How Successful Consulting Firm Owners Operate Their Business
Michael Zipursky
CEO & Co-Founder: Consulting Success® The Coaching Program & Proven Growth System for Serious Consulting Business Founders
Delivering Successful Consulting Projects
1. Use a Proven Process
When delivering services to clients, follow a consistent process. A consistent process can make your project run more smoothly, reducing stress and resulting in better results.
Here is a high level overview of the typical consulting process.
Example Before joining Consulting Success®, Vanessa Bennett did not have the formal and structured processes she desired for her firm. All was tailored and custom. This customization took up a lot of time and severely limited the firm's capabilities. Vanessa was able take on more clients by streamlining the processes of her firm (specifically, the onboarding process). Their revenue has increased by 30%.
2. Leverage Productization
Productization is an offer of consulting that is not customized for each client. You create the same solution for all your clients, instead of creating unique solutions for each client.
A typical consulting project may be 80% customized and 20% productized. True productized offers will be 80% of the project productized, and same for every client. A much smaller portion of the project is custom.
Create a productized offering by identifying the issue that you're solving. It should be a problem your customers are most interested in. Consider the steps you'd take to solve this problem. You can package these steps into a productized offer.
Exemple Before joining the Clarity Coaching program, Alexandra Craig offered highly customized services. It was this that prevented her from scaling and growing her business. She was able deliver more work and achieve better results by productizing her services into fixed-price packages. She used to provide discovery work free of charge, but now charges more than 10K for the same work. What's the difference? She marketed it.
3. Consultancy Retainers
Consultants' retainers are their version of recurring income. Your clients will pay you a fee to access your expertise or for your work instead of paying for the project.
Consultancy retainers are a great way to ensure that your clients get the services or expertise they need on a regular basis. These retainers will stabilize your income, and your clients will receive consistent results.
Example When Vince Rahth began his consulting business, the rate he charged was a standard one. If a client changed their schedule or if something unexpected happened, Vince Rath would lose his entire day's revenue because he was working onsite.
Vince was able to eliminate the revenue rollercoaster by creating and selling a monthly retainer. His clients can now access his expertise monthly through these offers. Vince now earns more consistently and his consulting business has increased its revenue by $600,000.
Start with one of the best consulting practices every two weeks or so, instead of trying to implement them all at once. Follow our blog's instructions, take imperfect actions, and then measure the results.
Marketing a Consulting Business
4. Clarify Your Revenue Goals
Consultants who set goals and write them down are more likely to succeed. This is particularly true when it comes time to get consulting clients.
So, write down...
You can then be more precise in determining the daily actions you need to take to achieve your monthly goals. For example, how many ideal clients should you contact per day? Or how many conversations must you have per month with them?
Example Doug Nelson joined Clarity's coaching program as a relatively new consultant. He put up sticky notes all around his house when he heard about the Magic # Exercise and wrote down his goals. He was able to contact more clients, because his focus and clarity were renewed. This simple number inspired him to grow his firm's revenues from $400K up to $2M.
More Reading : How to get more consulting clients
5. Create a Magnetic Message
Create your Magnetic Message. This is a short statement explaining who you work for and what value you offer. This is a marketing message designed to attract and engage your ideal clients.
Here's a formula to help you:
I [help] [WHO] [solve WHAT problems] so that they [see WHAT results]. Why I chose me ]...
You can start a conversation with your ideal clients by using a Magnetic Message that is both enticing, and specific.
Example : Jason Fearnow was a mining company consultant and executive in the natural resource space who struggled with marketing. Our program helped him create a message that was specific and authoritative, which attracted the ideal clients he wanted. In just one month, his newfound understanding of marketing and messaging allowed him to earn more than six figures.
6. Market from B2B and not B2C
B2C marketing (business-to-consumer) is different from B2B. Even if the webinars are automated, consumers will still spend a lot of time watching them. Social media can be scrolled for days. They will use complex funnels. Rarely do buyers of high-value consultancy services engage in any of these activities. You must be able to tell the difference.
B2B marketing is different. You are selling customized, high-touch consulting services and not products off the shelf. Therefore, you must focus on building relationships and adding value. This is the most important principle: Each executive you contact should feel that: "Wow, they are speaking directly to my needs and I." They understand my situation and our industry, and they know a lot about the issue or result that we are working on. They know more about this issue than I do!"
Exemple: Matt Domo helps software companies improve their engineering and technology processes. He entered the business as a technology expert, not a marketing professional. He didn't have a clue how to reach the executives of software companies, his ideal client. Matt was able to learn how to create personalized, valuable emails for direct outreach that were read by his potential clients and received positive responses. Since then, Matt has doubled his income and USA Today named him one of the nine top entrepreneurs for 2021.
Pricing & Creating Consulting Offers
7. Take the Value Conversation
It's important to understand the value that your consulting services will bring the buyer, both in terms of economics and intangibles.
In order to achieve this, you will need to have a value-based conversation.
You and your client will discuss and agree on the potential economic impact and outcomes of your offer.
You might think that charging $75K for your services is a lot. When your client realizes they will earn $750K more in revenue over the next 12 months, $75K is a great investment. Where else can they expect a 10x ROI for their business?
Example Howard Bryant left the corporate world after years of working. One of his biggest challenges was the consulting sales. Howeard should know how to structure and clarify his offer. It was a direct result of learning how to have a productive value discussion, in which he asked probing questions to discover his client's issues and desired future state. This approach helped him win a large consulting contract with an important client, one he'd always wanted to work with.
8. Buy A Discovery Offer
A discovery session can be a lower-cost, smaller-scope service that you offer to your consulting clients. You can get a "foot in" the door with clients, and provide them with a quick outcome. Discovery offers allow you to show your expertise and value to your clients. They are lower-risk investments and smaller. Consider them as an opportunity to give your client a quick-win. It is difficult to make the first sale. After delivering a discovery offer, you will be in the best position to deliver and provide a full-priced, higher-value engagement.
Exemple: Sam Schutte was a software/technology consultant who used to provide free discovery work before presenting a proposal. It didn't. After reading his proposal, his customers would say "I cannot get approval for this much money." Sam charges six-figure fees for his consulting services.
His clients were confused when he went from providing free consultation to consulting for $100K+. Instead of offering this work free, he started charging for it. He will spend an afternoon working with the client to create a project plan. They determine if the client's goals are achievable, how to achieve them, and if there are any roadblocks. These conversations are of great value to your client, and you should charge for them.
Sam now begins all of his consulting work with a discovery proposal. He used a discovery offer recently to generate the opportunity for $250,000 engagement, and increased his firm's revenues by 60%.
9. Price Based on Value
You can charge more for your expertise if you base it on the value that you provide to the client. It is one of the most effective ways to charge for your expertise, without having to do additional work or deliver more deliverables. You can then make a convincing case that your value-based fee and price is an excellent ROI for the client.
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After you've had the value discussion and have a clear understanding of the value that you will create for your client, you can charge them 1/5th the ROI they'll receive. If your marketing consultant service will generate $750K of revenue in a year, then you can charge $150K. There are many factors that can influence your fee. This is not a rule. We work with our clients to maximize their fees.
Example Stephen Fleming was a consultant who wanted to expand his business. We showed him how to expand his consulting business by charging according to the value that he provided for his clients.
He used to charge $20K as a flat rate for his services. After learning about value pricing, he offered options of $50K ($70K), $130K, or $70K for the same services. One of his clients recently chose the $130K price option.
Stephen's consulting business grew by asking the right questions and charging based on value.
It may seem excessive to charge $75K for your services. When your client realizes they will earn $750K more in revenue over the next 12 months, $75K is a great investment. Where else can they expect a 10X return on their investment?
Managing and Running Your Consulting Business
10. Your values should be expressed
It's important to take the time to define your values - a list that defines you and the company you want to build - to attract likeminded clients and employees (here's a great list example from James Clear).
After you have written down your values you can create a mission statement that will encompass all aspects of your business. This work may seem "soft" or trivial, but it is incredibly important because it explains "why" you are in business. This will motivate you to continue working, even in tough times.
Example : We've grown Consulting Success(r), a successful company, by sharing and articulating our values.
Our decision-making is based on these values. We make sure that any major decisions we make are in line with our values.
Your values will not only help you internally but also help you to attract clients who are a good fit. Many clients have told us that the story and values attracted them to us.
11. Track the Right Metrics
Tracking metrics is important because they allow you to keep an eye on your business. They can help you determine what works and what needs improvement in your business.
There are many numbers that you can track. Many of them lead you down the wrong path. We teach consultants that instead of focusing solely on vanity metrics, which look great but do not move the needle in your business, they should focus on a few key metrics. These include:
You'll be able to see your strengths, weaknesses, and areas where you need to improve.
Example Kristen Ireland and Erin Mies founded People Spark Consulting in order to improve HR strategies for companies. The consultants faced the same problem as many others: they were experts, but had difficulty finding clients willing to pay for them.
We taught them how to track and build their client pipeline in our Clarity Coaching Program. They were able, with this system in place and these metrics, to convert prospective clients into paying customers within a day. They had as many successful months as they did in their previous quarters by the end of the programme. The numbers are not a lie.
12. Create Systems & Processes
Consider the business tasks that you perform frequently. You likely have a list of steps to follow in order to complete the task efficiently and on time.
You don't have to worry about how to complete the task, just follow the steps to get the desired result. List all these tasks to create processes for your consultancy business.
You'll then write down the steps that you take to accomplish them. You're creating the systems of your consulting firm. The steps go from being abstract in your mind to concrete, concrete steps. You can then hire and train others to implement these steps so that you can concentrate on more valuable work.
It's especially important if your business requires you to spend time on tasks that you dislike. You should avoid doing things that drain you of energy. Document the process to get it off of your plate and onto someone else. It's likely that someone will enjoy doing something you dislike.
Example Scott Payne works as a management consultant for mortgage companies. He lacked resources from his former employer when he set up his own consulting firm. Clarity Coaching filled that void.
Six weeks into the program he was overwhelmed by his client list. We taught Scott to create systems and process for the tasks which make his business work.
He increased his revenue by 30% as a result. Here's what Scott has to say about the impact of creating systems and processes on his business.
"I just wanted to thank you for your help with my new business. I have 5 full-time (W-2 employees) employees and a wonderful team that allows me to spend 95% of the time I would normally spend "in" my business, working on it. Your team's guidance and support to move me in the right direction ." is invaluable.
Scaling up Your consulting business
13. You can delegate your lower-value tasks
Spending less time on low value tasks such as email, bookkeeping, scheduling and organizing will help you grow your consulting business.
Delegating these low-value tasks is a must. Consultants often have difficulty "letting go" tasks they could easily teach someone else. It's a major step you will have to take if you wish to increase your firm's revenue and capacity.
It is essential to hire an administrative assistant if you want to learn how systems are created and how they can be delegated. You will have more time for working ON your business and not just IN it.
Example When Tony Velasquez first started his own solo consulting business he felt like he worked hard but didn't really know if it was the right thing to do. He wanted to move beyond the solo consultant model and become an business owners.
We taught him to delegate tasks and outsource them through our Clarity Coaching Program so that he can focus on the running of his business. He now puts together teams of his employees and subcontractors who work to meet the needs of his clients. He has grown his consulting company to nearly four times its revenue: read his case study here.
You can either invest time and effort to figure out everything yourself or invest money to learn it and implement it much more quickly. It is possible to create more money but not more time.
14. Think Leaders: How to Become one
Thought leadership is a type of marketing in which you share your knowledge on a particular topic. Our expertise as consultants is our product. It's important to demonstrate our expertise and professionalism to potential clients.
In essence, thought leadership is a constant drumbeat on a certain topic, and the provision of genuine value, until your name becomes synonymous to that topic.
Create content to share what you know, provide valuable insight, opinions, perspectives and data, and reach out to your ideal customers. This will not only help spread the word about you and your business but will also build a solid reputation within your industry.
Example Nic Cameron addressed many of the common challenges consultants face, including creating a set of clear offers, defining your ideal clients, and establishing profitable fees.
It was her position as a thought-leader in the field of grant-making, organizational structure and nonprofits that made it easier to solve all these challenges. Nic was a leader in her field, but only after she started sharing this insight with others did clients start to take notice.
Nic became an industry thought leader by sharing weekly podcasts and videos. It's now much easier for Nic to create offers and target the right clients. She can also command higher fees. She has built a seven-figure consulting firm and is an authority in her field.
Further Reading Thought leadership marketing for consultants: quick-start guide
15. Invest in Yourself & Your Business
Most successful people either have a mentor or a coach. Why? You can achieve success in business by taking advice from someone who is already successful at what you are trying to do.
You can either invest time and effort to figure out everything yourself or invest money to learn it and implement it much more quickly. It is possible to create more money but not more time.
Investing yourself in the future means investing in courses, coaching, books, and events that will help you gain the skills and knowledge you need.
Example Tiffany Rosik received encouragement from her mentors in becoming an independent consultant. Her lack of confidence kept her from starting. She decided to invest in herself after watching our videos.
She won her first client in four months. They worked together for nine months. picked up a second client soon after at twice her previous fee. Her investment in herself and her company has been a great success.
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Helping ad agencies secure federal contracts | GSA Certification Expert 20+ years’ federal sales experience
1yGreat article!
Customer Experience & Customer Service Trainer | Top 25 Global Customer Experience Influencer 2023 & 2024 | Engaging Keynote Speaker | Writer
1yMichael Zipursky - this is truly an amazing article. I’ve read both of your books and they both really gave me practical knowledge and a roadmap to success. Consulting is hard work and you really do help to make it more process driven and results focused! 👏