Growing a professional services business may seem like a straightforward venture; however, once you explore the matter more in-depth, you will realise that any business model requires careful thought before scaling it.

In a service-based business, special considerations must be made. It is not as simple as selling more products when the product is your time; there are only so many hours in your day!

Several key factors determine the success of growing a professional services business.

• Human Resource
• Management Delegation
• Professional Relationships
• Financial Management
• Company Brand Management
• Differentiation and CVP (Cost-Volume-Profit)
• Networking
• Company Diversification
• Luck

Let’s expand on these.

Human Resource

It’s vital to recall that the chance of success in growing a professional services business relies on combining other scaling elements. Human resource is a firm’s most important asset and should not be diluted.

Scaling a business depends on recruiting and maintaining key personnel.

People should be the main asset to all businesses. Without a continuous talent flow matching the organisation’s growth ambitions, the business will become constrained.

To ensure the consistently high quality of hires, a standard template for recruitment and training should be created for new hires.

It is also good to have a mix of full-time and associates (contractors), as this enables downsize flexibility if growth is not on the plan. However, it is essential to remember that having full-time employees gives consistency and is also critical to building culture within your company.

Management Delegation

Growing a professional services business effectively will be problematic if management is frequently sent out on client projects.

You may be growing your sales pipeline and customers, but that doesn’t mean the business is growing – someone needs to spend time on the business itself.

It is a reality for most SMEs that senior management spends time on day-to-day activities through a combination of necessity (no one else is available or trained to deliver x task) and desire to (they enjoy performing x task).

However, if too much of their time is spent on day-to-day activities, it means little time is spent on broader strategic growth.

That behaviour and task fulfilment cycle needs to change, and the answer is delegation (accompanied by appropriate training and communications to whoever the tasks are being delegated to).

In order to achieve this, invest in a trusted team that you invest the time in to train so that senior management can concentrate on other projects.

This separation from operations makes the business more desirable for purchase.

Professional Relationships

This particular resource is very beneficial in the early stages of growing a professional services business as the early customers are often won from their previous professional networks and are also potentially previous clients.

It may take years until success is accomplished in marketing efforts. Rapid growth, in the beginning, relies on the strength of professional relationships and whether previous customers recognise the worth of their experiences.

Financial Management

Financial management’s main aim is to ensure a business is successful and profitable.

However, it also strives to support compliance and regulation adherence, maximising profits, stakeholder returns and overall company value.

Financial management is crucial in assisting with acquiring and managing funds, which then ties into fund allocation.

This is important as it provides insights into making critical financial decisions.

Without these tight controls and processes in financial management, it’s difficult to know how and where to progress in growing a professional services business with minimal risk.

Company Brand Management

Grow your business by reaching beyond your personal contacts and tapping into a larger audience!

Creating a well-known brand requires more than just quality work and service. For example, try targeting industry awards or hiring a marketing manager early in the firm’s life.

Brand management is important for many reasons. It helps to create an emotional connection between the company and its customers, which helps to build customer loyalty and increase customer lifetime value.

Good brand management can also help a business charge a premium price for its products and services.

Differentiation and CVP

Differentiation and demonstrating value are essential for success in busy professional service markets with no entry obstacles.

Firms typically specialise in consulting and use a staff model to offer ‘Big 4’ quality at a lower cost. Proven CVP with initial customer-enabled scaling.

Networking

Through the critical relationships made within your company, you can use these to build an initial platform and thus expand your network.

Building a network is often linked to the proximity of the end client’s location.

Having offices nearer to the customer simplifies account management and project execution and puts you in a better position to handle upcoming projects.

So for many professional services businesses, targeting a specific location is often beneficial.

Company Diversification

The majority of new businesses start by focusing on one industry, as this is where they have the knowledge, contacts, and experience.

This is the most intuitive strategy as it gives them the best chance to access early customers and use their own credibility from previous professional engagements.

However, once you have established this initial business model with early customers, the company needs to quickly expand and duplicate their model into new industries/markets.

This is an important stage to the scaling of a company as this de-risks their reliance on a downturn in their core market and also has the added benefit of including a new potential customer base to support the rapid growth phase.

However, it’s important not to dilute your company too much, and you should aim to expand to no more than five or six industries initially.

Timing

Timing and luck are vital elements for success. However, they are the most difficult to identify and control.

This includes variables such as market timing – being in the right place at the right time, economic conditions, execution speed, and knowing how long to ‘ride the wave’.

How can Growth Coach help to scale your professional services business?

Are you looking for high-growth business coaching? Look no further!

Our 1-2-1 Growth Programme is specially designed for companies that already have the basics in place and where the business and results are ‘OK’.

The owners of these businesses now want to achieve better (and more consistent) results.

If this sounds like your own situation, you’ll know that you aren’t yet achieving your potential and probably recognise that a helping hand is needed to achieve more or at least accelerate the rate of progress in doing so.

Working with your coach, you’ll focus on performance gaps and devise a plan for overcoming them. This programme aims for faster progress, more profit, and greater efficiency.

Contact Us for further information.