Improving the margins of a consulting firm or design office

The EBIT race... This is generally the speech: improving the margins of a consulting firm or a design office has become an obsession in providing services.

And the recipes are always the same...

The most immediate solution put in place is to increase the staffing of consultants. Going from 92.4% to 93.5%... But we also want to reduce billing times. And consultants are asked to time in advance, on the 25th of the month, in order to be able to bill the 1st of the following month.

But these systems have limitations:

• Unless you bill in advance, you cannot bill earlier than the 1st of the month
• Unless you make consultants work day and night, or bill them twice by lying to customers, you can't charge more hours than there are during the day.

And in the face of this problem, I am always surprised by the lack of discourse around value and effectiveness.

For your office, What is your Win-Rate (the number of proposals you win compared to the number of proposals you issue)? What would happen if it increased by 25%, 50%, or even if it doubled?

Always for your office, What would happen if you were able to halve the training time for consultants, while increasing the staffing rate?

How much could you improve margins?

Well watch this video, you will have some of the answers...

https://youtu.be/O9W5zwd3mb0

Increase the win rate

This involves two important elements:

• Increase the level of prior trust of prospects. To do this, set up a clear social selling strategy. Develop a blog, and a YouTube channel. Share your skills, your project results, and your methods. Improving margins means saving time completely free of charge. Making a blog or a YouTube channel is an investment, the prospect will learn to know you by himself. Whereas the time spent by your salesperson is useful time only once, in other words lost, not capitalized.
• Train your sales representatives better in the technical dimension. Advice sells on trust and hope. While remaining in their role, your salespeople must master the increasingly complex technical speeches of your experts. To do this, train them... Ask your experts to make micro-learning videos about technical offers. But the content should be “for dummies.” Make technical videos that a child could understand.

Better awake, better informed prospects, better trained salespeople... Do you think that your chances of increasing the win-rate and therefore increasing the margins are very real?

Hack the training of your consultants

No more classroom training on Friday afternoons where consultants sometimes have to drive 4 hours back and forth. Be honest about the necklace, set up micro-learning, possibly gamified.

Ask your experts to pass all the theory into microlearning, and then do virtual meetings, webinars, or other remote training to share experiences.

Once every two months, do a face-to-face session to maintain social ties. But make it a real moment of delight!

Respect your experts: the biggest lever for improving margins

Yes, I know, the title is provocative. However, what is the reflex of a consulting firm boss when it comes to experts: put them in the customers' homes! Autonomous, efficient, loved by the customer, high sales rates... They are very profitable people!

To keep them in the company, they are offered to train younger consultants and sales representatives. But often, it is in addition, in the evening between 9 p.m. and midnight.

Are they respected for that? And is their current situation good for the business? Does that help improve margins?

From my point of view, the expert is the bottleneck of the growth of consulting firms. And when 3 experts leave, the whole office falters.

To change this, apply the 3 thirds recipe on experts' time and remuneration:

• Tier 1: production. The expert must continue to produce, if possible in a management position, and not in a position of consultant alone on his mission.
• Tier 2: the contribution to the sale. The expert must participate in designing and defending commercial proposals.
• Third party: the memory of the company. The expert must formalize his knowledge for prospects, sales representatives and consultants in the form of micro-learning videos, or project rendering videos.

Adjusting the expert's time and remuneration according to this model makes it possible to respect him, and to put him in the situation where he is the best: transmit and convince.