Expertise Marketplace - Professional Service Firm Marketing Blog

I'm tracking others' insights - on Pricing and Value Propositions

I've been watching Chris Marston's blog.  At first glance, it appears he's just one more of many law-firm-management commentators.   But take a closer look.  For you non-law-firm professional service marketing leaders, Marston is one of the few who talks about PRICING and VALUE for clients. 

I love his comments on his late-summer post on the 4 C's of value pricing:  "(Say it with  me now) The Price of work has NOTHING to do with time."  Or this post, even earlier in the summer: "Outside in pricing is about looking outside of the four walls of your office building to determine what your work is worth to the client. Did you ever think to ask your client what it is worth? Why not? "

I still can't believe how often professionals -- even marcom consultants with whom I work -- are still using the hourly-pricing model, or who haven't pushed clients to re-think it themselves.  (If they did, they'd have to address their own value propositions. ) 

Marston is right on; as professionals, none of us should be afraid to find out the REAL perceptions of our value to our clients. If it means we have to push ourselves to improve, so be it. 

It's no fun otherwise. 

I'm tracking others' insights - on Innovation

I've been watching how other bloggers address topics that I think are critical to the marketplace leadership of professional service firms.  Take a look at what I found recently, followed by my own remarks. 

High-fives to Michelle Golden, whose blog mostly focuses on law and accounting firm marketing, for providing a close look at how she advises clients on integrating service improvements (both to the offering itself and to its delivery) into a marketing plan.  Golden does a great job of illustrating the link between Marketing and a firm's Operations side, as well as the role of the individual fee-earning professional to ensure a focus on this critical area.  How many consultants put illustrations like this on their blogs?  (Only the ones who are actively generating their own innovations, that's who.)

I'm tracking others' insights - on Value Propositions and Differentiation

A tip of my hat to Brian Sommer for his Services Safari blog, which has a focus on "improving professional services." 

He's got three great posts that all address the links between a firm's distinctiveness, client-perceived value, competitive advantage, and targeted marketplace focus.   Each one has a unique angle:

• Resurgence in Big 8 - Sommer comments on a CFO Magazine table that outlines revenue and staff shifts in accounting firms from 2001 and 2006.  Regarding the table's data on revenue per professional, he remarks:  "Buyers of these services should question though the real value they get from an audit staffer billing out 3-6+ times their fully burdened cost though. I’m not convinced that true value is accruing to the clients and that these costs are appropriate."   Brian, you're looking at the power of well-conceived and well-implemented branding to drive pricing UP!
• What Do Clients Want / Like?  - Here's a real gem for marketing leaders trying to find a way to start a conversation with colleagues about analyzing clients' emerging needs and satisfaction.  Referring to a graphic in Global Services magazine, Sommer says it "shows that offshoring is more satisfactory to executives than outsourcing while the latter is used more frequently."  He concludes, "More consultancies should survey their client base like Bain did if only to find out what clients want and how well their services are satisfying clients."  I think I've died and gone to heaven!  And what if these consultancies and other professional service firms went further than that, and also analyzed the relationship of satisfaction to profit margins, and then to innovation opportunities?  Someone get me the smelling salts.
• Building Moats Around Service Firms -- Sommer unveils a key insight about the cultural influences within most professional service firms.  He says,"Service firms are more often known for fast following of someone else's ideas. In fact, fast followers are experts at breaching someone else's moat."  Oh so right!  When it comes to building a durable and pre-emptive competitive advantage, most professional service firms fall back on copying the first movers, many of which didn't build a big enough edge in the first place.  Why?  Because it's hard, and harnessing groups of people to do hard work takes time and cost (gulp!) money.  But the cost of not building a pre-emptive edge is BIGGER. Sommer also says, "When you do see moat building in professional service firms, it often takes the shape of trying to ingratiate oneself to a client and keeping out other service firms via fawning and client entertainment."  Right on again, Brian.  Client relationship management initiatives are smart business, but can only take a firm so far.  The "value" game always wins. 

Here's why marketers leave their professional firms

One of my consulting-firm senior Marketing friends has just lost another marketing director.  She asked me to put the word out to my network that her firm is looking to replace this person.  She attached the position description.   It asks for MBA-credentialed pros who have 10-12 years of experience. 

Let's leave aside for a moment the fact that the described role is boring as toast, limited to mostly sales support and marcom.

WORSE is that it's nowhere near a growth role.  Not on a partnership track.  The internal career path for this position screams DEAD END.  It's as if this firm WANTS to make its marketing function a revolving door! 

Now why would I refer any marketing pro to this firm?   

I'm tracking others' insights - on Marketing Roles

Here's a roundup of some important insights I've found on others' blogs, with my remarks about why you should read their posts.  These posts are about the evolving role of Marketing.

Check out Bruce MacEwen's blog about a McKinsey article on the evolving role of the CMO.  MacEwen adds his observations to a discussion I've been leading for a long time: the shift that's already underway (but that needs to be managed more carefully than it is now) in the role of Marketing and Sales in a professional firm.  Bruce recaps and makes his own astute observations about how this shift can be better conducted in a law firm. 

Gerry Riskin, in his Amazing Firms, Amazing Practices blog, offers his own thoughts. He writes "ask your Managing Partner to ... have a meeting with you to discuss the benefits the two of you can achieve from selectively implementing David Court’s suggestions.  I am well aware that many CMOs do not have the influence they deserve inside their law firms..."

Mark Beese offers his own insights, from his law firm's work in structuring a marketing/business development team.   

Bruce's, Gerry's and Mark's remarks touch on part of a deeper look I plan to take in my upcoming book on reinventing the marketing and sales function at professional service firms.  But why does it appear that only law firm observers and consultants are talking about this subject? 

I'm tracking others' insights -- on Economics

Here's a roundup of some important insights I've found on others' blogs, with my remarks about why you should read their posts.  These posts are about economics, which is a terribly under-considered subject in the professional services arena.

• Knowledge Management Yesterday and Today -- Bruce MacEwen, writing in his Adam Smith Esq blog, has recently posted another gem.   His focus is on the economics of law firms, but he makes great points on the economics of any professional service firm.  This post, about knowledge management, reminds us again about the critical link between marketing and intellectual capital. If your marketing purview DOESN'T include shaping your firm's intellectual capital, or if no one else at your company is leading this effort formally, it will be increasingly hard to maintain your competitive edge.
• Take a look at the remarks of another law-firm thought leader and blogger, Gerry Riskin.  In his review of an article about the the impact of offshoring for law firms, Riskin cites "sobering information especially for those who hope that it means offshoring will just fade away sooner or later."  I've tried to raise awareness about this issue, too.  How many professional service firms are working TODAY to consider the impact that offshoring will have on their firms' future marketplace position and economic health?    

In a snit: Are we getting stuck with the dirty work?

I'm having a tiff with Ford Harding, the rainmaker guru to professional service firms. 

He wrote a blog post, claiming that, especially in small professional service firms, marketers and business developers cannot succeed at fulfilling all the conflicting roles that are required of them, so they inevitably sink to performing the least strategic function -- doing the marketing and selling dirty-work, instead of growing into more strategic roles.   

Ford, go pop an antacid, for gawd's sake!  Take a look at my reply.