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ServiceLine White Papers
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Five Steps To Predictable, Profitable Services
Imagine if your services organization ran like a well-oiled machine. Similar types of projects could be cranked out, one after
another, with the highest possible quality and reliability. For you personally, this would mean fewer surprises and late nights
at work. One strategy to achieve predictable services delivery is through the implementation of organizational best practices.
Like many of today's widely used business terms, “best practice” has become a tired phrase with many shades of meaning. However,
for professional services firms, possessing repeatable best practices is critical to long-term survivability and growth.
Developing and utilizing best practices is as important as having personal principles. Just as an individual's personal principles
define their reputation, best practices define a professional services firm's standing. Best practices speak to the experience
that an organization has in delivering projects consistently, on time, and with repeatable results.
Professional services organizations actively engaged in generating repeatable best practices encounter numerous obstacles. These challenges typically surround three core areas: process, people, and technology.
Process. The first challenge to developing best practices is the absence of project template submission, collection and refinement processes. Many services organizations are so busy implementing processes and technologies for clients that they do not have time to implement their own processes. What results is an ad hoc execution process, and consequently, inconsistent creation of best practices. Firms that successfully develop and utilize best practices must have a clearly defined best practices process in which everyone in the firm actively participates.
People. The second challenge to creating an efficient business operation powered by repeatedly refined best practices is the prevailing culture of the firm itself. Best practices can only come from the people who possess the relative business knowledge and actually deliver the services. An organization that has the right knowledge sources and a culture that is rooted in developing and working from best practices can quickly gain a competitive edge.
Technology. The third challenge is obtaining the tools that enable staff to participate in the development and refinement of best practices and provide the necessary process automation. The bulk of a typical services firm's product, project, and business knowledge resides in the minds of its consultants and project managers. So, what happens when an individual consultant or project manager leaves? The best practices also leave, and the organization must scramble to replace the lost expertise.
Given these challenges, what can professional services organizations do to enhance their engagement reputation and achieve the
greatest possible value from the knowledge they sell? How can best practices be submitted, refined, and re-used in a repeatable,
accessible manner?
The five steps outlined below will help organizations to start building a best practice methodology. As in most phased implementation programs, small steps must be taken to build the overall systematic approach to best practice development. Waiting is not the answer - the time to begin is now.
The Five Steps
1. Develop a best practice template collection and refinement process.
The best practice template collection and refinement process must be designed and clearly communicated before a firm can begin to build best practices. The starting point is simple: new projects. As a new project begins, the overall project manager needs to identify the content manager for each phase. These individuals are charged with collecting the key deliverables that exceeded a customer's expectation or greatly improved the project implementation. The end of each project phase is a good place for this contribution to start so that other teams can quickly benefit from key knowledge gained during the project delivery.
Next, refine the contributions. Someone needs to "templatize" the documents so that they can be re-used. Template building does not require large amounts of dedicated resources if the right approach is taken. People who are not being fully utilized on projects, or the person who is submitting the document, can be incented to refine the new best practice before submission. The point is, just as a content manager needs to be selected for each project, a template manager needs to be identified at the organizational level to ensure the right knowledge is delivered for re-use on future projects. This role may be rotated among various individuals so that more people get involved in the effort.
After creating these templates, it is critical to begin sharing them with other teams - which leads to the re-use of the templates in new projects. Thus, the continuous cycle begins. As templates are re-used, they will be improved as a result of the new lessons learned.
This process produces services that are predictable and profitable. When an organization earns a reputation for delivering on their claims and meeting project engagement deadlines, more business inevitability follows. A firm's reputation increases with
predictability.
Of course, participation is the key ingredient in an effective best practices collection and refinement process. The entire best practice process is only as good as its weakest link. For best practices to be of maximum business value, all knowledge holders
must participate in the knowledge refinement process. Encouraging best practice participation leads us to the second step.
2. Foster the right culture in implementing a best practices approach.
There are four types of organizations that can be developed, based on participation and business results.
- Low Participation and Low Results
Low participation and low results will inevitably lead to failure. An organization in this category will likely experience
high turnover, poor service, and little growth. Consultants will leave because they are not contributing productively to
the success of the organization; clients will not retain this organization's services because their reputation is poor;
and the firm's future is dim because new sales are stalled. The symptoms are inter-related and lead to poor results.
- High Participation and Low Results
High participation and low results will lead to frustration. Consider this scenario: people want to help, and are trying
to help, but no one is listening to the valuable contributions that are being made. The ideas are good and the developing
best practices are valuable. However, the processes may not be in place to formalize the best practices submitted.
Accordingly, turnover may result; services delivery may be inconsistent or unpredictable from project to project; best
practices are not evolving and the overall growth of the services firm will likely decline.
- Low Participation and High Results
Low participation and high results will inevitably lead to solo efforts. Many will consider this outcome and think, "What
is the problem? If positive results are happening, something must be working?" The problem is that individuals are
single-handedly saving the projects from disaster, and few best practice approaches are being built.
With this approach, the organization can never scale to take on more projects, and becomes too dependent on the individuals
rather than the collective knowledge of the team. When the individual leaves, the project knowledge also leaves, and the
organization does not have anything to apply to the next project. Instead, they will look for the next guru to pull another
heroic effort. The bottom line is that the low participation/high results model will not scale and will lead to an
unhealthy culture that delivers mediocre service and flat growth.
- High Participation and High Results
High participation and high results will lead to a robust, growing best practice community. The knowledge holders are
happily contributing best practices and the organization has processes in place to refine, share, and re-use what has
been contributed. The people are enlightened because they enjoy learning and participating. The clients are happy
because they are delivered services that allow them to achieve results. Consequently, the firm is growing because
their reputation is solid and their services can be delivered predictably and profitably.
Think about the differences in each of the models. Each quadrant represents a different type of organization. Which one best
describes your organization?
3. Measure what you want to create.
The best way to accomplish what you desire is to measure what is important to your organization. Measurements are the best
communication tool. In creating best practices and building the right type of culture to encourage contribution, measuring is
the best way to begin. Some examples include:
- Cycle time of starting similar type projects: The cycle of time that exists between the day a project was sold and
the time when consultants become engaged on the project.
- Cycle time of completing similar type projects: The time required to complete projects with similar size and scope.
- Client satisfaction: Is client satisfaction, as the results of services delivered, flat, decreasing or increasing
for similar project types.
- Turnover: Are people leaving your firm at a higher or lower rate than the industry average? Why are they leaving?
- Profitability: How profitable are similar type projects over time?
- Number of similar type projects that are fixed bid: Are you comfortable giving a client a fixed bid based upon the
knowledge you have learned from similar type projects? Measure the actual project costs in fixed bids to determine
if the best practices are effective.
- Recognition: When is the last time you recognized a team of people who contributed to the growth of the organization
by sharing their knowledge for future projects?
Communicate the measurements to the whole company. Metrics will motivate and underline the importance of what you are trying to build.
4. Implement technology that facilitates the creation and sharing of best practices.
Technology should enable, not hinder, best practice workflow and the re-use of best practice templates. A centralized knowledge
management system should be used to support the best practices program. Since the number one reason knowledge management solutions
fail is difficulty of use, the following areas should be addressed:
- Is the solution accessible to geographically dispersed consultants?
- Since email is the easiest and most common communication form, can best practice information be emailed directly and
automatically into the appropriate document management folders?
- Does the system support document routing and approvals?
- Do subscriptions and notifications exist so consultants are alerted of best practice changes?
A technology system that is too burdensome will result in a weary group of consultants who are smothering under a firestorm of information. Selecting the right technology comes down to the ability to easily use the system within your business processes,
and not adding additional steps to your processes because of inflexibility in the technology workflow.
5. Establish the best practice mission and objectives for your organization.
With the previous four steps in mind, it is important to set the mission and objectives of creating repeatable best practice approaches to delivering projects. The mission and objectives will provide the overall framework in which to build your firm's reputation. Everyone in the organization needs to understand the framework in which the best practices work will be completed. To avoid confusion, each of the following areas should be addressed in the framework:
- Processes: What is the purpose of the processes that are being built? Why are the processes important? How do
they fit into the organizational strategy?
- People: What is the meaning of the work environment that is being established? How does it define the business
that is being built?
- Measurements: Do the measurements link to the objectives? Are there measurements for each objective?
- Technology: What is the technology designed to support?
The framework - mission and objectives - provides the context that pulls everything together to ensure that your organization is pursuing a complete best practice strategy. Balancing client expectations with employee and business expectations will be necessary. With an eye to the customer, develop objectives that will excite and involve your people, while setting clear
business objectives as to why creating this service delivery approach is critical.
One method to establish the overall framework is to sit down and write a story about your firm and how you want it to be viewed internally and externally. In each of the steps, an outline begins. The processes that are put in place are the chapters in the story - they decide what happens in what sequence. The culture that is built brings in the characters that bring it to life.
Who will make it happen? Where will it happen? The measurements will determine how the story is delivered. And, the technology will be the stage on which the story is delivered and recorded. Write the story and then begin putting the pieces in place and take an active part in it. To begin, answer the following question: What story do you want to tell to your people, your clients, and your industry?
Summary
Operating through a best practice approach is critical to developing repeatable and profitable services. With predictable
projects, less time will be spent solving problems and more time can be allocated to identifying ways to take the organization to the next level.
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