Consulting Sales: How Should You Develop Your Strategy?
Welcome to the next episode of our management consulting iTunes channel How to Build and Grow a Consulting Firm, where we discuss the business of running and growing a consulting fir. In today’s episode, I want to talk about a question everyone faces frequently. Every time things do not go well when it comes to growing a consulting firm you are forced to confront the question, “What should your consulting sales strategy be?”
For example, let’s imagine you are leaving a consulting firm to set up your own firm or working in an industry and want to consult back to your former employer and their competitors. You are going to have to ask yourself, what should your consulting sales strategy be. I am going to answer this question and we will discuss it with an anecdote from my past.
When you start a consulting firm, it is easy to get caught into a long process to study the market, think about your skills, understand the business models you have, and then develop your strategy. All of that is a waste of time.
Many years ago, when I was a senior partner in corporate strategy, I used to act as a troubleshooter at the firm. So, when the clients were giving our firm a hard time on difficult assignments and engagements, the other senior partners would send me in not only to smooth over the relationship but to also get the work back into shape. So, I did that quite a lot and it went very well in Asia and Latin America and so on.
Then, my role shifted a bit whereby I was sent in to help reboot offices that were performing poorly. I was sent to those offices to stabilize them and figure out how to grow them or how to manage their client relationships. While major firms do not like to talk about sales or money, if these offices do not perform well, it is obviously draining the firm’s resources. At the end of the day, if the office is not generating profit, it is a drag on the balance sheet of the firm and that needs to be fixed.
So, this happened a few times but here is a good anecdote. I was sent to Latin America. I arrived in the capital city of this country. It was not a new office, but an office that had struggled in recent times due to an exodus of certain key partners who moved into industries.
Consulting sales approach error: getting into a long process of prospecting a client
So, the firm was struggling in that city. It was a relatively new office and not that established. The airplane had lost my clothing, so I arrived wearing the same clothing as I had on the trans-Atlantic flight the previous night. I looked like some kid from a J. Crew catalog and I went into this meeting with some of the other partners.
My colleagues were in name only as I had never met them before. The firm is big, so you do not know every partner. I was a lot younger than these partners and I was obviously not the ethnicity of the dominant group in that country. So, I had the trifecta of negatives going against me.
They brought in some of the engagement managers and we were talking about what is happening with consulting sales, just a general conversation.
When you are sent in to turn around the office, even though you have the mandate to turn it around, you technically do not have a mandate because those local partners need to accept you first. People always forget that at the major firms you generally cannot tell people what to do there. It is a partnership. Even if another senior partner sends you, the local contacts need to accept you.
So, I could not go in there and say, “Okay, we have a meeting, let me tell you what to do to grow consulting sales”. So, I was having a discussion. I ordered breakfast for them and we were all sitting and talking.
The engagement managers and some of the new partners had grown up in that environment and had never worked in some of our international offices. They were going to present this analysis they did of the major companies in that country and the surrounding countries. They had put together a very detailed analysis of the market shares and priorities and issues. But I did not see the whole presentation because it looked way too long, and of course, I was wearing stinky clothing and I was a little bit jetlagged. I had not even started eating my breakfast yet.
So, their strategy to increase consulting sales was that they had analyzed the market and they knew the clients to pursue and they wanted to pursue those clients.
Consulting sales the right way: rebuking the approach from deep-diving into analysis to directly talking to a client
So, I looked at them and I said, “Okay, we have three partners in the room and with me, that is four partners. How many clients do we know between the four of us? In Latin America, I do not know anybody. I do not speak Spanish, Brazilian, or Portuguese, so, obviously, I do not know anyone here.” They say “Well, we know about four clients per partner, maybe five, and we can get meetings. It may be a few more but we are definite for about four per partner”.
So, my view was, “Okay, if you know four clients per partner, our strategy to increase consulting sales is to meet those clients and figure out what their issues are and how can we help them”. Then I remember someone making the comment, “But how are you going to go into those meetings, Michael? You don’t speak Spanish and if we had to go to Brazil, you don’t speak Portuguese.”
And I told them, “Look, guys, I have access to the world’s greatest translator”, and they looked at me and said “Why? Did you bring your assistant?” and I said, “Nope, I have a credit card and it buys alcohol.” Let me tell you something. You go anywhere in the world, if you get people drunk enough, they will be able to connect with you and when clients connect with you it helps a lot to grow consulting sales.
Now, this may sound like a very throwaway comment but the point I am trying to make is that so many people I see do these detailed analyses of who are the clients, what the issues are. But you have got to understand unless you can meet that client and you have their respect it doesn’t matter whether you understand the issues. They are not going to do any work with you.
Growing consulting sales by working with clients you already have access to
So, the starting point to grow consulting sales is to hold the analysis for a bit and focus on the clients you already have access to and can meet. It is okay if you want to analyze them a bit but it cannot be a situation where an engagement manager is sitting in the office reading annual reports and the press to figure out some “aha” moment that is going to impress the client.
I understand if you are reading through the issues to supplement your knowledge. But if you are a partner, running a boutique consulting firm, and you know a client, it is very unlikely that you are not going to know what their issues are. So, your consulting sales strategy should not be about doing guess analysis.
Many boutique consulting firms are scared. They lack confidence, so they do analysis which does not really give the client any confidence. But it gives the firm confidence that they are ready. They put together an approach so that they feel that they are going into consulting sales meeting armed with something. It is almost like a sacrifice that they are making to the client, as part of consulting sales process. “Look, I killed some paper and made some PowerPoint slides. Would you give me work?” Those kinds of sacrifices went out a long time ago.
So, your starting point when it comes to consulting sales must be “I know the client, let me meet the client and figure out what the issues are”. If you do not know the client, then it is fine that your starting point is who are the clients I can meet. But then you do not go ahead and do arbitrary analyses for companies you do not know because you want to serve them. You can only do it if you have a lot of money behind you, and you have the time. Most partners within consulting firms do not have enough resources to use inefficient consulting sales practices.
If you worked at the major firms where they have partner reviews every two years, then you have two years to figure this consulting sales process out. If you took a two-year cycle to meet the executive of some Fortune 100 company, build relationships with them, win the right to serve them or to earn the privilege to serve them over two years, that is fine. But usually, you do not have that cycle.
The consulting sales strategy of any consulting firm must be to survive
Survival means you stay in business over time. Time costs money. So, you at least need break-even revenue. As you survive, you will serve clients. You will learn what works. You will improve. You will slowly develop your consulting sales strategy by engaging clients. Trying to develop a consulting sales strategy before you engage a client is a bad idea.
The starting point or the consulting sales strategy of any consulting firm must be to survive. Survival is your consulting sales strategy, at least initially. Survival means you would need money because time costs money. So, if time costs money and your job is to survive, it means that your goal is to spend money while you survive. You need to at least break even or cover your costs at a respectable amount. For instance, if you have put together a lot of savings and need not cover as much of your costs, by and large, you at least would want to break even.
Learning what works on the ground
As you survive and as you collect money to break even, everyone wants to be like McKinsey and BCG. The point is, when those firms started, they were not like themselves today. In fact, today those firms are not trying to be like themselves ten years ago. As you serve clients, you learn what works.
I have seen boutique consulting firms who refuse work because it is not prestigious. Let me tell you something, nobody knows you. The editors of the New York Times are not sitting together and saying “What is Barry Shaw’s boutique strategy consulting firm in Arizona do. We could do a story about the fact that he is not doing prestigious work for clients”. That would be a big issue.
Boutique consulting firms worry too much about what people think about them. I can assure you nobody cares about what you are doing. If for ten years you did work mostly for people who were thought not to be elite, nobody would know about it. And even if some of your former colleagues will think it is beneath you, your firm will much more likely survive. And if it does, you increased your chances to do more meaningful work.
The reality is that you need to start somewhere, learn about a client, and work your way up. There is a reason why countries like China, Singapore, South Korea started with basic menial assembly work. They went into the game, they earned money, they plowed it back and moved up the economic value chain doing more of higher-value work. You might be one of those fortunate people that do not have to start at the beginning. But it does not matter where you start. You need to be moving up the value chain.
So, start somewhere. Learn what works. You will improve and slowly develop your consulting sales strategy by engaging clients.
Leveraging what you have and the FIRMSconsulting resources that could help you
Do not try to develop a consulting sales strategy for the kind of work you would want to do with a client before engaging the client. That is the equivalent of a McKinsey, Deloitte, or Accenture deciding to develop a strategy for a Fortune 100 client without ever meeting them. Well, it does sound absurd but that is what most of the boutique consulting firms do.
If you want to serve a client doing mediocre work, do it. You need to start somewhere. If your game plan is, this is my staging ground to get to something bigger, that is fantastic! No one needs to understand that, and nobody is going to care. You know where you are going and that is what counts.
If you want to see some examples of thinking that we apply in sophisticated situations, for instance, how we would put together approaches and analyses for banks and so on, for a limited time only, you can go to firmsconsulting.com/promo and opt-in for free. You will receive complimentary episodes of some of the advanced material, we make available only to FIRMSconsulting Insiders.
The reason I want you to see that is to see what is possible and where you are going. You can even start there now. My point is if a client comes to you and says “Hey, I need you to do some basic data gathering work”, you can add a spin by adding in some value. You can see how to do that through some of the training episodes we make available, which basically shows you the life cycle of what you should be doing.
The time to develop a strategy without generating income is a luxury you do not have and do not need
You need to start generating income to afford the time to develop your consulting sales strategy.
You need to find a client, sell something, anything. Do not be caught into this trap of thinking. “I am only going to do consulting work this week”. Every single day consulting firms are figuring out new ways or new types of work to do. If you think to yourself that I respect these firms and am only going to do the work they do, remember that you are only doing the work they did ten years ago.
Firms are constantly changing the work that you respect today. It will take a few years for it to enter the media and so on and by the time you hear about it, they would have moved on to other things.
Drop your ego. Most likely, you have nothing to lose.
So, you are going to drop your ego here. A lot of us are driven by ego but you, most likely, have nothing to lose so do not try to be elite. You need to survive and be in the game.
The opportunity of meeting clients can just be around the corner
So, the act of trying to generate one sale is going to teach you more than months of planning. Know your consulting sales plan: the process of going through that discussion is going to teach you much more. Just being at the client’s office shows you so many things about the energy and the culture of the client. You meet new people.
I remember very clearly about working on a major restructuring. I was an Associate at the time. We were given room to work in the executive offices of this major corporation, which was our office. It was the head office of all the executive offices with people reporting directly to the CEO. Some of the board members also had officers there.
I would go and sit in the reception area whenever I had coffee. You would be surprised by the people you would meet just by being there. So even when I went to see clients, I would wait in the reception, meet other clients, and start a conversation.
I remember once going to Latin America and on the flight back in business class I sat next to one the head of operations for a potential client that I wanted to meet but had never got the chance to meet. Obviously, I struck up a conversation with him. It never led to any work, but it led to me understanding a lot about that client, which helped me with my existing client.
You meet new people. Your assumptions are verified. You may assume a lot of the things about a client but when you call them and talk to them, you realize, “This is not true. They do not want this. They do not care about this.” You understand what the client wants and what the client does not want. The act of going through with the process of trying to generate sales in that meeting is going to teach you all of that.
An additional benefit of this consulting sales approach is that you will do less work
One of the biggest mistakes that most boutique consulting firms make is, because they are so self-conscious, they may not end up bringing the amount of value they think they will be bringing. They do a lot of analysis and they like to take that to the client to say “Look, we analyzed your business. These are the issues. This is the framework. This is the methodology. Will you work with us?”.
Now, if you are a FIRMSconsulting Insider we have a typical McKinsey BCG engagement which is also available to premium members on strategytv.com. There you will learn the technique we use to generate only that analysis which is required to solve the problem and not to do a whole lot of unnecessary analysis to please the client with a thump factor. So, you do not end up thumping a big report on the table.
If you are an Insider, go to “How to become a McKinsey partner with Kevin Coyne”. It is a surprising course because he talks about consulting sales and of course McKinsey, BCG people do not talk about sales. At the partnership level, even though no partner talks about consulting sales, as we were not allowed to talk about sales, it is all about sales.
That program shows you how to think about consulting sales. But no way does Kevin talk about doing lots and lots of research before you arrive there. What you will realize is that you need to focus on your sub-skills to build camaraderie with peers, get their attention, show them your thinking. You have got to focus on delivery and on getting results.
Once you meet a client, a lot of the things that you think they are going to want, which you may spend all of the time doing, they do not want. So, you end up doing less work.
The minimum viable service and the critical delivery path
The next thing is that each one of us is different. Some people running boutique consulting firms may have a mother who needs their help, so they need to spend time every day visiting her. You have no choice. Others may have kids they have to pick up and drop off at school every day. So, you need to build your operating model around these things. This is what I call the minimum viable service and the critical delivery path.
So, if you are a strategy consultant, there is almost a hundred percent guarantee that you are not doing strategy the methodical disciplined way we teach in “Inside the Program – A typical McKinsey, BCG study” or “The US Market Entry Strategy” study. For FC Insiders, we also have the “Corporate Strategy and Transformation Study”. You most likely are doing what I call “A minimum viable service”. You will create some shortcuts for how you do strategy. You would not know what those shortcuts are. So, when you do your first engagement, you will figure out how you are going to do what you are going to do. You develop your critical delivery path.
The minimum viable service is, if you are doing strategy, what is the minimum you can do to develop a strategy for the client. If, for instance, you are doing an operations engagement, what is the minimum you can do to develop a viable operations plan for the client?
The critical delivery path is, how are you going to do that? For example, are you going to create all the slides yourself? Are you going to do all the analysis yourself? That is the critical delivery path.
As you do it, you are going to realize that many things you use, which you think should be done, are unnecessary. You learn to drop some things, but the bottom line is that you are creating a sort of a critical path.
The FIRMSconsulting Insider Program
If you are wondering why critical path thinking is so important, and if you are an Insider, listen to The MasterPlan program, where show you why critical path thinking is so important.
The steps are simple. Step 1 is to meet clients. Step 2 is to talk to clients. Step 3 is riveting the attention of clients. I do not mean taking a gun from a construction site and nailing them onto a plywood board. I mean holding their attention. Step 4 is four free days. I will talk about this in more detail later, but this is a program that we used even when I worked at the major firms.
I will talk about important ways for a boutique consuting firm to differentiate itself or even if you are at an office in some far-flung location of a major consulting firm. You will need to deliver two quick wins, secure an engagement, and then generate recurring revenue. If any of this is unclear or maybe there are parts you just need more elaboration on because you do not necessarily get support anywhere else, we are happy to provide that via our advanced programs (StrategyTraining.com/apps. Contact [email protected] to learn more).
So, some questions for you to wrap up here.
Self-Assessment: compare your own performance/planning to where you should be
Let us assume that you are going to a meet with a client tomorrow, what is the problem you want to solve for them? The problem I am solving is…
It is okay if you are wrong about this. That is fine. When you are going to meetings, you realize, that is not the problem they want to solve. So, when you are going to that meeting, keep an open mind, knowing that you want to test them out. You want to talk about things.
If you came prepared to discuss a problem they do not want to solve and you have no idea how to discuss a problem they may have, let us say utilization rates, then watch the episodes in The Consulting Offer (TCO) on how we do brainstorming.
I know most of you are running boutique consulting firms, and do not want to join McKinsey Bain, BCG, and Deloitte. So, you are wondering why Michael would refer us to that. We are referring you to that because the foundational skills on how to break out issues on things you do not know anything about is taught in that program.
For example, if you do not know anything about utilization rates or utilization factors, how we brainstorm will teach you how to have a discussion with the client. Then you can come back and say, okay this is the problem, how do I deal with it?
Ask yourself, who your potential clients are, who are the people you want to meet? Make a list. Five of them. Get meetings. Do not fall into the trap of, “Okay, I have got five clients. I need to prepare some PowerPoint decks”. Do not do that. Tell me when you are going to meet them and set the dates. Email or call. Do not stalk people on Facebook. It is not a nice experience.
I want to really drum this into you – “How will I avoid the urge to build long presentations by…” What are the things you are going to do, because, it is going to be a trap you are going to fall for. I want you not to get into that trap.
So, what changes should you make to shift your priorities away from over-preparation, which does not help if you do not know the client in that meeting, towards being ready to meet client and learn through the process?
I hope you found this article useful. Remember that I know how hard this is to do. If you speak to a consultant, they all put out this image of being in-charge and controlling everything that is going wrong and not going well. So, if things are difficult, it is okay. I do not want you to think there is something wrong with you. I do not want you to feel you have failed in some way. I do not want you to think that you should give up.
You may have to rethink your finances and cut costs in certain places, but everyone goes through this. Growing a consulting firm is not easy. If it were easy, partners in the major firms would be doing this and succeeding. But I can tell you they usually do not succeed because it is hard to do.
But that does not mean it cannot be done. Many boutique consulting firms are set up. You need to realize that if you leave a big firm, you are leaving behind certain assets that they have, and you need to compensate for that.
If you have never worked at a large consulting firm and you are a consultant, remember that you are not going to bring a custom of those best practices at large firms that do not work at small firms. That is a big mistake people make. They think that things that work at large firms should work at small firms, but they do not.
If you never worked at a consulting firm and you are launching your own boutique consulting firm, you are not going to make that mistake.
As always, I look forward to seeing you in the next episode.
If you want to see samples of our advanced training materials go to FIRMSconsulting.com/promo and sign up for free to receive sample materials.
Recommended books:
Bill Matassoni’s (Ex-McKinsey and Ex-BCG Senior Partner) Marketing Saves The World is a truly unique book. Never before has a McKinsey partner published his memoir publicly. This book is a rare opportunity – a true exclusive – to see what shapes the thought process of a partner and learn about marketing and strategy. The memoir essentially lays out McKinsey’s competitive advantage and explains how it can be neutralized. This is a great book if you want to learn more about some of the best consulting firms mentioned above, including for gaining a better understanding of the consulting sales process (insider stories on how McKinsey and BCG operate).
Turquoise Eyes started off the groundbreaking new genre developed by FIRMSconsulting that combines compelling narrative while teaching problem solving and critical thinking skills. Set after a bank begins implementing a new retail banking strategy, we follow Teresa García Ramírez de Arroyo, a director-general in the Mexican government, who has received some disturbing news. A whistleblower has emailed Teresa with troubling news about a mistake in the loan default calculations and reserve ratios. The numbers do not add up. The book loosely uses the logic and financial analyses in A Typical McKinsey Engagement, >270 videos.
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Cheers, Kris
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How to Sell Consulting Services: Secrets to Selling High Priced Consulting Services
Hi everyone and welcome to another podcast about How to Build and Grow a Consulting Firm or Practice. In today’s episode, I would like to talk about new clients and address how to sell consulting services.
I want to mention that this entire series is based on our experiences while helping numerous boutique consulting firms and offices of large firms as well as on our personal experiences. For FC Insiders, our loyalty members, we are launching an Insider version of this program, which is slightly difficult and a little bit different.
While we will cover the same concepts, in the Insider version if the program we will discuss a case study of a fairly large firm with revenue of about two million dollars and how we help the firm to significantly increase that revenue, change their client mix, and so on. We will show you how to use each of the tools and techniques and how we took the client through each step.
You can also go to our YouTube channel and watch the YouTube version with graphics (also inserted below).
How to sell consulting services: tip 1
So, let us just talk about clients. We know sales are important. You cannot do much without revenue a.k.a. sales coming in even if you have the best plans and noblest intentions. You may want to change the world, maybe do things that are important to the well-being of your country. But unless you have revenue coming in, all of that is just an aspiration that will never see the light of day.
So, one of the first things I always tell clients who run a firm whereby it is just one of them or a group of people or even an office of a large firm, is that you need to find clients and do it in a way that closes the sale fast. You also need to avoid what I call the layman’s view of the way McKinsey, BCG, and so on, does sales because the way they do sales is very different. But I am not here to talk you through how they close sales because a lot of the things McKinsey or BCG do, are not possible to do as a boutique consulting firm.
I am going to talk you through the things we have done with the client in the Insider program and similar clients that are suitable for smaller organizations or consulting organizations that are different from the larger firms.
If you stick to the basics, finding clients is not difficult, but you must follow the plan of not acting like a large firm.
I will tell you a little bit of an anecdote here. Many years ago, when I was a Partner, I was sent to Latin America to help stabilize one of the offices. I was working with quite a few of my colleagues. As a resource partner, I had skills that the potential clients of this office would want. I remember arriving there after a long flight of about 17 hours. Having lost my clothing, I went to office the next day wearing the same clothing from my flight, not feeling so good. I met everyone and the Partners talked me through an analysis that they had been working on for a fairly long time, led by some engagement managers and associates, on clients they should target and sectors they could target to rebuild the practice.
My feedback to them was, we already have a strategy and it is called Amex card. What I meant by that was that I was not interested in sectors or industries we should target or clients we should target or clients we need to get into. Instead, we need to focus on clients we know and take them out for drinks and dinner.
A common mistake I see most consulting firms making is that people trying to build a consulting firm focus too much on clients that they think they should be serving, while ignoring potential clients they have access to. In that situation there is never a market analysis. I have never seen a market analysis done with Partners. What we do is, we work on the relationships we have and start from there.
So, if you are thinking, “Whom I should target, which sectors, which industries,” then you are asking the wrong question. The correct question is “Who are the clients I know and who are the clients I can get a meeting with?”
Those are the clients you target even if they are in a sector that you do not want to serve. In fact, there is no such thing as a sector you do not want to serve. Every sector matters. Every sector in the world is going to have some segment of clients who will be attractive to you because if you worry about clients, the first part is to go for clients you can access. Go for clients you know and meet them.
There is another story about when I was serving my first major client. If you follow “Rebuilding a Consulting Practice” and “Partnership. A memoir”, I talk about this client a lot. It is the client that made me, and I ran the most important engagement at that client.
They had a very simple office and they believed in a low overhead structure, and a small head office. The head office of the resource’s client was in this luxurious high-end building complex with fancy Italian and French restaurants on the lower level. I would go and have a meeting with, usually the chief financial officer or the chief operating officer, or sometimes the CEO was involved. I was just starting out and was still only an Engagement Manager at this stage.
So, I did not have the access that I had later in my career. But I would meet these clients for a 30-minute to a one-hour meeting and then I would go to the Asian restaurant on the ground floor so that every time people from the client were leaving, they would have to pass the restaurant and they would see us. I would be sitting there with another Engagement Manager who was running studies for me and we would be having a four-hour lunch and drinks.
People from the office would see me but it did not matter because every time an employee of the resource’s client that I wanted to meet would leave, I would invite them along saying, “Hey, you know it is a Friday evening. Why don’t you join us for drinks?” That is basically how I did sales. There was some thinking involved but there was no PowerPoint presentation with an analysis of the issues. That is because as someone who was serving that client, I knew the issues.
It was not as if I was serving a client that I knew nothing about and had to do research to know the issues. I was working with them on an operation strategy for a few months. I was exposed to their financial strategy issues among other things. So, when I saw an employee I wanted to meet, I would just pull them or say, “Would you like to have a drink with us? It’s Friday evening.” Some would say, “Well, I gotta go home, I promised my kids.” I would say “Just one drink.” We would have one drink and, of course, it would turn into 10 drinks. By the end of that I could not walk so I would have to sit there for another three hours, have coffee, and get to the point where I could get myself home safely.
So, how to sell consulting services? The most important thing is to meet clients you can serve.
How to sell consulting services: tip 2
Another strategy of offering to demonstrate our skills for four days a.k.a. free is something we did as well.
If you follow “Rebuilding a consulting practice”, I moved to a badly performing emerging markets office. I had a chance to go to London. I also had a chance to go to Boston. But I turned them all down and went to a terrible office.
And I remember that the Associate Principal who groomed me to become a Partner, would call up people he knew in the executive offices of resources clients. Clients that we wanted to serve. They were not yet our clients but the clients of the firm. But this particular branch of that client was not being served by us.
So, we use to call them up and sometimes the head office as well because there were a lot of resources companies in the area. We would say “We know it is Christmas time. Why don’t we send one of our top people to work with you and think through issues? And see what happens.”
It was free but he would never say that. He would call it a secondment or whatever he wanted because we were trying to work with clients and see what could happen. And I would be deployed and later on when I became more senior and become a Partner, I would do the same with my top people.
The point is it is five days of continuous access to clients. You are doing work for free. But what is the alternative? Sit in an office and send them emails or proposals? No. At the end of this, I have never been in a situation where it did not lead to some work. Maybe the work came immediately. Sometimes it came three months later. At times it led to a significant improvement in the relationship. But it always led to us doing work.
In those four or five weeks, we would do one of two things. We would sketch out an issue that required us to do an analysis or we would identify an issue and say “You know what, we think we know what we need to do to fix this. But why don’t we do a short two-week pilot with just two people.” Obviously, it was paid. And then that would lead to billable work, which then would lead to implementation.
How to sell consulting services: tip 3
So, whenever I look at firms and they talk about how they are going to do the studies and the analysis – that is for the clients they do not know. Now, for clients you do not know, the easiest thing in the world is to do a survey of supply chain issues in their sector. Do a study. Firms invest in intellectual property. Do some kind study for this of the sector.
Do an analysis, a summary or develop a new approach. Do some benchmarks and then use it as an opportunity to meet an executive to talk about what you find in the sector. That is how you meet clients that you do not know.
All of this can be done cheaply and quickly. Here is the interesting thing. In the FC Insider version of the program, we are going to talk about that one client we work with, which is representative of other clients as well. But the interesting thing for them is that this area of work eventually generated over 50 percent of their revenues when we were done with them because we wanted them to diversify away from revenue that was purely generated from billable hours. It was difficult because quite a few of them were ex-McKinsey and so on. They had this view that consulting is pure. It must only be billable hours.
So, focus on clients you know. That is the most important thing.
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Self-Assessment: Compare your own performance/planning to where you should be
What changes should you make to shift your priorities?
As you go through this program, remember, it is all about going after the clients you have access to. Even if you have served them from a long time. What I always tell firms is to ‘serve larger clients’ because even if you finish one engagement with them, there is always a chance that something else will come up. If you serve a smaller client, the odds are they are going to be doing less consulting work and there is less for you to move on to.
So how are you approaching your current clients? How many meetings have you arranged? How will you lower resistance? What are you going to do to get them to speak to you?
And then the other category, which is for further down the line, but you need to start pursuing now, is how do you get to clients you do not have access to but you want to know.
How to sell consutling services: summary
The insights shared above on how to sell consulting services apply to new, young, small consulting offices, but it also applies to large offices. These are techniques I used when I was at the firm and I had to go after big multi-billion-dollar clients. When we had to turnaround offices with 70 people, 120 people. Let’s tie together some of the things we have already seen and learned about how to sell consulting services.
Go out there. Meet clients
The first thing is that you should not spend your days and weeks developing a strategy for “how you are going to serve a client” and “how you are going to grow the firm” and “how to sell consulting services” because you just do not know enough about the market and you cannot afford to burn so many hours on something that is really an expense.
Go out there. Meet clients. As you talk to them, you will find out what their issues are. Having two associates at an office reading annual reports to find out the company’s issues is really a hit and miss. If you sit with a client for an hour, you are going to find out more than anything anyone could ever do in the office to prepare you for that meeting.
Do not waste time on complex sales presentations
Do not get bogged down with complex sales presentations. This is something that people tend to forget at major firms. We generally do not really have to put together complex presentations. Because of our reputation we usually get to put together very simple presentations and get the work. But because you usually do not have a reputation as a younger, smaller office and smaller consulting firm, you should position yourself as someone who can get bankable results.
Do not talk about implementation
Do not talk about implementation. It is such a cliché. Implementation is not the same as bankable results. You can implement something and not get the results you promised. Bankable result says, “You hire us, you will get this.” But if you talk about implementation, it does not mean that you can get bankable results. A lot of implementation fails.
Approach the clients you know
Focus on the clients you know. Even if they do not agree to free work, go to them four days, five days in a row and talk to them. Help them identify issues.
I have been in situations where I remember the CEO of a very important client wanted to work with us. She did not really like the firm so much, but she liked me. She would call me, and I would go every day. I went to see her for something like a week. I obviously did not bill her for anything. I would sit in her office. She had a nice lounge. And I would do work for her, help her think through issues. When meetings came up she would go for the meeting and when she would come back, we would talk about things.
That led to an incredibly important mandate for the firm to work for a very prestigious client that we really wanted to work for. That is the same thing as working for free. But you can be creative in the way you do it.
Meetings for five days in a row where you are thinking through issues and providing updates is free work. But we do not talk about it. We do not call it free work.
If you want to meet new clients and you have a great reputation it is going to be easy. But if you do not have a great reputation, then do some kind of free work, e.g. analyzing the sector and present the results.
Create sustainable revenue streams
Finally, the goal is always to create sustainable revenue streams and not follow traditional consulting models. I may talk about this more but in the insider version, we definitely talk more about breaking the revenue streams. Because it is just tiring and demoralizing to go through these periods where you do not have revenue coming in for billable work.
Ask yourself, “How am I spending my day?”
You need to ask yourself, how are you spending your day because it should be in front of clients.
If you have any questions or comments on how to sell consulting services, post a response on iTunes or YouTube. As always, we look forward to sharing with you the next episode/article.
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Recommended books:
Bill Matassoni’s (Ex-McKinsey and Ex-BCG Senior Partner) Marketing Saves The World is a truly unique book. Never before has a McKinsey partner published his memoir publicly. This book is a rare opportunity – a true exclusive – to see what shapes the thought process of a partner and learn about marketing and strategy. The memoir essentially lays out McKinsey’s competitive advantage and explains how it can be neutralized. This is a great book if you want to learn more about some of the best consulting firms mentioned above, including for gaining a better understanding of the consulting sales process (insider stories on how McKinsey and BCG operate).
Turquoise Eyes started off the groundbreaking new genre developed by FIRMSconsulting that combines compelling narrative while teaching problem solving and critical thinking skills. Set after a bank begins implementing a new retail banking strategy, we follow Teresa García Ramírez de Arroyo, a director-general in the Mexican government, who has received some disturbing news. A whistleblower has emailed Teresa with troubling news about a mistake in the loan default calculations and reserve ratios. The numbers do not add up. The book loosely uses the logic and financial analyses in A Typical McKinsey Engagement, >270 videos.
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Cheers, Kris
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