Episode 140 – Lead Generation Inside the Small Service Firm: How It Is Different and What to Do About It – Member Case by Christian Banach

Small service firms need to generate leads but are constrained by limited resources. Budget and talent are in short supply. Therefore, what works in a small service firm is different than what works in a large service firm, or in a product company. Attend this session and learn what works, and what does not work, for small service firms.


Greg Alexander [00:00:10] Hi, everyone. This is Greg Alexander, the host of the Pro Serv Podcast, brought to you by Collective 54, the first community dedicated to the boutique professional services industry. On today’s episode, we’re going to talk about lead generation inside of a small services firm or an agency. And the reason why I want to have this conversation is because sometimes this term lead generation gets thrown around carelessly, and a lot of times the best practices that are available to people don’t apply to services companies only product companies, and they don’t really apply to small firms that are constrained by resources. You know, they sound great on paper. Then you go to implement them. You realize you need $1,000,000 budget, a team of ten, so it doesn’t work. So we’re going to dissect what is working for agencies. And we’ve got a great member with us today. His name is Christian Banach. This is what Christian does for a living and he’s got a lot to say about this topic. So. Christian, it’s good to see you. Thanks for being here. Please introduce yourself and your firm. 

Christian Banach [00:01:23] Thanks for having me, Greg. So, yeah, my name is Christian, but I am the founder of Christian Banach LLC. We are a business development and growth consulting firm. We work with primarily advertising and marketing agencies, but we work also with SAS companies, along with other professional services firm. And our job really is to help them get in the door with the types of companies that they want to do business with, and that’s oftentimes mid-market or enterprise level businesses. 

Greg Alexander [00:01:52] Okay. So very good. So I’m going to ask you a very simple question to start with, but it’s so important to get this definition correct. What is lead generation? 

Christian Banach [00:02:03] Yeah. Greg, that’s a great, great question that we do hear a lot of that thrown around in different ways to us. Lead generation is really the proactive engagement of prospects to generate a predictable pipeline of opportunities to a certain segment of a target audience. That’s what that means to us. 

Greg Alexander [00:02:22] Okay. So proactive, as important as what that means, is outbound outreach as opposed to just like receiving a referral or word of mouth or something like that. 

Christian Banach [00:02:33] Exactly. Yeah. So an inbound lead would be somebody who finds you through, say, a CEO or through word of mouth or through referrals. But when we’re talking about lead generation, it is more of a. A proactive approach in which you’re being really intentional about the types of companies and the types of people within those companies that you want to connect with. 

Greg Alexander [00:02:55] Okay, perfect. Okay. So with that as our foundation. Tell me how lead generation is different for agencies as opposed to product companies. 

Christian Banach [00:03:06] Yeah. So product companies, obviously there is a product, right? There is something tangible that somebody can hold that can feel, that can smell, it can touch. However, when you’re a professional services firm, you’re in most cases selling expertise. There is nothing to hold, nothing to touch, per se. So here you really have to demonstrate your expertise through case studies, through testimonials, through research, through various different ways where you can make a prospect, believe that whatever problem they’re looking to solve, that you have something that could help them solve for it. So it’s a little bit more challenging and much more complex than, you know, throwing a picture or an image up on a website somebody can click to buy. These are oftentimes also very much a consultative type agreements, right? So it’s very customized as well. So it’s much more complex than, say, a product. 

Greg Alexander [00:04:03] Yeah. Okay. Very good. All right. And how is lead generation different for small firms than it is for large firms? 

Christian Banach [00:04:11] Yeah, well, the biggest thing that I see here, the large firms obviously have much more brand recognition. So if you were to do some sort of lead generation or outbound call call or email and you work at IBM, the prospect is going to immediately know who you are and what you stand for versus if you’re a small professional services firm and you reach out, they have no idea who you are. So that barrier is much greater for a professional services firm that’s on the small side to break through, because I’m sure we’re all on the receiving end of emails and cold calls from various vendors. So we’ve been in our prospect shoes so we know what it’s like. And so how do you stand out? I’m sure with the work you do is great, but how do you stand out from all the other competitors that are out there? Yep. 

Greg Alexander [00:04:56] Okay, so by the time this airs, it’s going to be autumn of 2023. We’re recording here the last day of August. So in that time period. So tell me, tell me what’s working currently and why. And then as a second part of your question, tell me what’s not working currently and why? Or if you want to do those in reverse order, that’s fine too. 

Christian Banach [00:05:17] Sure. Yeah. Let me talk about what what isn’t working? You know, maybe first, I think a lot of people, when they think about lead generation, they really defer back to what, you know, kind of old school methods where you might get a list and you just sort of call it dialing for dollars, or you get an email list and you blast out an email to hundreds or thousands of prospects that used to work years ago. It doesn’t anymore. You really have to be much more strategic and thoughtful and who you reach out to, what you say to them. You have to be very personalized in your outreach to them. You can’t come across as like a robot or check your email. People will see right through it. So that has definitely changed. So there’s a lot more effort that is involved. And what’s also causing problems is technology itself. You know, is these inboxes are flooded now. There’s spam filters, there’s robo calls that are you know, your phones are blocking robo calls now. So the technology is blocking it. So it’s a lot more challenging to get through these days. On the other hand, there are certainly plenty of firms that we work with and others that are out there that are excelling. And what are they doing while they’re trying to doing the opposite of what I just said? They are taking the time to personalize their outreach communications to these different companies. They’re taking more of a quality over quantity based approach. What we’re also seeing is more creativity in what you’re reaching out with. And what I mean by that is sort of the old school way might be to contact the company and say, Hey, we’d love to get 15 minutes on your calendar or do a demo of our product and tell you how great we are and where our office is and about our company dog. And nobody has time for those things, right? They you really need to give we call give to get right you need to give value before you can expect value back. And what you want back from them is their time, right? Their time is worth something. So we’re seeing some of them are higher performing firms in the space. What they’re doing is they’re coming up with something. So maybe they have done some original research and they’re going to reach out to prospects and say, Hey, we’ve done some research into your industry. We’d love to share these insights with you on a call or I’ve seen others that are taking the approach of they might be organizing a virtual panel. And by that I mean as they pick a topic that’s really a hot topic, let’s say maybe A.I. and they’re reaching out to different senior managers, senior decision makers at their target companies and saying, Hey, we’d like to we’re organizing this panel. We’re getting eight thought leaders together to talk about this hot topic. And they’re using that as sort of a Trojan horse way to start building a relationship and contacting these people and then using that again to start building relationships. So the companies that are really. Doing well with this are thinking more long term. They’re thinking more about building relationships than they’re thinking about short term and transactional type regeneration. 

Greg Alexander [00:08:14] You know, one thing I would add to you, add to your list is community participation. So something I’ve experienced with Collective 54. There’s some of our members that are in collective that whose businesses have exploded as a result of that because they’re participating in the community. They’re not selling anything, but they’re in the community and people are getting exposed to them with their expertise and they’re proactively reaching out and saying, Hey, I noticed that you do X, Y, Z, I happen to have that problem. Can we chat? And it’s been fantastic to see the amount of business that’s been generated in the community. So and our community is only one. So the the lesson for the people that are listening is there’s all kinds of communities out there. And if you become a active participant in them and you adhere to the code of conduct, there’s there’s lots of benefits that can come from that. So just another idea. Okay. Next question. So who in a firm or an agency, a small firm should own lead generation? 

Christian Banach [00:09:10] Yeah, I think about this a little bit, depending on the size. Yes, small agencies. But if you’re under, say, ten people, you know, it can be challenging, right? Because you’re the founder, you’re wearing a lot of different hats. You probably don’t have the budget to go out there and hire somebody full time to do this. So in that case, I think you really need to get smart about how you’re prospecting, right? You’re not going to be able to do as large or volume of prospecting as maybe a larger firm would be able to do. But there are still some really tactical type things that you could do looking at things like your website, visitor ID, people that are visiting your website, people are engage with you on social media. If you have an email newsletter, who’s engaging a newsletter? So being really smart about who you reach out to and strategic and I think the owner can take that on, you know, in a smaller type of firm. That said, you know, if you want to up level and go beyond that, you know, I think at that point then usually this is on this is maybe firms of ten or more. You might then have somebody that’s a head of marketing or a head of sales or something along those lines. And at that point, they could potentially, you know, own this process as well. The challenge there is I see a lot of these firms is when you hire, say, a VP of sales, they may not want to do the prospecting. They may think that that’s maybe lower level type work for them and they want to be in the pitch in the close and get the deal sign. So sometimes it’s hard to motivate those folks to to do that type of work. But but I will say, you know, if you’re a small firm, you need to push your your team to do that. And and you might want to look beyond just those people to how do you involve maybe others within your team, you know, to be involved in this as well? You know, there are certainly you can go out and hire more of a junior business development representative. That’s certainly something to explore. Or, you know, you may want to explore outsourcing, you know, essentially what we do. But with a firm like ours, you know, you’re able to get the technology, you get the tools, you get the people, you kind of get everything, you know, all in one, which is, you know, generally for smaller firms, you know, they can’t afford all of those different elements. But by outsourcing, that is certainly a possibility for growth as well. 

Greg Alexander [00:11:26] You know, a collective even for one of our features is the process of benchmark, and that’s where we collect operational and financial metrics from our members. We’re always looking at kind of the firms that are doing really well in comparison to the average. What are they doing differently? And not to just give you a blatant plug here, but I can tell you that as it relates to lead gen, the firms that are doing better than average typically outsource it. And the reason why they outsource it is because it’s not core to who they are and what they do. And the idea of hiring these people and training them and retaining them, installing all the instrumentation and all the tech is, there’s a lot and it’s a very specialized skill. So, you know, spending money and having an expert do that for you, it would be my recommendation that to those that are listening, are you talked about obstacles to success. So let’s go there next. So I’m a I’m a small agency or a consulting firm of some kind. Maybe I’m 25 people or something along those lines. And you’re right, I realize I need to do lead gen because I want that predictable pipeline. That’s the thing that’s eluding me. What are the obstacles to success? 

Christian Banach [00:12:31] So a couple of things. So if you’re a size of 25 people, if you’ve grown primarily through more word of mouth and referrals, but we oftentimes see is that you sometimes still don’t have your value propositions and your ideal company profile really nailed down yet at times. Right. And you’ve kind of taken what have come in through the door, which is fine, which as you should. But when you’re going outbound, you really need to be very specific and you have to have a niche that you’re going after just to come out and say, Hey, we do marketing and we’d love to work with you. Is it enough? You’ve got to really zero in on specific problems that you can solve for clients. So a lot of the companies that we work with initially, that’s what we’re doing with them. To start off, we don’t just start off sending out emails or making cold calls for them. It’s really getting clear on their go to market from an outbound perspective because that is a different lens to think about it. So to me that is probably the number one challenge, is then also changing the mindset and wanting them to specialize in something. Because if you don’t, you’re not going to see success with outbound. 

Greg Alexander [00:13:39] Okay, very good. So the flip side of that question is, let’s say that I do this and it works. What’s the payoff? 

Christian Banach [00:13:47] The payoff is really scalable and predictable growth. Well, we work with our clients on and anyone that really implements a program like this is you will eventually start to know the metrics. The metrics meaning how many outreaches do I need to do to land a meeting on average? And then of those meetings I get what percentage do I convert to an opportunity? Which one of those what percentage of those opportunities converted to do business wins? When you start to know those numbers, you have that predictability. So if you’re looking to grow double in revenue, in revenue next year, you will know I need to do this many outreaches to get to that point and to get to that those number of wins that I’m going to need. If you get very busy and you can’t take on more clients, you could pull that back. So, you know, we’re it’s not uncommon to see clients of ours, you know, giving a ten X, you rely on their investment. But it does take time. You know, outbound sales cycles are longer than inbound sales cycles. That is another mindset shift that people have to take. So if your sales cycle is six months on an inbound lead, it’s going to be longer for outbound. So you still have to give it enough time in order to start to learn those metrics and then be able to dial it up or ballot down as needed. 

Greg Alexander [00:15:00] You know, one thing I would add to that is what we’re seeing is a decline in referral generation. And the reason for that is because the world has gone to remote work. Word of mouth and referral generation is impacted greatly by geographic density and face to face interaction. You know, so back in the day you’d go to a networking event and, you know, you’d meet ten, 15 people and there was all kinds of introductions and referrals happen kind of naturally. That’s the way humans spread. B2B brands, it’s face to face. I share something with you. Oh, that’s interesting. Tell me more kind of thing. Well, we’re not doing that anymore. We’re not doing that nearly enough. So the referral rate has gone down, and that’s been the bread and butter for most of the professional services firms. So if if you are experiencing a decline in referrals, I hope you’re not. But if you are two things, try to reengage in in-person networking as much as possible. This fewer opportunities, but you can do that. And then add, you know, outbound lead generation to your mix as part of your marketing strategy because something’s got to replace those lost referrals. And what we talked to Christian about today as one possible replacement for that decline in referrals. All right, Chris, and we’re out of our time here today, but it’s great to have you in the community. Your expertise is very relevant because you focus on lead gen for small agencies, which is what we’re comprised of. So it was wonderful to hear what you had to say today. I very much look forward to our Q&A session, which we’ll have in a few weeks. So on behalf of the members, thanks for being here. 

Christian Banach [00:16:38] Thank you, Greg. It’s been a pleasure. 

Greg Alexander [00:16:40] All right. We got three calls to action. So if you’re a member, look for the meeting. Invite when you’ll get a chance to attend question session sessions and you can ask your questions directly. Even if you’re not a member and you want to become one, go to collective 54 dot com and apply and the membership committee will consider your application and get in contact with you. And if you just want to learn more, go to Amazon and find my book. It’s titled The Boutique How to Start Scale and Sell a Professional services Firm. When we talk about subjects like this and many more, okay, until next time, I wish you the best of luck as you try to grow, scale and exit your front.

Episode 139 – How to Use the Post Project Review to Scale Your Firm – Member Case by Nicole Merrill

Listening to clients intentionally is a core competency for service firms attempting to scale. There are 5 listening techniques appropriate for a boutique service firm. They are: 1- client advisory board, 2- post project reviews, 3- client satisfaction program, 4- win loss program, and 5- conferences. In this session, we take a deep dive on #2 post project reviews. Learn what they are, why they are required, the benefits they produce, and how and when to perform them.


Greg Alexander [00:00:10] Welcome to the Pro Serv Podcast, a podcast for leaders of thriving boutique professional services firms. For those that are not familiar with us, Collective 54 is the first mastermind community focused on the unique needs of the boutique processor firm. My name’s Greg Alexander. I’m the founder and I’m going to be your host. Today on in this episode, we’re going to talk about one of the listening techniques. We discussed five listening techniques in the book, The Boutique. And one of those is called a Post Project Review. We’re going to talk about what it is, why you should be doing them, when you should be doing them, who should own it, how many should be done, etc., etc.. And we’ve got a great member role model with us. Her name is Nicole Merrill and she’s a CEO of Vecteris. Nicole, it’s good to see you. And you introduce yourself and your firm, please. 

Nicole Merrill [00:01:05] Absolutely. Thank you for having me here. It’s nice to be here. Vector is works with B2B professional services companies to build products that allow them to grow without adding more headcount. It’s an important area that a lot of our organizations are struggling with. So most organizations run right to the technology, you know, the app they want to build or the elements they want to build, whatever it might be, and they run into trouble. So we help those organizations by addressing the three major challenges they face leadership, vision and alignment, product mindset and skill set, and finally developing their own product innovation process. And that’s all specific to the B2B professional services space. So and my own background is in over 20 years of designing and executing the go to market strategies for those kinds of services and products. 

Greg Alexander [00:01:57] Okay, great. So let’s start with the basics. What is your definition of a post project review? 

Nicole Merrill [00:02:06] So for us, we like to use the post product review process. 

Greg Alexander [00:02:11] Yep. 

Nicole Merrill [00:02:12] Yes. Project Review Fork for a couple of different things. We see it as an opportunity to debrief and give people our clients an opportunity to ask more questions. Look for clarity. We also see it as a time where we can get feedback on the work that we’ve done for them and also a really a wonderful opportunity to explore new opportunities. How else could we be working together? So. 

Greg Alexander [00:02:42] Okay, fantastic. And the mechanics of it, how do you do them at the terrace? 

Nicole Merrill [00:02:49] So within our consulting practice, typically we’ll do a couple of things. We have a survey that gets sent out to all the participants in the project, and then we also will schedule time with the project sponsor to really get to talk through with them. Sorry. Things are about making noises here so that we get a chance to talk through with them. The. Her opportunities there, the victories that they saw coming out of the project. So there is a interview guide that we actually use to kind of walk us through that. So that’s with our consultant, with our customers. We actually also do an internal project review where everyone from the project comes together and we also do the same victories, opportunities for development for us internally. We look for the things that we want to productize, that we want to use again and again because they work so well in that particular project and look for ways that we can work to better together. So there’s kind of three layers to our post project work actually. 

Greg Alexander [00:03:57] And when you do it internally. Um hmm. What are some things that you commonly find? One of the outputs of that. 

Nicole Merrill [00:04:09] One of them is definitely to look for the opportunities that we can do more work with someone potentially, if we haven’t already identified them. It’s a way to give the team an opportunity to give each other like kudos and great feedback on Hey, you really helped me out when you did this. So it’s a good kind of team building opportunity for them. It also gives us the opportunity to look for places where we can repeat and just, you know, get better and faster and more efficient as an organization. Yeah. 

Greg Alexander [00:04:37] Yeah, exactly. Okay. And is there like, who owns it inside the company? Is it the person who own the project? Is it somebody else who owns the Post Project Review? 

Nicole Merrill [00:04:50] That’s a great question. So we actually have a leader in project management who is the person who kind of owns the set up of every project and then the debrief of every project. So she makes sure that we send out that survey. She makes sure that we’re scheduling that session with the project sponsor, and she makes sure that we actually have our internal debrief. So she schedules all that. She runs us through the agenda. And then she makes sure that those pieces that we want to make sure we’re repeating end up in the right place, because she is also the person who owns our playbook. 

Greg Alexander [00:05:23] Essentially, yeah. You know, the repeating concept is one that’s worth highlighting the way that we did it in my old firm and we use different terminology, but it’s essentially the same thing. What we did was we pulled out the original scope and and then we compared the original scope with what actually happened in the project. And if we were out of scope and therefore not as profitable as we needed to be, we would analyze why, you know, if the profit margin on that project was higher than normal, we analyzed why. So it’s always a good kind of closed loop process to, you know, to go back to, you know, what were the original assumptions and what actually happened. So, okay, So we talked about what it is, why members should be doing them. Who owns it in the firm? When is it done? 

Nicole Merrill [00:06:09] We usually do it within a few days of actually wrapping up the project. So we try to do it very, very quickly as much as we can. So someone’s on vacation will wait, but typically we’re doing it within days. 

Greg Alexander [00:06:21] And the theory there is there’s more time passes, the less fresh our memories are. 

Nicole Merrill [00:06:26] You forget. Yeah. Yeah, exactly. You forget what was important or you’ve lost sometimes. Well, even if it’s a particularly long project, we’ll actually fit in something mid-stream because we don’t want to miss the things that maybe happened early in the project that could have that we will have forgotten by the end. So it’s not necessarily only at the end that we’re doing these kinds of conversations. 

Greg Alexander [00:06:47] Okay. And do you do them after every project, or is there a certain project size that gets this extra attention? 

Nicole Merrill [00:06:55] No, for us, we do it after every single project. There’s really no project that we wouldn’t do it after. It’s it’s an integral part of kind of how we do business. 

Greg Alexander [00:07:07] Okay. And and the results that are gathered from this. Mm hmm. Are they use across the entire organization or is it just within client delivery? 

Nicole Merrill [00:07:20] The entire organization. So, you know, I mentioned early on that in our consulting practice, we do these post project reviews, but it’s really driven how we’ve developed our organization as a whole. So we’ve moved as an organization more and more into a subscription based advisory solution. And part of that was because we wanted our business model to to grow in that direction. But through these kinds of conversations is where we got that. Why, for our customers, like, why is this more important for our customers to be more in this advisory solution kind of approach? You know, we learned through having these discussions that essentially what companies were doing was almost outsourcing their strategy, and it was really important that they keep that strategy internal. And it became very, very clear as we were having some of those post project conversations that being able to work with and partner more with customers is really important and that it really kind of gave us the the why behind we were making a more a big business model shift. 

Greg Alexander [00:08:26] Yep. And as you do these post-graduate reviews and you guys are doing them after every project, which is, which is quite a lot, does it help you get a better understanding as to really who your ideal client is and therefore who you might target from a sales and marketing perspective? 

Nicole Merrill [00:08:46] Yes, I would say it does. It definitely helps us identify what are the. The things that are a bit different between each of the organizations so that we can be looking for those right companies when we see them, and also help us eliminate the ones that aren’t the right fit long term. Yeah, help us better understand the problems that they’re facing and so that when we’re upfront selling, where we’re positioning it better so that the people who really need us, they can self-identify as well. Yeah. 

Greg Alexander [00:09:17] You know, in my journey from time to time, we would have a set of projects that didn’t go so well, and then we would analyze those to see what was common amongst them and they would say, Listen, you know, when you’re in the services business, you become what you sell and who you serve. So if you’re having a problem with a certain type of project and you keep selling them that project, life is going to be miserable because you going to keep putting yourself into those difficult situations. And I know it’s difficult to walk away from revenue, but not every dollar is worth the same. Some dollars are more attractive than other dollars and there’s real opportunity cost there. So I just wanted to work into the conversation on how critical it is to pull forward the post project reviews into the sales and marketing process so that what you’re bringing into the firm, other types of clients and types of projects that you want to work on because that will lead to success because again, ultimately we become what we sell and who we serve. 

Nicole Merrill [00:10:16] Now, couldn’t agree more. 

Greg Alexander [00:10:17] If you were starting a firm today and you weren’t doing this and you didn’t even know maybe what it was, would some listening to this will fall into that category and you were paralyzed because you don’t even know how to take the first couple of steps. You know, how would you get going on this? 

Nicole Merrill [00:10:34] On the process of how to do a post project review. 

Greg Alexander [00:10:37] Correct. 

Nicole Merrill [00:10:38] I’d probably chat at first. 

Greg Alexander [00:10:42] I think we’re all doing that these days. 

Nicole Merrill [00:10:44] Yeah, 100%. I don’t think. I don’t think it has to be fancy. Yeah, we, we started with a like start, stop, continue kind of framework. So we just were able to kind of help people think about all the key areas that we wanted feedback on. We’ve kind of moved into a slightly more elegant framework, which is victories, opportunities and shifts. So what are the things that really organizations felt were there where they really saw value? Where were the areas where we had maybe we had a miss that we could have filled the gap on and still maybe could fill the gap on. And then shifts in the shifts is where we get into conversations of how we do work together in the future, because it’s how their organization is shifting because of this. And we really get a nice opportunity to get expansion from those kinds of questions so it doesn’t have to be fancy. I think you can start super easy and just have a conversation with people. 

Greg Alexander [00:11:41] Yeah, I agree. You know, one thing that I might put on top of that maybe at the intermediate step, not the expert stuff, but once you pass the beginning step is to really embrace this concept of project profitability. Sometimes we measure margins in the aggregate at the firm level, and that can be a little deceiving if you’re measuring profitability at the project level. And the post project review would be the way that which you did that you start to get really granular. You know, so for example, if you were I don’t know if there were four phases to a project and phase two was 200% of scope, like what the heck happened? You know, if if Bob, who was assigned to the project, you know, had these three deliverables and he was two weeks late on each one, like what was going on with Bob, did we staff the project correctly? And then when you when you start doing it that way, you really get good and understanding scope and then you can pull that forward into the sales process so that when you put a proposal on the table for a client, maybe you can move away from hourly billing and you can move into something like a fixed, better or flat fee because you really have great understanding as to what the work is, you know, what the level of effort is going to need to be in order to pull it off. So just something to think about there for for the members. All right. Well, listen, we’re at our time here, but for members of collective 54 that are listening, I want you to pay attention to the meeting invite that will come out for the private member Q&A session, which we’ll have with Nicole. And you’ll be able to double click into this and a lot more detail and ask her her direct questions and learn a lot about the Post project review. For those that are listening, that are nonmembers. Obviously, I encourage you to become a member and you can do that. A collective 54 Adcom fill out a form and some will get in contact with you. And if want to learn about the other techniques that we advocate for, pick up a copy of our book. It’s called The Boutique How to Start Scale and Sell a Professional Services Firm. But Nicole, you and your team have been long time supporters of Collective 54. You’ve made just a tremendous contribution to the community and you did so again here today. So on behalf of all the members, thank you so much for being here. 

Nicole Merrill [00:13:51] And I was delighted. Thank you so much. All right. 

Greg Alexander [00:13:55] Okay. Until next time, I wish you the best of luck as you try to grow, scale and exit your firm.

Episode 138 –  Journey Maps: What Are They, How Are They Used, and Why Every Professional Service Firm Needs Them – Member Case by Miles Kailburn

Quality work is table stakes, not a competitive advantage. Lots of firms deliver quality work and many clients cannot tell the difference between great work and average work. In contrast, the client experience is a powerful differentiator. Very few firms can deliver an outstanding client experience consistently. Those that can scale. The tool they use to do so is called a journey map. Attend this session and learn what a journey map is, and how to create and use them effectively. 


Greg Alexander [00:00:10] Welcome to the Pro Serv Podcast, a podcast for leaders of thriving boutique professional services firms. If you’re not familiar with us, Collective 54 is the first mastermind community focused on the unique needs of founders of boutique professional services firms. My name’s Greg Alexander. I’m the founder and I’m going to be your host today. On in this episode, we’re going to talk about one of the most important tools that services firms have at their disposal being best in class. And this tool can make a significant improvement in many areas of your business. And the tool I’m referring to is the journey map. And we have a role model with us today who’s an expert at this. His name is Miles. I’m going to mispronounce your last name. I’ll say it for me. Kelburn Kelburn. I was going to say Kelburn. So thank you for that. And Miles, it’s good to see you. Would you introduce yourself and your firm to the audience? 

Miles Kailburn [00:01:13] Certainly. Thanks for having me on today. We are a 17 year old creative firm located in northern Colorado, primarily focused on high lifetime value segments and client industries. And our company is OTM. You’ll find us at Time.com. 

Greg Alexander [00:01:35] All right, Very good. So let’s let’s start from the basics. You know, we have some young emerging firms here, and this term might not be familiar to them. So what is a journey map? 

Miles Kailburn [00:01:46] Simply put, a journey map is a visual representation of whichever audience you’re going after. Could be employees, that could be customers. Anything that we’re we’re tracking. But really, it’s it’s a visual representation of the process that they go through, whether it’s employment, buying services, things like that. 

Greg Alexander [00:02:06] Okay. And let’s let’s take those one at a time here. So if I have a journey map and let’s say I want to use it for service delivery because I want my client to have an exceptional experience, how might I use it in that context? 

Miles Kailburn [00:02:25] It’s a great question. And I just walked out of a service delivery meeting where we were going through that right now on SEO and social services. So. The first thing is to go through and map out what are the touch points in terms of I guess, first, are we looking at securing new work or delivering existing work to existing clients? 

Greg Alexander [00:02:47] So I’m going to get to the new work in a moment, but for this example, delivering existing work. 

Miles Kailburn [00:02:52] All right. So that’s what we’re going to map out. First is what our client engagement experience is. So we’re going to look at that typically on our side on a monthly, quarterly and annual basis. And so we’re going to map out all the touchpoints that we need to have with a client and really also what are the touch points and areas and timing of their business that they need to communicate with us. We’re going to lay that out kind of on a linear, flat visual map. There’s some great tools at mural near Miro smartly to to map that out. And then from there we’re going to look at what are the emotions that are driving that on the customer side, Where where are there intentional opportunities to align with the customer that we can get ahead of that we can predict? And then from there, we’re going to start to build our services really around that map. 

Greg Alexander [00:03:46] Okay, some terminology here. So touch points. What is a touchpoint? 

Miles Kailburn [00:03:52] Touchpoint would be any engagement that a prospective client or existing client has with our brand. So that could be visiting a website, reading a newsletter, engaging in social for the existing client side. It’s typically going to be more around our IT within our client engagement model. It’s going to be more around client meetings, client cadence, client reviews. Typically anything that account services leading is going to be a communication touchpoint. 

Greg Alexander [00:04:25] Yeah, Okay. Very good. And our audience here today is our members. So I’ll use Collective 54 as an example because they’ve all gone through this. An example of a touchpoint for us is your onboarding session. You know, we know that if you get onboarded well and it’s a good experience and then we’re off to the races and things are going to work out when onboarding does not go well, which sometimes happens for a variety of reasons, then you know, it’s a rocky road from there and we’re in recovery mode right away. So that’s an example of a touchpoint, that’s a milestone on a journey map. And, you know, highlighting that and recognizing it for the level of importance that it has and being really good at it is what a journey map would help you do. Now, you mentioned the word emotions, which I have to double click on because I completely agree with you on this, because sometimes with clients it’s not necessarily what you deliver them, although that is important, of course, but it’s how they feel in the project itself and emotions can get in the way. So for example, when someone comes to our onboarding session, they they kind of know like what they just bought, but not really. So they’re coming at it with, you know, a fair amount of skepticism. And then we need to know that. And so therefore we kind of go overboard in how we explain things to remove some of that skepticism and get them to open up a bit. So emotions plays a huge role here. So, Miles, how does how does your firm help clients? Because I know you do this for a living as well as use it yourself. How do you help people identify what those emotions may be? 

Miles Kailburn [00:06:00] The emotions are. I mean, to your point, that’s that’s almost almost a majority of what you’re managing from. From analyzing that, it really comes down to a bunch of different touch points. Some of it’s qualitative, some of it’s quantitative. So we use focus groups a lot. We use session recording tools like Hotjar that will record website activity to look at hesitancy and delay. But really it comes down to watching the customer in one way or another. We can you and I can sit in a room and we can hypothesize what what a pinpoint is to a perspective or where the emotional state of a prospective collective 54 member or potential sales prospect. But that doesn’t really do us enough good until we actually sit down and have those conversations like you guys do with your prospective members in measure that go back, look at the journey map. Are we addressing these touch points or are these emotions at the right touch point? And what could we do differently maybe leading into that onboarding process or things like that to actually influence that emotion? 

Greg Alexander [00:07:16] Yep. Very good. Now, these are used also in the sales process with new prospects, not just with existing clients during client discovery or client delivery. Excuse me, is it the process basically this the same into supply differently or is it an entirely different process? 

Miles Kailburn [00:07:35] The way we do it as well will basically take a look at the full funnel. So we’re going to look at it from a marketing and sales perspective first. So we’ll start to map through the marketing marketing process. So looking at awareness, consideration and acquisition and so working basically top down tracking that prospect or that persona really from the point at which they are even entertaining the idea of joining a group, buying a car or whatever, that, that buying that customer journey is all the way down through the marketing channels. The transition from marketing qualified lead an MQ out to a sales qualified lead, handing that over to the sales process. And then from there it’s a it is a separate journey inside of the sales process, but we look at it as a linear extension of that marketing, qualified marketing customer journey cycle, because really we’re looking at what is the customer’s experience or perspective customers experience going through that whole process. And then once they become a customer, then it serves to nurture and client engagement, so commonly referred to as a bow tie funnel. But really at that point, once they’re signed, you basically start a whole new customer journey. 

Greg Alexander [00:08:55] Tell us what a bow tie bow tie funnel is. 

Miles Kailburn [00:09:00] So think of two triangles that meet in the middle and the pointy side. But basically you’ve got your customer journey coming in, you’re attracting customers, you’re nurturing them, you’re getting them into your sales table. So from left to right, that’s getting a little more narrow. And that that center point in between is the conversion that client has purchased. The client has signed up, and at that point you actually start the process all over again, just well further on the right hand side of the spectrum. And that becomes what we would consider a client engagement model. So instead of looking at how are we heading them up with drip campaigns and nurturing their sales process, it’s how are we nurturing them as a customer? Are we having the right meeting cadences? Are we delivering things as planned, and are we doing our quarterly business reviews and things like that at the right cadences? 

Greg Alexander [00:09:54] Okay, got it. If I’m a member and I don’t have a journey map and I want to get started, but I might be paralyzed because I don’t even know how to take the first two or three steps. What do I do? 

Miles Kailburn [00:10:07] It’s a little funny, but the first thing I would do is the accidental way we got into this is I would go Google Starbucks journey map. There’s a couple of visuals. It we accidentally stumbled across it a decade ago, and it’s an incredibly well structured document that outlines the buying process and considerations that go into getting that daily cup of coffee. And it’s pretty spot on. I would take a look at that first. That’s pretty easy to wrap your head around as we’ve all gone through Starbucks going from there and actually putting it into use, the two resources would be smartly applied. They are a very large customer journey focused platform, but they’ve got a lot of resources. And then video audio, which is IDL, has some human centered service design courses that you can take and those are really fantastic, maybe 4 to 6 week boot camps that really can get you going from from nothing to your first map. 

Greg Alexander [00:11:12] Awesome. And the first one just to do the spell again. S a l. P y. 

Miles Kailburn [00:11:18] S a ap l y a map. 

Greg Alexander [00:11:23] My, my, my dyslexia is getting the best of me simply because. 

Miles Kailburn [00:11:31] I want to. Yeah. Napoli Yeah, and they’ve got a lot of great resources. 

Greg Alexander [00:11:37] So who in a firm should own this? Not only the creation of it for the first time, but I would imagine it gets heavily iterated against who owns us. 

Miles Kailburn [00:11:46] It’s a great clash and we see it as a cross-functional resource. So with our clients, we work with about 45 brands, pretty much all of them adopt customer Journey as a focus at the leadership level, typically at the CEO level. They’re not the ones leading it, but once we once we can align with the CEO around leveraging and managing towards and building towards customer journeys, that really allows us to build through the cross-functional teams, whether it’s customer experience, marketing, sales, h.R. And so in most of our clients, really, the ownership is usually spread out across two or three department heads that are each managing it in their own areas. We’ve got clients that use them for professional development, onboarding internally, externally sales, marketing, even down to how to build a house. Our clients have kind of taken journey maps as really the source of truth for almost everything they deliver, which has been absolutely exciting to see. 

Greg Alexander [00:12:56] Yeah, I’ll share a story to bring all this to life as maybe a way to put a bow on our session. So I had dinner with a gentleman Tuesday night this week. He reached out to me, called on LinkedIn and said, Hey, I read your book and I’m going to be in Dallas on a business meeting. I’d like to come see you. And I looked him up and he looked like somebody that would fit well with our community. So I said, Sure. So I went and met him for dinner. And he he’s really great guy. And I was so glad that he reached out and said, So what did you think of the book? And he’s like, Well, he goes, I read it about two years ago. And right there I was, dropped my fork in my plate. I’m like, What? So all of my assumptions of my journey map kind of went away. I’m like, So you read it two years ago and here we are tonight. So like, what happened? And he’s like, Well, I started listening to your podcasts and you mentioned at the end of your podcast, so that told me my call to action was working. He goes, and I went back and listen to it this time via the Kindle audio version. So and I didn’t know that right in there. I am kind of not really paying attention to those early steps in the journey map. And then he went from listening to audio and to reaching out to me, which is, you know, the idea behind content marketing. And here we are face to face. And it was something about the audio that did it as opposed to the text, you know, audio, all of it more intimate, you know, not a flat, that kind of thing. So just as an example for the audience that, you know, really understanding the behavior, the journey that a prospect or client goes on can help you make informed decisions in so many different ways. 

Miles Kailburn [00:14:35] Well, Greg, one point in there is you mentioned duration. You know, everyone has their own duration and that might be a little bit on the farther side, but respecting the duration that the customers are organically going to go through allows you to really back your tactics and and decisions to align with that and in our opinion, respect the customer journey. Yeah. 

Greg Alexander [00:14:59] Yeah, yeah, exactly. Yeah. I mean, in fact, if I had known that he had read the book two weeks ago, my aggressive sales guys might have reached out to him and it probably would have backfired. Like he that wasn’t the way he wanted to go through it. So I guess I got lucky in that scenario. All right. Let me let me summarize a few things here. So for members that are listening to this, you’re going to get a meeting invite for the exclusive private member Q&A session. And this will allow us to double click on this much more than we can do so on a shorter podcast. And it gives you the opportunity to ask Myles your questions directly to him. So I highly encourage you to attend that. For nonmembers that are listening, get off your, you know what and become a member and you can do that. A collective 54 icon fill out a form and some will follow up with you if you don’t want to get off your you know what and you want to just, you know, investigate a little bit more. Check out the book that I just mentioned. Ironically, it’s called The Boutique How to Start Scale Sell in Professional Services Firm authored by yours Truly, Greg Alexander. And again, you can find that on Amazon. With that, Miles, you know, the way that collective works is, is we make deposits in the collective body of knowledge so that we all benefit from it and we share best practices, and that’s how we all get smarter. So you made a big contribution today. So on behalf of all the members, I want to thank you for being here. 

Miles Kailburn [00:16:15] My pleasure. I’ve been on the receiving side of that for a long time. So happy to give back. Greg Alexander [00:16:19] Okay, Very good. All right. Until next time, I wish you luck as you try to grow, scale and sell your firm. Take care.

Episode 137 – How a Fast Growth Service Firm Formalized Goal Setting to Get Focused – Member Case by Jason Mills

A strategy defines who you serve, what you do, how you do it, and how you do it differently. And a strategy begins with a clear set of goals. In this session, learn how a boutique adopted a formal goal setting methodology, called OKRs, to get focused on what matters most.


Greg Alexander [00:00:10] Welcome to the Pro Serv podcast, a podcast for leaders of thriving boutique professional services firms. For those that aren’t familiar with us, Collective 54 is the first mastermind community focused entirely on the unique needs of the boutique processor firm. My name is Greg Alexander. I’m the founder and today I’ll be your host. And in this episode we’re going to talk about a popular management methodology, goal setting methodology called Okay Hours. And the reason why I’m going to talk about this is several of our members are attempting to implement them and we’re learning a lot and we want to share some of those learnings. And if you’re not using OKRs, you might be using something similar, such as the boutique framework from collective 54 or iOS or scaling up. There’s a lot of kind of techniques out there and it’s important to have one. Today we’re going to talk about OKRs and we’ve got a role model with us. It’s a member of Collective 54 from a company called Tribal Scale. His name is Jason Mills. Jason, it’s good to see you. Thanks for being here. And please introduce yourself and your firm. 

Jason Mills [00:01:25] Thanks, Greg. My name is Jason Mills. I had engineering a tribal scale. We’re a boutique services firm specializing in platform and software development, using extreme programing, which is essentially test driven development coupled with peer programing. We also use this to provide a unique approach to digital transformation. 

Greg Alexander [00:01:45] Very good. So let’s start with the basics. What is your definition of OKRs? 

Jason Mills [00:01:53] So Oscars are basically, I guess, essentially company goals. The acronym ACRONYM stands for Objectives and key results. The objective portion be more of a loosely defined company goal and the key results, more of the how to get there. So yeah, but it’s kind of like a quick overview. 

Greg Alexander [00:02:15] Yeah. And for those that might be interested, they really became famous when John Daw introduced them to Google back in the late nineties. And many in the tech world, such as tribal scale, you know, have embraced them as a result and to much great success. So, Jason, now we understand what they are. Let me ask you, why did you and your firm start using them? 

Jason Mills [00:02:40] So we’ve we’ve done goal setting exercises for several years to drive personal growth and company initiatives. But in the past, it was really just the manager collaborating with the with a report. And we came to the realization that, yeah, it’s great if someone wants to get a certification to support their growth, but what if that doesn’t align with the company’s goals? So what can we do to eliminate this gap? And as we as we look to really align the company vision in the organization, OKRs became the model to try out for us. 

Greg Alexander [00:03:15] Okay, great. And when did you begin your. Okay, our implementation. 

Jason Mills [00:03:21] So we started end of last year really trying to get the framework in place and for preparation to really launch this in Q1 of this year. So we are about two quarters in almost at the end of the second quarter right now and definitely iterated a little bit on the process. But that’s that’s where we are at this point. 

Greg Alexander [00:03:43] Which is great. I mean, we caught you at exactly the right time. If you already had everything fully baked, the the conversation wouldn’t be as fruitful because I think there’s many that are in the middle of an implementation. So to hear your your story is going to be helpful to them. So tell us a little bit about, you know, what the journey has been so far. You know, how are you using them, What’s gone well, what hasn’t gone well, etc.? 

Jason Mills [00:04:06] Yeah, sure. So we’ve gone ahead and we created for essentially for company OKRs to help line the teams. The first one was lined with white glove service. That was like an example of one of the ones we use trying to provide that ten X value to our clients. The second was service offerings kind of like complements the first OKRs, and the third was thought leadership in the form of content generation through blogs. Speaking of speaking out on podcasts or attending meetups, and the fourth one was meaningful bench work. So we were in a situation last year where a lot of times people were on bench and we wanted to make sure that it aligned with its valuable time. We wanted to make sure aligned with like with what would benefit our clients and our business the best. So those were some of the the OKRs we choose to use. And then each department really gets their own. They can add a couple of extra OKRs if they like, based on what the department needs might be. 

Greg Alexander [00:05:13] Okay, so let’s double click into into one of them and I’m going to choose meaningful bench work because I think that’s a rich topic for our audience. You know, most of our members, sometimes they’re a little lumpy in their businesses and they can find, you know, talented people on the bench for a period of time. And then unfortunately, sometimes it goes the other way your 120% capacity and everyone’s burning the midnight oil. So so what is some examples of meaningful bench work? 

Jason Mills [00:05:42] So a lot of times like the default for us just was like, okay, we’re gonna we’re going to certification certifications always help our, you know, our company in regards to Azure or things like that. But we took it a step further and we we said, you know, whatever we’re working on, it should benefit either a client that we’re going to have in the future or a client that we have currently. And we took it a step further and said, you know, how do we know we’re succeeding in this? So we put together like a metric saying that, you know, we want to we want to use whatever knowledge they’ve gained within two months of of learning it. And that’s how we know if we succeeded with that. So so that’s an example. 

Greg Alexander [00:06:27] That is a great example. So you want to use whatever you learned within two months. I can’t help myself. Two months is a very precise number. How did you pick that? 

Jason Mills [00:06:39] Oh, I it’s like it felt right. Okay. It seems like, you know, when you’re when there’s a little bit of leeway before the next client starts up, it seems like a good amount of time to prep before you actually get deep into the project. So that’s just landed there. 

Greg Alexander [00:06:58] Yeah. Okay. Well, that makes sense. All right. And you know, at the top, I mentioned that OKRs is there’s other similar systems. A lot of our members use iOS. Some use scaling up, some use the boutique. I mean, there’s a lot of them out there. And I advocate for everyone. To me, there’s not a ton of difference between them. The important thing is to have one and be committed to it and implement it. Right? So. So was there any reason why you picked OKRs over the alternatives? 

Jason Mills [00:07:27] Well, they you know, they were naturally a good starting place if you haven’t done organizational goals before. There they were from what we the research we did, they were loose, flexible to change, interpreted in different ways which which, you know, some might think that’s not you you want to make sure they’re not interpreting the phrase, but it actually allows to generate some creativity among the teams to solve different problems. And they’re not tied to compensation, which alleviate some of the pressure as well. So they were basically very forgiving if we screw this up, which we were going to screw it up. Yeah. So anyway, U.S. has its value, too, but I know that’s more of an operating system. And now that we’re two quarters in, we’re actually experimenting a bit, but laying us on top of that to kind of like help us drive and execute a lot of the a lot of the things we want to do. 

Greg Alexander [00:08:19] So that’s fantastic. So the reasons why you chose it, one of the reasons anyways, was the flexibility. And since this was the first attempt at this, that was obviously valuable, I also, I did not know that OKRs were divorced from compensation. So that’s a valuable add right there and I can see the benefits of that. Some might argue against that, but I can see if you’re early in this process that that might make it more, I guess, less stress in getting it implemented and maybe less of a shock to the system. So that’s interesting. Okay. And then in terms of the six months that you’ve been at it, you know, if you were to do it over again right now, if you had a clean sheet of paper, is there any any gotchas, any failures that happened along the way that you wish you would have known? 

Jason Mills [00:09:06] I think overall it went pretty well. We implemented this using just basic spreadsheets. Seems I think you can kind of run the world on spreadsheets and and just set up the spreadsheets, you know, kind of like doing weekly check ins, whether our our OKRs were on track, off track, or if they were done. Kind of provides that simple, simple implementation as we get into it. I think one of the challenges for the engineering team in a lot of times engineering is that one of the larger sizes is that multiple parking levels. So not having that visibility into, you know, what are the managers, the managers, you know, kind of trying to deliver. So are we all in one bucket of thought leadership and no one’s putting any any knowledge into or any time into white glove service. So that was a challenge that, you know, we are kind of working through and evolving on. Hmm. 

Greg Alexander [00:10:03] And what what are your early hypotheses as to how you might overcome that challenge? 

Jason Mills [00:10:09] So we had, I would say like long term, maybe just finding like a tool that can kind of work through and manage it and provide that hierarchal visibility. When I was working at a former Life, I built performance management systems and, you know, clients created goals from very simple to very complicated scorecards, you know, tracking metrics on time and dollar delivery. But end of the day, they all wanted to see a one page dashboard with visibility all the way down the line. So right now we are using a tool that actually integrates with our Google calendar and allows us to kind of tag each meeting that everyone has with an Oscar. And that month we can see how much time was spent across the organization and on the on the specific. Okay. So it kind of provides that visibility to Head Start, right? 

Greg Alexander [00:11:04] Yeah, very cool. Any other, you know, tools that you all leveraged or, you know, quick hacks that people might take advantage of when you got going on this? 

Jason Mills [00:11:15] And we’re we’re piloting a couple of different things, like from the iOS standpoint. There’s there’s a couple different tools that just manage that whole process. So it’s like we’re using 90 right now, which is something that we’re that we’re trying out, which is a good. 

Greg Alexander [00:11:33] Thing about like learning tools around OKRs. Were there any books that you read, any videos you watched, anything like that that you can recall that jump to mind that were particularly helpful? 

Jason Mills [00:11:43] Yeah, there were some there’s a lot of great information on some websites. Definitely read the book Traction, which was a good one on iOS, trying to think of some other ones that come to mind, but those are kind of amazing. 

Greg Alexander [00:11:57] Okay, Got it. And then my last question before we wrap up is, you know, the implementation of OKRs. Is there one person who kind of owns the the whole thing or is it distributed? You know, who’s in charge on it? 

Jason Mills [00:12:11] Yeah. So the for us we have the our chief of staff and she owns the process, kind of like owns the master spreadsheet. And then we have the department leads that kind of like manage the okay for each department, everything kind of rolls up, and that’s kind of a bogey structure. 

Greg Alexander [00:12:28] Got it. Very good. Okay, Well, so for the listeners that are members, let me draw your attention to making sure you accept the meeting invite that will come out here shortly with Jason Mill’s name on it from tribal school. And if you attend that member only private Q&A session on Friday, which is when we have a role model sessions, you can double click on any of these items and ask your questions directly of Jason. So I encourage you to do that. If you’re not a member and you think you might want to consider it, go to collective 54 dot com. You can fill out a form and one of our reps will get in contact with you. And if you want to read about other things that we do or the topics we cover. In addition to this, I pointed towards the book The Boutique How to Start the Scale and Sell a professional services firm in a video is your thing on YouTube. We have a channel called Profiting in Professional Services and you can see some videos on that. But Jason, I appreciate you accepting my invitation when I reached out to you and sharing your journey so far. And congratulations on the progress that you’ve made and we learned a lot from you today. So thanks for being here. 

Jason Mills [00:13:35] Great. Thank you, Greg. 

Greg Alexander [00:13:36] All right. Okay. And for the rest of us, you know, I wish you the best of luck as you try to grow, scale and exit your firm in the future. We’ll talk to you on the next episode.

Episode 136 – Why Podcasting Should be Part of a Professional Service Firms Marketing Mix – Member Case by Tom Schwab

Podcasting is a perfect marketing channel for boutique professional service firms. It allows a firm to authentically connect with its target market at scale cost effectively. Yet, many members are not taking advantage of this tool. This session will teach members how to leverage the podcasting channel to grow their firms.


Greg Alexander [00:00:10] Welcome to the Pro Serve podcast, the podcast for leaders of thriving boutique professional services firms. For those that are not familiar with us, Collective 54 is the first mastermind community focused on the unique needs of the boutique process of firm space. My name is Greg Alexander. I’m the founder and I’m going to be your host today. On this episode, we’re going to talk about podcasting and its role that it might play in your marketing mix as you look to grow your firm. And we have a collective 54 member role model with us who’s an expert in this area. His name is Tom Schwab. He’s with Interview Valet Time. It’s good to see you. Please introduce yourself to everybody. 

Tom Schwab [00:01:00] Greg, I am thrilled to be here. You know, I run the agency interview valet. And my my viewpoint is that today every pro serves business problem is obscurity, right? There’s thousands, tens of thousands of people you could help. They just don’t know you exist. And I think instead of breaking through the noise, it’s much more powerful to get in on the conversation that people are already listening to. 

Greg Alexander [00:01:25] All right. So so give us kind of a State of the Union on podcasting. I’m not sure our membership community, you know, has a full appreciation for how prevalent it is, how it’s growing, etc.. 

Tom Schwab [00:01:37] Yeah. And everybody thinks there’s, you know, millions and millions of podcasts. While that’s true, less than 450,000 have gone live in the last 30 days. So there’s always room for great podcasts out there. The other thing is that not everyone is listening to podcasts. If you look at the current data, it says 51% of the U.S. adult population listens to podcasts, right? And they’re above average income. They’re above average education. These are people that are early adopters, that are looking for answers. They’re looking to make their life better right there. There’s still probably a third of the people out there that are so proud They haven’t read a book in since high school. They’re probably not listening to podcasts. Right? The people that are listening to podcasts are looking for answers, looking for ideas. Look at looking for people that can help them. Yeah. 

Greg Alexander [00:02:33] I mean, if half the American adult population is listening to podcasts, I mean, that’s that’s a huge audience. So, I mean, relative to the other forms of media, it’s pretty new, although it is maturing. Why do you think it’s grown so much? 

Tom Schwab [00:02:49] It’s now, what, almost 20 years old, right? So it it’s you know, it’s going to stick around for a while. But I think it’s really because of the intimacy and also the authenticity. Right. We’re so tired of this little, you know, sound world. And while there’s a place for that to really learn, to really understand, something is going to take more of a longer conversation and it’s more authentic. Right? And we look at things that are on television that is highly edited, and we really just sort of want to see what what really happened behind the scenes. And in some ways, almost like a voyeur is a bright. You and I would be having the same conversation if we were sitting at a coffee shop or a bar. Right. The only difference is that there’s microphones and the whole world gets to listen in. 

Greg Alexander [00:03:44] Yeah, it’s really interesting. I like the concept of intimacy because if you think about our audience boutique process firms, I mean, they’re boutiques by design, which means they serve. You know, I like to say the riches are in the niches. So anything that you can do to build a more intimate or authentic relationship with the target audience and the client base is much preferred over maybe kind of mass communication techniques. So. So tell us why, in your opinion, podcasting should be part of the marketing mix specifically for the boutique processor firm? 

Tom Schwab [00:04:14] Yeah, I think it’s really because there’s this idea of you’re one funnel away and I don’t believe that, right. The best things in life don’t come through funnels, They come through conversations and there’s a great book called Clicks and How Digital Marketing is Ruining Your Business. And I love how Bill Troy says Big fish don’t swim through funnels and whales don’t click right. The people that are hiring processor firms aren’t going to hire you because you did a dance on Tik. If anything, that’s a reason for them not to hire you, right? So they want this discussion. They want to know who they are working with. And at the end of the day, none of us need more leads, right? We need more profits. We need profits come through great customers, right? So the idea of going out there and being able to communicate at length is really magnetic marketing, where it will attract the right people and retell the wrong ones. The other. The thing I love about this channel is that it becomes so easy to create and then so easy to reproduce and repurpose. Right. I’ve written a lot of blogs in my life. Most of them feel like homework assignments, right? But we can have this conversation and then take the take the audio and get a transcript, have somebody clean it up and make a blog. We can take video clips from it, audio clips so you can get a month’s worth of content out of one podcast interview. Yeah. So to my my sense, it’s it’s easy to create, it’s inexpensive to create, and it’s so powerful that you can use it in your marketing and even in your sales, right? You can for somebody who gets on a sales call, you can say, Hey, our founder did this interview. Right? And I think it’d be interesting to, you know, how they’re going to listen to 45 minutes of the founder before they even jump on a sales call. That that becomes a warmed up lead. 

Greg Alexander [00:06:10] Yeah, I agree. So there’s there’s two approaches. Should they be done mutually exclusive? Should they be complementary to one another? And the two I’m referring to is sort of collective 54 members start their own podcast or should they seek to be a guest on somebody else’s podcast? What’s your opinion on that? 

Tom Schwab [00:06:29] Well, I’ve always got opinions on everything, but I look at it, it’s like, should you be an Uber driver or an Uber passenger? Right. Say same platform, but what are your goals? Right. If you want to nurture your current clients and your current leads, then host your own podcast. And Greg, this is a great example, right? Because you take this content, we we dig into it each week in the community. Right. So it’s really for people that already know about it or part of it. Well, if you want to go out and find new leads, new customers, you know, if you build it, they will come. Doesn’t work. You really need to tap in where they’re already listening to. So I’d say be a host. If you want to nurture your current leads and customers, be a guest. If you want to go out and get new customers, new leads, new exposure, new backlinks. 

Greg Alexander [00:07:25] Yeah. I mean, so that’s I mean, and I should tell everybody that collective 54 is a client of Tom’s, and we do both. I mean, obviously here we are, here we are hosting our own podcast. And you’re right, it’s that is for our members primarily. And we are able to, you know, put role models in front of them through the podcast every week. And our members love that. But when Tom books me as a guest on another show, that’s an audience that doesn’t know who I am and I get exposure, you know, to that group. And then through that they find their way to collective 54. So I think, you know, being a guest on someone else’s show is a great acquisition technique, and hosting your own show is a great retention technique. At least that’s how I see it. I think that’s a good way to frame it. So, Tom, tell the audience a little bit about your services. And I’m giving you permission here not to be modest and humble, but, you know, your expertise is taking people like me and getting them on other people’s shows, which it’s hard to get on other people’s shows. I don’t know how people do it without somebody like you. So why don’t you tell us how it works? 

Tom Schwab [00:08:31] Yeah. So we’ve been doing this for nine years now and we have a team of 30 in Europe and North America and. When we first started out, it was almost like guest blogging, right? My background is inbound marketing and engineering, and I looked at it and said, Well, I guess blogs aren’t working anymore more. Could we? The equivalent of guest blog on podcast. And so we started with that. And Greg, the first three years, we built up the systems, the processes, and I went, I tell people about it. I’d get my elevator pitch and they’d go, What’s the podcast? Well, that changed about 2019, and people started to see the power of those. And so now, now one of our clients said, I love working with you because you let me be the guest and you take care of the rest. And I’m like, Oh, that’s good. Copy were taken that. But we’re working with thought leaders, right? Coaches, consultants, leading brands, not fiction, nonfiction authors to get them out there on the right podcast and really, you know, let them be Sinatra. And we do all the supporting work with that. So not only finding the podcasts, but prepping them for every podcast, giving in the best tools and processes for each podcast, and then also the feedback, right? I’m an engineer by degree, so, you know, in God, we trust everyone else bring data. So we license a whole lot of databases. And I think without that it’s more podcast guessing than podcast guesting, because at the end of the day, nobody comes to us and says, I want to be on a podcast, right? That’s that’s an ego thing. Now there’s always an overarching goal of I want to grow my business. Yeah, being on podcast. So that’s really what we focus on. 

Greg Alexander [00:10:24] Okay, so some of our members and I’d say quite a few are what I would describe as a brilliant domain expert. Whatever their domain is, I don’t know. Maybe they’re, you know, a brilliant creative director in a marketing agency, or maybe they’re an absolute brilliant technologist in cybersecurity or something like that. And that’s is what allowed them to get their firms to the point that they’re at. But they’re they’re not great at sales and marketing and they don’t like it. And they sometimes suffer from what’s known as the imposter syndrome. You know, they maybe don’t recognize how brilliant they really are. So putting themselves out there on a podcast can be very intimidating to that group, which is a shame because the world needs to hear what they have to say. So you mentioned that you coach them and you prep them before they get on a call. So how do you help somebody like that maybe overcome their fear and kind of hold their hand? So it’s a great experience for them. 

Tom Schwab [00:11:25] Yeah. And I think I’m going to correct you there. I think all of them are brilliant, right? They’ve all brilliance in different ways. And one of the phrase you hear me talk about a lot is what’s ordinary to you is amazing to others. Right? So that expertise that you have there that everyone knows that. And there was a friend of mine that actually helped me with this because I started out I had that imposter syndrome. I’m like, I’m not the expert, Right? I don’t think there’s anything as the expert, but there is a expert. And he said, you know, the legal definition of a of an expert is someone by their training, their education or their experience knows more than the average person. Trust me, as long as hard hours as you put in your business, in the industry, you have expertise there that others don’t have and that your clients are paying you for. And so I think to frame it that way, for people to also work through their one sheet to say these are the topics that you can bring expertise to, let’s focus on these. Right? Nobody’s going to ask you a question. You know, if you’re not in finance, they’re not going to ask you, Well, what do you think about the Fed’s move? I don’t know. That’s not my area of expertise. Yeah, right. So they want to bring you on. They they want to make you look good with that. So I really think it’s focusing that that light on where they can they can add expertise. The other thing is I love it when people come and they’re like, Yeah, I don’t like sales, I don’t like marketing, I don’t like promoting myself. Perfect, right? Because the worst thing to do on a podcast interview is to make it an infomercial. Yeah. And, you know, Rand Fishkin, who wrote the book Lost and Found Her, I love how he put out there. He said the best way to sell something today is not to sell anything, but to earn the respect, awareness and trust of those who might buy. And I would say, you know, on a podcast, it’s those who are ready to buy, right? If they listened to you for 30 or 45 minutes, they’re going to turn you up or turn you off. That’s fine, right? But if you’re the answer to. FRAYER You don’t have to sell them, right? You have to just tell them what you do, how you do it, and it will attract it to it. And, you know, the data shows that we’ve have for nine years that the leads from podcaster interviews tend to close faster for a higher initial engagement and less churn. Yeah, and it sort of makes sense. It’s not cold traffic. It’s it’s a warm referral. Yeah. 

Greg Alexander [00:14:04] I mean, that’s the experience that I’ve had for sure, and that’s why I’m so committed to the podcasting piece of our marketing mix. All right. Well, listen, we’re out of our time here, but for the members that are listening to this, I want to encourage you all to attend the private member only Q&A session, which we’ll have with Tom that will allow you to ask your direct questions to Tom and he’ll answer those. That meeting invite will come out shortly, but look for that and please attend. If you’re not a member and you think you might want to join, go to collective 54 dot com. You can fill out a contact us form and one of our reps will get in contact with you. And if you’re interested in topics like this and you want to learn about other things, I would point you in the direction of our book. It’s called The Boutique How to Start Scale and Sell a Professional Services Firm. But with that, Tom, I mean, I appreciate you and all that you do. Thanks for being a great contributing member to Collective 54. You give a lot as well as take. So thanks for that spirit and thanks for being part of our tribe. 

Tom Schwab [00:15:02] I thank you for putting it all together. It’s such a great community and like I said before, what’s ordinary to you is amazing to others, and there’s just brilliance in there. And when people share that, it’s amazing the magic and synergy that happens. 

Greg Alexander [00:15:17] Okay, great.

Episode 135 – How a Founder of a Consulting Firm Generates 98% Employee Retention by Deploying a Blame Free Culture – Member Case by George Jagodzinski

As a firm scales, bureaucracy creeps in and slows the growth trajectory. Culture is a substitute for bureaucracy, and it allows a boutique to retain its identity as it scales. In this session, members will learn how a founder built a powerful culture with a fully remote work force, and how it led to outstanding business results.


Greg Alexander [00:00:15] Welcome to the Pro Serve podcast, a podcast for leaders of thriving boutique professional service firms. For those that are not familiar with us, Collective 54 is the first mastermind community focused on the unique needs of the boutique Preserve founder. My name name’s Greg Alexander. I’ll be your host today. And on this episode we’re going to talk about culture. Culture is one of those things it’s tough to define when you see a good one. You can almost taste it. There’s a direct relationship between a healthy culture and outstanding financial performance, and it’s particularly important in a professional services firm for the obvious reason. These are people driven businesses and boutiques in particular because they’re smaller professional services firms. There’s a heightened level of need for a healthy culture because it’s a small group of people. Couple of bad actors can make a real big difference. And in contrast, you know, those that are living the values can have an exponential impact on the business. So we have a role model with us today is he’s a member of Collective 54. His name is George JAG Uscinski. Did I get that correct? 

George Jagodzinski [00:01:37] You nailed it, Greg. 

Greg Alexander [00:01:38] Okay, very good. So, George, would you introduce yourself and then tell us a little bit about your firm? 

George Jagodzinski [00:01:45] Sure. Sure. So, George Jackson, scheme managing partner at activity. And Greg, this is going to be a test because we just did our messaging yesterday the first time out. See how it goes. Right. So we’re a tech consultancy that’s built different so that we can build better. We help our companies succeed by addressing their toughest and most meaningful technology challenges, everything from e-commerce to back office modernization, application development or cybersecurity. We build, we integrate, we design, and we deliver strategy. 

Greg Alexander [00:02:13] You nailed the man. That was fantastic, right? Did you guys. 

George Jagodzinski [00:02:16] Start for today? 

Greg Alexander [00:02:17] Did you do that internally? Did you hire a marketing agency to help you with that? 

George Jagodzinski [00:02:20] We hired a marketing agency to help us out. 

Greg Alexander [00:02:22] Yeah. Yeah, that’s probably why it went so well. So a little plug for our marketing members. All right. So the reason why you’re on the show is because you have this thing called a blame free culture. And it’s almost branded, in my mind that term. Blame free really jumped out at me. So let’s start there. Explain to the audience what that means. 

George Jagodzinski [00:02:45] Sure. Absolutely. And I guess I’ll start with it’s it’s one part of our overall culture. There’s a there’s a lot more to it. But for me, it is it’s really stepping into challenges with curiosity rather than frustration and anger. Myself, I’ve gone through this journey. Personally. I think my wife’s going to get a kick out of this, this podcast, because even a simple act of asking where I misplaced my water bottle, you’d think I was accusing her of grand larceny just in the tone of asking a simple question. And so, you know, we’ve gone through this internally for a long time, saying that we’re transparent where there’s trust and there’s there’s blame free. But I’d say we’re now in iteration 2.0 of that, at least speaking for myself, whereas I used to just kind of bury the frustration and I’d use blame free language in addressing a problem. But when you can truly and this is through lots of therapy, Greg, which I’m a big advocate of, is is if you can take those because it’s perfectly natural to feel frustration and anger about a problem that you encounter. But if you can, you can tell that emotion what to do, you can accept it and let it move on. And then you could shift to curiosity and then really dig in. Then it truly becomes blame free because there’s always a myriad of circumstances and reasons why things happen and 99.9% of the time, it’s not because someone’s a bad actor, it’s because of the situation that they were in, the information that they had at that time. 

Greg Alexander [00:04:07] Now my team tells me you have a 98% employee retention rate, which is best in class by a mile. Connecting the dots here that the blame free culture contributed to that. Is that true? And if so, how exactly? 

George Jagodzinski [00:04:24] I think it is. I think it’s an overall you know, when you’re in a place of trust and there were, you know, that you’re not going to be blamed for something. It’s comfortable. And part of what we call the integrity way is that the journey is as important, if not more important than the results, both in the way that we work internally, in the way that we work with our clients. And I find that it allows everyone to sleep better and just really come to work energized and comfortable. At my favorite moment at our culture is because what you said earlier, people talk about this quite a bit and it’s hard to nail down really what a culture is. There’s always this moment a few weeks in a few months into when someone joins where they’re like, either see it directly or someone lets me know that they said it like, Oh, they really do mean it. You know, they said it, everyone says it, everyone has their values listed and everyone says that they’re going to have this culture. But it truly does happen. And, you know, I, I think that the way we make it successful in our culture is first and foremost as a leader demonstrating it. So we’ve had some big challenges where, you know, I’ve gone in and I’ve demonstrated at a blame free approach and I’ve heard, you know, months, years later that that was really valued and that, you know, that makes them happy to come to work. 

Greg Alexander [00:05:37] You know, when I first heard Blame Free, I had some negative thoughts that went into my head, which shame on me, but I’m being authentic. If I wanted to say, well, how do you drive high accountability in a blame free environment? So address that for me. 

George Jagodzinski [00:05:53] Yeah, it’s funny because when I was going through my journey to I would say I know that were blame free it just in confidence of my partner. But at the end of days something went wrong. So wasn’t someone to blame, you know. And I think it comes back to that just a competitive nature that where you want to win, you know, you want to do better and so on, that someone has to have been to blame for this. And I think that you can you can still be accountable without blaming, you know, and and we also we have common language here where some will say, hey, I own this and, you know, that’s not going to happen again. And as someone says, I own this and this isn’t going to happen again. And we learn from that and we become better. All the all the best. Right. And and that’s where I come at it from a curiosity perspective is, all right, you are accountable for this. Now let’s make it better. Let’s look forward. Blame is about looking backwards. But really, if you want to grow as a company and as people and you’re always looking forward, and how do we do this better? 

Greg Alexander [00:06:46] So that’s a good distinction. Blame is backward looking, you know, capturing those learnings and moving forward. That’s a really good distinction. You know, another thing that jumped off the page at me in terms of some of your benchmarking data is that you have 100% client renewals. That’s incredible. Did this unique culture that you have there contribute to that, and if so, how? 

George Jagodzinski [00:07:09] Yeah, So so to give clarity to that point, that’s last year to this year. So that’s not over the past 20 years. That would be insane. I’d love that that number. But from last year to this year, that was still good. And I think what it is, is I mean, we’ve had clients, we have one Fortune 500 sports apparel company that’s been with us 15, six years. Our government client has been with us over a decade now at this point. And we’ve had CEOs, CEOs bring us into companies that go from one place to the other to the other. And I think a testament to that truly is that, you know, valuing the journey over the results, you know, we have a team of people who are they’re driven to deliver. They always do the right thing no matter who’s looking, and they’re team players. And what we find is when we plug our teams into our clients, we not just get the work done, but we elevate their teams and they’re comfortable with it. One of my favorite moments is, especially in technology consulting, you’re sometimes dropped into a situation where you’ve got teams that are just butting heads. People are unhappy. They’re, you know, they’re they’re kind of they’re blaming each other back and forth. Right. And one of my favorite moments with our clients is where we can not only get them over that hump, but getting their teams working better together, because in my mind, those are people that are now going home at the end of the day that are bringing a lot more positivity rather than negativity to the dinner table. And that brings us a lot of joy. And I think that doing it in a transparent way, I’ll use one example for you is we had a gentleman join with us quite a few years ago. He came from another consulting agency not to be named and about three months in we had one of those moments where he said, Hey, I’m used to navigating this. What’s true versus what should I tell you versus what should I tell the client? And I’m always so busy playing that dancing game, right? And he’s like, This is so weird. There’s really just only one story that we’re talking about and we’re all on the same page and it helps people sleep better at night. And I think our struggle, quite honestly, from a from a marketing and branding perspective is so many firms out there say that they work like this, but so few, I think, actually do, because not only is it is it is it difficult, but to operationalize it at scale. But. Comes even that much harder. And when our clients actually experience it, it’s this best kept secret that they just want to hold on to. 

Greg Alexander [00:09:30] You know, the community is also told me that your superpower, if you will, is that you’re able to do this in a fully remote environment. You know, the everyday you pick up the newspaper and there’s big companies for some people back to work and there’s a debate three days, four days, two days. What is it? You’re fully remote. So how are you doing this? And describe that superpower for us. 

George Jagodzinski [00:09:51] Yeah. So we just celebrated our 20th year this spring. Congratulation had the whole company. Thank you. Had the company together was fantastic. And yeah, we were remote since day one and it was viewed a little bit weird at that point. You know, people couldn’t wrap their heads around it like, so you don’t have an office at all. People are working wherever they want to be. And it’s been it’s been interesting. Even pre-COVID, you started to see more acceptance. But then during COVID, you know, the big shift. But I think for us, it’s forced us to address culture head on right from the beginning and think about what trust is and and and not just do an okay job at it, but really be fantastic, best in class at how we do it. And even then the logistics of that. We’re a big believers in Patrick Lindsay and his writings and he talks a lot about the team norms. You have need to have very clear team norms and you have to be very, very intentional about that when you’re remote. And I was quite honestly, I was worried a little bit when when everyone started shifting to remote, I thought we were about to lose this competitive advantage that we we had because we’re able to find the best talent wherever it lifts you. We’ve had the best. It’s iOS developers that they they live in a house in Lake Tahoe, right? And, you know, they’re getting their skiing in, but they’re also cranking out the best code you could ever imagine. You know, or we’ll have a, you know, a designer that’s hanging out on a beach in Miami. Right. But they’re designing some of the coolest stuff you’ve ever seen. But what I’ve seen with the this shift that’s happening now is, well, first of all, I think a lot of people are kind of messing it up the hybrid and remote work. And then, you know, as I’ve I’ve thought about it, I think there’s something to be said for that. We we did this in an intentional way from the start because of our belief in people and how we we trust and value them versus as a reaction to what’s happening around us. 

Greg Alexander [00:11:43] Yeah, I agree. I mean, I’ve been doing it for 20 years way before anybody else was doing it. And because of that, you have all that institutional knowledge, so you do it well. Many of the firms these days doing it for the first time. I mean, so any time you do something for the first time, it takes way too long. You screw it up, you make mistakes, you know, and then you move down the learning curve and eventually get really good at it. So I think it is a strong competitive advantage for you. And what I found interesting was your strength is your culture, this blame free culture, but it’s origination was you’ve been remote from inception. You had to be really good at culture because your org model was a distributed workforce. Sometimes when people work, you know, central, they can kind of blow culture off a bit because they can get where they need to be, maybe through micromanagement, supervision, brute force, whatever you want to call it. But you guys didn’t have that choice. You had to be really good at it from the from the get go. So that’s a really interesting thought. Okay. Well, we’re out of our time here. I want to direct the members of Collective 54 to pay attention to when the meeting invite comes out for George. This gives you your opportunity to double click on his story. It’s a private session, as you know, and you can ask questions directly of him that go in much more depth and we’re able to cover in a short podcast. So check that out. If you’re not a member and you think something like that might be interesting to you, we do that every week on Fridays. We call it the Friday rule model session. Go to collective 54 dot com, You can fill out a form and one of our reps will get in contact with you. And then if you want to expand beyond this subject, this is one of many things we cover. I’d point you towards a book. It’s called The Boutique How to Start Scale and Sell a Professional services firm written by yours truly, Greg Alexander. You can find that on Amazon. But with that, George was great to have you today. Thank you for being a contributing member to our tribe. We’re better for it and I wish you the best of luck as you move forward in your blame free culture. 

George Jagodzinski [00:13:36] Thanks, Greg. I appreciate it.

Greg Alexander [00:13:38] Okay. Take care. Thank you.

Episode 134 – How to Capitalize on the Shifts in Labor Cost Across the Globe – Member Case by Satyam Kantamneni

Offshoring, or Nearshoring, is a proven method for founders to earn more. However, in a post pandemic world the acceptance of remote work has increased, and this has had a profound effect on labor costs across the globe. On this session, Collective 54 member Satyam Kantamneni shares how the cost per hour shifts by location, and how to take advantage of the opportunities being created.


Greg Alexander [00:00:10] Welcome to the Pro Serv Podcast, a podcast for leaders of thriving boutique professional services firms. If you’re not familiar with us, Collective 54 is the first mastermind community dedicated to the unique needs of founders of boutique pro serve firms. My name is Greg Alexander. I’m the founder and I’ll be your host today. On this episode, we’re going to talk about how professional services firms can improve their margins by leveraging a global workforce. And this is a topic we’ve discussed in the past. However, there’s some interesting dynamics that are happening different places across the world, and I wanted to bring an expert on and have him give us an update on what’s happening. So we do have a role model with us. His name is Satyam Catalini. I hope I got that correct. Satya, it’s good to see you. Please introduce yourself to the audience. 

Satyam Kantamneni [00:01:14] Awesome. Thanks for having me, Greg. It’s a privilege. Yeah. And I run a boutique design firm or UX design firm based out of Pleasanton, California. But we have presence in Colombia and India, so it’s kind of fascinating to have a conversation on this site. 

Greg Alexander [00:01:32] Yeah, very good. So let’s start there, if you wouldn’t mind. Maybe compare and contrast the the labor cost for those that would be employed by a professional services firm in the U.S., in India, in Colombia, since you’re operating in all three geographies. 

Satyam Kantamneni [00:01:50] So I think before I kind of come into contrast those numbers, I would probably break it down into maybe two categories. Okay. I would call it the knowledge worker category versus the back office category. 

Greg Alexander [00:02:01] Got it. 

Satyam Kantamneni [00:02:02] So the knowledge worker category is where we plan, which is people are directly engaging with clients and driving staff and are being paid as experts rated where they are in the globe. So when you look at and both of them have a very different labor structure, both in terms of cost training, grooming, everything else that goes to it. So I can at least share with you very quickly in our context, when we talk about the knowledge workforce, we actually a dollar in India, that means for labor cost translates to a dollar $0.40 and Colombia translates to about $3. In the United States. That means for the same talent, I pay $3 in the U.S., I pay a dollar in India and dollar 40 in Colombia for knowledge for workforce. That number changes significantly When you are looking at back office fare, you know, it’s basically a dollar in India, it’s a dollar in Colombia and it’s about $4 and in the United States. And just because it’s cheaper in India and Colombia, when you look at back office where there’s no direct working with any of the stakeholders. So that’s kind of what I would kind of on a high level to kind of share with you some numbers on that side. 

Greg Alexander [00:03:20] So very interesting. I’m already thrilled that you’re here because I was not distinguishing between the knowledge worker in the back office, and that was a mistake in my behalf. And I understand the distinction and it’s an important one. You know, it strikes me jumps off the page if we use your metrics here, that in the U.S., it’s three bucks for knowledge work and $4 for back office. That seems upside down to me. So if I’m understanding that correctly, the knowledge worker in the U.S. is making less than the back office worker in the U.S.. 

Satyam Kantamneni [00:03:52] To a large level just because the labor cost is much lower in India and in Colombia. Right. So that’s why the ratios are. So again, if it’s it’s $80,000 to get the Senate contract and nine states, you can get that for 20,000 in India. 

Greg Alexander [00:04:08] Okay. 

Satyam Kantamneni [00:04:09] Right. Whereas it’s much more expensive to hire knowledge workers outside the country because remember, the variables that are on language, Colombia is not always bilingual. So you got to pay a premium for that. Again, if they have to kind of be an expert so you pay a premium for knowledge workers when you’re outside, but still it is cheaper. 

Greg Alexander [00:04:30] Yeah, makes sense. Okay. Very good. And it’s nice to hear how it’s dimensionalize. Language is one of the dimensions. Now, from what I understand, the labor market, the talent market for knowledge work offshore is tightened a bit and that these costs are changing in these different geographies. I’d love to hear about that. Maybe how that’s changed over the last, I don’t know, three or five years. And then also, I’d love for you to project out, at least to the best of your knowledge, where you think that’s going. 

Satyam Kantamneni [00:05:00] So the interesting thing that I would say we are starting to notice in the post pandemic, the labor markets are actually rationalizing very fast. And I say that because and I’ll give you an example. In Colombia, for example, people are directly hiring. In Colombia, they are willing to pay a premium for that. And especially with this whole remote working by mindset, people are like, If I was just going to hire somebody who’s going to work, you know? We are in terms of time that I’m gonna be like, um, I don’t, I just cross the border and then hire somebody in Mexico and Colombia. So that just a bit changing a lot and that so when we started the process with Colombia, the ratio between India and Colombia was only one is to 1.2 and it inflation eased because of this, because people are directly willing to care about somebody in Colombia and or in any of the negotiating facilities and bring people in. So that’s changing and I continue to see that happening. It looks like, you know, even in your team you have people and to the country and that’s what’s happening. People in the United States are relocating to other parts and then they are willing to take a little cut, but not too much because they’re still being paid for their impact. So I see five years from now, this will normalize a lot more If you’re looking for finding lottery talent. And that’s another differentiation I would make as lateral talent is going to get be more and more premium, you’ll still see a variance between hiding in the United States with other just because the cost of living is different. But for a good talent, you start not to start normalizing, but for entry level talent, it’s a totally different game store system. And then I think that is where the value is, where if you kind of have a good grooming system, if you have a good way to kind of onboard people, you can continue to keep those margins pretty high. 

Greg Alexander [00:06:55] Yeah, it’s a great lead into my next question. I understand that your firm UCS Reactor has a fantastic way of hiring an entry level developer in them, grooming them over time. So please share that with the audience. How are you doing this? 

Satyam Kantamneni [00:07:09] So I come from a military background. Right. And then and so. And one thing that the military and most professional military still really well, as they groom people, they select people on aptitude and attitude. They drill them well with techniques and then better what they are at the fighting force. They all have the same language and the same structure. The same applies to us. So irrespective whether somebody is in Colombia, somebody is in India, somebody is in the United States, they all have the same vocabulary, the same structure, the same process. There’s no inconsistency between how things are done. So that is the foundational, I would say, structure to make that happen. That means you have to kind of select people on the same variables of aptitude and attitude. You kind of run them for the same variables. You drill them, you coach them in the same aspects. And the best part of this also becomes the camaraderie because everyone’s gone through the same drill and because the back office model has always been structured around the high end work is done by someone else, the low end work is done by someone. So that’s a different mindset and I think that that works well. That’s how most of the offshoring has worked and it has its own, you know, a benefits being. You can run a 24 hour cycle, especially if you’re working at halfway around the world. But I can obviously knowledge working side that is is a big factor that’s continued to kind of allow us to thrive. So when you take and for that to happen, you need to have a good relationship with that in your intake processes like with the universities. But where we are bringing up talent and how do you select them, how do you groom them? So that’s what we’ve been doing really well. And once that system is in the rhythm, the supply side of talent keeps going on. And the good thing is, you know, three years down the line you will have people are three years and then you have four years of learning for years and tenure that the pyramid of people will start and yet that attrition happens. You’ll still treat in a good model of people coming in again, very much like the military. And then everybody is a mentor and everybody’s a mentee and it just continues to be a nurturing system. 

Greg Alexander [00:09:11] Yeah. So let me ask you about the mentor mentee, and I’ll use myself as an example just because the people that are listening to this are members and they can resonate with that. So we we have partnerships with universities, two in particular, Baylor University and TCU here in Texas. We’re based in Dallas and those are schools around us and we’ve partnered with their career development office and we’re bringing young talent in and we’re screening for aptitude and attitude. It’s making me feel good to hear you say these things. And then we’re, you know, we’re growing these people over time. The strain that that does put on the system is that, you know, the quote unquote, senior people now have to, through the apprenticeship model, they’ll have to help groom the young people. And we run into some resistance there, not only inside of our firm, although that’s modest. But when I share this idea with others, the sometimes the founders of these firms say, no way, I don’t want to be running a daycare center. I just want to hire very senior people and not have to deal with all this. I think that’s a mistake. I think a talent supply chain is mission critical to scaling a boutique processor firm. But what would your response be to someone who might share that concern? 

Satyam Kantamneni [00:10:19] It’s getting. If I had. The opportunity to hire everybody who’s lateral, everybody who’s motivated, everybody’s enthusiastic. Absolutely. But as we all know, as people get more tenure, there are different things that can motivate them. And, you know, they they’re happy coaching, but they’re not happy doing. And so when you start looking at doers and there’s a lot of that that’s needed and especially outside of work and people are excited about being a new client and so on and so forth, there is a benefit of having hyper enthusiastic folks. That’s why I read General is not coach and they know holding the gun right there. So there’s also everybody has a role there. Now, to your point, you know, it’s all coming. It comes down to having a system, a system that’s in rhythm. And the system here as it and we run something called a skill based system that means and given that we work in a construct of what we do as a profession, you know, it goes all the way from an entry level, you know, a designer to a chief design officer in a company. So it’s a profession all the way. And so the skills of Chief design officer has a very different set of skills and an entry level has a different set of skills, is we teach skills and teach. And that’s the thing where we don’t need a senior to teach someone how to work. Let’s say, for example, do a competitive analysis. There’s there’s methods there. There is watching videos, there’s artifacts there. So a lot of that is already out there for them to get to 0 to 80. And and again, with people the right attitude and attitude. This is a generation where you can sit on YouTube and learn coding over the weekend and then code something. I mean, if you have the aptitude and attitude, you can do a lot of things. You just enable that. 

Greg Alexander [00:12:01] Yeah, I’ve been blown away by how capable this generation is, I think, and I might be getting this wrong, but I think they’re called Gen Z and they come after the millennials. Millennials who got a bad rap, maybe rightfully so in some cases. But the Gen Z, the the let’s call it the newly minted undergraduate up to maybe, I don’t know, 25, 26, 27 years old. It’s been miraculous of how capable they are. And for the things that you just said, I mean, they grew up, you know, this way, doing things this way, right? Instead of coming to you with every little question, their first thing is to go to YouTube and try to figure it out on their own. So and I share that with members just because I think maybe sometimes our members have a misconception as to what this really is. You’d be surprised at how self-reliant and how capable this group is. All right. Well, I’m sure we could talk about this forever. We try to keep these podcasts short. We will be having four members that are listening to this, a Friday role model session with Santa. Look for that meeting invite. This will give you an opportunity to double click into this and much greater detail and ask direct questions of Satya and he’ll share more and more of his knowledge with you on that. So that’s my call to action for members. Look for that invite. If you’re not a member, I would encourage you to become one and you can do so at collective Fifa.com fill out a form and one of our reps will call you as an inspiration to me. Just heard it’s three or 4 to 1, you know, in some of these countries. So if you’re a boutique processor firm and you’re not tapping into the global talent supply chain, that in and of itself is a reason to consider joining. And if you’re not ready to join, but you want to read more about the types of topics we discussed in addition to this one, I would point you to our book. It’s called The Boutique How to Start Scale and Sell the Professional Services Firm. You can find it on YouTube. Satyam, thank you for coming on the call today. I always enjoy our chats. Glad that they’re happening more frequently and thanks for contributing to our collective body of knowledge today. 

Satyam Kantamneni [00:14:01] Absolutely. Thank you for doing that great stuff and collect it for people. 

Greg Alexander [00:14:05] Okay, very good. Have a good day. 

Episode 133 – From Stuck to Unstuck: How a Founder Transformed a Lifestyle Business – Member Case by Jamey Harvey

Collective 54 member Jamey Harvey has doubled revenue and tripled margins in 18 months. This session shares how he did it by implementing the Boutique Framework, in its entirety, instead of one idea at a time. Hear how this remarkable entrepreneur went for it and won.


Greg Alexander [00:00:10] Welcome to the Pro Serv podcast, a podcast for leaders of thriving boutique professional services firms. For those that are not familiar with us, Collective 54 is the first mastermind community focused entirely on the unique needs of founders of boutique Pro Serv firms. My name is Greg Alexander. I’m going to be your host. And on today’s show, we do something a little different. Normally for regular listeners, listeners, you know this we take a single topic and kind of dive deep on it with the objective of, you know, makes making the most of a short 15 minute show. Today we’re going to combine multiple things and we’re going to have a case study of sorts. And it’s not a case study in the sense of, you know, hey, look how great we are. I’m not a fan of those. It’s a case study in the sense of, hey, members, here’s how to get some of these ideas implemented. I hear sometimes from members that the ideas are getting from Collective 54. Great. But there’s a lot of them, you know, And how do you get them implemented? And we’ve got a great role model in Jamey Harvey. And Jamey has done, in my opinion, the exceptional job of going from idea to implementation in a nanosecond. And he’s learned a lot in the process and has gotten some great results. So that’s what I’m going to do today. So, Jamey, if you wouldn’t mind, please introduce yourself and your firm to the group. 

Jamey Harvey [00:01:35] Yeah, great. I’m Jamey Harvey. I’m the CEO of Agilian. We are a boutique consulting firm. We serve social equity enterprises and we provide digital liberation services. So basically we work with enterprises that are serving social equity populations, vulnerable populations of people that are that need housing, where jobs or health care. And we help those organizations move to 21st century open source cloud based digital platforms. Most of them are stuck on something developed in the seventies or eighties, and it’s very, very complex for them to move because of their regulatory environments. And and it’s our privilege to help them do that. 

Greg Alexander [00:02:24] Okay, very good. So I’m going to kind of tee up some statements as opposed to questions, and I’m to let you run with those to, you know, to really illustrate. And I really want you to focus on this idea of how I idea to implementation. 

Jamey Harvey [00:02:37] Okay. 

Greg Alexander [00:02:37] So the first one is you got everybody billable. And as a result of this, you saw a growth in profits and revenue. So tell us a little bit about how you did that. 

Jamey Harvey [00:02:50] Well, a little background. You know, I would say a year and a half, two years ago before I joined Collective 54, we were sort of a lifestyle business serving state and local governments, and we were kind of trapped in our locality because I used to work for the D.C. government and we were a local DC cover company. And the regulations are such that we’re very advantaged to work in D.C. and not very advantage to go to other states. So we had sort of a digital liberation problem ourself and and I was trying to I was like I was like, okay, this business is nice, is great lifestyle business, you know? And it is we love what we do and we’re really good at it. But like, if I looked at like, how I could grow the business, it was all pretty unappealing, right? Like the, the, the, the paths. I could become a federally grader like this. Well, I go to the States. I’d have to, like, recuperate to do that was it was it was not great for growth. And so I was looking for a way to have a great business and a business that’s built to last have something generational that I could pass on to other people and could make a big difference for a long time. And and like 54 reached out to me and was like, Hey, we have this with this mastermind group. This is what we do. And you couldn’t have picked a better time for that because I was I was trying to figure out how to transform this whole business to be something special. Right? And we were going we tend to win projects. I would say we kind of box above our weight class and we had won a lot of quite large projects for a company our size. And and I have sort of a machine here that, that where I can do those projects. And I was trying to figure out how to grow enough to do these big projects. At the same time I was doing the projects. So I had invested a lot in infrastructure like infrastructure in people like Ausiello and CIO, and I brought in a professional services automation system, a PSA based on your guys recommendation. And we had made all of this investment and we we had a really good year. We doubled in size, you know, last year. And but our profitability went way down, like with, like, like we had a we had doubled in size and we made the same amount of money. So our profitability was cut in half. Right. And and it was a little you know, I knew we were investing. It wasn’t that big a shock, but it was a little startling. So. Something that I had done that I didn’t know was so useful was I had hired these kind of multi potentia people that had really great skill sets that other than what I was having them do. So like my VP of program management is built, you know, three giant government data warehouses and he’s a real expert in that. And my field is used to be the past president of the D.C. Bar and my Chief medical informatics officer ran interoperability for all the hours in the mid-Atlantic region. So I basically went to them. And those were people who are mainly not billable, who are sort of central people. And I was like, Look, you’d be great consultants, you know, like our customers would love you, you know? I know I didn’t hire you for this, but are you willing to get billable? And to a person, they were all like, Of course. Oh, my gosh, we’ll do it. Do anything. Right. And so we we really, like, took oh, and then I had another person who was like, less senior who wanted to learn to be a project manager, like she wanted to get her PMP, like she was sort of interested in the consulting path. So we re-engineered everybody’s jobs and we got everybody on the senior team, with the exception of one person, at least half billable, and some people, you know, like 70 or 80% billable and with the hope that that would be kind of the best of both worlds and also give us some flex as we as we take on these large projects, we could get the billable. And then, you know, if we’re doing the next lengthy, we have the feast and famine thing going on for right. So now everybody can flex to being billable when they when, when, when there’s billable to be had. Right. And they can go back to their other jobs in between to go build the business. 

Greg Alexander [00:07:16] Otherwise, yeah, it’s a great story because sometimes that’s a mistake that members make is, you know, they invest in the future, which we advocate for, and then all of a sudden they’re like, Wait a minute, revenue looks great, but margin doesn’t. It’s because they got all this non-bailable stuff. So the lesson there for the members is to get everybody know. 

Jamey Harvey [00:07:33] And we made that mistake, right? And so this was the correction of it. Really? Yeah. 

Greg Alexander [00:07:36] Yeah. Okay, great. All right. The next thing I want to talk to you about is the seller doer model and how you moved to that. 

Jamey Harvey [00:07:45] So you at one point in one of your podcasts were like, you know, don’t just go out there and hire a salesperson. You can hire the best salesperson in the world, and if you’re not ready to do it and you don’t have your positioning right and you haven’t, you know, that’s not going to work, right? Like you’re going to just bring that person over and they’re going to been successful someplace else and they’re going to fail at your company. So I did that. You know, I, I brought in an incredible executive from Oracle and like we and he was great and he fit the like he worked really hard, but we had no presence in the market, right? Like we had no story about who we were. We had no differentiation. And so, you know, eventually we you know, we had this very sad conversation of like, you know, we love you, we think you’re great. And like, we weren’t ready for you. Right. And parted friends, you know, And but but basically the conclusion I came to and then then I, I had done all the selling before, and then I went back to doing all the selling again. But the conclusion I came to was for the kind of complex, you know, big. Digital liberation kind of engagements that we’re selling. It’s very hard for somebody to sell that that hasn’t done it right. Like if you’re in front of customers and you don’t know the regulations around the cards for interoperability, when you’re talking to people who are doing that, they smell that right away. Right. Like, they don’t really want to talk to any salespeople. Right. So all of this sort of multi potential people that I was talking about before got I hope that’s a word as I’m saying it on a podcast, but it is now. Okay. Now, right now what we do is, you know, they they all went to their rolodexes. We, they all. Went through the Rolodex, sorted through, found all the social equity enterprises where they’ve got relationships and and I’ve been coaching them in a in a consultative sales model. So they’re selling doing right And when we get leads, if they’re in the medical area, they go to Ross Is that the medical person? If they’re the legal area, they go to Anna maria, who’s my you know, so we actually have these we’ve we’ve organized by vertical and people. Yeah, right. And so what’s great about that is I actually you know and they just bring me in to close the sale sometime or make the introduction like I’m I don’t have to be that involved because when, when those customers are talking they really want to talk to those people. Yeah right. I’m, I’m the generalist compared to those folks. Right. So I’m the generalist and they’re specialist and, and they can close the deal by themselves. Yeah. 

Greg Alexander [00:10:27] Just another great example because you know, I’ll hear from members, hey my delivery people and I hate that label but that’s term this use they don’t want to sell you know I can’t get them to contribute to the growth of the company. And the answer is you can’t. I mean, this is how this is how Jamie just did it and everybody was responsible for finding opportunity. And then the selling environment, as you just heard from from Jamie, was it was a collaborative one. He was involved when needed, but not at all when not needed. And that’s how you do it. And that’s called the seller door model. So if you’ve tried investing in the high powered, you know, senior exec sales person and it hasn’t worked, this is the alternative to that and give it a try. And it’s just a proof point that it can work in the right situation. And it’s more of a mentality and a cultural thing than anything else. Just like another great example of going from idea to implementation. I mean, next question, Jamie, is talk a little bit about you personally and how your day to day life has changed as you’ve taken some of these ideas that you’ve come across and implemented them in your firm. 

Jamey Harvey [00:11:29] So, you know, I don’t know if you remember this, Greg, but when I first joined, you know, I’m a I was really hungry for this framework. Let me let me start by saying that I read the book once. I read the book twice and I took notes, second rate I went through and I ended up with like, here are the 86 things that I must be valuable. And I scheduled a session with you. And I was like, okay, what do I do first? Right? Like, I can’t possibly do this all. And you were like, They’re in order. Like what? They’re like, Yeah, start with chapter one. Do those first and then do chapter two. Right. So, so about nine months ago, we spent a lot of time on chapter one and chapter two, which are getting your target market specific. So, you know, the big thing is like we’ve and we are a very socially conscious firm, like one of our core values of social equity, right? Another one of our another one of our core values is mutual liberation, like we are we are unabashedly do gooders, right? And and my people come to work for me like they’re there because they want to help, you know, poor, disabled children. Right. Like, which is what we do right, with, you know, with one of our. Showcase clients. Right. So. So we stopped saying to people, Hey, we do state and local government work. We started to say to people, Hey, we work with social equity enterprises, you know, and if you’re in a regulated environment, we understand that better than you do, right? For for the funding streams that you got to align and we can help you fund your big projects. And that message is so specific, right, to like a particular audience of people that those people are beginning to find us. So. So that is a totally different world to live in. Right. And and it feels great for everybody because now our inward expression of who we are, which are these, you know, unabashed do gooders, is aligned with our external representation of like, hey, this is what we do for a living, right? And so there’s this pole that, you know, where you’re you’re paddling the canoe in the river, the direction the river is going. So like, that is like a very, very big, you know, game changing transformation we’ve gone through as a result of being neglected. 54. 

Greg Alexander [00:13:46] Now, I want to follow up question on your day to day. Sometimes I hear from members, hey, these are all great ideas, but I don’t have any time to do them. I’m just too busy. I can’t get to them. And I remember our early conversations, and you were pretty busy guy, but you figured out how to of got to get to these items and and you’ve made all these changes in the firm has thrived as a result. I mean literally like how did you create the time to spend the necessary time on these items because these aren’t small items. 

Jamey Harvey [00:14:11] Well, I, I hired very great, very senior talent. So I didn’t really like like on that there was a there was an investment. Right. For sure. And and I am a talent magnet, thank goodness. Right. And the way that we’ve constructed the company has created a multiplying effect for that. We’re like people who want to do what we do are finding us now. Right. Like across the country, which is, you know, amazing. An amazing privilege to write. So it’s you know, I did most of my changes before. You did the Founder Bottleneck book. Yeah. But like, by the time I read The Founder Bottleneck and I did that diagnostic, I was no longer I had replaced myself 80%. 

Greg Alexander [00:14:58] Yeah. 

Jamey Harvey [00:14:59] Already. Right. And the last and I knew the last remaining one was the sales, which is what we’re doing with the seller do or model. So a large it’s it’s it’s I didn’t. And I got a lot of work to do. Like, I can go into that, which is probably a different topic, but like on some level, like the big boulders had sort of had sort of been handled. And I, I have really been able to to focus on strategy coaching, developing high potential people. 

Greg Alexander [00:15:31] Yep. Because. Because you remove yourself as the bottleneck. You hired a great team and that freed you up to do all these things. And, you know, in in Jamie’s example, I mean, he had a great lifestyle business and he have continue on that, but he wanted more and therefore he had to make the investment and he made the investment behind the right people, gave him back the time and boom, here we are. Right? So that’s the decision that we all have to make. Do we really want to be more than a lifestyle business? If so, are we willing to make the right investment to free ourselves up? 

Jamey Harvey [00:15:58] The other big change, of course, is our gross. Our gross margins went from 17% to 35%, and our our net margins went from like 8% to 25%. So which I think is what got your attention about this story. 

Greg Alexander [00:16:12] Yeah, I mean, it jumped off the table at me because because I know the investments you made also because I mean, you could say, like, how is that even possible? You made all these investments which would depress margins if you made all these investments and the opposite happened, you know, the margins and tripled. So help the audience understand that. 

Jamey Harvey [00:16:32] Well, partially it’s phasing like the investments actually depress the margin one year. And then and then they sprung back. They sprung back and then we saw the return. Right. So our business is you know, I talked to a lot of other members of like the 54 hour businesses lumpia are deals are are big are bigger than most of the deals and they’re collective and they last longer. Right. So that stuff develops more slowly for me. My sales cycles are longer right. Like so we’re we’re doing a lot of stuff that doesn’t show up the year that we do it right. It very often if we’re we’re seeing the results the next year. And part of, you know, but, you know, on some level, like what are the changes we made? We got the people, we got people billable. That’s going to make you more profitable. Yeah, we we got rid of salespeople and we had that consultants do that. That’s going to make us more profitable. We we raised our price. It’s like I don’t we skip over that. Like because of our positioning, we were able to demand a premium and, and, you know, compared to the other alternatives market that do what we do, we’re much like we’re so much less expensive than than the biggest. Right. Who are the people that are able to do what we do so. So all of that. You know, we now know that when we’re humming, like those are the normal margins that we ought to make. And we know we’ve got weaknesses because of the lumpiness, partially because, like last quarter, our main client, which is the D.C. government contracted and a bunch of contracts went away. Right. And on and we felt that very badly. But because we were running a healthier business, we were better able to test results like that. 

Greg Alexander [00:18:19] Yeah, exactly. 

Jamey Harvey [00:18:21] Yeah. 

Greg Alexander [00:18:21] All right. Well, listen, you are the quintessential role model for the boutique framework. And it was great to have this kind of macro conversation to see how multiple things combined together produce the end result. So I want to make sure I leave a call to action for the members. When you get the meeting, invite link for the private Q&A session will have with Jamie. Please accept it and attend and you can really dive in and ask a direct questions of him as to how he pulled this this miraculous story off. There’s a lot more to it than we can cover in a short podcast, so please attend. If you’re not a member, you should consider being one. Go to collect 50 for Whatcom, fill out the contact us form and somebody will get in contact with you. And if you haven’t yet had a chance to read the books and Jamie referenced the boutique kind of start scale and sell the pro firm. And then for members, if you want to eliminate the time constraints on yourself, check out the founder bottleneck. But with that, Jamie, I want to thank you for the contribution you made. You know, we’re trying to make deposits in the collective body of knowledge and you’re constantly doing that. So on behalf and all the members, thank you so much for being part of our community. 

Jamey Harvey [00:19:31] Thank you. It’s it’s really a privilege. Thank you. 

Greg Alexander [00:19:33] Great. Okay. With that, I wish everybody the best of luck as they try to grow, scale and exit their firms And until the next episode, go get them.

Episode 132 – How Psychometric Talent Assessments Should be Used by Boutique Professional Service Firms – Member Case by Ted Jackson and Dr. Julie Carswell

Pro serv firms are people driven businesses, therefore, getting the people decisions right is mission critical. As a result, many members are using assessment tools, or have in the past. However, the results have been mixed. In this session, learn from a PhD in organizational psychology how to improve the results you are getting from assessment tools.


Greg Alexander [00:00:10] Dive all in on the next chapter of your life. Welcome to the Pro Podcast, a podcast for leaders of thriving boutique professional services firms. For those that are not familiar with us, Collective 54 is the first mastermind community focused on the unique needs of boutique processor firms. My name’s Greg Alexander. I’m the founder of Collective 54, and My World Today will be your host. On in this episode, we’re going to talk about assessments. Now, why are we going to discuss assessments? Well, in professional services, it’s obvious that there are people driven businesses and therefore getting the people decisions correct is pretty important. And as a result of that, many of our members are using assessment tools or they have in the past or they’re considering them in the future. However, the results have been mixed. So my hope today is that we can help our members improve the results to getting from their assessment tools and help me with that. We have the leaders from Sigma Assessment Systems members, Ted Jackson and Dr. Julie Carswell, and they’re experts in this area and they’re going to share the wisdom with us. So as they say here in the great state of Texas, welcome. And how are you all doing today? 

Ted Jackson [00:01:36] Thanks, Greg. Doing okay? All right. 

Greg Alexander [00:01:39] Very good. Would you please. 

Dr Julie Carswell [00:01:41] Nice to be here.

Greg Alexander [00:01:42] Provide it. Provide an introduction for the. For the audience. 

Ted Jackson [00:01:47] Yeah, sure. Before I do, I just want to say I’m really inspired with what you guys have created here. 254 I’ve benefited from the podcast from the Office Hours, the expert instructions, and you guys have saved me a ton of time and money, so keep up the good work. 

Greg Alexander [00:02:02] Oh, thanks for saying that. I appreciate it. 

Ted Jackson [00:02:05] Yeah. My pleasure. My name’s Ted Jackson. I’ve been the CEO of Sigma Assessment Systems for, gosh, about 20 years now. I started off as a freelance software developer, mostly working on computerizing performance appraisal systems and then was hired by Sigma to do the same, eventually got involved with sales and business development at Sigma, was promoted to president and eventually took over ownership. And here we are one than 20 years later. 

Greg Alexander [00:02:39] And Doctor, how about yourself? 

Dr Julie Carswell [00:02:43] Yeah. I’m sorry. I’m an industrial organizational psychologist by training, which is an area of psychology that is focused on the science of human behavior in the workplace. We help organizations with selecting, developing and retaining talent, and I have specific expertise in the area of developing assessments to support organizations with those types of activities. I’ve worked with Sigma for almost as long as Ted has been the CEO of Sigma and helping to develop and optimize our assessment solutions and also using assessments as a foundation to support our other services like executive coaching and succession.

Greg Alexander [00:03:29] All right, Well, very good. Well, thank you again for being here. Let me jump into the questions. So some of our members are young growth firms and they may not even know what assessments are. So if you would humor me for a moment and just maybe give us a definition of what an assessment is. 

Dr Julie Carswell [00:03:47] Happy to. So in the context of our business assessments, refer to evaluative tools that we use to support organizations with those hiring and development decisions. These tools can take the form of either tests or assessments. And in our industry, we distinguish between those things. Tests have right and wrong answers, like measures of IQ or cognitive ability, for example, whereas assessments inquire more about preferences and people’s kind of natural tendencies. So measures of personality and career interests would be examples of assessments. 

Greg Alexander [00:04:29] Very interesting. I didn’t understand there was a difference between tests and assessments, so I’m already learning something today. All right. So. So why do leaders use assessments? 

Dr Julie Carswell [00:04:41] Yeah. So when I think about that question, I frame it up as why do organizations want to use assessments, which I think is a similar question. As I mentioned previously, organizations primarily use assessments to support hiring or promotion decisions and talent development. The use of assessments also has several applications and advantages for organizations. So there’s the efficiency factor. For instance, they can enhance the efficiency of the hiring process, particularly when dealing with positions that have large volumes of applicants. Right? So organizations with large applicant pools don’t have the resources to interview every candidate. So this can be a really helpful tool at the front end of the process. 

Greg Alexander [00:05:32] Okay. You know, our members are probably not in that category. Yes, they are quite a few people, but it’s not a large volume type situation. So in that context, like let’s say you’re, I don’t know, a 40 person consulting firm, and through growth or attrition, you might hire 8 to 10 people a year. Yeah, I would I would have to like this be leveraged in a situation like that. 

Dr Julie Carswell [00:05:56] Yeah. Okay. So in addition to that efficiency factor, which may not be as applicable for your audience, assessments can also enhance fairness in the hiring process by adding objective metrics and helping to minimize the role of, you know, those built in cognitive biases that can influence hiring decisions. Right? For instance, we tend to more positively evaluate others who are similar to us, right, in terms of gender, age or background. That’s known as the similar similarity attraction, bias. I like that. So again, yeah, similarity, attraction, bias. And there’s a number of other biases too. But again, the use of assessments to inform hiring decisions can help to minimize the impact of those biases on our decisions. 

Greg Alexander [00:06:46] Yeah, I mean, it’s a great answer. I’ve seen several of our members make that mistake. We tend to like we tend to hire in our own image because we’re projecting ourselves on them. That’s interesting. And and tools like this. Guard against that, how? 

Dr Julie Carswell [00:07:04] Yeah, but as I as I was saying. So these tools have been developed to more bring more objectivity to the assessment process. Right. So when we’re looking at developing assessments, we’re very focused on making sure that the assessment, whether it be a personality or a cognitive assessment, is accurately measuring what it’s intended to measure. Right. And doing so in a consistent manner. Okay. So making sure that you have what we call a really psychometric, rigorous assessment that’s both valid and reliable means that, you know, those scores are accurate indicators of. The underlying constructor concept you’re trying to measure in. In our case, that’s often job performance, right? So just having these more objective metrics to help support decisions rather than, Oh, I really like that person. Yeah, you know, I have good gut feel about them. So yeah, I’m going to. 

Greg Alexander [00:08:03] Yeah, I mean that. But that. 

Ted Jackson [00:08:05] Strong handshake. Yeah, right. 

Greg Alexander [00:08:07] Like a nine handicap, right. I mean that, that bias alone. That’s right. Yeah. Yeah. All right. So there’s a lot of them in the market and our members have been experimenting with a ton of them, and I have a hunch, and I can’t back this up, but I have a hunch that maybe they don’t know the differences between them or which one to pick or should they build their own. So can you help our members think through that a bit? 

Dr Julie Carswell [00:08:32] Yeah, I would say don’t build your own. You can start there. Okay. Not only because that would obviate the need for my job, but because it’s not a good idea from a, you know, an accuracy and rigor perspective. So let me just talk about context first. So different assessments are designed for different purposes. So you need to make sure that the tool you’re using is aligned with the purpose for what you’re using it. Okay. For example, an assessment intended to help with coaching and development or support were designed to support more self awareness or personal insight might not be suitable for making selection decisions. And this is great on this website. So I’m I’m comfortable saying this, but many of your listeners might be familiar with the risk assessment, and that could be helpful in terms of better understanding different styles of communication or behavior within a team. But it has not been specifically designed and developed to help inform hiring decisions. So if you’re not using a tool that’s been developed for that purpose and it’s not an effective predictor of job performance, hasn’t been validated for that purpose, that can expose you to litigation risk. And we don’t want that. Okay. 

Greg Alexander [00:09:57] So you start with what’s the purpose of the tool? And then there’s certain tools that are designed for certain purposes. 

Dr Julie Carswell [00:10:04] Right? Yeah. 

Ted Jackson [00:10:06] I would I would even maybe take it a step backwards and consider what is important for the individual, what is important for the war, How does one need to perform in order to excel in the role? And what traits, knowledge, skills and abilities are important? And then go backwards from there and choose the assessment battery based on that. 

Dr Julie Carswell [00:10:28] Steve Austin Yeah, I agree. I mean, I think if you’re, you know, looking at various tools in the market, you know, that makes, that makes perfect sense to better understand, you know, what are the critical competencies required for effectiveness in this position or what are the critical knowledge, skills, abilities and other aspects of a of individuals like personality are related to success in their role, and then use that as your lens through which you’re making your assessment purchases and decisions. 

Greg Alexander [00:11:08] Okay. And then I guess my last question would be let’s make the leap that we understand the purpose of the tool. We understand the mission critical traits and attributes of the person that would thrive in that position, who in the organization should be using them? 

Dr Julie Carswell [00:11:29] Yeah. And that’s an important question. So some assessments require certain levels of training, experience or or education before they can be purchased and administered. Those are what we refer to as qualifications in our industry just to ensure that the assessment is being used and interpreted appropriately. Right. So be sure to check the qualification levels for various tests and assessments. You know, as you’re looking through offerings from various publishers or solutions for various from various publishers and just making sure that you have an appropriate, appropriately qualified user or someone who can undertake the training that’s required to properly interpret the assessment results. 

Greg Alexander [00:12:21] Yeah, and that is really important. I our membership consists of entrepreneurs and they kind of have a ready fire aim approach. And it’s one thing to use an assessment, spend the money on it, It’s quite another thing to use it correctly and make sure that you’re trained on how to interpret their results. I think that’s great advice. All right. Well, this is all the time we have today. But I want to remind the members that are listening that we will have a private Q&A session with Ted and Dr. Julie. Look for that meeting, invite that comes up and we’ll go into much more depth than we were able to cover in a short podcast, and you’ll be able to ask your questions directly to them. So take a look at that. And then if you’re not a member, but you find this interesting and other topics like this are intriguing to you, consider joining. You can find us at Collective 54 icon fill out the contact us form and someone will get in contact with you. And then lastly, check out our book, The Boutique How to Start Scale and Sell a professional services firm. You can find it on Amazon. But Ted and Julie, I want to thank you on behalf of all of all of the members for contributing today. This is a hot topic and we look forward to your Q&A session. So thanks for being here today. 

Dr Julie Carswell [00:13:39] My pleasure. 

Ted Jackson [00:13:39] Thanks again. Good seeing you. 

Greg Alexander [00:13:41] Okay. Take care, everybody.

Episode 131 – Why a Merger of Equals Might Be Your Best Exit Strategy – Member Case by Jonathan Wilson

Some members want to exit, but they cannot. The reasons are many. For example, insufficient EBITDA, high client concentration, over-dependence on a founder, and many others. The journey to fix these issues is clear but can take many years and millions of dollars. And for some, this is unattractive. An alternative is a merger of equals. Attend this session and learn from the discussion with Collective 54 member Jonathan Wilson, President & Chief Value Creator at Dubb Value Creation, on how a merger of equals can convert an unsellable boutique into an attractive firm for many acquirers.


Greg Alexander [00:00:10] Dive all in on the next chapter of your life. Welcome to the Preserve podcast, a podcast for leaders of thriving boutique professional services firms. If you’re not familiar with us, Collective 54 is the first mastermind community dedicated on the niche that we define as boutique producer firms and founders of those firms who tend to have very unique needs. My name is Greg Alexander. I’m the founder and I’m going to be your host. And we’ve got an interesting topic today. Today, we’re going to talk about how a merger of equals is a potential path to exit. Now, let me shape this a little bit before we introduce our role model this week. So let’s suggest that maybe two firms operating independent of each other are led by founders who want to sell their firms, and they’ve tried to sell their firms and have been unable to do so. And there’s a whole variety of reasons for that. For example, maybe the EBITDA dollar amount isn’t large enough, or maybe there is a high client concentration risk or several other reasons which we’ll get into. But if you brought those two firms together, so instead of being two separate firms, they became one firm. These problems go away. For example, all of a sudden the EBIDTA number is big enough. All of a sudden client concentration issue goes away because when you bring the two firms client rosters together, now presto, you have client diversification and on and on we go. So that’s what we’re going to kick around today. It’s something that I think represents a big opportunity for our community, and it’s also something that I don’t think has been explored enough. So to help me explore it, we have the man, the myth, the legend. Jonathan Wilson, he’s the founder of Double Value Creation. Got a chance to get to know him. And let me tell you how best to think about Jonathan. He a unique combination of the CEO whisperer and someone who has great knowledge on M&A transactions because of his journey in his career. So with that, Jonathan, why don’t you please introduce yourself to the audience and maybe tell the team a little bit about your firm. 

Jonathan Wilson [00:02:42] Thank you for saying that. Thank you for the great introduction, Greg. We are focused. So just you know, this Jonathan Wilson here, CEO of Discovery Creation, also chief value creator. We are focused on two elements of our of professional services. One is mergers and acquisitions, and the other is strategy and analytics. When it comes to M&A, otherwise known as merger and all our mergers, acquisitions, sorry. When it comes to M&A, we are focused on three things one being a bull by side services so that anything from M&A strategy to M&A, target assessment to due diligence and then also to integration planning or the first 90 days of integration. We are also focused on full scale side services. So meaning that a company that wants to engage with a full whole transaction, we will engage with them. And then also we are focused on this program called Grow before you sell, and that is where we put together a strategy for you to grow your EBITDA over the course of a 2 to 3 year period. What that may look like, that could be a capital injection, be an investor, that that could be a merger of equals, as you mentioned, but also may be buying small, small acquisitions so that you can accelerate your growth. But that really we focus on from a merger and acquisition perspective. 

Greg Alexander [00:04:22] Okay, great. 

Jonathan Wilson [00:04:23] A strategy. From a strategy perspective, we focus on three things simply planning, execution and strategic governance. 

Greg Alexander [00:04:33] Okay. So maybe just briefly explain to the audience all the stops you’ve had along the way with some of the world’s top professional services firms. 

Jonathan Wilson [00:04:44] Yeah. Thank you for asking that. So background includes Accenture, Bank of America, Deloitte and Grant Thornton. Yeah, my first exposure really was with Countrywide Financial, which became America. 

Greg Alexander [00:04:59] Okay, got it. I wanted to get that out there because, I mean, your resume is unbelievable. So you’re very credible on this topic. All right. Thank you. So let’s dive into it. Right. So I’m going to tee up a few things for you. So let’s say I’m Joe Blow and I’m running X, Y, Z firm, and I’ve been doing it for 20 years and I want to sell. I’ve been trying to sell it. I can’t sell it or I’ve been getting these lowball offers with ridiculous terms. And the first thing they hit me with is you got subscale EBIDTA subscale, limited as defined as EBIDTA less than $3 million. It’s tough to sell a firm when you’re subscale ebidta because it’s just riskier for the potential acquirer. And now I find myself presented an opportunity potentially of a firm who looks just like me. But maybe is another region. Like maybe I’m in Minnesota and this firm is in Philadelphia as an example. And in theory we can slam these two firms together and next thing you know, I go from a non sellable asset because a subscale bidder to an asset that everyone’s going to want because my EBIDTA dollars are big enough. So is that real in your minds and what are some of the maybe the obstacles associated with that that are not obvious? Because on paper duh, that looks like we can go do that, but it can’t be that easy. So help us think through that. 

Jonathan Wilson [00:06:14] It’s actually not easy in a merger of equals. You know, that’s an interesting term in itself. It really does show that you’re willing to collaborate with another organization and together that you’re willing to build something that’s going to be more powerful than either one of you can achieve alone. So, you know, with that said, you want to focus on some of the benefits around doing that, and especially for a company that is in that situation currently today, founders do get tired. I respect that. And you’re ready to move on at certain points. Right. And there’s a few things you want to focus on, one being the synergies, Right. So what can you do together to increase your revenue And then what can you do together to minimize costs? So some of that might be accessing the new are accessing the new market if somebody already has a complementary, complementary service offering and they are in markets that you are not, that seems like a no brainer. Right? And in addition to that, you want to think about that might help. Also with the increased market share. It might also help out with with with kind of a risk diversification, if you will. Keep in mind that if you’re concentrated all in one part of the country, there is a little bit of a risk that to write something happens from now. We have we do have something called micro economic challenges, right? So there are challenges that North East might have at a certain point. There are challenges that the Southwest might have a certain point. So you want to make sure that you are diverse spread across the US. Yeah. The other piece also taking a look at expanded your expanded skills and knowledge base, right? So it’s a nice complementary skills and maybe some people you have to worry about acquiring but you can actually leverage from the complementary firm. Yeah. And those are some of the, those are some of the great things that you could get together. 

Greg Alexander [00:08:07] Very good. So let me I want to follow up question here, because you mentioned the word risk, and I want to talk about something that often sinks boutiques when they try to sell. And it’s the nature of the business. It’s not anyone’s fault. It’s just the way that these things evolve. We tend to have high client and revenue concentration, and that’s defined by if the top five clients are generating more than, let’s say, 30 or 40% of your revenue and profits, then the way that investor looks at that is your risk is risky because of the client and revenue concentration, meaning one or two clients goes away and the whole PNL falls apart. Now the great thing about a merger of equals here would be if you have that problem and you merge with another firm that also has that problem, but they’re not the same clients, then it goes away. But when I present that to people, Jonathan, what I hear is, well, I own 100% of my firm right now and if I merge with someone, I’m going own 50% of my firm. So I don’t want to do that. That’s dilutive. What would your response be to somebody who would share that with you? 

Jonathan Wilson [00:09:05] That’s crazy. That would be my initial response. But, you know, when you when you really think about it, everybody understands the idea of giving out some earnings and some element of control. There’s a reason why people became founders to begin with, right? However, if your ultimate goal is to be sold, you have to think about what you have to give up. Right. And yes, you’re giving out some of that share, but you’re also working together as somebody who has a shared mindset and shared goal. They probably have a background similar to yours. Any other thinking founder for the same reason. The other pieces too, is that their clients actually might be clients, but you might want to also work with. Yeah. So you guys can double down together and and really grow that client and make them happy in a larger way. And also you can actually increase not only your increase in customer satisfaction, but then that one plus one equals three is a real scenario for the company. Yeah. 

Greg Alexander [00:10:05] Yeah. I mean, the well said much better than the way I would have said it. What I say to those people tends to be a little too blunt, which is, Listen, 100% is zero zero. So right now you have a non sellable asset, so you’ve got nowhere to go. So 50% of something is much better in that scenario. So let’s consider it. Now, there’s cultural issues here. Right. You know, you’re all of a sudden you’re this fiercely independent founder. You 100% of your firm and what you say goes. And now you got partners. So in your experience, when all the years you’ve done this with big companies and now your own firm, you know, how how should two strong willed, independent founders think about working together and how might you help them consider that as an alternative? 

Jonathan Wilson [00:10:51] You know, that’s so key. And that is not outside of a merger of equals. That’s really with every single M&A transaction. When you think about culture that’s behind everything that is going to be coming out of a merger of any kind. Right. Because the people are what helps you gain your revenue. They’re also the people that can sink your ship. So those are things you think about from a cold perspective. You want to lead with having them as part of the diligence process. So you want to think about what exactly what are similarities of the cultures, how do you operate, what kind of systems you use, what kind of processes you use? Is it is it a culture of meetings, a culture, ad hoc conversations that matters? You know, there are there are there series is a credit culture that also matters to you. Is one willing to take out more loans than the other? That that also is a big that can also sink our ship senior seat or help partnerships as well. But you want to go through any. You want to go through it like any other judge over the process and think about culture as a unique workstream and combine that with your H.R. element and your communication plan, Strong communication plan. Yeah. 

Greg Alexander [00:12:11] That’s why I would suggest to members who might want to consider this idea, to pick up the phone and call Jonathan and consider having him be your facilitator here. And the reason for that is that, you know, sometimes you need a facilitator and just the presence of an independent third party who can facilitate these conversations makes it easier to do. And that’s why this unique blend of the CEO whisperer through the lens of M&A transactions would be really helpful. And Jonathan is adhering to his code of conduct. And thank you for that. It is. And why make this a sales pitch? But I want to put that out there on his behalf. That’s why somebody like him, you know, a consultant that specializes in M&A transactions, is particularly useful in the use case of a merger of equals. One more thing I want to discuss with you, and we’ll talk at much greater length on this when we have the Friday role model session and we have an hour as opposed to 15 minutes is is I have a situation with some members who want to sell. They go through diligence, which you just brought up, which made me think about this part of diligence as the management meetings and potential acquirer says, You’re a brilliant founder, but you have no depth beyond you. And it’s too risky because if I buy your firm and something happens to you, the firm goes poof overnight. So can a merger of equals solve that problem? That problem defined as founder risk? 

Jonathan Wilson [00:13:38] Well, that’s a good question because, you know, I hate to do it in the answer. 

Greg Alexander [00:13:43] But it does. 

Jonathan Wilson [00:13:45] But it really does. The idea is that sometimes things revolve around a founder, and it wasn’t in that way. Does it mean that there wasn’t open to other ways of working? It just became that that fair number two left at the wrong time or something else happened. So that doesn’t necessarily have to be a big game changer or showstopper, but you do have to make sure that founders open to other ways of thinking, because if if they’re not, then that’s going to be a hard case for managing others, in which case, you know, if you become a larger part of a larger organization, it’s going to be somebody rejecting his way of working. Right. 

Greg Alexander [00:14:26] Yeah, exactly. Exactly. And one of the items that would be discussed during the diligence phase of a merger of equals would be the chart. And you’d say, okay, here’s my org chart and here’s your org chart. We put these things on top of each other. Yes, there are redundancies and there’s also holes. So so for example, maybe, maybe I’ve got a great firm and what I’m really great at as my donor, my domain and I have outstanding client delivery, but I’m weak on sales. Well, then I would want to merge with with a firm who their strength is sales, because that’s what I’m getting in the transaction and maybe their weaknesses client delivery. So in that scenario, one plus one equals three because there’s complementary skills. So you’re looking for how you lay these two orchards together and the organization, the team gets strengthened as a result of that. Now that does two things for you. One, it makes you a lot more attractive to potential acquirer, which is what we’re talking about today. But number two, in the event that you can’t transact after the merger, things happen, economic cycles, etc., the firm’s going to be a lot better off because you’re going to have a stronger team and you might be able to scale to to new heights. So with that, we’re at our our time window here, but I want to point the audience in a couple of directions. So first, if you’re a member and you’re listening, please watch out for the invite that you’ll get from us to attend Jonathan’s role model session. That’s a private Q&A, and you’ll have an opportunity to double click on this idea. And most importantly, ask Jonathan direct questions about, you know, how you might consider this and your firm if you’re not a member and you might think you want to be to learn about things like this and others go to collective 54 Ecom can fill out a form and one of our reps will get in contact with you. And if you just want to further educate yourself on growing, scaling and exiting a firm which would include this topic, but others. I’m going to point you to two books. One’s called The Boutique How to Start Scale and Sell a Professional services Firm, and that’s for everybody, members and nonmembers. If you are a member, there’s a book that’s only available to you. It’s called The Founder Bottleneck How to Scale Yourself and a Merger of Equals is one way to do that. I would encourage you to dive back into that book and really devour its concepts and principles. But listen, the way this works is we’re a collective. The name was chosen for a reason, and that requires members like Jonathan to make deposits in the Knowledge bank, because if we all do that, we all get smarter and that is that knowledge base grows. You’re able to also make withdrawals of that knowledge. So, Jonathan, on behalf of the community, you’re a fantastic member. We’re so lucky to have you. And thanks for sharing your wisdom with us today. 

Jonathan Wilson [00:17:17] You Greg, It’s fantastic to be part of your organization, so I really appreciate you. 

Greg Alexander [00:17:22] Okay, Very good. All right. Well, with that, I wish everybody the best of luck as they try to grow, scale and exit their firms. And until next time, we’ll talk to you then and go get them. 

Jonathan Wilson [00:17:35] Thank you for having me.