen knives.  There would be a light on the dashboard to alert you that it’s time to upgrade her technical skills or send him to presentation training.  Even better, every consultant would take responsibility for his or her training and development, reading white papers after dinner and attending classes on the weekends.

In the real world, you may be well advised to create a schedule for sharpening each consultant’s skills regularly.

Every consulting firm is different and every consultant’s career path is unique, but the following is a generic, highly-simplified career path for technology consulting.

Most likely, you already have a formal program for training the Rookies.  You assign them to a mentor, usually an experienced consultant working on the same project team.  In addition to on-the-job training and mentorship, you may have a series of classes each new hire is required to complete.  It’s easy to remember to train Rookies because there is a measurable impact on the bottom line when the training is complete.

Technical Gurus train themselves.  They read and write white papers in their spare time.  They participate in user groups and serve as mentors to their fan base.  They are genuinely interested in their subject, they are curious about the newest technology and they like knowing about it before everyone else.  You don’t get to be a Technical Guru by waiting for someone else to send you to a training class.

PS Leaders also take some responsibility for their own development.  A pending promotion may inspire you to recommend sales training or leadership development, but ambition is usually sufficient catalyst for most leaders to continue training.

Make Training Part of Every Job

The most overlooked group is the Trusted Performers.  They are your workhorses.  They show up every day, do their work, and receive very few complaints from clients.  Until one day, like my kitchen knives, someone notices that the edge is dull and has been for a long time - and a preventable crisis lands on your plate.

To prevent dullness, create a yearly routine for training and implement it for every consultant on your team.  If you require each consultant to do one thing to develop their technical skills, one thing to develop their communication skills and one thing to help others do the same every year, you’ll soon find that the standard of performance for the whole team goes up dramatically.

The examples below are necessarily general because each practice has a different focus and specialization, but you can easily create three lists for yourself.  Ask each consultant to choose a task from one of your lists each quarter.

It’s not necessary to classify your employees or restrict participation to only the Trusted Performers.  Rookies can add these tasks to their training routine easily.  Technical Gurus will find their communication skills improve when they take on the role of mentor inside the organization.  PS Leaders are already coaching their direct reports and will be happy to get credit for something they are already doing, but may need to be reminded to keep up with technology changes.

Mentoring Is Training, Too

Professional skills can go stale more quickly than we realize.  Administrative and process tasks are usually the first place you’ll notice a slip in quality.  Unfortunately, there are no classes in how to submit a timesheet before the billing deadline or write an effective status report, which is why mentorship is a critical element of your skills development program.  When one consultant is acting as a role model for another, he will be careful to demonstrate the right behavior.

The simple act of sending someone to training to learn new technical or communication skills is reinforcement of its importance.  Implementation of a program that includes regular skills development, even when there is no budget for extended training excursions, will establish quality performance as a priority for every consultant.

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.

We all face sticky situations and cranky clients-they go with the territory. It’s not tricks or tactics that help you meet those challenges, but a mindset of healthy respect for your client and yourself, and a focus on the interests you have in common.

“We Have a Problem”

Nobody creates a client problem on purpose, but it happens. You miss a milestone; people get upset with one another; and misunderstandings about scope, among other things, can lead to tough client situations.

When a project kicks off, though, everyone wants a speedy, successful conclusion. You may run into detractors and internal politics, but shared optimism usually drowns out the protestations of any naysayers.

Still, momentum and the best intentions aren’t enough to prevent the inevitable bumps in the road. It’s easy for even a small glitch to turn into a serious threat to the project and the client relationship. So it matters how you get past those roadblocks.

Avoiding the Blame Game

The fastest way to slow progress on resolving any issue is trying to pin the blame on someone else. Too often, I hear consultants calling their clients jerks (or worse) when something doesn’t go as they’d like. As soon as you blame the client, two things happen.

First, your focus becomes shielding yourself (and your ego) from the negative implications of the situation. But any false sense of security you get is not sustainable. Eventually, you have to face the issue objectively.

And second, affixing blame inevitably bogs down the resolution process. When you need speed the most, playing the blame game is like dropping a boat anchor.

It’s equally destructive, though, to blame yourself for every bad situation. Some clients readily point the finger at the “expert” as soon as the smallest problem arises. I know one client who regularly blames consultants for the outcomes of his poor decisions. And he lets them know it.

Once you accept the blame, regardless who is at fault, your tendency is to try to make the problem go away, at any cost. Usually, that means taking on extra (often unpaid) work. And it absolves your client from any accountability for the situation. Take this approach and don’t be surprised if you find yourself in the same position again and again.

Of course, you have to know why a problem occurred. You can’t solve a problem without diagnosing it. But blame simply begets more blame. Tempers flare, positions harden, and real problem solving comes to a standstill.

Granted, some people embrace the blame game and have raised it to an art form. But if you get tagged as a finger pointer, the client is likely to see you as someone who refuses to take responsibility for decisions and actions. That is fatal for a consultant.

Even if you are confronting finger pointing, resist the urge to join the fray. Avoid the blame game and watch how much faster you resolve problems.

It’s Not a Win-Lose Proposition

If you and your client discuss any problem with three principles in mind, the solution will come more quickly and you’ll strengthen your ability to work together.

Begin with the simple acknowledgement that no one caused the problem intentionally. It’s natural to be upset that you have to deal with a bad situation, but your interests and those of your client should be in alignment. So define the problem quickly and decide on a course of action to solve it.

Next, recognize that most project problems result from poor decisions. But remember, people usually make the best decisions possible given the information available at the time. Find an answer to the problem first, and then look at the decision making process to see what you can do differently in the future.

Finally, resolving a problem situation isn’t a win-lose proposition, even if it sometimes seems that way. As you work through the issue, remind yourself and the client that you have interests in common. In the heat of a conflict, it’s easy to forget that. If the conversation gets rough, take a step back and reflect on and reaffirm your points of mutual interest before you return to the issue at hand.

Searching for “Aha”

Once you and the client agree on the definition of the problem, get all the facts and assumptions out in the open, even if that’s painful. Sometimes, we convince ourselves that we already know the facts, but resist that notion and keep an open mind. Few things impede issue resolution more than a closed mind.

As you discuss what happened, be assertive-not combative-in conveying your perspective. Sometimes, you have to let others reach conclusions on their own.

And remember that you are talking to a peer. You’re not a supplicant addressing the Grand Pooh-bah. In an open, objective discussion, it’s common for one or more people to have that “aha” moment of epiphany that allows for a breakthrough.

When my client’s CFO said that he was voiding my final invoice, my first reaction was typical: I was indignant and a bit panicked. I decided to keep an open mind, not blame anyone (including myself), and see what we could work out.

An abbreviated version of the conversation went something like this:

CFO: We’ve decided that we shouldn’t pay your final invoice.

Me: I see. Since we did this work before you arrived, I want to make sure you have all the facts. Our team did deliver the promised results, at a fixed fee that we negotiated in advance.

CFO: Yes, but you failed to provide consulting support at a pivotal point in the project. As a consequence, we incurred unnecessary overtime expenses and we think you should share those costs with us.

Me: Were you aware that our team anticipated that problem and offered the support you mentioned ahead of time?

CFO: You didn’t push hard enough for that. You should have known better. You are the experts, after all.

Me: Well, we felt so strongly about it that we offered to support the effort at no cost to you.

CFO: Really? Tell me about why we didn’t take you up on that offer.

From that point, we easily found a solution.

You can resolve many difficult situations by reaching a meeting of the minds on facts and assumptions. But you’ll never get to that point unless you can handle the give and take that accompanies tense conversations.

That means airing all the facts, even the ones you don’t agree with. It also means resisting the rush to judgment.

Responding from the Hot Seat

When the client says, “We have a problem,” these simple rules will help guide your way to resolution.

• Affixing blame doesn’t fix anything
• Define the problem in a way that allows you to solve it
• Test the validity of all assumptions and facts
• Disagree without being disagreeable
• Prevent future problems by focusing on how decisions are made
• Keep reminding yourself and others that no one intended to create the problem.

Keep that in mind and you’ll be able to tackle any problem clients throw your way.

It may be too early to be certain, but many economists are now suggesting that the recession may be coming to an end.  And while that’s great to hear, it also means that there’s a lot of hard work yet to be done in order for companies to ramp back up, and eventually surpass their previous financial and operational levels.  I do believe we’re going to get there - but not by simply going back to “business as usual”.

The recent business climate has been described as a “correction” - because it exposed outmoded ways of conducting business which are no longer appropriate, relevant, or profitable in an ever-changing global marketplace. We saw this play out over the last four or five quarters, as many (if not most) firms underwent a series of painful measures in an attempt to weather the storm.  In many cases, budget cuts, headcount reductions, contracted operations, and a litany of other adjustments were made just to keep the ship afloat.

If there’s a silver lining in all of this, it’s that as those same firms begin to regroup and rebuild, they will have the opportunity (and the responsibility) to replace antiquated practices and processes with newer, more efficient ways of doing business.  Otherwise, they risk becoming obsolete in a new, less-forgiving marketplace.

As with any daunting task, the toughest part can often be figuring out where to start.  And while, in this case, there are certainly countless possible answers to that question - this article provides a high-level framework consisting of 6 focus areas that any services firm can leverage as a starting point for renewed operational success. 

CRITICAL FOCUS AREA #1 - THE SERVICES CHARTER

So where does it all start?  Given all the variables that have changed - this is the perfect time to begin by re-examining and, if needed, re-prioritizing your services charter.  Over the last several quarters, whether consciously or not, many firms shifted from a growth strategy to a client-retention strategy, focusing energies and resources heavily on ‘protecting the base’.  While this strategy may have been appropriate in a flat or negative-growth climate, companies that are quick to re-evaluate and re-align their PS charter with their longer-term growth strategy will almost certainly be at the forefront of the recovery.

Re-establishing the charter and communicating it to your team will be an essential first step for most firms, and one that will guide you through the next five critical focus areas, as well as the many other real-time decisions you’ll be faced with in practice.

There are four key business objectives that the charter should prioritize for the technology PS organization:  Revenue, Profit, Market Share, and Customer Satisfaction. 


Each of these ‘choices’ will drive an operating strategy congruent with that choice(s).  By way of example, if you decide to focus on market share, that choice will not support driving high margins/profit.  Typically PS orgs are able to optimize their operational strategy around one of the four choices, maybe two, but never more than that.  Determining your charter will drive clarity with the product organization about what the PS org will and as importantly what the PS org will not do. 

CRITICAL FOCUS AREA #2 - FUNCTIONAL INFRASTRUCTURE

The charter you’ve established will ultimately support the definition of key aspects of your services strategy, from budgeting and forecasting, to the packaging and marketing of the offers you will bring to market, as well as delivery, quality controls, maintenance, sales alignment, and more.

So once you’ve nailed down the charter, you’ll need to analyze your existing functional infrastructure, and invest as appropriate to ensure support of the objectives and priorities you’ve defined.  For example, if you’ve determined that the primary goal for PS is to grow revenues, then you’ll need to have a plan for services marketing and sales in conjunction with your company’s overall product strategy.  Or if you’re simply not identifying and closing every possible opportunity, soft skills training for your PS practitioners might be appropriate.  And to ensure that you’re capturing and billing for all work delivered, you may also need to reassess both your time and expense process, as well as the toolsets you’re using to manage the entire quote-to-cash lifecycle.
As with all prioritization exercises, you’ll have to find the right balance of functional investments to support your stated PS charter and strategy.

CRITICAL FOCUS AREA #3 - PROCESSES

Okay, so you’ve heard the “processes” story more times than you care to remember - fair enough.  But there’s a good reason it keeps popping up:  It really is that important.  And you will never have a more pain-free opportunity to review, refine, and replace processes than when you are rebuilding your organization.

The truth is that many PS leaders often recognize and acknowledge that their processes are outdated, un-enforced, ineffective, or some combination thereof.  But even armed with this knowledge, issues like bandwidth, resistance to change, complexity, or inter-dependencies can create a perception that the effort required is too overwhelming to justify a change.

In a rebuilding phase, these objections are more easily overcome.  Simply put, as you introduce new priorities and build out a new infrastructure to support them, reviewing and aligning your processes with these initiatives is required - not optional.  In many cases, we have seen that a lack of willingness to proactively change these legacy processes was the chief reason such drastic operational cuts had to be made when the downturn first hit. 

While there’s no denying that everyone felt the pinch, those companies that had already implemented scalable, state-of-the art processes and governance around resource management, project management, and quality assurance had efficiencies in place that made it much easier to adapt and scale down their operations with far less permanent sacrifice than their competitors and counterparts.

Follow their lead as you examine the processes required to fulfill your new PS strategy, starting with Resource Management - for two reasons:  First, getting the right person in the right place at the right time is essential to making any project management or quality process successful.  Second, no matter what your overall strategy is, driving the utilization metric is absolutely essential to the efficient operation of any services team.  Whether or not your specific charter requires you to drive billable utilization - an effective Resource Management process will help reduce bench time and labor costs, drive profitability, and improve overall project performance, along with employee morale and client satisfaction. 

Next, you’ll want to look at Project Management - and here’s the key - with a fresh set of eyes and an open mind.  I say that because, over the last decade, Project Management processes, practices, and tools have received more investment of time, energy, budget, and angst than virtually any other discipline in the corporate arena.  And yet “over time and over budget” is still a chorus we hear all too often.  Whether it’s time to start from scratch with a new PM methodology, or adapt an existing process - you must be willing to move past the status quo to ensure that your project management process is both aligned with and capable of supporting your strategy moving forward.

Lastly, you’ll want to examine your Quality Assurance processes, to ensure that you are consistently and systematically meeting client requirements.  Without proper QA processes tailored to your PM methodology in place, including a coordinated system of precisely-timed project audits and checklists, you not only risk client satisfaction (and thus future revenue) - but you will also inevitably contend with both scope creep and re-work that immediately impact both profitability as well as your ability to deliver against backlog and pipeline projects.

CRITICAL FOCUS AREA #4 - TECHNICAL SKILLS MIX

As markets change, clients come and go, and product portfolios evolve, the demand for PS is in a continuous state of flux.  Factor in shifting worldwide economic dynamics, and you can be certain that the quantity and location of resources, as well as the skills mix required to effectively meet demand will continuously change.

Fundamentally, the most important matter to address for determining ongoing skills mix needs is building and maintaining skills forecasts using whatever method best serves your needs. The forecast should be granular enough to identify type, capacity, and geographic dispersion of skills needs over a reasonable time horizon, typically six months or more.

So in order to effectively rebalance supply to meet demand as it arises, you should take proactive steps to create a more agile, responsive resourcing model.  This will include recruiting, on-boarding, training/re-training, competency centers, peak-load planning, partner/contractor strategies, and more.

CRITICAL FOCUS AREA #5 - SOFT SKILLS

We’ve all the seen the studies that demonstrate how much less expensive it is to sell into your existing client base than it is to acquire a new customer.  And as the shift from a product-driven economy to the new services economy continues, there is nobody better positioned to identify and foster new revenue generating opportunities within your client base than your PS practitioners - the trusted advisors that your clients look to for expertise and guidance.

The challenge for many organizations, however, is that the vast majority of training bandwidth and dollars for consultants is allocated exclusively to the development of product and technical knowledge.  And while these are certainly core competencies that every consultant should possess, they do not equip services professionals with the skills needed to handle the more qualitative and ‘human’ issues that arise every day in the field - things like effectively engaging with a client, managing scope creep, effectively handling complaints and issues, and indentifying and up-selling new opportunities.

By augmenting your training programs to include the enhancement of these mission-critical soft skills, you will develop more capable, confident, and effective consultants, who can help take your services organization to the next level.  As you build out or contract for soft skills training, the key concepts to focus on are client-facing skills, communication strategy, role dynamics, stakeholder awareness, scope and issue management, opportunity identification, value prop creation, and up-selling. 

CRITICAL FOCUS AREA #6 - TECHNOLOGY

Much as with process adoption, ongoing challenges associated with day-to-day operations and delivery can perpetually delay the evaluation and adoption of new and improved technology solutions that could ultimately streamline, automate, and improve your overall services business from end-to-end.
Also as with processes, there’s no better time to invest and implement new technologies than when you’re starting fresh.  And while both processes and tools separately are extremely important, one simply will not work without the other.

The key technology needs for highly competitive PS teams should be Professional Services Automation (PSA) and Knowledge Management (KM), including integrations with other front and back-end systems, such as financials, SFA or CRM tools, and project management or ERP systems.

As you begin the vendor selection process, you should prioritize a strong track record for customer support over today’s product features and functions.  There are many choices, and the best PSA vendors are introducing new functions all the time, so chasing function is much akin to not buying a PC quite yet because you want the latest and greatest.

From a functionality point of view, pick a specialized PSA solution that has strong integration of mission critical PS applications, one that provides for easy integration of popular front and back end applications, a well thought out and flexible workflow approach, compliance with audit requirements to meet regulatory demands, and one that will facilitate the least disruptive approach during transition to a new environment.

Lastly, look for customization flexibility in the form of flexible reporting capabilities, open APIs, and toolsets designed to allow integration of other modules or applications, and the ability to use Business Intelligence tools to gain access to data and perform analyses that may not be part of standard functions.

GETTING STARTED

There’s no question that firms will have to adapt and evolve to remain competitive in an emerging global marketplace that will include new, more innovative business models and delivery mechanisms, and in which buying behavior will cause all of us to raise our game.

And while it may seem overwhelming at first, by securing executive buy-in and cross-functional support now, and beginning to work through the six steps above, you can create a collaborative business transformation plan that will not only position you for success through the rebound, but also provide you with much better insulation against any future storms that may come.

"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.”

As the economy approaches the “new normal,” companies and service providers may think they can become a bit complacent with the customers who have stuck with them through the “thick and thin” (or perhaps “thin and thin” says it better) of the recession.  As this CFO demonstrates, it’s not about factors like total cost of ownership (oh, so pre-recession), but about value derived - and in this case it’s “show me the money” before any deal is consummated.  But even as companies start emerging from their cocoons to see that the economic world, albeit changed, is still out there, the recessionista view of business operations will be with us for a long time.

The belt-tightening of the past three years has hit every aspect of business, and as service providers, we see it in fewer professional services customization requests; delays in product upgrades, especially if hardware upgrades are involved; and an increasing search on the client’s part for lower cost service options.  Purchases of new software for first-time solutions, replacement for existing aging applications, and the add-ons of cross-sells and upgrades have all dropped during this period.  And while the pick-up in these activities will likely be slow, professional service providers need to ensure that they are top of mind for the client’s work when those activities commence.

Here are five key points for all service providers to consider as they approach each customer-points that will help you ensure that you maintain that post-recession business.

1. Learn the impact of the recession on your client’s business. Before you go in to push an upgrade path or to sell customization or integration services, take the time to learn what has happened in that account since the start of the recession.  Have they downsized significantly? (Perhaps now is the time for a software-as-a-service initiative). Has their business model changed?  Has M&A activity impacted them in new ways?

2. Evaluate the state of their technology platform today. Are solutions out of date or clearly not working well for the client?  Were technology upgrades or projects back-burner-ed for the past three years?  In your role of trusted advisor, look at the entire technology enterprise-even if you are concerned with only a part of it, such as CRM, supply chain or financial applications. Your ability to retain the long-term loyalty of the customer can be enhanced through intelligent guidance on the larger scope of technology use in the organization.

3. Know what the client thinks. Might the IT team be searching for a third-party alternative to expensive vendor-provided service and support options?  Are they grumbling about costs or poorly executed integration outcomes?  Might they be contemplating a product switch that you are unaware of?  Are they likely-as many are today - to keep the existing technology scenario in steady state mode for far longer than they would have pre-recession?  Your intelligent conversation with client management depends on a solid understanding of these issues before you begin.

4. Develop a service sales strategy that supports an incremental plan for the future. Wherever the client is today, your success will be more likely if you can present your projects and ideas in a “crawl-walk-run” model.  Rather than beginning with the “run” view that you would have used in the past, take time to develop a project strategy that can be bitten off in smaller increments, but clearly tie to one cohesive plan for future outcomes.  The client will appreciate your understanding of his business goals and objectives, and see that you can move him toward the desired outcome over time.

5. Be prepared for flexible pricing options. Many companies have been exceptionally hard hit this recession; many are still facing liquidity problems. Whether you are selling standard services, integration projects or customized development, your success against competitors may well rest with your creativity in pricing options.

The first goal for all service professional in the “new normal” is to retain all the customers they had when the “old normal” melted away.  As ever, we cannot take our customers for granted - and in the face of more and more alternatives for service and consultancy support, professional service providers must become more diligent in providing the service their customers need.

But even more important, going back to the CFO quoted above, selling services in the new normal requires the provision of demonstrable business value.  It’s not the cost of the proposed solution, it’s the quantifiable benefit - and that will be the driving charter for all professional service providers.

Dr. Katherine Jones is the CEO of Independent Consulting Services (ICS), a business and marketing strategy consulting firm in San Mateo, CA.  ICS senior professionals help companies define and articulate business value for their prospects and customers. TechVentive CEO Brian Sommer contributed the CFO interview for this article.

I’m writing this article as a follow up to my last article - “Designing Deliverables for Efficiency”. The major points I made in that article was that deliverables created in the design process of a technology project have to meet certain goals.

1. They must help you think
2. They must stack, and
3. They must serve the consumer

1. Size of the team
2. Specialization of the team
3. Duration / scale of the project
4. Years of experience/seniority of the team
5. Specific experience with the project environment of the team

There’s no reason to O.D. (over-deliverable)

Like anything that seeks to eliminate both waste and the chaos of under-planning, the goal of the planning and deliverable process is to have as much documentation as necessary and as little as possible.  The creation of deliverables is really about breaking down problems enough to think thoroughly about them and then communicating the conclusions to the next person down the line.  If you don’t need a deliverable to think something through, and you don’t have a communication challenge in getting the design across to someone else, then you don’t have a good reason to spend time on incremental deliverables.  (Note: that is not to say that you don’t need documentation, which is its own topic.)

The trick is figuring out how to decide what deliverables are appropriate for each project in a consistent and correct way across an organization.  In the best of all situations you have a very senior resource involved in every project who just knows inherently what is useful and what is a waste of time.  However, in practice you end up with a wide variety of experience levels trying to make the decisions, and they’re likely to make the wrong decision just as often as the right one.  This can quickly lead to wasted time, or quality errors.  Worse yet, it eventually leads to procedure rot.  Processes and procedures fall into disuse because people apply them in the wrong situations and conclude that they’’e a waste of time.  Eventually they quietly stop doing them.

Leveraging rational selfishness

One of the better ways I’ve found to get the organization oriented towards the “as much as necessary and as little as possible” mentality is to use a system of checks and balances between team members.  It’’ a pretty straightforward process:

1. Make sure everyone is trained on the full design process, the defined deliverables, their purpose, and how to create them.
2. Establish a checklist of deliverables and decide which items a mandatory.
3. Get the team (or job function representatives of the team) together for each project and have them select the deliverables they collectively feel are necessary for that project from the checklist.
4. Train the team to escalate any disagreements for management review and decision.

It’s the natural self interest of the person receiving the work to want it documented and clear because it makes their life easier.  It’s the natural self interest of the person defining the work to skip making the document and just assume that the resource will “get it” after a meeting or two because it makes their life easier.  The dynamic between those two motivations can help to strike a balance IF you empower them to make collective decisions about what’s necessary—and what isn’t.

You might as well pave the shortcut - it saves the grass

When you combine a decent culture of accountability and ownership of work product with a defined and enforced process you have a recipe for quality.  When you then add in the ability for the team to flex that process to appropriate situations you can have a pretty powerful tool for efficiency.  If the team understands that they will be held responsible for their ability to execute correctly then they will be motivated to negotiate smarter and smarter process decisions.

The key is providing a defined mechanism for adjusting that process so that people understand the project-by-project decisions they’re making about deliverables to be PART of the process rather than working around the process.  The checklist keeps the value and purpose of the overall process alive and encourages the evaluation of each project in a conscious way.  That’s a far better process than just falling into ruts of useless deliverables or chaotic processes.

Great, now everything is perfect

So of course this isn’t perfect.  You can still manage to combine experience levels or personality types that get into a “group think” situation and make poor decisions about the depth of the design process needed.  However, another nice thing about the checklist is that management now has a document that gives them fast insight into the project plan and allows them to question decisions about the work flow quickly and easily.  This tends to be better than finding out after the fact that the domain model was blown off ...  as you’re writing off the dollars to fix the database design.

Like any procedure, it still requires management to make sure that it’s being done and to review the results, but building the process in a way that pushes the team to be responsible for “right-sizin"” can yield some nice results.

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?

CRM and Project Management Software Data Flow

The diagram above shows an overview of the various types of information exchanged between a CRM and project management system. CRM and project management software integration points are as follows:

- Customer provisioning: a CRM is the system of record for customer information while the project management software is the system of record for project information. CRM customer data is mapped to the customer object in the project management software system for project billing and execution.

- Project initiation: CRM project management software integration enables you to automatically launch a project or a project request from a CRM application once an opportunity reaches a certain state. This provides the service team with great insight into upcoming projects and allows both sales and project teams to track project status using various CRM/project management mashup reports, dashboard and views.

- Professional services automation: With full professional services automation functionality, CRM project management software integration automates the entire customer project billing cycle. A professional services automation system leverages the customer and initial project data that resides in the CRM application to create the project, establish the key project milestones and billing rules, and generate pre-bills or invoices based on that information. All the while both sales and project teams have access to various dashboards, reports and mashups that provide them with a real-time view into the entire project pipeline and portfolio.

- Time tracking for customer cases and issues: A frequent requirement is to track time spent on customer cases or issues being tracked in a CRM application either for cost accounting or billing purposes. CRM project management software integration links a CRM case to the project management time entry system so that individuals who work on the case can report the time they spend on resolving it.

Benefits of Connecting CRM and Project Management Software Systems

Here is a list of benefits for integrating CRM and project management software by user group.

- Executives: company executives gain access to real-time project cost, budget, and revenue information that enables them to quickly answer questions like:

• What does the quarter look like?
• What is our project revenue and cash flow?
• Which client engagements generate the most revenue or highest profit?
• How can I get a consolidated view of all of our service engagements and their current status?

- Service teams: service team members are able to plan and prepare for upcoming projects and collaborate more effectively with the sales team on new opportunities and existing customer projects. Service team members can answer questions like:

• What is the status/health of our projects and service engagements?
• What does the project pipeline look like? When are projects forecasted to start and when are they due?
• What resources and skills are required to deliver these projects? Do we have enough capacity to staff upcoming projects?

- Sales team: CRM and project management software integration connects sales team members to the project execution teams. Sales team members gain access to customer and project summary information that helps them understand a customer account’s current status and whether there are new sales opportunities to pursue. Sales team members are able to answer questions like:

• What is the status of my customer’s project(s)?
• Is the customer happy? Are there any red flags regarding requirements, delivery dates, budget or scope?
• What else does the customer need?
• How much of the project has been billed so far?
• How much services have been consumed from the open POs?  When is the right time to contact the client for more services?

CRM Project Management Software Integration Connects Sales to the World of Projects

This article described how CRM and project management software can integrate and exchange information to provide sales and project teams with instantly available project status, pipeline, cost budget, and billing information. Real-time access to this information helps:

- The sales team analyze customer status and pinpoint new opportunities
- Project team members plan, train, staff and prepare for upcoming projects
- Executives assess project performance and forecast future demand
- Accelerate and streamline the entire project billing cycle

Dispersed teams, projects and customers have made project management and execution more challenging than ever. It takes considerable collaboration and effort between various teams to win new customers, keep them happy, and to deliver projects profitably and effectively. By linking CRM and project management software, project and sales teams gain the visibility to forecast demand, seamlessly transition projects from sales to service teams all the while exceeding customer expectations. In today’s fast paced impatient world, spreadsheets, emails, manual processes and disconnected systems will not get you there.

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.  I have seen variances in specialized markets, but general operational consulting tends to be a pretty competitive market.  Why is that?  My theory is there are a lot of people out there who ‘come through the ranks’ and want to share their hindsight with those who hopefully would benefit.  That’s why I was encouraged to start a consulting company and I’m sure others out there have experienced the same thing.

When you work in a small consulting company, a big challenge is how you differentiate your company enough to stand out among all the others vying for the same business?  You’re too small for a big marketing budget and may not even have a real sales team.  Your employees may need to be the well-rounded wear-many-hats type.  Competing with the big guys is a bit daunting but you have a few advantages.  Your biggest differentiators are partnerships, networking, and referrals.

No matter what the size company, there will be holes in knowledge and expertise.  No one knows everything about everything (thankfully!).  This is where partnering comes in.  In fact, some of your best partners may actually be your direct competitors.  Pull together on joint proposals or strike up a prime/sub contractor relationship.  You’ll find strengths and weaknesses in each other that can give you the upper hand on opportunities that walk through the door.  I’ve worked on many opportunities as part of a single team where it was difficult to provide a complete proposal due to weaknesses that could not be compensated alone.  Partners can fill in those weaknesses and, in many cases, those partners can be small consulting firms since they tend to be more flexible on terms and may have unique skill sets.

You always hear about networking but that’s because it truly is one of the best techniques to get your name out there along with your reputation.  It doesn’t mean you have to send flyers to all the local businesses or attend every professional conference in your industry area.  It does mean that you have to take advantage of forums out there to meet people and share advice.  You are reading this on PSVillage so you have already started on your networking goal.  PSVillage will lead you to other forums and conferences such as TSW, and to their sponsor networks including OpenAir, Tenrox, Projector PSA and Appirio.  You do have to participate, though, in order to get the benefit of the networks you join.  It’s not like a Christmas card list that you pull out once a year and get lots of letters in return.  But if you are vigilant, it will pay off in dividends.

Referrals and references, not surprisingly, trump any other method of driving business.  How many times have you casually referred something to a neighbor like a good restaurant or a lawn service? Or to a client or colleague, such as an article or a helpful contact?  Companies benefit from referrals no matter what their business and that includes consulting.  Striving to have all customers reference-able and to have those companies refer others to you is an ultimate goal.  Word of mouth is the best sales channel you have ---- it can help you gain partnerships, expand your network, and close deals.

Companies, no matter what their size, all have the same problem - to differentiate themselves and win new business.  Why try to do it alone?

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.

That question is how does the client know what the problem actually is?

Take, for example, a water bottling company that was plagued with late and missed deliveries to its customers. As complaints about the service grew, the executive team started investigating. After some analysis, the team concluded that poor communication and a lack of shared information between the delivery drivers and warehouse employees were causing the daily schedule to slip.

In response, the company decided to install a delivery scheduling software system to solve the problem, and asked several consultants for help with the project. Instead of jumping into a series of questions about how to implement that solution, one consultant began with this question: “How do you know that is the problem?”

The client could offer only limited factual support for the conclusion, and that stirred everyone’s thinking about the problem. The consultant used that opportunity to uncover what was really amiss.

Why “How” Matters

The best consultants, and the top services sellers, resist the urge to talk about what they will do until they understand how the client identified the problem. They take this approach for three reasons.

First, most clients respect the honest skeptic. Once you accept a client’s assertions at face value, you’ve elected to place the sale above what’s in the client’s best interests. Clients expect some pushback when they advance their conclusions, and your response offers them a way to learn about your skills, perspectives, and ability to communicate.

Second, if you and the client base the definition of the problem on shaky assumptions, everything you do going forward will be unreliable. Without a solid foundation, you can’t be sure if the proposed solution will be successful or miss the mark.

Finally, if your solution doesn’t resolve the problem, don’t look for clients to chalk it up to poor diagnosis on their part; they will hold you accountable.

One of the consultants responding to the water bottling company asked “how” questions for every assertion the client made about the delivery problems. After a long discussion, the clients realized that they still needed to identify the true source of the difficulty. So instead of leaping ahead with the project, they asked for an independent assessment.

Checking All the Angles

The point of asking “how” questions is not to lay waste to a client’s analysis; nor is it to showcase your superior analytical skills. Instead, such questions offer an important way for you and the client to clarify the situation and give everyone an idea of how you’d work together.

To be effective, “how” questions should examine a problem from multiple angles. In the case of the water bottling company, the consultant probed six specific areas:

1. How well does it work? For every process, like customer deliveries, there are acceptable and unacceptable levels of performance. Find out how each part of the process performs in terms of that standard, where it works well, and where it needs improvement.

2. How effectively do people and processes work together? Few (if any) business processes work in isolation. Drivers work with warehouse personnel, customers, accounting staff, and others, for example. Ask how well the groups work together.

3. How thoroughly do people understand what to do? It’s common to assume that the people involved with a business process know how to do their jobs. That assumption is often invalid, especially when it comes to handling exceptions to normal procedures. Ask how the level of employee education and training might be impacting results.

4. How appropriate is the work flow design? Often, the way people do their work is outmoded or poorly designed for the needs of customers. Examine how suitable the process is for its intended purpose.

5. How promptly do workers get the help they need? Many process failures result from delays in helping people solve tough problems. An employee may need help with a tricky situation, and might have to hold up operations until it is forthcoming. Ask how the client provides support for exceptions and for problem solving.

6. How satisfied are people with the performance of the processes and systems they use? It’s always instructive to ask people who are directly involved how satisfied they are with the way the work goes. Often, an open-ended question about an individual’s overall satisfaction reveals insights that you may not uncover any other way. The answer often leads you directly to the root of the problem.

The Real Answer Is in Your Questions

Once the consultant got the answers to the questions in the six areas above, a much broader definition of the bottler’s delivery issues emerged. It became clear that the benefits of a driver scheduling system could be substantial, but a larger problem would remain: The customer service reps were inadvertently introducing errors into customer order quantities.

As a result, the warehouse workers were loading incorrect orders onto the trucks, which the drivers didn’t discover until they attempted delivery. They had to fix the orders on the fly, leading to delays. The resulting proposal for solving the problem addressed the order processing system as the first step in a project to help the client improve customer service performance.

Your best opportunity to demonstrate your competence during the sales process begins with how you manage discussions of the client’s issue. In this case, the consultant earned the right to work with this client by challenging the diagnosis of the problem, being insightful, and starting with that simple question, “How did you come up with that?”

Overview

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. There are, however, a number of less obvious factors affecting margin health that take root in the sales process. 

The primary focus of any sales cycle is winning profitable projects. Firms employ formalized review processes and scrutinize the financials, contracts and business terms. The results, in theory, are deals that meet the profit and risk goals of the firm.  There are, however, a number of smaller things that should be considered in the sales process that do not reveal themselves in the project economics, but impact the overall organization profitability.

The following are four such “traps” of the sales process that can go undetected, or worse, are behaviors embedded in an organization.  The good news is that these traps are not hard to solve, but do require communication and education between delivery managers and their sales counterparts. 

Holding Key Personnel

Often times, prospective clients want to know the key personnel proposed for their project. Sales leads and client managers also view this as a strong tool for differentiation by selling “the A team”.  Selling resumes is a facet of selling, but can erode profitability if not managed correctly. The common result of using this approach is that key personnel (project managers, architects, team leads) are “held” before the deal is sold. Two weeks to close the deal quickly leads to two months, and the billable utilization of these key resources has plummeted.  You do not have to eliminate the practice, just manage it more closely and try these approaches:

• Manage client expectations
• Create options
• Implement a centralized resource management operation

First, manage the expectations of your prospective client. Get them excited about the potential resources, but talk frankly about their availability. Often times, the chance to secure strong resources creates a catalyst for faster action by your client. Second, create options. Use scenario planning and develop options based on multiple resources and various start dates. Do not allow anyone to completely lock on one resource, rather, keep them open to more options.  You can also share the various options with the client so that the client does not get focused on any one particular resource - instead they begin to see that you have multiple, effective staffing options to meet their project needs.  Finally, this problem can be exacerbated by organizations that do not have effective, centralized resource management. Regular monitoring of key resources, maintaining options and the continuous adjustment of staff based on delays are extremely difficult without the data and tools for managing this dynamic scenario. Centralized resource management also eliminates inefficient hoarding of resources, leading to more options and flexibility in staffing the project. 

The Fractional Resource

The following is based on a real scenario I have experienced many times. In the professional services organization of a large software firm, the client manager sells some post-implementation consulting services. The client is attempting to perform an upgrade; while the client does not believe they need the help, they do want access to a Subject Manager Expert (SME) “just in case”. A senior architect in the solution domain is sold at a good rate, say $200/hour. The client manager gets the client to agree to 50% of the SME for a month, on demand, meaning no set pattern or schedule. The client manager thinks he has a win-win deal: flexible service to his/her client and high margin for the resource. We, the delivery managers, are somewhat less enthused.

The obvious response to this arrangement is.... what to do with the other half of the resource’s time? Fractional allocations of resources (especially on demand) make it very difficult to find other opportunities to fill the remaining billable capacity. The situation only gets worth when resources are sold at 30%, 20%, or even less than 10% allocations. The result is either a significant hit to the resource’s utilization, or a lot of management time trying to find creative ways to keep them busy on other billable work.  In either scenario, overall profitability is drained.

The solution is usually clear, but not easy: educate your sales and client managers. Often, they do not understand the impact these deals have on your organization. From their perspective, these types of deals yield good revenue and good margin. In your discussion with the front line, determine if the fractional needs are a one-off, or a trend. If a trend, then determine how to capitalize on it. If there is a measurable need for upgrade support from SMEs, then develop a structure to pool experts across multiple clients, similar to a help desk. 

Hidden Costs

If a cost is not on the deal financials, is it expended? This is not an existential question. The answer is a resounding yes. Firms establish internal cost rates for resources and provide associated “load factors” to account for other variable costs. Too often, there are additional variable and fixed costs that are not assumed in the load factor and are not explicitly accounted for. These costs can surface after the deal is booked, and undermine both project and organizational profitability. Examples of such costs include: specialized training, recruiting, state gross receipt taxes, HW/SW requirements and management oversight.

In my experience, the first issue is that most resources involved in selling and constructing the deal aren’t aware of what is included in overheads and load factors. Second, there is a tendency to focus only on variable labor costs, and not the one-time or fixed charges.  Recognition of hidden costs must be embedded in the estimating tools and process of the delivery team. Early recognition of the true cost to execute projects will allow all stakeholders to make the most informed decision on how aggressive to be on price and margin. Again, it comes down to education. All personnel involved in selling and constructing deals should understand what is included in load factors and the other additional costs.

With the costs known, there are options on how to include them in the price. For fixed fee, it is straight-forward to include in the overall price. For time and materials costs can be additional line items, or embedded into the hourly rate (cost) of the resources.

The A-Team at B-Team Rates

Like my point about key personnel above, every salesperson or client manager wants to provide their customer with the A-team of resources. Staffing models, however, typically assume a mix of resources, known as a leveraged model. This staffing model assumes there are some strong, experienced resources mixed with a greater number of less experienced, less expensive resources. The result of positioning too many good resources is obvious:  you will exceed the resource budget immediately.

Achieving a good mix of resources for projects is not just about the project economics, it also has impacts to the delivery organization overall. Done well, it maximizes the impact of the experienced resources. It prevents an imbalance of organization utilization, where the most valuable resources are over-utilized while less experienced resources become under-utilized. It also fosters skills development and mentorship by mixing experience with inexperience. Ultimately, it can make the organization more price competitive. 

To consistently assemble effective, leveraged teams requires good inter-team communication and a solid resource management infrastructure. Too often, sales and client managers latch on to name brand resources. These are the minority of resources with the established reputations and known resumes of experience. The delivery manager should be prepared to quickly identify strong alternatives, and easily be able to highlight their skills and experience. Centralized resource management supports the delivery manager with a skills inventory, resume database and immediate visibility to all available resources internally and externally.

Every delivery manager should have success stories where they put less experienced resources in situations and they succeeded beyond expectations. This is how the next wave of A players emerge.

Conclusion

Avoiding common margin eroding traps starts with having a good resource management infrastructure and processes. This gives delivery managers the greatest set of options and flexibility in defining and assembling their teams. With this, the focus needs to be active communication and continuous education of sales and client teams. Sales teams may overlook these traps that do not show up in deal economics and more importantly, do not always align with their incentives for selling. It has always been my experience, however, that once these issues are explained and alternatives are provided, delivery managers, sales and client team members can better work together to ensure the organization maximizes profitability.

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.

The truth is speed wins.  Just ask Usain Bolt who set the world records in both the 100m and 200m dash in Berlin last month.  Even in a long, steady race like the Boston Marathon, whether you’re a tortoise or a hare, the fastest runner across the finish line wins the gold.

When it comes to selling services in a recession, why is speed so essential?  In a recent interview, Jeb Blount, CEO of SalesGravy.com explains that speed creates energy in business. He says that we have to take more decisive actions and move faster to get to buyers first.

While many companies are more or less hibernating, waiting for the next boom or even signs of a recovery, Blount offers a different perspective of these perilous times:  Now is the time to move your business forward.

Blount says that the problem you have with a recession is that everybody starts getting obsessed with trying to retrench or be safe.  Business leaders need to recognize that recessions are about action.

“In every industry segment, there’s an opportunity to win. What smart professionals do is they go on the offensive early and they start taking advantage of weak competitors, and they take action right now to take market share. These are the folks that are developing strategies and energizing their teams to go out and find new customers,” said Blount.

Blount says that speeding up our processes, as well as our sales and marketing, our response times - and certainly our customer service - will help us achieve a solid advantage in a down economy.

“Recessions are about action, not about retrenchment.” So, right now is the time to move even faster than before.

“In the 21st century, speed is the great differentiator; speed is what drives innovation to market; is what will make you faster, stronger, sleeker, better, more powerful, as we begin emerging from this economic downturn.”

So, what can you do to speed up the services selling process in a down economy?  Here are three strategies that you can take action on today to speed up your services sales processes and win new services sales now:

1. Segment
2. Simplify
3. Systematize

Segment

Sure, most service organizations already have in place today some level of maturity in their services selling processes.  Yet, what we’ve found is that most of these organizations treat all customers and services sales the same way. 

But, at a high level, there are two types of services sales and each need different strategies, processes and systems in order to close more sales faster:

1. Complex Consulting Services - These are typically defined as long-term, complex and custom-tailored solutions that require talented and forward-thinking consultants and subject matter experts to create, position and sell. 

   In these types of services, the sales cycle is longer and more complex.  And selling these solutions requires that you spend more time with customers creating value and positive, measurable results (i.e. ROI). 

   But even in these seemingly long and complex sales, there are things you can do today to simplify the processes and systems and shorten the sales cycle, as we’ll discuss below.
   

2. Transactional or Packaged Services - These are typically defined as short-term, “SKU-able” services for a specific product or service.  Often these services are sold as a fixed-price, fixed-scope of work and a fixed-timeline and include services such as deployment services, support services, managed services or even health checks and upgrades.

   In these types of services, the sales cycle is short, and often appear as a line item to a larger sale of products and services - but not always.  Selling these types of services require that you create an immediate and visible value (ROI) during the short sales process.

   The idea is to create easy-to-sell packaged services so that you can close a higher volume of these transactional or packaged services quicker, without long and complicated sales processes.

   By segmenting the services sales processes, companies are now in better position to put the right strategies, people, processes and systems in place to match the long or short sales cycles of these two services sales processes. 

Simplify

Recently, I came across this quote from Todd Natenberg:  “The easier you make it to buy for your prospects, the more they will.”

Nothing earth shattering here, right?  But, in the world of selling complex, intangible services in a down economy, there is reason to stop and think about this for a moment.

Natenberg points out that simplicity goes beyond just ensuring that your sales language is clear (i.e. you do not talk technical when describing offerings to prospects).  It means keeping everything about the sales process simple.  It means recognizing that selling to prospects is indeed a process and, when you simplify this process, your sales have the potential to skyrocket. 

Take another look at your own services selling process from your customers’ or sales reps’ point of view.  Are your services easy to understand?  Are the selling processes simple and easy-to-follow?  Is there an easy way to buy when the customer is ready to make a decision?  How can you make this faster and easier for the sales rep and the customer?

In other words, imagine a world where you have a fully functional, scalable and repeatable sales machine where your people, processes and systems make it easier for sales reps to sell and prospects to buy. 

Systematize

Sales reps and consultants are quick to point out that every client’s technology and business environment is unique.  But whether you’re selling long-term, complex consulting services or short-term transactional or packaged services, there are elements of the services selling process that can be “componentized” and systematized into a scalable and repeatable selling methodology that speeds up the sales process and makes it easier for customers to buy.

Here’s an example of what I mean.

A VP of Professional Services (and PSVillage Member) was hired by an enterprise hardware and software company to stand up a new professional services business.  Prior to his arrival, professional service sales were virtually non-existent and services sales and delivery were performed on a client-by-client, one-off, ad hoc basis. 

In this services sales model, every proposal and statement of work was unique and different and created from scratch for every new services sales opportunity.  Because of this, creating statements of work and proposals often took weeks - averaging over 15 days per opportunity.

This was not a scalable and effective services business by any means.  And the results showed - professional services sales were underperforming and sales were under $10 million a year. 

So, this VP went to work on the business. 

First, he created a playbook for services sales, with clear roles and responsibilities and service level commitments for everyone involved in the services selling process including frontline sales reps, inside sales reps, pre-sales consultants and contract support personnel. 

Then, to streamline and speed up the services scoping and sales proposal process, he created a services sales
“deal desk” so that everything in the entire services sales process, from quote to cash, was componentized and systematized and run through one centralized services call center mechanism.
The centralized deal desk was staffed by inside sales reps and contract support personnel - not consultants and subject matter experts who were off on billable projects and only worked on sales when they had time. 

So now, when a sales rep or customer called in, the inside sales reps on the deal desk immediately answered the phone and the services sales opportunities were captured and responded to in real time - nothing went to voicemail and nothing fell through the cracks.

In parallel, he segmented his services business by creating standardized statements of work components for complex consulting sales, and quick-and-easy-to-sell packaged services SKUs for transactional services.  That way, when sales reps brought an opportunity to the deal desk, the inside sales rep could quickly quote the transactional services themselves or line up a subject matter expert or consultant for larger and more complex deals. 

On the larger and more complex consulting opportunities, the subject matter experts and consultants had a quick and easy pick list of standardized services components in which to build a statement of work and proposal. 

Then, once all the requirements were gathered from the sales rep and customer, the opportunity was handed off to contract and proposal experts - again, not consultants - who quickly created the statements of work and proposals and got them back in the hands of the sales reps and, ultimately, into the hands of the customers.
As a result, after gathering customer requirements, services statements of work and proposals that once took weeks to generate, are now easily produced in just a few hours. 

Finally, he created software and systems to track proposals and statements of work and created dashboards that would give him complete, up-to-the-minute insight into his services sales pipeline.

That’s how he systematized his services sales business.  Now, he has a scalable and repeatable services sales process.  Not only did he make it easier for sales reps to understand the services sales process, he made it faster and easier for his customers to buy. 

And the results speak for themselves.  Services sales grew from under $10 million a year to over $45 million a year in less than 24 months.

That’s the power of speed and a clear example of how speed wins when selling services in a down economy.

If you want to know more about this case study or have other questions, feel free to drop me a line at steves@entelligence.com . 

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.

Off-target, “one-off” sales may generate short term revenue, but prove detrimental over time - requiring diversion of development or support activities to one customer at the expense of a more solid long term sales strategy.  Sales reps are driven by quotas they may see as close to impossible to attain, leading some companies into contracts that they would never entertain in normal times-deeper discounts, tougher SLAs, more generous payment options, or unrealistic implementation or integration timeframes. In times of stress, the sales revenue sounds good, but the short term benefit can prove a costly long-term resource-sink to the company. 

When implementation, customization, and other professional services are dragged by technology sales, services professionals may face delivery of solutions in a timeframe or at a price point without having adequate input into the contract that was delivered to the customer. Frenzied sales efforts militate against the PS professionals’ ability to calculate the return they are generating for each sales dollar spent and evaluate how their return compares objectively to corporate sales and revenue goals, and the overall corporate strategy.  Thus, professional service leadership today thus faces a balancing act:  to accommodate both the opportunistic sales delivered by the sales force while maintaining the focus on areas in which the organization must excel to realize the company’s revenue goals. 

Professional service providers have more data at their fingertips than ever before:  they can see their key performance indicators (KPIs), often in close to real time. But what they often cannot see is the deterioration of their service sales strategy in face of a sales slowdown until it is too late.  Valuable insights that may be gleaned from all this data into the effectiveness of the service sales strategy and business processes are lost.

Professional services leaders face the difficult task of recognizing and balancing the impact of off-strategy selling when it does occur, and often face the even more difficult task of explaining to the CEO why the short-term response may be detrimental in the long run.

Because professional services have a much longer life-cycle with the customer than the initial sales activity, it falls on PS leadership to maintain discipline in off-strategy sales that heavily impact their departments. This discipline is foremost in both increasing revenue now and meeting future business goals.

The juggling act will continue for the near future - but PS leadership is now required to develop a clear vision of the post-recession upswing. The key for planning is to manage the impact of any opportunistic sales activity in terms of resources and time over the long haul, while ensuring that the resources are available for driving the corporate strategy forward with kinds of customers and business contracts the company sees as critical to long term success.

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. In other words, the same capabilities and approaches that make people successful in selling products to managers will not be adequate (and sometimes will prove counterproductive) when attempting to sell to the more ambiguous issues and complex requirements of multi-faceted solutions facing executives. You may get invited in, but you won’t be invited back.

The Five Questions to Ponder

1. Why?

The first question to answer is: Why would a prospective executive want to see you in the first place? What qualifies you to take up his valuable time? What do you have to offer him that he might value? Executives care about finding answers to nagging questions impacting the enterprise, discovering ideas that may lead to innovation, or accumulating knowledge that might drive competitive advantage. If you have nothing that can add worth to their world at an initial meeting, don’t bother making the appointment. You will be seen as a waster of time, not a creator of value.

2. What?

The “why” above drives the “what.” To make your executive prospect happy that he met with you, you first need to be seen as a business peer--someone with enough credibility to “earn the right” to converse with him as an equal. An important conveyer of that credibility is to have relevant information--things the senior manager does not know but would like to know. Examples might include the critical issues of CIOs in his industry, or the results of a user survey in his company about satisfaction with SAP, or the latest industry benchmarks on key operations metrics, etc.

To be able to demonstrate that credibility often takes extensive preparation. It is taken for granted that anyone in an influencing role should do his homework before making contact. Study existing account records, do a review of the company’s Web site to learn more about them, talk to people who have experience with them, etc. All sound advice, but not nearly enough when calling on executives. You need in-depth information that takes significant time to procure--time that is often not allocated toward cost of sales.

Next, look for the potential value-adders. Do you have recent industry studies of trends, critical issues, benchmarks, or best practices? If not, get them. It is a powerful way both to show your uniqueness and to provide immediate value. If you don’t have industry studies, do your homework with the executive company even deeper. For example, interview the management team on a topic you know the executive finds important, or survey the users of an application or a process. Executives love this type of information because on their own they would never get it.

3. How?

How we approach the executive interview is also different. The basic techniques taught in needs-satisfaction sales training (SPIN Selling, Strategic Selling, PSSIII, etc.) that served your sellers so well in the past when dealing at low- and mid-levels will now work against you when selling to executives. Senior managers expect you to already know their business. They don’t want to waste time educating you by responding to questions that might have been very powerful when dealing with those on a lower level ("What are your critical issues?”, “What keeps you up at night?”, etc.). To display your credibility you must start by demonstrating your knowledge and quickly bring something of value to the conversation first--that’s why doing your homework is so important.

Your questioning strategy must be modified to deal with this different situation by starting with predicting probes that demonstrate both competence and understanding. Next, exploring probes help your executive sort out the complex, often ambiguous issues he faces. They also help him to think through his alternatives to fixing the problem or leveraging the opportunity. Properly done, this is where sellers create value when calling on the C-level and quickly distinguish themselves from the typical feature-benefit-spewing, PowerPoint-toting, normal-product-selling approach.

4. Who?

The capabilities described above are both wide and deep. Requirements include not only all the standard components of professional selling but added knowledge (e.g., business acumen, problem analysis), skills (e.g., synthesis data, framing alternatives, whiteboarding processes), and new mindsets (e.g., assuming the role of trusted advisor or business consultant) as well. These are consulting skills that do not come naturally to most people. So take a serious look at who you designate to the role of selling to the C-level and ask some hard questions: Do they have the capabilities required or can they learn them? (If so, are you willing to invest the time and money?) Do they have enough confidence and “presence” to be accepted and respected by customer executives?

After careful examination you may find that your existing people in sales roles are not appropriate for this responsibility. Some organizations find that they must bring in outside blood and/or actively involve their senior management in either a support or sometimes a primary role to make their C-level selling work.

5. When?

This is worth repeating: Only attempt C-level selling when you have competent, credible people armed with value-adding information. Otherwise, stay home.

Action Steps

If working at the C-level is to be an important component of your selling approach, consider the following:

1. Designate or hire a person or staff to research key accounts, key executives, and their key competitors--no matter how well intentioned, faced with their 30-day deadlines to deliver, salespeople just won’t do it.
2. Make it an important goal of your services marketers to find and package information that your C-level folks will find of value. Become the “holders of the data” for your industry on topics of importance.
3. Selling at the C-level does not come naturally. If you want your sellers to be confident and competent, provide them with appropriate C-level training, coaching, and the tools they need to be effective.

© Alexander Consulting

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. After all, Tom Watson and Phil Mickelson also possess those very same traits and neither has a chance to surpass Jack Nicklaus’ record of 18 majors, although Tom put on a magnificent and inspirational performance last week (perhaps the subject of a future posting). 

Tiger also excels in an area that does not get a lot of media attention: continuous improvement. This is where Tiger can teach us the most. All professional athletes and business leaders engage in some form of continuous improvement. What separates the great athletes and business leaders from everyone else is their ability to not only grasp the essentials of continuous improvement but to also integrate them in their games and leadership. They don’t talk much about it, but they relentlessly execute on the principals every day.  Let’s look at a few examples of Tiger’s approach and what we can learn from him.

1. Goals / Vision
Everyone in the world who follows golf knows what Tiger Woods wants to achieve with his career: he wants to be the best golfer ever to play the game. And, most importantly, Tiger tells us how he measures his success : Win the most majors of any golfer, which means 19. Tiger has never wavered from this goal and he articulates it publicly and regularly.

How many of us can honestly say we have articulated our organization’s goal (or mission) with a clear, simple, easily-understood measurement that EVERYONE can relate to and that is actiontionable for all? How many of us have fallen asleep or cracked jokes during the annual “visioning” exercise when the consultant runs out of room on the flip chart paper because there are too many “objectives” or you’re expected to simultaneously build a “world class” or “best of breed” organization and cut the expense budget by 30%?

The lesson: be clear about what success looks like and how it is measured. Tiger operates with a one number metric, 19. How many do you have?

2. Brutal honesty In order to improve you need to know what to change and why. Golf and business processes are remarkably similar in that you’re doing the same thing over and over, attempting to achieve consistency and success in changing conditions. Tiger, as well as other great athletes and business leaders, has the rare ability to look at the process - not simply the end result - and assess it based on ACTUAL performance. I can’t count the number of times I’ve heard Tiger interviewed after a round when he’s on the top of the leader board and speak of all the things that he did poorly during the round. I’ve also been around a few business leaders with the same trait, but not many. Most of our compensation is based on short-term results. However, long-term greatness demands absolute honesty in how well we have performed and what needs to be better, even in the face of favorable business results when all the chips fell our way. Accidents and luck happen. Greatness comes from relentless effort.

The lesson: be brutally honest as it relates to performance.

3. The courage to change and the patience to see the change succeed Tiger has had eye surgery, he’s changed his physique, he’s changed coaches, he’s changed caddies, he’s changed his swing, he’s changed his game, he’s changed his equipment. About the only thing he hasn’t changed is wearing red shirts on Sundays. Many of these changes were made following a winning year. In fact, Tiger completely rebuilt his swing in the year he won the US Open and The Masters by huge margins. Why? Simple. Winning 19 majors requires a long career, and his swing at the time was very tough on his back. Concerned that his back would break down before he reached his goal, Tiger rebuilt both his swing and his physique. During the first part of the following season he did poorly, but ultimately Tiger went on to even greater success. Greatness takes time, effort and practice.

I have spent most of my adult life involved in large scale systems (all of which involve complex business processes) with some world class companies. The projects and systems that have had the greatest strategic impact all took multiple years, with multiple releases and leadership teams that had both the courage to change and the tenacity to see the change have an impact. Just like Tiger rebuilding his swing and physique.

The lesson: Achieving greatness requires courage and tenacity. It’s not easy, and it’s not a one-time event.

4. It never ends
The final lesson is that it never ends. Tiger no longer leads the Tour in distance off the tee - he’s in the middle of the pack (#88) - but he is now in the top tier in Total Driving (which factors in accuracy and distance) and scrambling, and has dramatically improved his putting. I’m sure that next year he’ll improve in some other areas. Why? 19.

The same holds true for business operations. We can always improve margins, quality, the type of services we offer and most importantly the skills of our teams. The great business leaders improve these measures routinely. The average business hits their goals, declares victory and rests on their laurels.

Let’s recap what we can learn from Tiger:

1. Create a clear view of success and how we’ll measure it
2. Be brutally honest about performance
3. Have the courage to change and the tenacity to make the changes work
4. Never stop - that’s why they call it continuous improvement

"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)

If it costs more to acquire a new customer than to retain an existing one, then how are you ensuring your professional services portfolio gives your customers what they really want? Often, professional services portfolios are too heavily focused on transactional product implementation offerings. Product managers want an installation service for every one of their products. Sales teams want ‘packaged’ services that easily attach to and don’t slow down their product sales. Services delivery teams want to finish engagements quickly and move on to the next project.

In short, when product service providers become so internally product-focused, they lose sight of the real value of professional services: ensuring the company’s products are solving customer business problems. By taking a customer-oriented approach, you are;

• Ensuring Customers can fully leverage the value of your products
• Improving customer satisfaction
• Driving repeat business at a higher profit and at a much lower cost of sales.

Moving from Transactional to Transformational

Basic product implementation services are, by their nature, transactional offerings. The design goal of these offerings is to get a product up and running quickly: Once the hardware or software is installed and basic functionality is confirmed to the customer, the service is considered complete. The problem with this approach is that you don’t leave the customer with an integrated solution. It’s too easy for the product to fall into disuse, and unfortunately, more easily replaced by a competitor’s offering.

To truly address your customers’ needs, your portfolio needs to start with their perspective and business challenges, rather than focus simply on getting your products up and running. As Scott Monaghan, Area director of Professional Services at NetApp, says, “We want to help transform our customers’ businesses by leveraging the full value our products, not just installing something that becomes shelfware or is not fully integrated into their operating environment.”

That focus has paid off for NetApp, a leading storage provider with a reputation for innovative problem solving: The company is recognized throughout the industry for its dedication to customer success and reflected a double-digit growth in professional services revenues in FY09 defying the global economic downturn. As Monaghan points out, “A lights-on service is not good enough; we need to think of the complete solution value chain to ensure we are not missing something.” (And of course, this complete value chain may well include other products and services you can provide or recommend to your customer, increasing your value as a trusted service provider.)

Mapping Services to Customer Concerns

An ideal services portfolio demonstrates relevance to your customer by answering one or more of the typical questions they have about your products:

• How do I know I need your product? How much do I need?
• How do I plan for the implementation?
• How do I implement (and/or manage the implementation of) the products?
• How do I integrate the solution into my existing environment?
• How do I transition the solution into production and manage the ongoing operation?
• How do I determine my solution is working optimally?

• Assessment/Consult Services
• Planning/Design Services
• Implementation/Deployment Services
• Integration (or Custom Development) Services
• Managed Services
• Optimization/Healthcheck Services

The most challenging solution to develop and position can often be Assessment or Consultative Service. “Customers are really only willing to pay for these services if they are solving a business problem,’ warns Shane Anastasi, vice president of Client Advocacy at Vignette, which provides software and services that help organizations provide dynamic Web experiences. In other words, assessments can’t just be about sizing the order - they require an honest determination of the ideal solution for the customer’s business need. They can be educational in nature as well.

Winning Repeatable Revenues

Beyond the need to ensure the Assessment Service isn’t just a thinly veiled sales offering, you need to be prepared to demonstrate your ability to provide unbiased recommendations. At Pervasive Software, for example, the Client Services team is willing to show customers reports from prior engagements in which they’ve recommended non-Pervasive products.

“There’s no value-add in hiding information and no benefit to selling a product that becomes shelfware,” says director of Client Services Bill Humphrey, whose team focuses on helping customers realize immediate value. Well-executed Assessment Services should bring business value to your customer, often (but important to acknowledge, not always) leading to product sales and additional services sales.

This need to focus on bringing business value to your customers should extend to the rest of a services portfolio. Implementation services should ensure your customers are fully able to leverage your products, versus just getting the products out of the box and barely installed.  Integration services drive value by ensuring that you are fully integrating your products with customer systems and/or key operational processes which are already in place.  The benefit of this service approach is it makes your products “sticky”, or harder to displace.  Continuing up the value stack, Managed services provide an opportunity to develop a long-term relationship with your customer, often by making your consultants part of their team to help operate your solution.  Finally, Healthcheck, Audit, or Optimization services provide the customer assurance that their products will operate optimally. These solutions additionally provide cause for ongoing customer face-time and further sales opportunities.

Robert Machnacki, Senior Vice President of Professional Services at NetQoS understands the value of focusing on customer needs. NetQoS provides network performance management products and services for the world’s largest networks; a focus on customer satisfaction and client enablement has earned Machnacki’s team industry leading customer satisfaction scores.. The true value of customer satisfaction is what that satisfaction typically leads to: repeat and expanded business. As Machnacki points out, “We know we are successful when customers are using our software to solve problems; this reinforces our value proposition, and offers opportunity to broaden our relationship.”

Earning the Encore

Technology product venders live and die by the ability to ensure their products are deployed quickly and in a quality and repeatable fashion. However, creating product ‘stickiness’ and ensuring that product capabilities are fully leveraged and values realized is a more challenging task for product Professional Services organizations. Offerings must be developed which help customers understand gaps in their strategy and provide a roadmap to address them by leveraging technology. With the right customer approach, you will elevate your position from supplier to ‘trusted advisor’ and ensure your products and services will have value and impact. As Shane Anastasi tells his team, “The job you are doing now is the best advertisement for the one you’ll do next.”

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.

There is no right or wrong answer as to which delivery approach you should adopt.  Doing either well can lead to marketplace differentiation, favorable regard by your clients and prospects, and financial success.  Trying to be both can lead to confusion in the marketplace and within the company, staffing issues, and disappointing financial results.

In reality, the two approaches can coexist in an environment where one dominates and the other is done opportunistically.  It is more common for a projects firm to do periodic staffing when business is slow and consultants are on the bench.  It generates revenue and keeps skills up-to-date.  Typically, rates and margins will be lower, but acceptable in the short-run.  It is less common and more difficult for staffing firms to take on projects due to the lack of a track record of project experience and credentials and not having a delivery methodology.

The comments and information presented in this article are not just observations, but personal experiences, too.  I have been a consultant for 30 years, and have worked with about 140 clients.  I have worked in very large and very small firms; some project-oriented and others staffing-based.  I have seen the projects versus staffing issue almost everywhere.  Many firms deal with it proactively and build their chosen approach into the strategy, culture and other aspects of their companies.  As a result, these are the more successful professional services firms.

A while back the main distinction people pointed to between projects and staffing was that when you did project work you owned responsibility for the results (i.e., deliverables).  Although still a major distinction, the differences are much more pervasive.

The remainder of this article presents a comparison of the projects versus staffing approaches.  It is shown within the context of a firm’s general business functions (illustrated on the next page).  This will enable you to get a sense of the impact each delivery approach has on your business.  The comparison is in table format, which can serve as a checklist for you to re-evaluate or validate your chosen approach to the delivery of IT services.

Business Functions

The following chart depicts business functions broken out into seven basic areas.  The comparative table below that is organized around each of these areas.

Projects versus Staffing

The table beginning on the next page is designed to help distinguish the characteristics of project work versus staff augmentation.  The items included represent the general rule, although you may experience some exceptions in your business.  (e.g., some staff augmentation jobs may have more people or greater revenues than some projects).  It is important to consider each business function, since they work in concert and impact each other.

Ultimately, your firm will do some of both, so just keep within the context of one approach being your core strategy.  Use the projects versus staffing table to periodically reevaluate each business area in order to confirm that your company is aligned with your chosen focus.

Introduction

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.

Very few firms have comprehensive and documented processes for how they manage resources and achieve a desired level of utilization.  They have utilization measures (sometimes), utilization targets, time recording procedures, project tracking mechanisms, and more.  However, what is not seen often is a well thought-out process for ensuring that billable utilization is high and stays that way, every day, week after week, month after month. 
This paper is dedicated to those that need/want some simple and actionable ideas on how to effectively manage to achieve high utilization.

10 Hottest Tips

1. Adopt a utilization metric that’s easy to understand - Having utilization metric is a good thing.  Having one that everyone understands is better.  Too many firms allow different formulas for utilization to proliferate around the enterprise.  As a result, confusion sets in and inevitably the lack of a common taxonomy for utilization results in unnatural pressures being applied internally. Doubt is often cast on the PSO team to manage the business efficiently, all because there was a lack of understanding relative to what was being measured, and what result was expected. The simplest (and most commonly used) formula for utilization is #billable hours/available hours with 2080 being the standard for available hours.  Some key points to remember:
   • You can set the available hours number at whatever you like - as long as you are consistent
   • If you pick 2080 hours, you are saying:  The Consultant will take training, vacation, and sick time throughout the year.  But, the Consultant should hit this overall utilization target.
   • If you pick less than 2080 hours, you are saying:  We are backing out time for training, vacation, sick time from the denominator. But, the Consultant should then maximize the productivity of the remaining hours.

2. Get the forecast right - Having a view into the future is essential to resource planning.  Technology companies are usually pretty good at forecasting product demand.  They expend time on process and software applications to assist with the task.  Unfortunately, most are not so good at forecasting services often leaving the task to the PSO leadership to figure out.  Without a good services forecast, it’s difficult to manage utilization well. 
   The forecasting process, irrespective of a companies’ organizational construct, must facilitate the most precise estimate of need, by person and skill, by month, to span the necessary hiring horizon. Normally some ‘what if”
   methodology is used to provide sensitivity analysis to your projections and ultimately a capacity resource plan to guide your investment decisions.  Effective interlock of the resource management team and sales is imperative for effective forecasting and capacity planning.

3. See #2 and then plan on being wrong - We find most companies have room for improvement in this area.  How can you plan when you have no view of what future needs will be?  Because a forecast is just that - a forecast - you can count on it being wrong.  The key is to gain some control and consistency over how wrong (or accurate) you will be.  Sales should have a metric that is tracked to ensure they focus on the services forecast, as should the PSO.  No matter what the volatility of your business, we have not yet observed a company that cannot improve on their forecast accuracy using better risk based planning.

4. For resource planning one pool will do - The bane of PSO’s is where resources are ‘owned’ by multiple departments creating silo’s of resources.  Unfortunately the silo mentality is alive and well in corporations all over the world.  The best medicine for this problem is for the company to begin to manage resources in a centralized way.  Resources are and should be assets of the corporation, not a particular department.  Department management relationships should be maintained to help manage employee development, goal setting, reviews, etc.  The Resource Management Office concept, pioneered by RTM Consulting, provides a process based approach to helping companies make deployment decisions centrally while managing employee careers locally.

5. Let the computer do the heavy lifting - Today’s Professional Services Automation (PSA) tools can do a big part of the job of analyzing resource needs and help with making staffing assignments leaving managers more time to manage.  Surprisingly, some PS firms today manage their resource pool either without the help of automation or with simple tools generally not up to the task of today’s business needs.

   Considering the impact of just a few points of utilization of a typical labor pool, justification of investment to automate this important task is usually easy.  Are you trying to manage a large and growing workforce with a spreadsheet?  Resource management software (also commonly part of or referred to as PSA software) exists to create a data base of resource pool information, enter and track project needs and progress, and produce reports/queries capable of reducing determination of project staffing needs by up to 90% (a human element is still needed to finalize resource selections). 

6. Manage resources, not people - Don’t let your PSO be hobbled by sales people who may insist on a particular person to do a job.  Your job as the PSO leader is to complete a project on-time, on-budget.  Who does the work is irrelevant.  Breaking the organization of the “I want my favorite person” syndrome is critical to improving utilization.

7. Watch the non-billable time buckets carefully - It’s too easy to hide idle time unless you make the process of time recording and reporting transparent in the organization.  Regular analysis of this information is vital to making necessary adjustments when problems develop.  Avoid using non-productive time recording codes such as ‘other’.  Additionally, these codes should be managed centrally and require the approval of the PSO leader to establish new codes.

8. Higher labor cost is better than bench time - Don’t let overzealous desires to take advantage of offshore labor rates get in the way of using higher cost labor that may be sitting on the bench. 
   The art to staffing a project is to find the right balance of cost, skills and project management.  Sometimes resource availability will dictate use of a labor from higher cost pools than desired, or vice versa.  Re-balancing the base of skills is a constant exercise requiring continuous discipline and process improvement.  Making these choices requires that the PS organization look at its gross margin performance over a range of projects to accommodate these inevitable resource imbalances.  Simply put, no two identical projects will produce the same profit, but on the average achievement of a target gross margin should/can be the desired outcome.

9. Never employ enough resource to meet demand - Did I just read that right?  Yes.  Figure out what your steady state resource needs are (every business has at some level a steady state), and use partners/contractors to fill peak-load needs.  Note the white line (approximate steady state) in the chart below.  At some point it makes sense to fill peak-load demand with partners or contractors so that excess costs can be shed quickly when demand slackens.  While the cost of a contractor may be greater than an employee, avoiding idle time, hiring training and attrition costs, and impacts on morale from layoffs all offset the temporary spike in per headcount labor.

   

10. Consultants should own the utilization metric - In my view, management always benefits from driving accountability to the lowest level possible in their operations.  Period.  Key benefits of consultants owning the utilization metric:
    • Encourages the consultant to up-sell
    • Captures the collective input of the team for solving utilization issues
    • Creates incentives for continuous skills development

Summary

As stated earlier, while there are many important aspects of managing a PSO, managing utilization is fundamental to making a profit.  Companies invest lots of energy and time into processes to address many aspects of their businesses, but resource management has long been lacking in discipline for many PSO’s.  Using the ‘10 Hottest Tips’ will help you get on the road to sustainably high utilization.

About the Author

Randy Mysliviec is CEO of RTM Consulting, the market leader in resource management and PS business optimization services.  Comments and feedback are welcome at info@rtmconsulting.net .

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.  These issues manifest themselves exponentially when dealing with enterprise, multi-national corporations. 

This need for automation is more important than ever.  Over the past generation, we have seen a transformation in the value drivers of the world economy.  Major companies have moved from focusing on higher product margins to driving increased margins and competitive differentiation through the use of “value added” services.  This move has been highlighted in IBM’s transformation from a product to services company and has been attempted and considered by an enormous variety of enterprises large and small.

With this shift in the world economy comes a need for a shift in the type of systems and processes that will drive business success.  This article seeks to outline some of the keys to consider in beginning the journey to automate the global services delivery chain.  It requires not only new partnerships, processes and an open mind but also company wide dedication to achieve success.

With operations across the map, global business automation is a high risk, high reward proposition.  However, by understanding and implementing the following success factors, you can greatly increase not only the speed and efficiency of your initiative but also its return on investment (ROI).

1) Define a Clear Vision and Strategy

Know where you are going!  It is much easier to reach your ultimate goal when you actually have an ultimate goal.  Take the time from the beginning to lay out the manual processes that must be automated immediately and those that can wait.  It’s easy to be distracted by secondary priorities, so create a ‘parking lot’ to ensure that mission critical tasks are completed on schedule. Focus on the ‘must have’ objectives and park all other requests until you have fulfilled the top priorities.  By detailing a clear vision and strategy, the key decision makers will be on the same page with a common end result in mind.

2) Ensure IT is a Strategic Partner

It is highly likely that your automation initiative will involve the implementation of new tools such as a Professional Services Automation solution (PSA) as well as integration with existing business solutions.  If this is the case, clear communication between business executives and your IT department is essential.  It is no secret that these two groups often have different objectives and needs so strive for open dialogue to clearly explain the greater corporate goal.  With everyone in the organization on the same page, you will hit your milestones on time and on budget.

Clear communication with the IT department will also help to make clear that they are strategic partners in the effort to improve services delivery.  With the advent of Software-as-a-Service (SaaS) solutions, IT’s role has moved to a new strategic level.  Line of business executives can “try and buy” solutions and IT can play an invaluable role in helping integrate new solutions into the overall enterprise footprint.  This is an unprecedented time of change and growth in the ability of software to solve business needs and IT can be a key part of that solution.

3) Earn Executive Backing

Without corporate support on various levels, your automation initiative will never get off the ground running.  However, by gaining executive sponsorship, you will maximize your success and return on investment. 

Funding

Although automation of your services delivery will in time prove cost effective, it will require upfront costs.  Now more than ever, the ability to clearly and concisely state the short and long term benefits to justify these costs will make or break your cause.  Executives are metric driven individuals and a lack of concrete ROI figures will scuttle your initiative immediately.  However, prove the business value of these costs and even the most conservative executives will have difficultly ignoring you.

Motivation

Automation of your global services delivery will require cooperation from every department.  Due to complication, inconsistency, or a lack of scalability, current business processes will need to be replaced or retooled.  You will need executive level support to get everyone in the organization behind your initiative.  An automation tool is only as good as the manner in which it is used.  C-Level motivation across your organization will drive user adoption and help ensure the viability of your initiative.

Expectations

So your executive team has given the green light for the purchase of a services automation tool.  Now show them results.  A concrete and rapid return on investment is the quickest way to ensure the success of your implementation.  Clearly illustrating profit margin, reductions in overhead costs, and increased revenue will create a thirst for metrics that will keep your executives engaged and satisfied.

4) Process Alignment

As I stated earlier, global business automation is a high risk, high reward proposition.  It is a coordinated dance across regions, roles, and zones.  Furthermore, services delivery is an increasingly integrated chain of processes that are intertwined and interrelated.  If implementing services automation software, it is essential to leverage the vendor’s consulting capabilities.  They have an intimate knowledge of their software capabilities and have refined common processes to handle implementations of any size.  For example, without proper consulting and strategy sessions, time and expense tracking may be scheduled to come online before projects are even set up in the system to track time and expense against.  You will save time, money, and energy by taking the time to align your processes in a manner that allows for coordinated implementation across departments and geographical locations.

Another key example of this relates to achieving appropriate business definitions.  We take for granted in the manufacturing world a level of granularity to describe processes and parts that simply does not exist in the services world.  Resolving questions around such items as how to define utilization, work schedules, standard rates and other items are always herder than they first appear.  Typically, it is not because these concepts don’t exist in the enterprise, but rather because they exist in so many different forms in the enterprise.  Particularly, as enterprises have grown by acquisition, you will find that the exercise in defining and clarifying these definitions will be some of the most valuable - and most painful - work that can be done.

5) Project Execution

The worst thing you can do after your plan is set is to deviate from it.  Stick to your established milestones and stay focused on your end goal.  Active involvement with a select group of capable and credible internal resources provides the best avenue for success.  However, too many voices will impede the process. Less is more when it comes to deployments and having a centralized decision making body will pay dividends.  Also, ensure that middle managers are involved during testing and training since they will most fully utilize the system.  Finally, constant alignment between zones will help ensure that your automation initiative is coordinated and finishes on schedule.

Conclusion

It is very difficult to make a case for a global overhaul of your services delivery in today’s economy.  However, automation of your core business processes will streamline your time to marketplace and eliminate revenue draining manual processes.  Although every services business is different on a variety of levels, the above critical success factors provide a general plan that will guide you on the right path to success for the automation of your global services delivery. 

About OpenAir

OpenAir is the world’s leading provider of Software-as-a-Service (SaaS) project management software. Offering both Professional Services Automation (PSA) and Project Portfolio Management (PPM) solutions, OpenAir provides project-based organizations and firms the tools they need to grow their businesses quickly and profitably. Providing enterprise-level functionality for businesses of all sizes, OpenAir has more than 45,000 active users across 350 world class firms utilizing the software to better capture billable time, manage projects and resources and bill customers. Coupled with a team of highly experienced consultants from some of the world’s leading services firms, OpenAir PSA and OpenAir PPM drive higher profits through improved utilization, visibility and data collection. To learn more or schedule a demo, please visit http://www.openair.com.

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.  Part of this may be due to the fact that becoming a project manager is not a book-learned skill but an investment of time and gaining of experience that defines and hones the basic skill set required to do project management.

In general a project manager must have the 3 ‘tions’ to be successful:  Communication, coordination, and organization.  I find that in many cases these are personality traits just as much as learned items.  Your project managers will stand out as technical leads or project leads simply due to their ability to keep on top of things and keep their respective team members in sync.

The 3 ‘tions’ are the starting point to the project management cultivation cycle.  The project manager cultivation cycle is made up of three stages:  Learned Techniques, Role playing , and Experience. Each stage is a progression in the level of your project management skills.

Learned techniques covers those items that you can pick up from reading books, taking project management courses, and attending seminars.  In this stage your project managers are introduced to tools of the trade including project plans, budget management, issue tracking, status reporting, and so forth.  The execution of these learned techniques, however, is what makes an effective project manager.  A project manager needs to know when to reach out, when to escalate, when to let others take the lead, and how to keep the entire team in sync.  By combining the 3 “tions’ and learned techniques, the beginnings of a great project manager are seen.  Unfortunately some project managers will stop here which limits their ability to take on challenging projects or expand into a mentoring role for other project managers.

The Role Playing stage is one that typically is covered as Project Managers rise through the ranks.  The best project managers are ones that have performed many of the roles of the project team and so have a basic knowledge of what the role entails.  What this means is that your project managers usually have a technical or industry background in the types of projects that are being managed.  I started my career as a software programmer and eventually started managing software development projects.  I would always have the ability to apply my ‘role-based’ knowledge to team discussions to resolve issues, revise timelines, and insert contingencies and dependencies based on my experience in those roles.  If you step into a project manager role in an unfamiliar industry or technology, you tend to revert back to the learned techniques stage until you gain role based knowledge.

The last stage is experience. There really is no substitute for this phase.  Project managers gain knowledge and skills by simply dealing with what comes their way each day on a project.  This knowledge cannot be taught by courses.  Many people would call this Intuition.  It’s a skill like anything else but it’s a skill that comes with time.  Once a project manager reaches this stage they never leave since learning is a continuous activity.  Instead they evolve into a mentoring role to those up and coming project managers that are just starting the cultivation cycle. 

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.

To begin, let’s establish with what I am referring to in the term “Practices”.  I use the term of a Practice as a focused effort on a particular Discipline.  Disciplines range from IT aspects, such as software development components, (i.e., Java, SOA, or EDI), to broader spectrums like Project Management, Quality Management or Process Improvement.  Disciplines also are constructed around a service or product offering.  Examples here might be off shoring, SAP, education at high schools, or healthcare.

The key is that you can assume that every consulting organization has at least one Discipline from which they sell and specialize.  These Disciplines might have an open repository of collateral and marketing materials, but a Practice takes this one step further with a level of focus on the development and evolvement of a Discipline.

Let’s first start by saying that nothing is more important to understand that while developing your Practices you are going to need some patience.  Wait.... I am getting ahead of myself.

The Value of Practices

If you don’t currently have a program of Practices in place today let me give you a couple of reasons why I believe that it makes since to start the process. 
You have spent years developing resources in your organization with qualities you desire and have made heavy investment in their skills.  Every time someone leaves, you take a skills hit.  One of the reasons why people leave an organization is because they no longer feel that they are acquiring new skills or are participating in activities that do not lead to personal growth.  Practices allow an organization a method of keeping skills fresh with persistent and active learning.  In addition, an offshoot of a good Practice is the internal development of management talent to those wishing to take steps in that direction. 

The advantages to the organization are more visible.  Practices build and capture collateral, and are used to build or extend service offerings and marketing endeavors.  In addition, a Practice can become the organization’s quality control agent and provide consistency in the delivery of its services.

All these values start to pay real dividends when your organization even begins to exhibit the perception that you are skilled and knowledgeable in your Practice areas.  Being able to market and demonstrate your commitment to a Practice is something that your current and future clients will both value.

The Starting Point

So let’s say that you are at the point of having a few technical Disciplines and a couple of solution Disciplines in your organization.  Everyone is eager to begin a stronger focus on these and you want to start developing them into Practices.  Stop.  Here is Lesson #1:  Start with only one or two key Discplines. Practices are a dedicated and focused effort.  How many of these can you really put on your organization’s plate?  You are better off selecting one or two Disciplines and getting them up and running successfully before swinging the doors wide open.

Which Disciplines should be the first to migrate into Practices?  The answer lies in the answer to the questions, “What do I want to sell more of?” and “What are most of my people skilled at doing?”.  Between the answers to these questions you should be able to prioritize your Discipline to Practice roadmap.

Management Investment

It is easy to say that management must be committed to the building of Practices, but it is going to take more than words to make a Practice successful. Lesson #2:  You need to understand that management is going to have to make an investment. This investment constitutes both an aspect of time and of money if you really want this to work.

You want a Practice because it allows you to better position yourself in the marketplace and helps you develop specific service offerings.  Why would you ever want this to occur without your management involved in steering the ship?  Management must be involved in the Practices.  Now I am not saying that you need to be in every Practice related phone call or meeting.  Remember, this is a good place to mentor and develop management skills in others.  Keep this as your objective of involvement within the day to day development of a Practice.  Where you really want to be more involved is in the direction setting and prioritization of activities within the Practice.  We will continue on with the understanding of the management investment, but here is Lesson #3:  Manage your Practices. What I think works the best is to have your Practice leaders meet periodically with the organization’s management and marketing leaders.  This is the best place to develop the roadmaps used within your Practices and to collaborate on the activities across your Practices.

Practice Leadership

So, who should be in a Practice and how should it be led?  This is where a few of my lessons have been learned through some pain. Lesson #4:  A Practice must have a lead driver. I use the term of a lead driver because in most cases many consulting organizations do not have the ability to have a senior individual who is solely responsible for the development of a Practice.  Larger organizations might be able to support a full time Practice Manager role that is focused on the development of the Practice, but in most cases these individuals are directed towards being the billable leader within deployments.

This brings us back to the investment that management needs to be willing to make.  The best person to get a Practice off the ground is the same person that everyone else goes to when they have a question within that Discipline.  This is in many cases the same person that you can bill most often and at the highest rate.  My suggestion is to begin a program where these individuals bill 30-32 hours a week in lieu of the typical 40.  In order to do this you have to establish this expectation upfront with both your sales team and your clients.

These newly freed hours are used to “drive” the Practice by working with management in setting direction, organization and communication within the Practice, and collateral development.  Done correctly, the benefits equated with the loss of revenue should be minor to the advantages.

The Practice Team

At this point, we have management commitment and someone to pilot our Practice plane.  If you stop there and think that our Practice will organically grow, you are doomed to failure.  This brings us to Lesson #5:  Avoid having a strict Practice structure. While the best Practice structure includes having your lead available for 8-10 hours a week, things happen.  You might be required to use this resource on a project full time for a month.  Or, the resource might leave your organization.  When these things occur you get a Practice that is on again, off again, and momentum is never developed.  Make sure that a Practice Lead finds and develops others to hand over the controls to for these periods.  This will ensure that activities like Practice meetings and communications are not hindered when the Lead is not available.

Who should you include in your Practice?  This is Lesson #6:  Keep your Practices open to everyone in the organization. It is a mistake to start a Practice with only those skilled in that discipline.  What I found is that people want to extend themselves to areas that are an interest to them, and felt slighted that they weren’t included.  Once Practices were stated to be open to anyone having interest, they also benefitted by the exchange of ideas between various Disciplines.

Collateral Development

All organizations have some level of focus on developing and reuse of corporate collateral.  In order to promote this attitude, I found Lesson #7:  Compensate for collateral development. I am not sure that one method is better than another; however I would review it on a quarterly base and make sure you get the Practice Leads involved.  I also believe that having the Leads receive a small stipend for their participation in the role to be beneficial as well.  You could do this in addition to the collateral bonus or just the one Lead bonus if you wish.

Remember that we don’t wish to stymie the development of any collateral, whether it is from a Discipline or a Practice.  So, reward for anything that adds to the organization’s IP.

While we are all developing this collateral, let’s add Lesson #8:  Keep marketing in sync. I’ve witnessed consulting organizations where the Marketing team determines the service offerings and assigns collateral development to the consulting organization.  To me, this is backwards.  Let the people who live that discipline shape your direction, then let the marketing team work on the best way to present and bring these ideas to bear.  This happens once the marketing team members and Practice management begin working hand in hand.  Every couple of weeks I would have a “Service-focused Leadership” meeting where the executive team, marketing, and the Practice Leads worked on development of new offerings and the building of marketing plans.

The Practice Reach

If you stop at the development of collateral as your delivery from a Practice, you are missing out on a great opportunity for the continuous improvement of your organization.  This is Lesson #9:  Have Practices involved in the delivery of your services.

Your Practices should be involved in at least the review of your SOWs and proposals.  Practices should also be very much involved in quality and consistence checks within your delivery methodology.  This reach of your Practices helps ensure that skills development and the implementation of best practices are active in your organization.  What this does for your culture and belief in team work for both new and existing members of the organization is wonderful as well.

And Finally

There is one last lesson to be discussed.  As mentioned at the beginning of this article, you need to go into this with an understanding of patience.  To me, this was probably the hardest to accept.  Lesson #10:  In development of a Practice, you will need patience. Change takes time.  It doesn’t make much of a difference whether the organization is small or larger.  Getting a Practice established takes a commitment to see things through.  You need to be prepared for a decent amount of coaching and time to show that these new changes are important to the organization.  But once they get going and develop a life of their own, you will be glad that you did, and will benefit from the effort.

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). Additionally, all customers benefit equally from software upgrades and improvements - not just those considered “strategic” or with fat wallets. Yet, many companies fail to realize the benefits they expect (and were sold) from the product. Why is that?

From a corporate perspective, many SaaS products are sold as part of a “subscription” model, which provides much more predictability in bookings, revenue, and cash targets. Still, many SaaS companies have examples of customers not really using what they paid for or not renewing their contracts. Again.... why do you think that is?

Many businesses have a misconception that if it is SaaS, it is also 100% self-service (or close to it, anyway). While that is definitely true in many cases and to some degree, it is not entirely the case. On-demand businesses that provide primarily transactional software may, in fact, be more self-service “out-of-the-box” than those whose products and services are more transformational in nature.

So what is transactional versus transformational, and how does each affect the go-to market strategy for a Professional Services Organization (PSO) in a SaaS business. Let’s explore two different SaaS businesses and the role the PSO plays, WebEx and Salesforce.com, to answer that question.

WebEx
WebEx (now part of Cisco) professes to be the “#1, on demand collaboration platform” for online meetings and training. Let’s focus on the “on demand” component.

“On demand” is another way of saying, SaaS. A WebEx customer can quickly and easily get started with WebEx for as little as $39/month for an annual agreement, and there is “no software to download and install” and “no technical expertise needed.” It’s very transactional: I need to host a meeting with my counterparts in another region. WebEx does not transform a business; rather, it allows businesses to conduct meetings (transact) in a less costly and time consuming way. Can anyone imagine what a PSO’s role would be at a transactional company like WebEx? The product is so easy to use. Anyone? Well, I’ll tell you....

Salesforce.com
Salesforce.com is a much more complex application than WebEx. Any experienced sales person knows how to manage contacts, opportunities, forecasts, and pipelines (we hope). However, by using Salesforce.com, businesses can fundamentally change how they approach the selling process by providing it with better insights and knowledge into its customers, prospects, and sales and marketing efforts. With better access to data, sales managers can assist their teams in managing their business by chasing the best opportunities and enlisting the help of others in the organization to close deals. Senior management can more closely track sales progress in a given period and predict results. As with any tool, though, the ability for a company to do all of those things is dependent on the use of the tool, not necessarily the tool itself. If not used properly, it can become a cumbersome tool with incomplete and unreliable data.

So what role does Salesforce.com’s PSO play in this transformational business? As teams grow, information sharing and cross departmental metrics become increasingly more important - and difficult to get.

Salesforce.com’s PSO provides strategic consulting in the areas of CRM guidance, methodology definition, and best practices (transformational services), but since Salesforce.com is highly customizable, the PSO also provides implementation services (transactional services). Let’s face it, too, the data captured by Salesforce.com can be very complex, so the PSO provides data management and integration services (hmm…could this be both transformational and transactional?).

So is Salesforce.com really “self service?” Well, of course ....  if you have the time, knowledge, and expertise to set goals, define a proper methodology, implement the solution, train your team, and use the data properly. If you can’t do all of these things, you won’t get the value you hoped. Professional Services to the rescue!

Conclusion
In my experience, many SaaS companies do a great job of creating self-service tools and delivering them as an on-demand application. The training is straight forward, and learning how to point and click throughout the application is relatively easy.

WebEx has a team called Assist Services. Assist Services provides customers with dedicated technical support before, during, and after the WebEx meeting. For a little more investment, Assist Service will produce a recording of the meeting without all the “pre-and post-session footage.” They can also conduct dry-runs with the meeting host to be sure the meeting goes off without a hitch. So even something as straight forward and self-service as starting and running an online meeting may require some support along the way. Again, though, the products and services WebEx provides are not transforming the way Company XYZ does business. (WebEx charges $495/hour for their ala cart Assist Services, btw.)

The hard part, though, is not the pointing and the clicking. It isn’t the technical implementation, either. Rather, where users of SaaS products get stuck, and the area where a PSO can contribute the most value to customers and the company overall, is in defining a proper methodology for using the tool to ensure that the outputs add business value, customizing the application to meet their unique needs, and aggregating the data. The value is in providing our customers with the knowledge and ability to transform their businesses to the next phase of their evolution, one that achieves strategic goals and optimizes the performance of the organization through the methodology, tools, and data provided by the on-demand solution. These areas are difficult, at best, to address in a truly self-service manner or through standard product training offerings.

WebEx wants to ensure that customers have dotted the I’s and crossed the T’s when planning and executing a meeting. They do it every day, and they know where customers get hung up. On the other hand, Salesforce.com wants you to think about your sales goals and initiatives differently and define your data needs to support those goals: Why are you implementing this solution, anyway? What do you need to know about the opportunities in the pipeline across your organization to evaluate the health of that pipeline? What data do sales executives need to input or access to be the CEOs of their business? Without first thinking about your goals for using Salesforce.com, you cannot be assured of a successful implementation or the benefits the tool was designed to provide.

In a nut shell, SaaS products are self-service for some customers the way my attempt to teach myself to play guitar in the last year has been self-service. I have a guitar, and I can pick it up whenever I want. I have a “how to” book to teach me the notes on the strings and the most commonly used chords, and I can even go online to download guitar tabs that show me how to play my favorite songs. Yet, I still can’t actually play the guitar.

The fact is, until I decide what kind of guitar player I want to be (playing rock in a band, performing at a local coffee shop on open mic night, or strumming away in my back yard with the fire pit going), I won’t develop a plan to learn the guitar they way I need to meet my goal.

In my experience there is a natural conflict in SaaS companies between the need to be perceived as “self-service” and the need to support customers and ensuring their success. By focusing first on strategic, transformational services that ensure customer success, PSOs can help their companies strike the balance.

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. 

The media, it seems, is obsessed with economic bad news.  Maybe because we, as a society, are so afraid of bad news that, when we hear even the slightest hint of bad news, we tune it out.

Frankly, I don’t pay much attention to it at all. Not to say that I’ve got my head buried in the sand - I don’t.  In fact, we’ve seen some of our clients suffer from real economic challenges.  And, worst of all, some folks have lost their jobs.  That’s never good.

But I’m a “glass-is-half-full” kind of guy.  For me, I’m looking for signs of strength and opportunity, especially in IT services.  And, just so you know… I intend to find it.

For example, all of the traditional IT analysts (Gartner, Forrester, IDC, etc.) are predicting a very tiny sliver of growth in IT services for 2009.  Yet, somehow, this is being spun as “bad news” for the IT sector.

In my book, and in this economy, a tiny sliver of growth is not bad news.  In fact, it’s great news.  And consider that tiny sliver of growth they’re talking about is moving global IT services spending close to $1 Trillion a year.  That’s 1 Trillion with a capital “T”.

But that’s the optimist in me.  The reality is that, as services leaders, we’re all dealing with a multitude of pressures in 2009.  If you’re like any of our clients you’re under a lot of pressures to cut costs, improve utilization and drive higher revenue, just for starters.

In fact, see if any of these strategies sound familiar in your organization: 

• Grow Services Revenues
• Reduce OpEx
• Redeploy people
• Speed up Services Sales Activities
• Restrict Hiring
• Improve Margins
• Increase Utilization
• Drive Better Customer Experience

Really! I mean, how does one drive-more-sales-faster-with-fewer-people-and-no-new-hires-so-that-I-can-increase-utilization-to-reduce-OpEx-and-improve-margins-while-improving-the-customer-experience?

In our company, we call that “running around the building with our hair on fire.” We call it that because, well, that’s what it feels like.

So, if you’re an IT services leader at a product company, you’re going to have to pick your battles for 2009.  This may be a good time to take a look at how you go-to-market and create or improve services strategies that align with each customer segment.

Here’s what I mean by that.

Most product companies segment business customers into three different groups.  And, regardless of what your organization calls them, they probably fall into these simple categories:  Enterprise, Mid-Market, and Small & Medium Business.

In other words, think of your business customers as big, medium and small.  And each of these customer segments deliver different levels of revenue and profits for your organization.  Therefore, they each need a different level of services involvement from you, especially when you’re challenged with restricted headcount or reduced OpEx pressures.

An easy way to segment your customers is to sort them into the three service activity levels required by you:

• High Touch, High Involvement
• Low Touch, Partnering
• No Touch, Outsourcing

If you want to maximize your services organization’s value in these tough economic times (and stop running around the building with your hair on fire), consider these strategies.

• Put Your Best People on Your Most Profitable Accounts (High Touch)

  This may seem like commonsense and most of us would agree that this is right thing to do.  But, before you breeze over this, consider that it’s not as easy as it may seem.  Your most valuable and profitable customers require a high-touch, high-involvement strategy from your services business.  Makes sense, right?

  Yet, ask yourself how many times your organization has had to take one of your highly-skilled and most valuable consultants off an important and profitable client to deliver a short-term, transactional product deployment service?
  Experience shows that selling, managing and delivering short-term transactional (packaged or SKU-able) services is distracting and difficult at best.  Because of its high-volume, high-velocity nature, transactional services are unprofitable for most services organizations.  And the amount of churn and resources required for this business will eat up valuable time and energy and take away from your most important customers.

  Service executives tell us over and over that they spent 30-40% of their best peoples’ time supporting and delivering this type of transactional service yet it only accounts for up to 10% of their overall services revenue.  Does this sound familiar?

  There’s no argument that these short-term transactional services are important to your business.  After all, these packaged services make it easier to sell and deploy your products. 

  Yet, as a services executive, when you take your best people away from your most valuable customers, these customers are negatively impacted.  And if product sales to your big, enterprise customers start to suffer, I’m sure you’re going to be hearing from your sales reps. 

  So, keep your best and brightest people on your most profitable customers.  Protect these clients.  Grow you business within these accounts.  It’s vitally important in today’s economy. 

• Empower Your Channel Ecosystem to Service Mid-Market Accounts (Low Touch)

  Mid-Market customers need to be serviced by your Channel Partners.  In this segment, you can best support your Channel Ecosystem by empowering and credentialing your partners to become even more self-sufficient.  Most would agree. 

  Yet, Mid-Market customers are typically your Channel Partners’ biggest customers.  And, just like you, your Channel Partners want to put their most talented resources on their largest and most profitable accounts.  This is where things start getting slippery. 

  Oftentimes, product companies will rely on their Channel Partners to deliver short-term, transactional deployment services.  But in most cases, the Channel Partner has the same set of challenges you do.  They, too, want to put their best people on their best customers.  Yet the churn and velocity of short-term transactional services starts to pull them down as well.

  So, when these transactional services are delivered poorly by your Channel Partners, it can negatively impact your own organization.  Why?  Because when transaction deployment services go wrong, the end-user customer is going to escalate a support call to your services organization, not the Channel Partner. 

  Now, you’ll have to send out one of your best people to go fix it.  Now, you’re distracted again.  Now, you’re taking your best and brightest people away from your most important customers.

  So, what’s the solution?

• Carve Out and Outsource Your Transactional Deployment Business (No Touch)

  By nature, transactional deployment services are characterized by high-volume, high-velocity, rapid fire activities.  Yet, it’s also a double-edged sword. 

  On the one hand, the high-volume, high-velocity nature of this business means more sales to your company. It’s the long tail revenue stream. 

  On the other hand, the amount of churn involved with delivering these services can drag down an entire services organization.  Now, as we discovered earlier, your biggest and best customers are suffering.

  If your company sells hundreds or even thousands of transactions a month, then you’re probably experiencing a never-ending barrage of calls, opportunities, requests, projects, updates & changes.  This is where clients tell us they feel like their hair is on fire.  Does this, too, sound familiar?

  This is where partnering with a service provider that specializes in rapid deployment transactional services can provide relief to your organization - especially in these economic times when you have limited resources. 

  Partners who specialize in transactional deployment services utilize specialized business processes, delivery methodologies, and integrated Professional Services Automation (PSA) tools specifically tailored to this unique and challenging business.  These service providers can now create a high touch feeling in your no-touch business segment.

  With the right outsourcing strategy, you can even turn your transactional deployment services business into a profit center and eliminate the churn and distraction inherent in this segment.  Now your best and brightest people can focus on what they do best - taking care of your biggest and most profitable customers.

Remember, times are tough.  Belts are getting tightened and you can’t boil the ocean.  So, pick your battles.  Smart organizations who are segmenting their services strategy and outsourcing transactional deployment services are the ones that will be in the best position to capture their unfair share of the new IT services market this year.

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.

1. To work for an organization they are proud to be associated with.

   People like to be associated with organizations that have their act together--those that have lofty ideals, important missions, and inspiring visions that align with the employees’ personal value system. Foremost in desire is integrity, where organization leaders model and reinforce what their words define. Working for this type of organization is invigorating and fun.

   Ponder Point: What can you do to build pride in your team?

2. To contribute.

   Employees who believe in an organization’s cause want to contribute to accomplishing it. They want to be given lots of responsibility and to be personally challenged with the chance to test themselves by performing new tasks in new ways.

   Action Step: Ask all your high-potential players what important issue/idea/problem/opportunity they’d like to address, and let them at it.

3. To be respected as the professionals they are.

   Just as craftsmen of old looked to their guild for the accepted standards of quality, today’s knowledge workers look to their professional association for benchmarks of performance--not their employer. Employees expect their organizations to understand and apply these professional standards to them when discussing performance expectations, negotiating desired actions, and acknowledging achievements. This offers a win-win opportunity for everyone, as professional standards are usually higher than those normally imposed by the organization.

   Common Sense: Treat your professionals as professionals.

4. To be treated fairly.

   Although many organizations work hard to keep it a secret, employees know how other employees are treated: what their compensation packages are, which departments have the most flexible work hours, who goes to the conferences in Barcelona. Furthermore, except for an extremely small percentage, modern workers want their measures of performance to be based upon their contribution to achieving important goals, not on how hard they work, how long they have been employed, or the depth of their relationship with the president’s children.

   Furthermore, although management may not be aware, employees know which of their peers deliver the most value to the organization. In today’s team-oriented workplace, individuals quickly separate the performers from the laggards. Workers want to receive similar rewards and recognition to those that deliver similar value, either inside or outside of the organization.

   Reality Check: Assume that everyone knows everything, then act accordingly.

5. No hassles

   In most situations, employees don’t ask for much from management. They want clear and realistic objectives that align with the organization’s mission, along with goals and streamlined work processes that make sense. They want the necessary information, time, and tools to do the work, and fair compensation linked to objectives. They want fast, specific, and accurate feedback on performance as well as enough power to “do what’s best” in a situation, and not worry about later rebuke. They also want input into creating all of the above. That’s about it. So get out of their way. They will call you when they need you.

Cold, Hard Reality: If you’ve hired the right people, they know more about their job than you do, so let them work. Remove obstacles, don’t add more.

Address these five things that your people want, expect, and deserve, and watch them make you successful.

*Adapted from The e-Impact on Business Performance: Leveraging the Internet for Competitive Advantage. James A. Alexander. August 2000.

Jim Alexander is founder of Alexander Consulting, a management consultancy that creates and implements professional services strategies for product companies. Contact him at 239-283-7400, alex@alexanderstrategists.com, or visit http://www.alexanderstrategists.com.
Alexander Consulting

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. Given the poor macro picture, the amount of M&A and startup activity in this space shows how much interest there is and how much more there is to do in order to improve in project management.

- What do you mean you don’t do on-demand?! On-demand adoption surged in 2008 and is now the standard way to deploy project management software. In fact, the tables have turned. Vendors that do not offer on-demand solutions look out of place and out of touch with the market.

- Project management continued to gain credibility as a legitimate profession that is very much in need given today’s complex project, workforce, market realities and regulatory requirements.

- Working remotely, virtual offices, working from home, are now almost as accepted as working from the office in an increasing number of industries and work types. It is now common to find work arrangements that account for some work being done from a home office.

The stage has been set for some very exciting changes in the project management world. In a three part series, I discuss ten potential project management trends that may be more prominent in 2009.

# 10. The Increasing Correlation Between Project Management and Operational Excellence

It used to be that senior company executives such as the CEO, CFO and board members would generally stay away from project management related decisions. The expectation was that CIO, COO and other operational executives would “take care of” ensuring that the company has effective project management practices. In fact, most executives generally regarded project management as something the “techies”, field-level workers and mid-level managers should worry about.

In today’s highly competitive flat world, the “Chinese wall” between executives and operations has broken down. In 2009, we will continue to see increasing sponsorship, collaboration, and direct involvement of senior executives in project management initiatives. Senior executives have come to appreciate the direct link between effective project management processes, best practices and tools and operational excellence. This task is no longer delegated away and deemed to be a tactical activity. Senior executives and board members view project management improvement initiatives as a strategic investment.

# 9. The CFO and the Project Manager Friendship

An increasingly project-based service-oriented economy has led to more complex customer engagements and billing arrangements. By instituting charge backs, even internal departments have to justify their costs, deliver services efficiently, and earn the business of other entities within the same organization. Consequently, for CFOs measuring project value and recognizing revenue in compliance with various GAAP (Generally Accepted Accounting Principles) cost accounting and revenue recognition regulations has become an even more daunting task. 

The intricacies of estimating project value have created unprecedented ties between financial executives and projects managers who have to collaborate to produce incontestable project value assessments that can withstand the various forms of potential financial and project audits the organization may be subjected to. Given the current trends, the CFO/project management alliance is likely to grow stronger in 2009.

# 8. The Rise of the Project Workforce

As explained in my book The Rise of the Project Workforce (http://www.projectworkforcebook.com) more and more individuals choose the projects they want to work on rather than the company they work for. Similarly, more companies are adopting the Hollywood model for a larger percentage of their workforce.  In this model a project team is quickly assembled to execute a well-defined objective; the team is just as quickly discharged once the project (the movie) has been completed. This flexibility makes both the company and the workforce more agile in a rapidly changing competitive marketplace.

# 7. Dispersed Customers, Projects and Teams Kill Politics

The flat world and access to a global talent pool has significantly changed the inner workings and team dynamics of virtually all organizations. There are many disadvantages to working with remote dispersed team members, which most of us are doing today. We tend to be happier, more loyal to the team, learn faster, and accomplish more as a team when we work physically close to each other. On the other hand, there are less emotions and politics with a dispersed team; people tend to pay more attention to getting the work done, than playing office politics; and their performance ultimately dictates how they are evaluated.  In today’s increasingly dispersed teams office politics is certainly on the decline.

# 6. Finding the Right Talent Gets a Lot Easier

It is much harder to find the matching resources you need when you limit yourself only to looking for talent in a local market. The flat world, Internet collaboration technologies have made it possible for organizations to tap large remote pools of talent at very competitive rates. For example, at Tenrox, we are increasingly leveraging specialized programmers working (probably) from their homes in Russia, Eastern Europe and at outsourcing shops in India. These resources are not replacing our full-time staff; they complement our team by working on projects on a need basis. It allows Tenrox to remain flexible, not to over-hire, and yet quickly staff projects when required. With better collaboration technologies, improving quality of global resources, and our own improved knowledge of how to manage such projects, this process is becoming a lot easier and rewarding to execute.

# 5. Emphasis Shifts from Project Management to Workforce Management

The project management discipline has traditionally emphasized the science of project management. Project managers and contributors are encouraged to follow strict templates, guidelines and steps to ensure a project is executed successfully. However, in spite of the increasing number of certified project managers and great project management tools, projects continue to show high failure rates, or high rates of disappointment by being too late, cost too much, or not fully meet their intended objectives.

Numerous studies have looked at why projects disappoint. Many of these studies often conclude that better project management, communication, stakeholder involvement and change controls would have reduced failure rate. However, as books like Built to Last (Collins Business; 1 edition; November 2, 2004) suggest while best practices and better tools help there is nothing more important than picking the most qualified and best-fit resources to run the project (what Jim Collins called having the right people on the bus). Having the right people on the team makes everything easier; in fact, less process and less enforcement is needed since great team members innately know what needs to get done and just do it. As a result, more and more organizations are investing in cataloging their resources, understanding their resources’ capabilities and interests, and using more sophisticated workforce planning tools to find the best resources for their projects.

# 4. Uncertainty is the New Normal

The unceasing uncertainty we have all felt about our jobs, our homes, the economy and the world in the last two years is going to be with us for the foreseeable future. The credit crisis, terrorism, climate change, and prolonged wars will continue to directly and indirectly impact our lives, our psyche. However, with human being’s remarkable ability to adjust to any situation we are starting to get used to it! When this whole war/economic mess started I remember how shocked and surprised I was every time I turned on the TV. Now, I do not watch as much predictably bad news anymore, and when I do, I know it will be bad .... so it does not really bother me nearly as much as it used to.

# 3. The Rapidly Increasing Service Web

The business model of virtually every large monolithic company is under attack. The Web has enabled small, fast-moving, low-cost global competitors to emerge virtually overnight. This is even more true in the enterprise software space. Small companies with deep expertise in a particular problem area are able to build and offer Web service based solutions that solve the customer’s pain point a factor of time-cost faster than the ERP/established vendor alternative. With ever improving collaboration, Web services and integration technologies this trend will only accelerate in 2009.

# 2. Enterprise Software Technology Cross-Pollination Gains Momentum

Web services and new technologies continue to create a powerful seemingly perpetual wave of innovation in productivity tools. One of the more recent developments that is starting to gain further momentum has been the surge in hybrid software technologies. Here are some examples (with varying degrees of success):

• ERPs offering and embedding analytics
• Project management vendors embedding business process management capabilities (true enterprise class workflow engines)
• Project management and workforce management (not just time tracking but also workforce planning, time for payroll, leave time and other integrated HR/labor related functions/services) hybrid applications
• Accounting systems offering CRM and other enterprise solutions

# 1. Leadership Matters

Above all, I think one of the most important lessons of the last several years has been the critical importance of the leader. It does not matter who is on the bus, what great technologies one has access to, how many best practices you are fully versed in, it is all for nothing if the people that lead your organization and projects lack the leadership skills and intuition to make the right decisions. An incompetent leader can lead the best team, the best technologies and the organization with the most abundant resources to total and shameful failure.

The primary reason we are in the mess we are in now is extremely poor ignorant leadership at some of the largest public and private institutions throughout the world. We have learned, the hard way, that choosing a bad leader or project manager can be hazardous to us, to our way of life. I think, in 2009 every single one of us, whether you are executives, members of a board of directors, members of a committee, voters .... will pay a lot more attention to who we pick as our leaders, representatives and our project managers.

These are my predictions about what to expect for project management in 2009. It should be helpful to consider these trends in your business plans to help you leap ahead of your competition.

BACKGROUND

Professional Services Organizations are often quite proud of the technical expertise of their personnel - and deservedly so. It is common to hear things such as “Sue is the best technical architect - there is nothing she cannot do with this product.” At the same time, how many of us have seen situations where the great technical resource:

In this article, I will explore what the PS organization can do to enhance the “soft skills” of its PS practitioners and ultimately drive more value to both the client and the PS organization.

WHY IS THIS A PROBLEM?

The key to this issue is related to the “Customer Experience.” Anyone who has been in a retail environment in the past two decades has gone through a designed customer experience; take Starbucks for example. The customer experience is designed by Starbucks to satisfy the various attributes its customers enjoy.

The concept of a customer experience is no different in the business to business environment. As your professional services resources are deployed in the field, they are not simply performing technical tasks. Rather, they are: 1) the face of your company to the end client; 2) your eyes and ears into new opportunities for your company’s software and services; and 3) creating a lasting impression (good or bad) in the minds of current and future buyers.

So, while your recruiting process identified great technical talent, and your training programs educated the new hires on the intricacies of your product, it is very likely that you have not prepared your professional services resources to effectively operate and interact with the most important people to your business: your customer.

DEVELOPING A WELL-ROUNDED PS STAFF

The pyramid is an often discussed shape in the consulting and professional services industry. As RTM Consulting thinks about developing professional services practitioners, the pyramid is an apt metaphor.

TYPICAL SKILL CONTINUUM DEVELOPMENT

As PS practitioners enter an organization, they typically come with the requisite Technical Knowledge and organizations will then train them on their specific Product. The training is very often well thought-out and extremely thorough. As it should be - no one wants to put someone without a depth of product knowledge in front of the customer.

As practitioners develop and get staffed on a variety of projects, they start to pick up skills based on experience. They see how project managers operate, how to put together a work plan, and how to address an issue. Additionally, they are handed templates for issue management and status reporting. In effect, they learn by doing. Generally they do a decent job, but in reality, it is a little bit of luck that determines who succeeds and who does not.

Lastly, for those practitioners that keep developing skills, if they are fortunate, they will find a mentor that can help them truly become a “trusted adviser’ to their client. The nuances of communication these folks develop help them navigate difficult situations; explain difficult and challenging topics to a client in a way that the client not only understands the issue, but also the implications. Additionally - and more importantly - mentors help these fortunate few practitioners understand how to identify and capture value. Yes the word dreaded by many PS practitioners: SELLING. Not selling in a used car sort of way, but rather, identifying client pain points and opportunities that your software and services can address.

PROACTIVE SKILL DEVELOPMENT

The challenge to the Traditional Skill Development approach is that it leaves too much to chance - for something that is so critical to your business. Delivering a satisfactory - if not outstanding - customer experience requires that your PS practitioners be able to address all layers of the skill continuum.

I started my career with a Big 6 consulting firm with a comprehensive training facility. Sure, I learned a great deal about technology and analytics at this facility. However, there is one key lesson I learned that which sticks with me nearly 20 years later. Bear with me while I share the story - as it points to the benefit of proactively addressing skill development.

The course was designed around ‘successful client relationships.” I was a young consultant, 1 or 2 years on the job, doing a “role-play” exercise with a client; keep in mind that the session was being videotaped so that my peers and I could review and critique performance. Needless to say, I walked into the client’s office: 1) aimed to please; and 2) confident that I would excel at the exercise. After the standard small talk, we got down to business.

“Absolutely!" I confidently replied as I walked out of the office.

Any idea how this turns out? All of my peers and I failed miserably at achieving the real goal. I had just agreed to perform $1.5M of scope creep. Fortunately, it was done in a safe environment - and it did not result in a cost overrun. The remainder of the course was focused on identifying, practicing, and internalizing the appropriate way to deal with these client situations.

Scope management was not left to chance. Neither should any other layer of the Skill Continuum be left to chance.

The Professional Services Skills Continuum highlighted above identifies the core skills required to develop a well-rounded professional services practitioner:

My early experience at the Big 6 Consulting firm - as well as my work with a number of Consulting and Professional Services organizations - indicates that you need a formal program that includes a combination of lecture, case study, and experiential learning. As in any classroom setting, you need to explain the “theory” of what you want the Practitioner to learn.

Typically this is best delivered by experienced Professional Services personnel so that the theory is coupled with real life examples; making the course a rich mix of both theory and experience. In order to ingrain the lessons with the student, I have found that integrating case studies into the lecture can have significant impacts. Done right, case studies force the student into an experiential learning process. That is, they have to think and act like they were out in the field. Since the material may be new, it may be uncomfortable for them - this is good. They are in a safe environment, where experimenting and trying new techniques can help them better incorporate the learnings into their own behaviors.

Lastly, do not end the education at the end of the lecture and case study. Create follow on forums (e.g., brown bag lunches, monthly conference calls) where the students can come together and discuss how they are applying the lessons they have learned. These follow on forums have multiple benefits: practitioners get to hear what others are doing - giving them the confidence to try the same methods; in a safe environment you can discuss how you might potentially address a situation and gain the feedback of others; and you force the practitioners to continue to think about the lessons learned so that it is not “just another course” that was attended then disregarded.

CLOSING

We have all heard the phrase, “It is much cheaper to keep a customer than it is to find a new customer.” Yet, most organizations invest more money in chasing new customers than in doing the things required to create a positive customer experience. By proactively addressing the Professional Services Skills Continuum, Professional Services organizations can prepare their front-line personnel to better manage client relationships, deal with difficult client situations, and proactively identify new “win-win” business opportunities.

ABOUT RTM CONSULTING AND THE AUTHOR


Cincinnati-based RTM Consulting provides strategic and operational advice to assist technology companies with increasing revenues and margins, by leveraging professional and consulting services more effectively. Specializing in Global Resource Management and Professional Services Business Optimization, RTM Consulting helps IT hardware, software and pure consulting businesses achieve the benefits associated with a successful professional and consulting services portfolio. With its unique Business Acceleration Services and focus on operational excellence, RTM Consulting helps large, medium and small firms move beyond theory to practical application of industry best practices and achievement of exceptional results in the shortest possible period of time.

Mark E. Sloan is the COO of RTM Consulting. Mark is an industry pioneer with respect to defining and deploying Global Resource Management processes for Consulting and Professional Service Operators. Mark is a frequent speaker at professional services industry events. Prior to his current role as COO and Senior Founding Partner of RTM Consulting, Mark held a number of executive consulting and entrepreneurial roles with Accenture and Convergys.

©2009 RTM Consulting, LLC. All rights reserved.

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. It is hard to decide what to focus on first, what will reasonate best, and most importantly, what will ensure that we do not offend some very weary clients who are dealing with issues that most have not experienced in their careers. I have actually been able to boil it down to one word; cash.

Nearly every client today is running and re-running 13 week cash flow models in real time. They are monitoring cash by the minute, as if it was a heart monitor in the intensive care unit. Since credit markets are so tight, should a company fail to accurately depict its cash position, and be unable to meet its creditor obligations, a whole host of crippling repercussions can take place. That is where you come in.

If you are to succeed in tough times such as these, you must focus on CASH. You must ask yourself each time you attempt to pitch a solution to a client “How will this enhance their cash position?”. This will get the maximum attention and the highest likelihood that they will take an interest in your pitch. As a consultant, I have always said that we win when we can clearly articulate that we understand a client’s pain, and that we have a solution that will be some form of triage. Rest assured, regardless if you know it or not, many, many companies are in cash pain today.

So how can you best align yourself with your client’s pain? You can ask yourself the following 3 questions:

1. Does this solution reduce payroll/headcount?
2. Does this solution reduce SG&A expense?
3. Does this solution allow the client to forgo anticipated capital spend?

While many of us have focused on increasing revenues or improving efficiencies in the past, those two approaches are merely just the other side of the “cash coin”. Don’t expect a client, who is dealing with rapid erosion in the marketplace to be receptive to a pitch about revenues or efficiencies unless you are clearly correlating those results to an improved cash position.  To do so will ensure that in this marketplace, you are speaking their language, and that you understand the true pain point in an abundance of businesses today.

Deliverables are at the Heart of Team Collaboration

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.” There is a great deal of satisfaction that comes from a well crafted crystallization of ideas into direction.  But more importantly, there’s a great deal of wasted time that’s avoided by creating a well crafted deliverable.

In most professional service situations the work we do involves enough time, people and complexity that incremental deliverable creation is a constant process throughout the project.  Statements of work, project charters, diagrams, functional specifications, data models, screen designs, object models - let’s face it, it’s a long list.  Crafting them well is a critical skill set and a key part of what makes projects go well.

However, as much as a great document is a thing of beauty all by itself (ok, maybe that’s a little over the top), deliverables don’t DO anything by themselves.  They only tee up the next step for someone else to take over and DO something.  Even a finished software product is, in the end, just waiting for users to sign in and DO something.

So if that’s the case, then let’s not accept a weighty document as a justification for itself - let’s force it to optimally support the next steps in the process.  In order to do that I’ve been focusing lately on three fundamental aspects of deliverable creation in order to get the most benefit out of each design stage.

1. They should help you think
2. They should stack, and
3. They should serve the consumer

This “back to basics” approach has me revisiting our design process and deliverables and looking for things that don’t contribute to these goals.  This economy is the perfect time to trim fat from processes and cut down project thrash.

Thinking with Deliverables

System design, like any collaboration, boils down to evolving ideas from general descriptions to specific instructions.  The trick is to create design documents that help the team move incrementally through the thought process from the overview to the specifics.  The defined documents in the process should capture common “reality check” points where group confirmation of the direction is necessary.  They should also work to isolate particular aspects of the design process and allow clear thinking about just that element.

For example, it’s possible in custom software development to build a system by diving straight into screen prototypes.  However, when this happens people get wrapped up in the screen design and often lose track of important factors like understanding the most likely order of execution of the user tasks, or building a fundamental understanding of the domain and data model.

Assess the deliverables you use to see how well they serve in moving projects from generalities to specifics in an orderly fashion and how sensibly they bring focus to individual design aspects and then move through them in dependency order. Find out whether the evolution of the process or the rotting of procedures has broken the basic design narrative that leads your teams from big ideas to execution details.

Deliverables that Stack

It’s easy to lose sight of the big picture and make deliverables that adequately address the phase you’re in, but become awkward and time consuming when trying to apply them to the next phase.  When you can define a step 1 that really is half of step 2, and when step 2 is completed it turns out to be half of what’s needed for step 3 then you’re accomplishing a couple of goals:

1. Each step in the process leads directly to the next so logical disconnects are minimized.
2. Redundant work is removed from deliverable creation, saving time and errors.

On the technical side, system architects work in diagramming languages like UML and then use code generation tools read the diagrams and stub out the code for programmers to fill in.  This is a great example of creating a first deliverable (design ideas) that is supremely useful for creating the next deliverable (code).  The progress the industry is making towards tying front-end design deliverables more directly into code production is great, but there is still alot of room to improve this flow in the business arena.  Search for redundancy between deliverables and see if you can narrow those elements down to a single format that “stacks” into the next deliverable.  For example, it’s not atypical to see a pattern like this:

Deliverable #1 - describes things a system will do - usually in big fluffy paragraphs.
Deliverable #2 - breaks down the system activities into curt phrases and diagrams that show order of execution.

Why not do the initial system description in deliverable #1 in bite-sized “user stories” that can be plugged directly into flow chart boxes and arranged into order of execution?  Let deliverable #1 be the first step of deliverable #2.  Let the work done in deliverable#2 focus on the chronology instead of re-describing system activity.

Make Sure the Deliverables Serve the Consumer

Not every deliverable can stack.  At some point a person receives Deliverable A and transform it into a radically different Deliverable B.  The classic example of this is programmers taking a functional specification and transforming it into a coded system.  Although tools exist to speed that process along and do some stacking, there is still a volume of information that can’t directly BECOME code.

In that case the goal is to make sure that the way the deliverable is provided will serve the consumer’s need to DO something with it in the best way possible.  It’s entirely possible to correctly describe a system in a functional spec in a way that will immediately give the technical team a migraine.  Usually this is because the format:

1. Does not synchronize the organization of the deliverable with the order the work it supports must be done in.
2. Does not divide the the deliverable along common resource assignment break points.

The best way to approach this is to have cross functional teams sit down with deliverable formats and share their pain.  It’s likely that every day in your organization people receive direction and deliverables that are flawed and - if anyone asked them - they could tell you just what’s wrong with them.  By having teams that have frequent hand-offs of deliverables meet to improve the process they can become aware of minor changes that create big advantages.

The Cumulative Effect

Tuning and refining deliverable formats and quality is like statistical quality control in manufacturing.  If you can control the quality of every step in the process then the quality of the end product will automatically be more on track, waste will be lower and profits will be higher.  In professional services the steps we need to control are the incremental deliverables created during design and production.

So finding better and faster ways to make these hand-offs clean has the potential for big payoffs.  Work on your document formats and definitions to capture these benefits.  And once they’re defined logically and your staff is trained to know how to execute them, start thinking about a program where consumers of deliverables get to “grade” what comes to them.  Give the people who build them some incentive to make sure they not only follow the format but produce quality content according to their peers and “customers”.

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. 

I’ve been reading a lot lately about how companies are reacting, and for the most part, there seem to be two primary schools of thought:  drastically cut costs in the short term and try ride it out, or take the opportunity to reevaluate operations and make the changes necessary to become more efficient and productive in the long run.

Well, I’m not big on the “try to ride it out” approach, so if you’re like me, then it’s probably time to take a good, hard look at your business processes with a fresh set of eyes and ask one simple question - are we doing absolutely everything we can to run our business as efficiently as possible?  We recently asked ourselves that very question, and found several opportunities to improve. 

Not surprisingly, we found that internal projects aimed at improving operations - particularly those that were time or resource intensive - were the ones most likely to have fallen by the wayside when “more pressing” business issues arose in the past.  And throughout our brainstorming sessions, several of our ‘new ideas’ turned out to have been proposed before, and even started, but never pursued to completion. 

Some were process oriented; some were simply a matter of “spring cleaning” - taking the time to organize things and eliminate distractions and clutter; others related to getting more value out of tools we already have in place - taking the time to better understand and implement functionality that we were paying for but not yet using.  Some even involved making investments in new tools that we could no longer afford not to have.  In other words - all things we should be doing anyway, but which now carried a greater sense of urgency.

And so we looked at all of them, determined which ones would have the greatest bottom line impact relative to the scope of effort needed to complete them, and set forth a plan of action to finally get them knocked out.

The other determination we made was that we would not be victims of the doom and gloom mentality that is plaguing so many organizations right now.  We watch the news just like everyone else - and if you’re not careful, it’s easy to feel complacent, if not powerless to do anything about your current business environment.  And while it’s true that you probably don’t have the power to greatly influence external factors like the marketplace, you almost certainly have tremendous power to examine and improve the internal factors that can insulate you against the current challenges you and others face.  In our case, we already knew what many of them were, and just needed to make the commitment and take the time to finally address them.

So we did.  And something amazing happened:  As people had the opportunity to work on those long-delayed projects, and to do so with a real sense of contribution to the health of our business and to each other - they started becoming more motivated and more engaged with each passing day.  And that optimism has been more infectious and more powerful than anything on the news.

So now, instead of operating out of a sense of fear or panic about the things that are out of our control, we’re taking firm control of the factors we can influence.  And as we begin to complete projects that people have wanted to do for years in some cases, the resulting sense of accomplishment and momentum has paved the way for new and innovative ideas that will help us better serve the marketplace moving forward.  And that’s exciting for everyone.

The key here is that most people will gladly seize the opportunity to make a difference, if only given the chance.  So rather than just trying to ride out the current ‘crisis’, I would challenge you to identify the shelved projects that you’ve talked about forever - that people actually want to work on and to put in the extra effort to see them to completion.  Not only will you find your team engaged and willing to work on the ideas they’ve been passionate about for so long, but your business will become more efficient and productive as a result. 

There’s an old adage we try to live by here that says essentially “It’s always the right time to do the right thing.” There’s a good reason the same ideas keep coming back up.  You already know what the right things to do are - so just do them.

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.  Maintaining high utilization of your employees drives higher billings, higher revenue and ultimately higher profits.  It is a critical measure of your financial success and sustainability.  There are three levels of utilization that can be used by companies.  Some companies will focus on one level, while others will focus on all three.

Level One - Resource Utilization

Resource utilization measures the time your resources spend working on useful projects and tasks.  “Resource Utilization” measures the allocation of a resource on a specific set of work, including client and internal work, and tends to ignore “on the bench” time during which the resource is neither working on billable nor non-billable work. 

Measuring “Resource Utilization” helps managers minimize administrative work, is usually the easiest metric to measure, and is the easiest to act on.  If a resource is on the “bench” and not billing her time, at least the company can have the resource work on valuable internal projects or sales efforts.

Level Two - Billable Utilization

The next level down is “Billable Utilization”, which measures the time your resources spend working on billable projects and tasks.  The time spent on “internal” projects or business development is not included since this time is not billed to the client.  “Billable Utilization” is almost always less than “Resource Utilization”, which includes hours spent on internal projects and business development.  For instance, a resource may be 90% utilized overall (Resource Utilization), but not all time was billed back to the client, so “Billable Utilization” may be closer to 70%.

Level Three - Realization

Realization is a measure of how much of a company’s revenue capacity was captured. The goal of this calculation method is to determine “how much of the time the resource spent on billable work was actually billed back to the client”.  Time spent on internal projects and business development is not included. 

Realization is a useful metric since it involves hours and rate and gives some indication of where a company gives up money (e.g., in the sales process, in the collection process, or in delivery).

The appropriate baseline

Available hours, the denominator in the utilization calculation, is one of the most highly debated topics among professional services professionals.  Should it be?

• 2,080 hours (40 hours per week * 52 weeks)
• 2,080 hours less company holidays
• 2,080 hours less company holidays and personal vacations
• A more arbitrary number, such as 70% of 2,080 hours

Available hours also can differ by country, so global firms have to be very careful in how it is calculated.  Again, there is no right answer, just what is right for your company.  The most common number used in the industry is 2,080.  Using this baseline will make your utilization numbers transparent in your company as well as when comparing your performance to peer companies.

What is the right target utilization for my company?

Once you decide on the correct utilization, either billable, resource or both, for your company, the next step is to tie this calculation into compensation.  What is the right target for your company?  It depends on a few factors, including:

• The utilization calculation method that your company is using
• Benchmarked utilization rates for competitors and peer companies
• Your company revenue and margin targets

For example, if the baseline hours that are used in the numerator of your utilization calculation are 2,080 hours, then 100% billable utilization targets would not be feasible.  You would need to subtract company holidays, vacations, sick days and potentially “on-the-bench” time from your baseline to determine the appropriate target.  In this case, 70-80% utilization would be an appropriate target.  Conversely, if the baseline hours that are used in the numerator of your billable utilization calculation excludes company holidays and personal vacations, then an appropriate utilization target would be higher, perhaps 80-100%.
There are many benchmark studies available, so before settling on a utilization target, you may want to consult additional sources of information.  In addition to looking at peer company data, another data point to use is the calculated utilization target per resource that allows your company to meet its corporate revenue and margin targets.

For example, let’s assume that your billable resources have a fully loaded cost (includes salary, bonus, benefits and fixed cost allocation) of $200,000 per year, your average rate per hour is $200 and your corporate gross margin goal is 40%.  To achieve a 40% gross margin, each resources needs to bill $333,000 to clients. At a rate of $200 per hour, each resources needs to bill 1,667 hours.  If your company uses a baseline of 2,080 hours as the denominator in the utilization calculation, then your billable resources need to target 80% utilization.  However, if your company excludes company holidays and vacations from the baseline hours (denominator), then the utilization target is closer to 90%.

Critical to measuring and managing against both overall and billable utilization is the understanding that time capturers are often not in control of their own destiny.  Resource managers are responsible for staffing, and the organization’s commitment to skill development can be an important factor in determining your company’s target utilization.

In closing, there is no clear answer to how a particular company should calculate resource utilization, but there are a few basic principles to follow when making this decision for your company.

One, it is imperative to keep the calculation simple.  By making the calculation simple, consultants will understand the goal.  If they understand the goal, there is a better chance they will beat the goal, and if they don’t, they should not complain.  If the calculation is not simple, it is understood by no one, and ultimately becomes a number on a spreadsheet that everyone is aiming towards, but does not really understand, which can hurt morale.

Two, ensure your calculation is globally consistent.  Whatever you decide is the right utilization formula for you company, it is critical that you apply it consistently and uniformly across all users.

Three, the inputs to your utilization calculation should not be controlled by the individual resource, but rather decided at the task or project level.  Take the human element out of the input, which will help ensure consistency in the application of the calculation.

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. America’s past time is about to give us all something to take our minds off the mess the financial system has wrought (except, of course, for us hockey fans who are looking forward to the pursuit of the Stanley Cup). Baseball also offers us a great example of how to use business intelligence strategically.

“Business Intelligence” is the new clichê for gathering, organizing and reporting on business-related statistics. We all do it and would never think about running a business without it. We collect the stats, run the reports, review the data and buy benchmarking reports to enhance the data - but never question the need for the data or the reason behind it! I would pose the question: How many of us REALLY use the data to create real intelligence that leads to strategic decisions? Decisions like “should I change the composition of my sales team?” or “should I create a new line of services?” or “should I close down a set of partners?” Experience tells me that most of us don’t. We either wing it or think we’re playing a better game than we’re actually playing when it comes to using Business Intelligence to make strategy adjustments. So let’s look at baseball briefly and see if it can help us use all this data strategically.

Collecting stats and keeping score is part of baseball culture and lore. How many of us learned to keep score from our dads while sitting in the bleachers at a major league game and asking dad “why do we put a K in the box for a strike out”? How often did we look through the box scores, which are in every newspaper for every game, to see if Mickey Mantle went 3 for 4 or did Ernie Banks pound a couple out onto Sheffield Avenue the day before? You knew the batting averages for all the starters and ERA for all the pitchers. You may even have known how many walks the leadoff hitter was able to draw and how many stolen bases he had as a result. And if you were a fanatic you could go to the bible of baseball stats published each year by Bill James and have EVERY stat ever collected in baseball. We all had deep, deep data and all of this before Al Gore invented the Internet. Heady stuff and - be honest - we’d love to do this for our businesses. Perhaps many of us have key operational stats on the tips of our tongues, such as “Joe the PM regularly achieves 85% utilization,” “Connie hits her booking targets month after month,” and “turnover on Pete’s team consistently is under 10%.” But do we go deeper and ask and answer the really tough but high-impact questions?

Baseball collects this info for a variety of reasons. Certainly the fans figure into things, but they do it for a couple of other very important reasons as well. First, the obvious: day-to-day operational decision making. We all have drills that we run when utilization starts to drop for a team or an individual, just as Joe Torre begins to adjust his lineup when his number 6 and 7 hitters stop getting on base. Second, the data is used to pay people appropriately. Manny Ramirez is currently a free agent looking for a club for this season and believe me, the GM’s know every one of his stats for his entire career and his contract will be laden with performance bonuses that are based on these stats in the same way that you’ll factor in margin, utilization, bookings, etc. into your comp plan for next year. Third, and most importantly, the stats are used to help improve the team’s record, the ultimate performance measurement. Billy Beane the GM of the Oakland A’s (and a member of the Board of Directors for NetSuite) has really illustrated the power of Business Intelligence applied strategically to baseball. This is where most of us can learn a heck of a lot from baseball, and Billy Beane specifically.

Most of us are probably familiar with the book Money Ball, written by Michael Lewis, describing how Billy Beane turned conventional wisdom on its ear in rebuilding the Oakland A’s a number of years ago. Billy was faced with the challenge that most of us live with every day. His bosses, the fans and the owners of the team, wanted a winner but couldn’t give him a budget equal, or even close, to his chief competitor, the New York Yankees. We can all relate. How many of us compete every day with Oracle or Accenture? In Billy’s case, he had one of the smallest budgets in the league. Very similar to a boutique going up against the big guys. So what Billy did was to analyze what actually won baseball games. As simple as it sounds, the answer was “score more runs than your opponent.”

Sounds simple, but as we learn when we read the book, for decades baseball had evaluated talent against a conventional set of criteria - including size, weight, batting average, errors and a lot of other data - that had no direct correlation to scoring runs. Beane and his team, which included a Stanford stats guru, broke the game down to it essentials: getting on base, advancing and scoring for position players and hits and walks for pitchers. Their theory was simple: the guys who got on base more, scored more, and the pitchers who kept people off of the bases won more games. From this they began to study a whole new set of measurements such as on base percentage, runs scored, bases allowed, etc. They then went back and reviewed successful teams and players in the past, validated the theory and built the ball team from an entirely different strategic perspective. A position player’s ability to get on base and score runs no matter how they did it became more important than his batting average. A pitcher’s ability to keep players off the bases was more important than the speed of his fastball or whether he was 6’2” tall. Beane then completely retooled the scouting process. In a few years he had consistent winning teams that were exciting, competitive and profitable - all with one of the lowest payrolls in the major leagues. He did this by using the information (stats) strategically.

We can all do this as well. What the A’s (and subsequently other teams, including the Boston Red Sox) did isn’t magic but does require some very deep thinking about what is truly important to our individual businesses and the ability to think past conventional and traditional wisdom. And probably the most difficult element is the confidence to stand stiff in the face of the predictable skepticism and make real decisions to drive real change. In other words, strong and committed leadership.

Let me tell a story based on a real experience to illustrate this point. A few years ago I was asked by a long-time friend and colleague to help figure out how he could accelerate the growth of his business. His company, a boutique technology consulting firm, had a great reputation, a list of blue ribbon clients and some incredible operating stats, but they were having a hard time growing the business. He thought he needed more sales people and asked me if I’d help hire a couple of “knock ‘em out of the park” sales types. We did a focused strategic review and yes, they needed some sales help - but not anything like his initial ideas. We then dug deeper into the business and set some short - and long-term targets and metrics to measure achievement. All pretty standard stuff.

After a few months, however, we began to notice two things that seemed at odds. Business was growing, as measured by revenue, but some of the sales team were underperforming badly.  After a few more months it became clear to my friend that for years the method and data he was using to run his sales efforts was not right for him. He was using a lot of traditional methods that were not working (baseball’s conventional wisdom). When he began to use a different set of measurements and methods (Billy Beane’s on-base percent) not only did his business begin to grow (over 35% increase in revenue in the 1st year) but his confidence for the future rose dramatically. Most importantly, a couple of very important strategic changes became very clear to him and his board. He hasn’t won the World Series but he knows exactly what changes need to be made, and they’re huge, because he’s looking at his business intelligence strategically.

So, as you put your feet up and begin to enjoy another start to America’s pastime (I’ll be at the Shark tank watching the SJ Sharks make a run at Lord Stanley’s Cup) think about how you can be a Professional Services Billy Beane by:

• Putting conventional wisdom aside
• Digging down to the very basics of what makes your business win
• Understanding how to look at your data to match your basics
• Understanding the changes that you need to make to win your version of the World Series

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”.  Why does it depend?  We’ve got access to all kinds of communication devices now - email, Instant Messenger, text messaging, e-newsletters, websites, etc.  The key is getting to know your community to figure out the best interaction.

Take the PSVillage Newsletter as an example.  I subscribe to get the newsletter electronically.  It comes with all kinds of great information, discussion groups, and links to helpful areas that I may need.  However, I know it’s a newsletter and it gets prioritized in the email queue until I get all those critical customer emails taken care of.  Is the delivery means effective?  Yes.  Does it demand response from me?  No.  Do I review it in a timely manner?  Honestly, it may take a few days but eventually I get to it.  This format suits the PSVillage community.  We are a group that wants to share information and communicate with each other informally. 

In thinking about your own organization, take the time to determine if you need to inform people, if you need responses from people, or if you are looking to encourage feedback/discussions among your group.  Not all of your communication needs to be handled with a single approach.  Email is effective in getting the information out there but there are LOTS of emails out there.  Using options like read receipts can help ensure people are accessing the email but unless responses are required, you cannot determine if the email has actually been read.  Newsletters are a great reference provided they are relevant to the audience and regularly delivered; if they become sporadic, then the audience doesn’t rely on them for information as much.  Websites become a good site for posting reference information and may also serve to encourage discussions using tools such a blogs or discussion groups.  Instant Messenger (or similar tools) gives you more of an “in the office” feel with user interaction expected - something that can easily lead to distractions if etiquette is not laid out.  The communication method you need may span one, some, all or more of these options.

Now think about the type of community you are dealing with.  Are they on the road a lot?  Are you dealing with multiple time zones?  Are they at customer sites?  This will drive how information would best be received and accessed.  If you’re posting everything to an internal website which requires internet and VPN access, your mobile team may run into difficulties accessing it.  If your team is primarily at customer sites, having random Instant Messenger windows pop up with questions may not go over well.  Email and Newsletters ignore time zones and can be read on your own time so time critical responses may not be received when expected or desired.

It would be helpful for your organization to layout a communication plan.  What types of information or feedback do you send and receive?  What is the frequency?  Who are the recipients?  What is the communication method you prefer?  You may have your Project Managers creating communication plans as part of their methodology but you can apply the same technique to your organization.  Make it available to everyone so there’s an understanding of what is critical, what is informative, and what is meant to become a community building tool that will benefit everyone.  Take the time to also setup an etiquette guide for things that are a bit more dynamic like email, Instant Messenger, and discussion groups.  The expectations you set for your community on clear communication will save time and energy in the end.

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.

A friend of mine in Austin, TX started a candle manufacturing company.  A few years ago, after he had just started the company, I stopped by his house to say hello and see how things were going.

When I showed up at his house, it became apparent that his little candle company was growing and doing well.  The funny thing is, he was still making candles in his kitchen, his spare bedroom, his garage and everywhere in between.  Plus, he had a 2-ton blob of wax sitting in his driveway.
Amazing.

Then, one day, his products got picked up by Oprah on her now famous “O List”.  Oprah featured his candles on her TV show and in her magazine.  To no surprise, his sales skyrocketed.  And, needless to say, he’s not making candles in his kitchen anymore.

In fact, he’s making thousands of candles in a huge warehouse and manufacturing facility now.  Every time I check in, it seems like he’s moving to another bigger facility.

One day, his accountant and staff told him that in order to run the business, he needed to upgrade to an Enterprise Resource Planning (ERP) system that would take care of sales, inventory, production and shipping all in one package.  So, he chooses one.

He called the ERP software company who educated him on the product and sold him on the benefits of their software.  But, they told him, they don’t sell direct to small businesses, so he’ll have to buy the products and arrange for installation through a local systems integrator and reseller.

Not knowing where to turn to, the ERP software company set him up with a local channel partner who claimed expertise in selling and installing ERP software for small, growing businesses just like his.

They send him a quote:

• ERP Software = $32,000
• Installation Services = $39,000 (For 5 Weeks of Services)
• Total Cost = $71,000

That was February 2007.  Nearly two years later, the ERP software is still not totally up and completely functional.  And basic features, like credit card processing, have never worked in the two years since the purchase.

Even worse, after nearly two years of “Be-Backs”, re-do’s and revisits, the channel partner has charged him over $150,000 for the services alone - more than $111,000 and 22 months longer than what was promised in his contract.

Now, instead of using great technology to spread joy to candle lovers all over the world, his technology is using him.  It’s consuming his and his staff’s time and energy.  It’s incredibly distracting to the business.

And, quite frankly, he’s fed up.  In fact, I can’t believe he’s lasted this long. 

Not to mention, he’s incredibly upset (that’s a euphemism for the words he actually used which I can’t repeat here).  Who could blame him?

But who is he upset with?  The channel partner?  No way.

He’s upset with the ERP software company.  In fact he’s so upset that he wants to return the product, sue them and start a blog to rage against the ERP software machine.

All because of a poor installation performed by a partner.  A certified partner, no less.

Now, this might not be happening at your organization, but I actually see this kind of situation being played out over and over again.  Why?

Two reasons:

1. Most channel partners fail at short term, packaged or transactional services (like in this case).  This is the hardest part of the services business to execute consistently and profitably and in a way that leaves customers with a positive customer experience.  And, we all know, when the customer experience is bad, they are no longer loyal to your company’s products.

2. Channel partners make more money on services and not so much on product sales.  So they’re incentivized to create long term, repeatable streams of service revenue through consulting projects, onsite residencies and outsourcing.  They are not incentivized to perform short term product installs because it’s not that profitable for them and it chews up their valuable consultants’ time.

So what’s the solution to this dilemma? 

Call me crazy, but I think about this problem, and customer experiences like Robert’s, non-stop every single day. 

You see, I have a dream that, one day, we will eliminate the pain, frustration and disappointment that customers experience when buying and installing complex technology products. 

Think, for a moment, about why small businesses buy your products in the first place.  If it’s a bank, they’re buying your technology products to more effectively grow and protect the financial assets of their customers. 

If it’s a school, they’re buying your technology products to educate our children and improve the future of this nation.  If it’s a hospital, they’re buying your technology products to save lives.

Yet, all too often, the technology products we thought were going to make our lives better, instead end up dragging us down and consuming our precious time and creative energies.  Instead of using technology to make our lives better, the technology products we buy are using us.

As services leaders, we must come together to rewrite the future of IT services by making it fast and easy for small businesses, just like Robert’s, to buy and deploy complex technology products - exactly the way it should be. 
We must unleash the power and potential of complex technology products - products that improve lives and help us realize our dreams. 

We must fulfill the real promise of technology so that small businesses can use innovative products and services to focus on the things that are most important to them.  Let’s let them get back to business.

If there’s a call to action, it’s this:  Take Back Your Customer Experience! 

We all know that channel partners are very important to product companies to drive product sales.  But at the end of the day, the end user customer wants to be loyal to your products. 

So, if you have channel partners that do a poor job at installation, step in and fix it as soon as possible.

Here’s how.

Create and execute programs that make it easy for your Tier 2 and Tier 3 channel partners to sell and install your products.  Here’s what I mean by this.

Like most product companies, you probably segment your channel partners into three groups.  And, regardless of what you call them, they probably look something like this:

• Tier 1 - Big and capable partners who have the means and motive to sell and install your products. 

• Tier 2 - Mid-sized partners who have strong sales capacity but only limited capabilities or resources to install your products.
  

• Tier 3 - Small-sized partners who resell your products but have very limited to no capabilities to install your products. 

Most product companies spend most of their time and resources capturing and holding the mindshare of the 600 - 700 Tier 1 channel partners.  That’s great.  Don’t stop doing that.  In fact, I encourage you to continue to grow and expand your Tier 1 partners.

However, more often than not, product companies can’t afford to invest the same amount of people and resources with their Tier 2 and Tier 3 partners.  Why? Because there are tens of thousands of these partners in the channel that can sell your products.  Product companies can’t afford to invest in training and supporting this large, fragmented channel segment even though this is where most of the channel sales come from.

But these partners desperately need your help.  Left to their own devices, these channel partners are probably not going to make significant investments in training or certification to get better at installing your products - especially in this economic climate. 

So, product companies who invest in programs to make it easier for their Tier 2 and Tier 3 channel partners to sell and install their products are going to win their unfair share of the mindshare of these partners.  And, by doing so, they’re going to win more market share across their product portfolio.

At least that’s my dream. 

Let’s change the story.  Let’s eliminate the pain and frustration small businesses feel when buying you installing your products. 

And let’s let Robert get back to the business of spreading joy and happiness throughout Candle Land. 

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!”

I smile every time I think about that tip. He’s referring, of course, to the challenge of building teamwork and mutual trust between the Professional Services and Sales Organizations. And while a section of the chapter that is dedicated to Services Selling is excellent for helping increase PS Sales, we need to dig deeper if we want to find ways to improve teamwork.

My best lessons in working with Sales have come directly from Sales professionals themselves. Some of the lessons I’ve learned may not be immediately obvious. Some may be counter-intuitive. In this article I’ll share a few of those lessons, which can be implemented virtually overnight, and which should greatly improve trust between your PS and Sales organizations.

1. Don’t police Sales: It’s not your job, and it creates a lack of trust between the Services and Sales organizations. Handle concerns openly with sales management, and avoid sounding punitive. If you’re sincerely concerned about elements of a deal (such as pricing or schedule) ask for a joint review by Sales and PS Management, or by Executive Management if needed. Enter the review as a team, not as two competing parties. You’ll get your concerns heard without eroding the trust factor.

2. Communicate, Communicate, Communicate: This is a golden rule, but one that PS often breaks. ALWAYS let Sales know when you’re talking directly with an account. For standard project communications, regular status reports to Sales are critical. For out-of-band discussions, invite Sales to the call, cc them on email, or send Sales a summary of discussions. Lack of communication between PS and Sales can be ruinous to the relationship and has often led to some of the most impressive account escalations ("train wrecks”, “fire drills") that I’ve witnessed. Make this form of communication a cultural aspect of your organization.

3. Root for your team: Regardless of how much work the final deal may create for you, let Sales know that you want them to win. Emphasize the benefits to you and your company of closing the business. Your support does two things: it increases confidence in the Sales team, while building trust. When that happens, be prepared for a surprising twist: you may be asked how to improve the deal for services.

4. Congratulate the winner: One CFO I worked with would always place a call to the salesperson after a deal was signed. He’d personally thank them. That call was like winning an Oscar - it did more for building self-esteem than most other things we tried. I like to do the same (but I confess to using email more than phone). For a salesperson working remotely, you can really make their day by placing a brief call to congratulate them on a good win. Your call will demonstrate your value for their work, and in return you’ll create more open communications.

5. Make the Sales request a priority: When you’re assigned work for a Sales opportunity, view it as a project. Then schedule it into your day along with your other services projects. Let Sales know your schedule so they can see you’re taking it seriously. Then stick to your schedule - treat the salesperson as you would a customer by being on time, and showing them that the deal is as important to you as it is to them.

6. Return their calls: Respond to an email request or voicemail within the same workday. Even if your response is that you’re booked today and need to get back later, acknowledge their request so as to show you’ve got the ball. Your call improves confidence in the PS organization and peace of mind for the time being.

7. Salespeople are your immediate customers: A truism of Sales is that if you’re not delivering to their needs, they’’l find a way to get it done without you. Frightening, isn’t it? Salespeople will almost always take the path of least resistance. And they’ll find their way to those in the company who will help them, such as Engineering, as their first option. If you see that happening, it’s a good sign that you need to review your service approach to Sales.

8. Ask Sales how you can help: When you see an account raising challenges, offer to help and be willing to get directly involved with the prospect during the sales process. You’ll help lift the burden from Sales and you’ll show that you’re part of the team.

In the next article on Working with Sales, I’ll review the types of PS activities that can exceed expectations and create excitement within your company. Hopefully, you’ll find these lessons useful. Feel free to contact me to share your thoughts.

Sincerely,

Joe Longo
VP Professional Services
MetricStream, Inc.

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.  As a result of the current economic climate, many Professional Services Leaders who once considered their jobs safe are now finding themselves back in the job market. It’s an uphill slog to be sure, with few open slots and many experienced candidates dusting off their resumes and targeting the next opportunity. Not only is it a buyer’s market but competition among world-class candidates is fierce. With this in mind, I was recently asked to consider the following: In order to differentiate ourselves in the job market, can we package and sell ourselves in the same way that organizations sell a product or service? Is it possible to architect and execute a sales campaign for ourselves?  Can we in effect sell “Corporate Me” into the career market?

My job as a Consultant to Sales Organizations is to help my clients run successful sales campaigns; to open new markets and to find them new customers.  My work generally focuses on organizations that have run a number of unsuccessful lead generation campaigns, lack processes needed to be successful, and are looking for a better way forward. The programs that I offer navigate the pitfalls that inhibit the success of many go-to-market campaigns. Can these programs also work for someone looking for the next career opportunity?

The job search can be gut wrenching:  You contact your network, call recruiters, send out your resume and then (apart from the truly exceptional or lucky candidates), wait and hope for the call, for the interview, or for the job offer.  Frankly, it is a lot like sales cold-calling; digging around to get a sales cycle started. You usually have to face a lot of rejection before success; it’s disheartening!

Yet the best sales professionals don’t just sit around and wait and hope; they don’t get discouraged by rejection. They have a plan, a process and a clear understanding of how to attain their quota. Rejection is built into their plan. Rejection is all part of the sales process, and as such it’s both normal and commonplace, so don’t let it set you back. Top sales people will tell you that a call not returned, an opportunity that dead-ends, or even an outright “no” from a prospect is just one step closer to getting to a “yes” and winning a deal! So let’s look at the eight key elements of a sales campaign and see how they can be used to market the Corporate Me.

1.  Set Expectations at the Beginning of Your Job Search

The very first thing I do when working with a client is to get all the stakeholders’ expectations nailed down, documented and agreed upon by all. The Corporate Me should do the same. Document the types of positions you are considering. Review the risks and rewards and the expected return on your personal investment. Then work with your stakeholders to define an agreed set of goals and objectives.  You may, for example, be willing to take on a project that would mean moving to Dubai for a year; but are your stakeholders, in this case your family, on board with the plan?  Are they as willing as you are to move for a new position?  Things like documenting your salary expectations, maximum commute time and the types of positions you are willing to accept are key to keeping you from leaping at the first job that comes along.  Your expectation report will minimize the risk of accepting a job that’s a poor fit so that you’re not back in the job market again six months later.

Your “Stakeholder Expectation Report” will set the direction that you take in your job search. It will be the tool you use to monitor and manage your progress. Your goals may change as the search progresses, so you may need to revise your expectations from time to time. But to get the job search started, your Expectation Report is the foundation of your plan; from this you will build your job search roadmap.

2.  Know Your Unique Selling Proposition

Going to market with a so-so value proposition will ultimately lead to so-so results. Yet many companies launch sales campaigns with nothing more than glossy literature. To be successful, a company must identify its unique value and communicate that to its prospects and clients. Remember, though, that a unique selling proposition is not found in the latest technology, corporate IP, or even the best service and support staff; it can only exist if these products and services help solve a client’s business problem. Many companies forget this. Seduced by the prowess of their technology or their staff they believe that the product or service will sell itself. It rarely does. Superb technology and outstanding people may well give a company a unique proposition, but it does not become a unique selling proposition until someone is willing to pay for it. Don’t fall into the same trap.

Your 25 years implementing financials systems, or having successfully managed huge change management projects for Fortune 500 companies may make you unique (or at least somewhat special), but it only becomes a unique selling proposition if someone is willing to pay for it.

I know a salesperson who was recently hired within 45 minutes of being interviewed by her future manager. Sarah had a written offer in her hand before she left the building. She was a strong salesperson for sure, with a demonstrated track record; but so too were all the other candidates interviewing for the same position. What did Sarah do that set her apart?  She personally took to market what the company was looking to buy. The company, a systems integrator, was planning to jump-start an Oracle implementation practice. They had tried many times in the past to build a robust Oracle presence in North America only to see small market gains lead nowhere. Sarah knew this, and in the interview process explained how she could build market share and win new customers in the coming 12 months.

Sarah’s hiring manager told me that while all the other candidates talked about what they had done in the past, Sarah focused on what she would do in the future. Other candidates focused on their unique propositions; Sarah presented a unique selling proposition that the company bought on the spot. Using your resume, no matter how impressive it is, to lead the job search is like driving by using the rearview mirror. You give your prospective employee a great view of where you’ve been, but little indication of where you’re going.

3.  Articulate Your Value - Sell Yourself

When working with clients to build unique selling propositions I rely on the time-proven industry pain sheets. For those of you who’ve never come across pain sheets let me expand a little. Have you ever sat through a presentation where the sales executive blindly (and often self-indulgently) launches into a presentation or a sales pitch on the virtues of his product? Did you ever get the feeling that the presentation had been given a hundred times before? The presentations are often slick and fast-pitched; but unless they are relevant to you, they can be annoying and sometimes painful to watch. Pain sheets are designed to help generate a more productive and consultative sales cycle: One that seeks to diagnose a client’s pains before prescribing a solution. Essentially, a good sales cycle always starts from the customer’s position and the business problems to be solved. Pain sheets coach the sales exec to stay customer-focused and drive the consultative sales process.

The key components of a pain sheet are:

1. A business pain a prospect or client is experiencing
2. The reason for that pain
3. The impact that pain has on the organization
4. The solution the client is looking for
5. How you can help provide that solution

The husband of one of my colleagues, Jake, recently landed a prized job running web-based marketing for a vacation resort in the Northeast. When you hear his story about how he landed the job, it’s not surprising that he left the other candidates at the starting gate. He did a well thought out and well planned job of articulating his unique selling proposition. First he researched his “prospect”, understood its immediate business issues and came to the interview prepared to win the deal. Jake discovered that the company was looking to attract more customers through its website, and that they had not been successful in doing so in the past. Using statistics he’d pulled from his past projects, he demonstrated how he could build a web-based marketing presence that would generate new business for the resort. Jake didn’t feel like he was going through an interview; it was more like the type of sales pitch he was accustomed to giving to customers. In preparation for his interview he actually built a sample website to show how it could be designed and tailored to attract more guests to the resort. Did he use his resume? Well, yes but that was also presented as a website rather than a few pieces of paper stapled together.

By linking his experience and skills to a business problem, Jake created a unique selling proposition. By demonstrating how he could solve the problem, Jake had articulated his selling proposition in terms that resonated with his potential employer. Jake simply followed the fundamentals of a successful sales campaign by hitting all the key points of a pain sheet. He recently relocated to Vermont where he is now the Director of Web-based Marketing at the resort!

4.  Perfect Your Elevator Pitch

Just as you would in any sales campaign, the Corporate Me should also have an elevator pitch; something that enables you to describe your value in 30 seconds or less! For the sales campaigns I run, I have my clients build an elevator pitch, cold call script, reference story and sales pitch, all from the pain sheets. 
Here’s a real life example. Sally works for a professional services organization where she designs and runs their training programs for new hires. Using the components mentioned above, let’s build a pain sheet for Sally:

Pain - When the company hires a new recruit, it can take weeks before he or she is trained enough to take a productive role on a billable project.

Reason - To come up to speed, a new recruit needs to learn many things, from corporate policy to project tracking to expense management. This is sometimes a hit-or-miss activity, with some managers working well with new hires and others doing nothing at all.

Impact - Poor training has a negative impact on the morale of the new hire, and it delays the time it takes to get consultants on revenue earning projects.

Solution - Wouldn’t it be nice if we could have a central training program for all new hires and have them ready to work on clients’ projects within two weeks of their start date?

Using the pain sheet as a foundation, Sally’s elevator pitch might be: “I’m in the business of helping my company save costs and eliminate the frustrations experienced with hiring new recruits. Getting new hires up to speed can be an incredibly time-consuming, frustrating and wasteful activity. To solve that problem, I design and run targeted on-boarding programs that enable new recruits to be productively employed on billable projects within two weeks of joining the company. Each course I run saves my company thousands of dollars and improves the morale of our new employees.”

Doesn’t that sound better than: “Well, I run the training programs for new hires at my company”?

5.  Generate a Prospect Database

Fundamental to any marketing campaign is a good prospect data base. The prospect database needs to be both accurate and appropriate. Accurate because you need to ensure that information about the companies, contacts, phone numbers and emails are correct. Appropriate because you need to ensure that the target companies are interested in the product and services you offer. There’s no use pitching a solution to a company that doesn’t have a problem you can solve. The same is true with the job search; you need to sell to companies that want to buy what you have.

Using your “Stakeholder Expectation” document and the articulation of your unique selling proposition you can start building a list of prospect companies. Your stakeholder expectations may say something like: “I want to work for companies located within 50 miles of my home in San Jose, the company must have greater the $100 million in revenues and I want to be hired in at a vice president level.” With that you can start to build a prospect list. The work that you’ve done to articulate your unique selling proposition will help you refine the list. Sally, for example, would want to target companies that are having issues training new hires.

Next rank your prospect database into A, B and C lists. The A’s are the low-hanging fruit, these could be organizations associated with your professional network and close contacts. The B’s will be the next group of organizations, those who could benefit most from your unique selling proposition. And the C’s are the rest. Now it’s time to start reaching out…

6.  Build a Funnel - Dialing for Dollars!

Sales is a numbers game - the more leads you have the greater the chance of closing a deal. Successful sales professionals know that they must actively manage their sales funnels to ensure that they not only meet but beat their quotas. It’s called a sales funnel because it’s just that, wide at the top and narrow at the bottom. You need to constantly fill the top of the funnel in order to ensure a flow of opportunities to the bottom. 

Landing a job is just like a sales win, so you’ll need to start building a job funnel from your prospect database, and you’ll need to do it in a systematic way. Suppose for each job opening, organizations will interview an average of five candidates from a pool of applicants.  With your unique selling proposition you should get the job, but put that aside for the moment. All things being equal you have a one-in-five chance of getting the job once you get into the interview room.  Getting an interview is another story. One recruiter recently told me that in today’s environment, it could take 20 applications to get just one interview. Do the math; based on these figures you’lll need to prospect 100 opportunities to land your next job. 

In his book “Cold Calling Techniques” Stephen Schiffman describes how the sales funnel works. To make his quota he needed to make fifteen cold calls a day. That was seventy-five calls a week. From those seventy-five calls Schiffman was able to get five face-to-face appointments. And from five meetings he could close one deal. Schiffman figured out that to meet his quota, he needed one new sale each week. So through hell and high water, he called seventy-five new contacts every week. Rejection was factored into the formula: seventy-four calls went nowhere. It wasn’t personal; it was just a fact of life. But as Schiffman worked through all those rejections, he knew that he was one step closer to closing a deal. That’s the way it works.

For the job seeker, Schiffman’s numbers may be a bit excessive, but you get the idea. After 16 years working for a large Silicon Valley software company, Margo was suddenly let go. Although the termination was part of a cost-cutting effort by the company, it still came as a complete surprise to her. The biggest impact on Margo was not the loss of salary or benefits; it was the sudden, unexpected inactivity and lack of structure after years in the corporate whirlpool. “The idea of not being needed, of not getting up and logging into email was tough,” she told me.

“I had always thought that I would enjoy my leisure time, but the emptiness was oppressive. So I made up my mind to make 10 calls every day, Monday through Friday. After the calls were done, then the rest of the day was mine. I knew that most of the inquiries I made would never get a response, but I was prepared for that because I knew that the next day I would make 10 more calls and 10 more the day after that. In a sense, I gained back a bit of structure and started to control my own destiny.”

7.  Sell the Corporate Me

Nick, a good friend of mine, recently started his new job with a global consulting company.  As an experienced consultant, he saw the whole interview process as a sales cycle right from the very beginning. He told me of one situation in which he was asked to upload his resume to a corporate recruiter, something you find to be typical of the Monster.com or Hotjobs process.  And as soon as he hit the upload key, Nick felt as if he had lost control of the whole process. His instincts told him that he would never hear back from the company unless he was able to speak with the hiring manager. He called the company. “At first they didn’t want to talk with me. They said it was out of process.  So I told them that just as they needed to learn about job applicants, so I wanted to know about them. I started asking a few well-researched questions and 30 minutes later, the H/R Director walked my resume over to the president of the company. There’s really no point just sending in a resume and hoping for the best. You have to assume some level of control.”

When he landed the job interview he was prepared. Nick recalls, “I researched the company’s pain points. They had great delivery capabilities, but were anonymous in the market place. They had no branding so I explained what I could do for them.”

Before the interview Nick researched and was prepared to answer the same questions that he used whenever meeting with his clients:

1. What is the point of the meeting?
2. Why should the client care?
3. Why should the client care now?
4. Why should the client listen to me?

Nick believes that if he hadn’t run his job hunt like a sales cycle, he would probably still be looking today.

8.  Push for the Close

Rob Friedlander has years of experience as a corporate recruiter. He’s worked with Mercury, Bearingpoint and Gartner and managed the process of hiring thousands of candidates in his career. “Those who get hired,” Rob says, “are the candidates who treat the interview as a sales call, whether or not they are interviewing for a sales position”. A candidate who wants to get to the next round of interviews must ask probing questions and express their value proposition. Rob points out that long gone are the days when you can come to an interview and see it as an information-gathering session. You need to be intensely prepared to understand what the hiring company is looking for and craft your background skills to meet those needs. Then you need to close. The candidates that advance to the next round of interviews are often those who push for a close with questions such as: “Is there anything that you see that will prevent me from getting this job?” or “Are there any concerns that you have that I could address?” or “I’m keen to move forward; what are the next steps?”

In all his years of hiring, Rob says there is one candidate who truly stands out. Some time ago, Rob’s company was looking for someone to support a large software account. The candidate came to the interview equipped with an action plan for the next 30, 60 and 90 days with action items, names of individuals to meet and the goals that would be achieved. Needless to say, he was hired and proved to be a great success in his new role.

Conclusion

For those of you looking for employment, let me wish you all the best. In my own profession I find that if you build a firm foundation of value and articulate that value in a manner that resonates with a prospect organization, and then systematically seek those organizations that can best benefit from the value that you can provide makes all the difference between a mediocre sales campaign and a real winner. Being part of the PSVillage community means that you are already an experienced professional with a lot to offer your next employer. For those of you in the job market, grab a piece of paper and a pen and start working on your stakeholder expectations, work with colleagues or friends to craft your unique selling proposition and get ready for your next, great employment adventure!