Most professional services firms will make a claim to being industry focused. Their websites will list the industries they serve, may identify industry practice leaders and experts and feature industry focused thought leadership and events.
This is undoubtedly acknowledgement of the numerous studies and client feedback results over the years in which clients and prospective clients have said that industry knowledge and expertise ranks high in their criteria for selecting and retaining lawyers, CPAs and consultants.
But how much of these firms’ claims of industry focus is window-dressing and how much is reflective of a comprehensive strategy and operating model designed to deliver industry focused client service?
The rationale for industry expertise is simple. Can you really provide the best possible advice to a client if you don’t understand the context, drivers, and issues that are impacting the clients business?
Furthermore, while accountants, attorneys and other professionals tout their deep technical or functional expertise, most clients view that as table stakes. They assume you’re an expert in employment law, international tax or enterprise application development. What they want to know is have you done it in their industry? Do you understand the nuances of their industry? Can you hit the ground running or will they have to teach you and your team how things are normally done in their industry?
So what does having a true industry focused practice or program really mean?
Through our many years of experience in helping build and grow industry practices we have identified a set of questions that can help firms assess whether their industry practices are just for show, or for real. Here are some of the top level questions you should review in evaluating where your firm stands with respect to a genuine industry focus:
- Does firm leadership believe that industry knowledge has a direct and meaningful impact on firm financial performance? For example through the ability to achieve premium rates, retain clients, win new work, cross-sell other services, build a reputation to win new/better clients, etc. (Read our discussion of this question)
- Has the firm made strategic decisions about which industries to target and focus on – or are industry teams simply a reflection of accumulated experience and/or does your firm claim to serve just about every industry? (Read our discussion of this question)
- Does your firm assess the strength of its industry practices relative to key competitors and best practice professional services firms? (Read our discussion of this question)
- Does your firm understand how much importance clients place on industry knowledge and does your firm measure clients perceptions of your firm’s industry knowledge and expertise? (Read our discussion of this question)
- Does your leadership team set industry specific strategic goals and identify key clients and prospects on an industry basis? (Read our discussion of this question)
- Has your firm adapted its service offerings to the specific needs of each industry and where appropriate developed industry specific services? (Read our discussion of this question)
- Does your firm have a formal marketing and business development program, and assigned marketing professionals for each industry? (Read our discussion of this question)
- Does your firm report and manage performance by industry (fees, profitability, growth, etc.) – and how important is performance by industry relative to service line and geography? (Read our discussion of this question)
- Does your firm provide industry specific budgets for marketing and business development, service development, training and knowledge management? (Read our discussion of this question)
- Does your firm organize and assign all or some of its professionals into industry teams? (Read our discussion of this question)
- Has your firm defined what constitutes industry expertise in your professionals? Does the firm have an industry competence model? (Read our discussion of questions 11, 12 and 13)
- Are industry competence and expertise assessed and tied to recruitment, performance evaluation and career development? (Read our discussion of questions 11, 12 and 13)
- Does the firm have formal programs and resources to develop the industry competence and expertise of its professionals, including keeping them abreast of the latest trends and developments in the industry? (Read our discussion of questions 11, 12 and 13)
- Does your firm have industry focused research programs that monitor and identify emerging industry trends as a means of developing thought leadership and identifying new service opportunities? (Read our discussion of questions 14 and 15)
- Does your firm capture and leverage the industry specific intellectual assets gained from client engagements? (Read our discussion of questions 14 and 15)
How does your firm stack up?
Over the next few weeks we will discuss each of these questions in further detail on our blog. Stay tuned!