How to boost your consulting business?

5 Strategies That Work to Accelerate Consulting Business Performance

Professional service activities (consulting, agencies, IT Services , studies, training) have in common that they have multiple possible levers to improve the performance of the activity. Depending on the level of maturity of the organizations, the differences in performance can be gigantic. A perfectly optimized consulting company that applies the strategies described in this article will be able to generate better turnover. But also, to benefit from growth in pipe sales faster, to display utilization rate very superior and a much higher result than a less mature consulting activity. This without process or management.

 

1. Track performance in real time rather than retrospectively

a. No longer be a blind organization: give managers the right data in real time

If the sale of projects is a major issue, it is important not to neglect the management of projects once they are sold. In particular the monitoring of the profitability of the project. Whether the project is sold as a package (a fixed amount decided with the client) or on a cost basis (amount of sale based on the time spent on the project), it is up to the project manager to ensure that the project margins remain aligned with the objectives set when budgeting for this project.

When starting a project, a budget must be created and take into account all the costs of the project to put in front of the expected turnover:

• The costs of the collaborator(s) based on the time spent on the project
• Possible subcontracting costs
• Expenses, such as travel and meals, which when they are not rebillable to the client have an impact on the project margin
• The cost of any products sold as part of the project (for example training, or licenses for software, etc.)

During the project, it is important to know at all times:

• What was consumed from the budget
• Details of variances: how the time actually spent on project tasks compares to the time budgeted
• What is the actual profitability compared to that planned in the budget?

Project managers must have easy access to this up-to-date data for all the projects they manage.

With this information, they are more empowered and act at their level to improve performance. If each manager leads the improvements at their level, imagine the overall impact.

b. Being able to anticipate to better correct

Comparing the performance of a project against what was budgeted is a good thing. But to be proactive, it is essential to have forecast data.

It is therefore the forecast profitability (or the margin at completion) of the project that must be looked at during the project. This forecast profitability takes into account what remains to be done on the project.

Ideally, the remaining work is regularly updated by the project manager, who provides a progress update on the various tasks and confirms the time remaining to be spent.

Thanks to these elements, all forecast profitability data can be calculated (or given automatically by your management platform). Thanks to this, you identify projects that deviate from their objectives and you take the necessary actions before it is too late. For example, if you realize that the forecast margin deviates from the budget you can:

• See with the client to renegotiate the contract. The work may have been poorly described in its specifications
• Take stock of the different tasks to see how to reduce the time spent on each of them
• Rearrange the resource planning on this project, and see if less senior collaborators (thus representing a lower cost) can move forward on the project with the same chances of success

Management of pipe proposal in Stafiz

 

c. Benefit from more relevant indicators

You can't improve what you can't measure. This adage is also true for the performance of a consulting activity.

Managing a consulting and service activity is not a simple thing. Carrying out excellent management allows you to achieve a competitive advantage: more relevant reporting, which allows you to make better decisions more quickly, offers a strong competitive advantage. Operational excellence allows you to achieve better profitability, which in turn allows you to make better investments, which in turn allows you to accelerate your growth. In short, with the right indicators, it is possible to create a virtuous circle of performance improvement.

And what is good reporting?

It is a reporting which provides you with all the key indicators, in real time, on the actual and the forecast, at the granularity that interests you (overall, by division, by sector, by type of employee, etc.)

At a minimum when you manage a consulting activity, you must have the following indicators:

• Turnover
• Margins
• Production in days and value
• ADR (Average Daily Rates) real
• staff activity rate / TACI / utilization rate
• Employee occupancy rate
• Income statements
• Discrepancies between product and invoice

Put this data in the hands of managers. Set the objectives to achieve on each of them. You thus ensure that these employees are empowered and that they will carry out the actions that will achieve them.

2. Gain visibility into capacities and forecast load

a. Know at a glance the forecast workload level of the teams

The heart of the reactor for improving the performance of a consulting activity is the management of the workload of employees: it is necessary to ensure that the load is better distributed between the different employees. Let them be neither too loaded nor too lightly loaded.

It is imperative to have the right level of information. This allows us to know if in the coming periods (coming days, coming weeks, coming months), our workforce has the capacity to hold the load. Or if, on the contrary, the workforce is too large compared to needs.

Giving yourself long-term visibility on this aspect of capacity and load allows you to make better recruitment decisions (should recruitment be accelerated or slowed down?).

But also to improve employee engagement (ensure that employee workload is appropriate).

And to improve the profitability of your activity (having the right resources to meet your needs so as not to be over-staffed or under-staffed, which can prevent you from winning projects).

Forecast load in Stafiz

 

b. Plan the utilization rate / staff activity rate according to the objectives

One of the key indicators to monitor is the staff activity rate or utilization rate (or billable rate): this is the time spent by employees on billable projects (which will generate turnover) in relation to the time available.

Gaining visibility on this indicator will allow you to have much better management of your workforce.

Depending on the hierarchical levels and roles, the time spent on billable projects is not always the same. It is therefore also necessary to analyze the TACE or utilization rate by role or by team. You must also set an objective to be achieved by type of employee. The objective of TACE will undoubtedly be different between a junior employee and a director or associate employee who spends more time selling projects.

Finally, you need to look at the staff activity rate or utilization rate achieved, of course, but also keep an eye on the forecast: to date, what is the TACE achieved in one month, two months, etc.? And therefore, how much do you need to get to reach your objectives?

It is with this type of approach that you will improve your performance and generate more results.

c. Improve the management of resource planning collaborators

By doing resource planning a key process of your consulting company, you put the employee at the center of your strategy. You promote the commitment of your employees and their satisfaction.

Ensure that teams have full visibility of their forecast planning and empower managers by giving them long-term visibility on the resource planning of their teams are typically actions that pay off by promoting employee engagement and retention.

Managers must be equipped to be able to better predict the workload of their teams. Offer everyone sufficient charge to feel engaged and progress. But at the same time avoid overloading employees, to avoid demotivation or burn-out.

 

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3. Improve employee experience

a. Provide access to a platform that brings together all their needs

To keep your employees motivated, it is also necessary to provide them with technology that helps them work simply and more efficiently. The type of technology that allows them to fully express their potential by saving them time on non-value-added tasks and providing them with the right information at the right time.

A good way to save your employees time is to allow them to centralize their tasks on a single platform. This is the definition of an unpleasant experience for an employee. :

• log into a system to confirm your times
• to another application to submit your charges
• and a third to request leave before going…
• …search your schedule on an excel

This clearly lacks efficiency!

Bringing together all these elements in a single environment available on computer or smartphone. This is a solution that, on the contrary, offers everyday simplicity! And which allows the employee to be focused on their mission and on their customers. This improvement in the employee experience is a contributor to satisfaction which contributes to retention.

b. Offer the right technology

There are many technologies available today that greatly simplify the employee experience. The numerous gains (productivity, satisfaction, engagement) brought about by these technologies alone justify their acquisition.

Take for example OCR for expense management. All the employee has to do is take a photo of their receipt so that the expense line is pre-filled with the amount, taxes and date. All the employee has to do is indicate which project to attach this cost to.

Or even the probative value. It is now no longer necessary to go through the painful stage of keeping receipts in envelopes before photocopying them and attaching them to an expense report. Fortunately, the photo is now sufficient. Good expense report management solutions allow you to benefit from this, by taking care of the storage required by URSSAF.

Ideally, your employees should be able to access their entire environment from their mobile. Why not take advantage of the metro ride to confirm the time spent on the different projects during the day?

Other technologies, notably integration between software, also make it possible to simplify and save many hours of administrative management.

c. Use the resource planning to better engage your employees

Improving the employee experience requires management of resource planning which takes into account more criteria than simple availability. Ideally, skills development should be considered. That is to say, ensure that the resource planning of an employee allows them to improve their skills and achieve their progress objectives.

A resource planning perfectly managed can even integrate the desires of employees. Allow them to indicate the type of project they would like to work on or the type of skills they would like to develop. When the resource planning intelligently cross-references more criteria and offers you the most suitable employees based on your criteria, it is the assurance of increasing employee satisfaction and growing talents within your organization to keep them as long as possible .

4. Gain reliability and control

a. Avoid working on spreadsheets or multiple solutions

Excel is an excellent tool, but has a major problem: spreadsheets in general are far from infallible. Human error or modeling problems are sources of many errors. Furthermore, the knowledge behind complex spreadsheets is often kept by an employee who, when he leaves the organization, implies the loss of knowledge of the file, making its maintenance too complex. It is then often necessary to recreate a new model. Or spend many hours adapting it to understand and use it. A waste of time and a risk no organization should take.

In short, management on Excel is suitable for very small structures (less than 10 people) but is not scalable when the activity grows.

So that a company is structured and grows in the right conditions. :

• The data that teams use must be reliable
• The risk of errors must be zero.

Another option is sometimes to use several solutions not connected with each other. But this also entails a risk. It will undoubtedly be necessary to extract the data from one solution before re-importing it into the other. This creates risks of error, not to mention wasted time.

Software that carries out end-to-end calculations provides finer analysis and necessarily reliable data. In fact, the risk of human error is eliminated. When the data is also used to prepare financial closings or payroll, it is even more secure to use a single platform.

b. Set approval levels

Working to improve the reliability of data and better internal control does not necessarily lead to administrative burden, quite the contrary.

When the various requests (for reimbursement of expenses, leave, etc.) are organized with workflow systems, that is to say approval flows, collaboration and simplicity are only reinforced.

To do this, it is necessary to have clearly defined the approval flows beforehand. These must remain simple to avoid too many validation steps but must intelligently direct requests according to their nature.

For example, the person best able to approve an expense report is generally the manager of the project to which the expense is attached. It is he who will be able to confirm whether the expense is justified, whether it can be re-invoiced to the client or not, whether the employee respects the company's rules on this project, etc. The project manager is also responsible for this responsibility. monitoring of costs spent on his project. On the other hand, an absence request will more often be approved by the employee's manager or by HR, who are more able to have an overall view, necessary to approve.

It is therefore necessary to carefully create workflows and ensure that they are fully automated so that approvals are given quickly, with the appropriate level of control.

c. Enable finance teams to work with reliable data

Operations management and associated reporting is crucial. But for the organization to be fully effective, ensure that the data generated by operations provides financial teams with reliable data. They will be able to carry out their accounting closings and carry out the necessary management analyzes at certain frequencies.

This means that your system must be able to extract data with complete reliability and transmit it to the accounting solution you use to update it. This data transfer can be done either by preformatted files (called “flat files”), or by API, that is to say by automated transfer via connectors. To avoid any errors, the second option remains the best.

 

The sales logs, data on expenses to be reimbursed, and subcontracting purchases are then directly transmitted to the accounting system to complete the closing and prepare the tax packages. Payroll variables (vacation, bonuses, meal vouchers) can also be directly transferred to the payroll software.

This automation helps avoid human error. All data remains reliable and controlled until it enters accounting and payroll. Not only is internal control strengthened. But management control teams gain enormous productivity and can focus their efforts on value-added analyzes for performance. Without it, they can work for hours to achieve financial close.

5. Accelerate your commercial activity

a. Anticipate new purchasing behaviors

Selling projects is a subtle art. Multiply exchanges to identify customer needs, provide clear answers and stand out from potential competitors for proposals that stand out from the rest...

Project sales for a consulting business are a very human process that leaves little room for automation. Some major trends should be taken into account to improve your commercial strategy:

• Using referrals and connections alone to grow the business can be risky.

In a few years, the search for advice has moved from an approach focused on recommendations obtained through the network to an approach more influenced by internet searches. In 2013, Hinge Research Institute surveyed buyers of consulting engagements in a study. 70% of them then declared that they had obtained a recommendation to choose the consulting company with which they wanted to work. In 2019, they were only 60% and this trend accelerated in 2021.

• Buyers place more importance on technical skills when selecting a consulting firm

Expertise has become a key element in a very digitalized world which requires getting into technical aspects, code and developments to improve business performance. The differentiation of providers is stronger than before, when generalist profiles were preferred.

• Buyers consider consulting activities more useful and important than in the past

While in 2013, only 19% of customers considered their consulting providers to be instrumental in resolving their problems, this figure jumped to 29%.

b. Integrate digital and growth marketing skills within your organization

If the commercial development of a consulting activity must favor the human approach, modernizing marketing methods is nevertheless a necessity for any consulting activity that wishes to accelerate its development. We must prioritize visibility and increase opportunities to interact. And this is where growth marketing methods can be extremely useful to a consulting business:

• Putting content online that provides maximum value on expert topics helps establish credibility and improve SEO performance to be more visible when a search is made on search engines. The first step is the regular posting of articles on the company blog. If the content is important (it must provide maximum value to readers), its distribution is just as important: a poorly referenced article has little chance of generating new prospects. Before writing an article, you must define the distribution strategy.

• Frequent communication on social networks is also a simple way to gain visibility and highlight expertise. And there, nothing works better than having the employees themselves get involved and highlight their expertise by participating in online discussions, commenting on posts or distributing articles that may interest your targets.

• Developing your growth also involves expanding your audience by broadcasting personalized messages to well-identified contacts who fit your target. To recover these contacts, there are now many perfectly legal methods to “scrap” LinkedIn and obtain the email addresses of these contacts (Phantombuster for example). In an approach to distributing professional content and respecting certain rules, there is no GDPR problem when you distribute content that may interest them. As long as they have a link to stop the process if they wish. This content can be found through newsletters, emails or blog articles. Growth techniques make it possible to automate the search for contacts, emails, or even telephone calls, which increases the power of your marketing tenfold.

c. Follow his pipe sales and anticipate your forecast

To improve the performance of a consulting activity, you need to have precise visibility on what will happen:

• Know the forecast turnover
• the forecast workload and capacity of employees
• forecast profitability
• all these elements are crucial to anticipate problems well in advance and to be able to correct them.

Without this visibility on the forecast, there is no management possible. The management of the activity is undergone.

It is therefore necessary for projects to be visible in their pre-sales phase, with the possibility of weighting the associated turnover according to the chances of success. This data will make it possible to complete the forecast based on projects already sold and give a complete and more realistic vision of the forecast.

Ideally, these projects still at the proposal stage allow you to also plan the associated budget in terms of resources and therefore the associated profitability.

Even better, if you can script the resource planning of these projects from pre-sales. This gives you a head start by having much more precise visibility of the forecast load and possible recruitment needs.

 

The challenge for improving the performance of a consulting company is clear: implement technologies and tools to simplify tasks, to gain visibility into performance and to improve collaboration. This transformation is vital to move an activity to a more mature state, which undeniably generates much higher performance.

The most successful consulting businesses are those that have made this choice. A 2021 study from SPI Research, a research and consulting firm that helps service providers like consulting firms grow, showed glaring evidence of gaps between consulting firms based on their equipment. Companies that had a complete management platform showed 3 times higher revenue growth, utilization rate 1.8 times higher and an EBITDA 5 times higher, compared to non-equipped companies.

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Stafiz helps service companies and consulting firms gain visibility, manage their activity, manage their resource planning and their project progress using real-time data. Stafiz is a SaaS management resource planning , project management and Business Intelligence. So budgets and margins are always respected and you make better decisions for your business.

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