Four Keys to Successfully Scaling a Professional Services Business
Each month, Kimble co-founder Mark Robinson leads a workshop where he answers questions from attendees about the challenges they’re facing as professional services leaders – the focus of these VitalSigns Workshops is on what decision-makers need to look out (or listen) for in order to drive success, the heartbeat of the business. After each session, we will take one of the most impactful and actionable questions we received and expand on Mark’s answer, with hopes you can apply the learnings at your organization. If you would like to sign up for our next VitalSigns Workshop, which will be June 9, click here!
Question: What are some key things you need to do in order to successfully scale a professional services business?
Mark Robinson’s Answer
1. Create a growth mindset
Understanding what skills you need to shape the business in the future is key. Growth is primarily about adding headcount. The kinds of organizations that I see growing successfully are those that actively create opportunities to hire new people instead of avoiding them.
I see many organizations that wait to recruit until they are in a mess because they can’t staff their existing projects. Many services organizations just bump along without really aspiring to grow or understanding how to do that. That may make the challenge of matching supply and demand easier and it does work for some businesses, but without that aspiration to grow the risk is that things can become static and make the business a dull place to work.
There are too many services organizations that don’t have a regimented hiring process. Instead of using recruitment to shape the future of the business, they let it become a fraught ‘get me three people yesterday’ scenario.
2. End the operational whirlwind
For a lot of services organizations, there is an operational whirlwind at the back end of the process. Month-end close is a frantic week of trying to work out what happened and send out invoices – then the wind dies down for a couple of weeks. Smoothing out that process over the month and having a regular cadence means that you don’t get into that reactive, firefighting mode. That’s key to being able to scale effectively while keeping the business under control.
3. Decentralize decision-making
It can be difficult for business leaders and founders to hand over decision-making control. They understand the risk to their brand of a bad decision. But you have to do it to scale. There is no shortage of data in most service organizations – but often there is a shortage of experts who know what to do with it. That leads to bottlenecks.
So empowering people to make decisions is key. What is more important than the individual decisions is the process – you have to hone this so that it is consistent across the organization and people have access to the information they need.
4. Incentivize sales people to prioritize future growth
For businesses that sell products, this is fairly straightforward; salespeople are paid on the amount they sell in a time period. But in services, I think it makes sense to incentivize salespeople not on what is paid initially by the client but on the size of the total contract. It is possible that later in the cycle if the implementation doesn’t go well, that total might change. But that is not the salesperson’s fault and in terms of building a growing business, it is better to balance the incentives towards future growth.
You may ask, what if a salesperson signs a deal for a massive future contract on the last day of the year? Well if that happens, you should celebrate! You’ll be too busy popping champagne to worry because while you will pay the salesperson on the money you have not yet received, you will have next year’s backlog already filling up.
If you have any questions like this one you would like to ask Kimble’s co-founder Mark Robinson, you can join our next VitalSigns Workshop, which takes place on the second Wednesday of every month. You can register for the next session and submit your questions here.