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Innovating An Industrial Giant. $42 Million Single Project Fee

Innovating An Industrial Giant. $42 Million Single Project Fee

Exclusive to FIRMSconsulting Insider and Legacy members. Enroll as an Insider or Legacy member here (scroll for membership options). If you would like to receive sample episodes of our Insider content, please opt-in to our newsletter and receive a free gift. This is the only way to receive sample Insider content.

What is innovation consulting or innovation strategy? Do you teach clients how to innovate or do you innovate for them? What is the definition of innovation and how does this limit what you can do? Do you create new products or services for clients? Do you create new businesses? What is the work that you actually do? How do you create value for clients? Innovation teams are often small teams sitting within the strategy practice within the larger consulting teams, and if you are a multi-disciplinary firm you are a tiny part of a larger apparatus. The majority of innovation advisory work is about the topside: revenue, profits, cash flow, and sometimes the share price. It’s about sales. Most advisory firms compete in this space with practically little differentiation between themselves. They offer advice, roll out an intranet and app to collect ideas and funnel them towards creating revenue, collect a fee, gain some knowledge, and walk away. They all do it. Some offer business model innovation which is often a nice way of saying they adjusted the business model. What is the difference between innovative pricing versus a new pricing strategy? Why does innovation always assume something must be new? How do you explain the work you do as an innovation expert? And the most important question, are you really any different from every other innovation advisor?

What if there was an entirely different model for innovation? What if the fees collected were not billable hours but an asset that appreciated over time? These are the questions we chose to build this program around.

***

Imagine a type of company that does not innovate much. It is unable to pass on the higher pricing, to customers, that comes from innovation that creates value for which customers. Hence they do not innovate. Their share prices languish. They often exit lucrative markets. In the space of innovation advisory and innovation work, this would be a blue ocean. There would be few competitors doing innovation work here. The companies would not be fatigued from innovation work. All of the low-hanging fruit would remain.

This is not a hypothetical situation. In this program, we explain how we found this type of company and how we landed that first deal. We also found this type of company exists in almost all countries and across more than one sector. That is why we made the effort to build a business to serve them. It is a substantial opportunity when done correctly.

***

After a glittering start working with us to reboot his career and successfully rebuild the internal innovation division of his firm, where he became a rising star, Andrew decided that he knew enough to work alone. He believed he no longer needed our help as he prepared to build a business serving innovation clients. Things did not go well. He generally knew some of what to do from having worked with us previously but he quickly learned that the how, why, and why now are what mattered. Subtle changes, which he struggled to deduce by himself, had outsize results. Most of his fellow partners did not help him and he battled to get into existing clients to discuss innovation. He did not have an innovation model or program that resonated with clients. The biggest mistake he made was to take the innovation system we had developed for internal use at his firm, to clients. He was effectively selling them a piece of software.

Yet, the technology firms were already selling software to automate the innovation program we had designed for his firm. The world had caught up and overtook him and his practice. The tech firms had commoditized the program for which he had hoped to charge premium fees. To gain sales credit he helped other partners with ERP  programs, leading him to spend less time on innovation. Andrew learned it is hard to be a medium-tier consultant. You either compete at scale or the value you bring. There is no middle ground. Andrew did not understand why innovation was not an easier sell. Surely his potential clients knew it was important. Surely his fellow partners should be welcoming him into their clients. Believing he was not fully appreciated, Andrew took small and persistent actions to further undermine the support he had. For example, he took longer to respond to his fellow partner’s emails and sometimes showed his frustration when clients and colleagues alike did not see the value that he thought he could deliver. By the time he sought our help, Andrew had not only lost the momentum we had created when we first worked with him, but he had now engineered a worse set of circumstances. This was a tough program and you will see a constant push by Andrew to sell unsustainable smaller analyses work, while we want to move towards non-advisory recurring fees.

***

In the Andrew Program, over 214 episodes, we took you through the most detailed and valuable breakdown of how Andrew became a partner at a major professional services firm by rebuilding their internal innovation function. We are now going to begin releasing the next part of the program, to FIRMSconsulting Insider and Legacy members, and it is radically different. You can catch up on all 214 previous episodes on StrategyTraining.com.

Editor’s Note: What we teach is unique. It is valuable. It cannot be found anywhere else. The knowledge, skills, strategies, and technical understanding required to repeat these successes in your own careers would take the average professional years, if not decades, to acquire and that’s assuming you find the right opportunities. We compress all of that learning into these programs.  This is just the latest in an array of mega programs: (1) Getting Andrew Promoted to Equity Partner Within 3Yrs, from Senior Manager, (2) Corporate Strategy & Transformation of a Major Industrial Company, (3) Merger and IPO of a National Tech. Champion, (4)Turnaround at a Major Financial Institutions Group, and (5) Rolling Out AI + Cloud at a Fortune 500 Company. A 30MM / Year Contract . They are developed over many years and given detailed explanations, they each often exceed 200 episodes/program. We are proud to make these available to our clients. As always the programs have two objectives: (1) Show you what we did to radically accelerate the clients’ career, and (2) what we did to create significant value within the company by solving a critical, and often strategic, problem.

What is New in the “Innovating an Industrial Giant” Program?

  1. Rival consulting and technology firms had developed similar capabilities and offerings and were shopping them around to Andrew’s target clients.
  2. Innovation has more than one definition. It means different things to different people. Andrew struggles to pin down what he, and his firm, will do for clients. They try to sell a program to find new products, revenue streams, and profit centers. Andrew does not make much headway with this approach.
  3. Andrew had not learned how to gain the trust of clients quickly. So, he is picking up small audits and strategy studies. This creates several problems. It takes a long time to incrementally earn the trust of clients to eventually secure an engagement in excess of $10 million. Andrew does know how to do this. Those small studies and audits did not train his team to do the type of work they wanted to do. Andrew, like most consultants, hoped that small studies lead to large programs. They rarely do. Worse, studies on innovation are dominated by firms like McKinsey and BCG, who excel at them. So, Andrew keeps going up against firms for work where his team is not the first choice.
  4. Andrew struggles to use the full assets of his firm. He does not know how to organize the different parts of the firm to do something McKinsey or BCG cannot do.
  5. Andrew forgets why he was successful in Phase One and struggles to replicate the success.

Differences in This Program

The first program was all audio. Subscribers love that program because it is packed with details, insights, and even business case calculations. We have made big improvements to this program.

  1. Michael and Kris worked on Phase Two. Michael led the mentoring, while they both worked on the strategy used to mentor Andrew and the strategy he would use to reboot his career.
  2. At the end of each part of the program, we will have some tips/guides/questions you can use to implement the most important parts of the program.
  3. By following the prompts in step 3 above, you can begin transforming your career. Set yourself a 12-month goal, though it is realistic to see major changes over 24 months.
  4. We will focus on the principles. So if you are not a consultant or not in innovation, you will find the material beneficial. The program starts off pursuing innovation programs but ends somewhere far from innovation and consulting.
  5. We often do not need to show all the slides we develop, in this program. However, any slides we create for this program will be loaded into The Strategy Control Room, Advanced Level.

Ten Pivotal Moments in the Program That Ultimately Lead to $42 Million in Fees 

#1 We teach Andrew a process to sell very large studies by significantly cutting the time to build trust with senior clients and increasing the number of senior clients he could reach. (This is different from the approach we teach in The Consulting Sales Rainmaker Program (CSRP). CSRP is a superior process and must be used as you become more senior. The process we used for Andrew in this program is one where we get faster results and bigger sales, but in the long term, he would need to adopt the CSRP approach. Since we need results quickly and he has time to learn CSRP later, we used the new approach. This approach can generate larger sales than CSRP earlier in one’s career, but cannot be used for the long term.)

#2 We use the whole of the firm to compete for clients, in a way rivals cannot match, and for the few that can, they struggle to do so. This was a pivotal style of thinking that we had to impart to Andrew. It made all the difference.

#3 We develop a new definition for innovation. This allows us to identify a unique category of clients.

#4 We identify the problem in innovating that is unique to this class of clients.

#5 Andrew has an “enemy” who is a very senior partner. We identify him, understand how he is sabotaging Andrew’s career, and develop a plan to work around him.

#6 Developing streams of income from the project fees that are recurring and semi-passive. That, in itself, is a form of business model innovation. The problem with consulting studies is they usually result in no asset for the firm, and no form of recurring income. They are essentially one-and-done and the sales process needs to start all over again. We worked very hard to move Andrew and his firm away from this model.

#7 Teaching Andrew how to sell where he does less of the work and voluntarily gives away sales credit, which, counter-intuitively, increases the sales credited to him.

#8 Closing the $42 million single-fee contract. We break down the contract and explain the strategy and what is once-off, passive, and semi-passive revenue, and consulting versus other types of revenue that are more stable and attractive.

#9 Andrew’s promotion to senior partner.

#10 Managing two major priorities for the firm at the same time.

Due to client confidentiality, as always, we have altered some of the details. 

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