In 2010, Clayton Christensen, renowned professor at Harvard Business School and author of The Innovator’s Dilemma introduced a concept that every founder must eventually confront: the choice between being Rich or being King.
My dad founded Corporate Insight in 1992 as a solo marketing research practitioner. He was content in that role—until 1997, when he hit on an idea to productize research. That’s when I joined him, and within three months, we launched our new service and made our first non-family hire. At the time, we thought we’d stay a small, five-person operation. But the market had other ideas, and as demand grew, so did our team.
Launching a rocket to the Moon and scaling a professional services firm to the top of its industry share similarities – both endeavors require immense effort, strategic planning, and overcoming significant challenges like gravity, drag, and heat generation. Traveling to the Moon parallels the stages of scaling a firm to the top:
Professional services firms face constant pressure to be creative and rise above the clutter. For executives, particularly CEOs and COOs, one of the most effective ways to break through is by leveraging the power of strategic partnerships. By forming alliances with complementary companies and key industry players, professional services leaders can expand service offerings, enter new markets, unlock new revenue streams, and maximize their return on investment (ROI).
As entrepreneurs in the professional service firm arena, we often embark on a journey with dreams of scaling our businesses, achieving success, and ultimately reaching the coveted exit. However, the reality is that many founders falter along the way, lacking the endurance required to go the distance. In a world where millions of firms are started each year, only a select few make it to a successful exit. Why? Because the path is long, challenging, and demands unwavering mental toughness.
Scaling a services firm takes more than hiring salespeople and boosting your marketing budget. This is a common, major, and costly oversight. The cost of this mistake is typically $450k to $3 million in direct costs and lost sales. At Collective 54, we call these avoidable things that are simply down to a lack of experience “dumb taxes”. This cost is incurred before the founder realizes they skipped the steps needed to build the foundations correctly because they have not done it before. It often takes 2-3 years for founders to run out of patience with burning cash and not growing. Then, they take action to fix it. The solution is creating a systematic, replicable sales and marketing process that can grow along with your business.
Use this effective approach to overcome scalability issues and accelerate the success of your professional services firm.
Named after Admiral James Stockdale, this paradox is about maintaining unwavering faith that you can and will prevail, despite the most difficult circumstances, while at the same time, confronting the brutal facts of your current reality.
Greg Alexander dissects the moments of truth every founder needs to confront to overcome under delegation in business.
