This article outlines a handful of key indicators of potential positioning problems.
In a blog I wrote a month or so ago titled, 15 Things I’ve Learned From 15 Years Marketing Professional Services Firms, I commented that the biggest challenge facing most small and mid-sized firms is a lack of effective positioning. In this article, I’m going to offer 7 ways to determine whether your firm falls into this trap.
Positioning a firm is a tricky endeavor. A firm needs to be diverse enough to be sustainable, yet narrow enough to be seen as special to prospective clients. In today’s market, it’s quite easy for clients to literally reach across the world to hire the specific expertise they need (in the past year alone, we’ve received inquiries from Nigeria, the Philippines, Australia, the UK and Germany). If you get it right, positioning can be the entry to a path full of all sorts of new opportunities previously unimaginable.
The good news is that most firms don’t really get it wrong. They just don’t really think or do anything about it. So, in a sense, if you’re a principal or marketing leader in a firm and you’re thinking deeply about your firm’s positioning then you’re already a bit ahead of the game.
A quick tip on using this list — if you have just 1 of these problems, then your firm may still be positioned just fine. That said, if you find yourself nodding your head to 3-4 of these, then you most certainly have a serious problem that needs to be dealt with.
#1 – Lack of Quality Inbound Leads
At a high-level, a firm has 2 sources of inbound leads: thought leadership (in all its forms) and referrals. Let’s look at each in turn — over the last 5-6 years the landscape for thought leadership has become incredibly noisy. This cacophony of voices has driven clients to expect thought leadership content to be highly relevant to their unique issues and show deep knowledge of a problem and solution (this is literally what they told us in our research with AMCF). For a small or mid-sized firm, producing content that satisfies these two requirements pretty much demands the depth in knowledge that narrow positioning provides.
Simultaneously, generating high quality referrals is also a function of positioning. If your clients and potential referral sources have a hard time articulating what you do and who you serve it becomes nearly impossible for them to refer any quality business to you. If you’re finding that the referrals you’re getting don’t really reflect the types of clients or work you’re looking for, then there’s a good chance you have a positioning problem.
All that said, even well positioned firms can suffer from lack of quality inbound leads. So, if lack of leads is your problem, you’ll still need to dig a bit deeper.
#2 – Difficulty Describing Who, What and Why
At its core, effective positioning should make describing your firm much simpler. A well positioned firm can tell its story in just one or two sentences. Go to the About page on your website or turn to the summary page in your corporate brochure (if you still actually have one of those). If you were the key decision-maker in a potential client company, could you tell right away if this firm is for you? A well positioned firm has the advantage of describing itself to the marketplace with simplicity a more diverse firm cannot. We are healthcare architects….we are experts in protective design…we provide competitive intelligence tracking for the pharma industry…these are all real-life examples of simple claims that can be made by well positioned firms. When visiting the website of one of these firms, a client can almost instantly tell whether they’re in the right place or not.
#3 – Decrease in Proposal Win Rate
This next indicator is a fairly obvious one. If you believe, like I do, that today’s clients are increasingly buying more on knowledge and less on relationships then it’s plainly obvious that a declining win rate is largely indicative of a problem with your firm’s professed expertise. If clients are hiring you less, it’s not because they don’t like you, it’s because they’re simply not seeing evidence of the depth in expertise and experience they’re finding in other, more well positioned firms.
#4 – Lack of a Defined Go / No-Go Process
Just about every A/E firm I know has some type of Go / No-Go Process built into their practice. The real questions to ask yourself are these:
- Is our process well documented?
- Do we rigorously follow it? (Or, more specifically do we routinely make pursuit decisions using objective reason or do we frequently make decisions with emotions?
If the answer to either of these questions is “No” then chances are good you have a positioning problem.
A well positioned firm thinks very long and hard before making decisions that might otherwise compromise their positioning. Once a firm builds deep collective knowledge in a narrow area of focus, the opportunity cost of re-deploying resources into areas where the firm has less expertise is just too great to justify. Hence, Go / No-Go Processes become much more defined, more rigid, and become core to the practice.
#5 – “It’s Easier For Us to Say What We Don’t Do”
Have you ever heard these words creep from the mouth of one of your partners? Can you imagine the leader of any other business making this kind of statement? Could you imagine Tim Cook standing before Apple’s Board of Directors and declaring, “We’re finding it hard to define what products we’ll make. It’s much easier to say what we won’t make…we won’t make airplanes, cereal bars, or slinky dogs.” Did you hear the loud explosion that followed? The one caused by the absolute collapse of the company’s stock price?
Yet, we give professional services firms a pass on this all the time. Sure, the essence of strategy is having absolute clarity on what you won’t do. But, equally important is having absolute clarity on what you absolutely, positively want to do — who you serve, what they need, and what makes you better than anyone else in the world to solve a problem (or a collection of problems) for them.
#6 – You Describe Your Practice in Your Language Not Your Clients’
The best clients select a firm because they have a steadfast belief that it has the ability to radically improve their business. Well positioned firms speak to this directly. They speak in the language of the client and they describe their business in ways that reflect the direct operational impact they have on their clients’ realities (to some extent, this is true no matter what type of firm they are).
By contrast, overly diverse firms describe their practice in one of two ways — either the language is entirely esoteric or painfully simplistic. Esoteric statements are those that use all kinds of flowery language to describe what the firm does or how it operates. It’s like a magician’s trick. Let us confuse you with all these fancy words while we attempt to pull money from your pocket with our other hand. By contrast, when language is painfully simplistic it practically insults a client’s intellect. If you go to your firm’s website and you see statements like these, you almost certainly have a positioning problem:
- “We begin our design process by asking questions and listening carefully.” — Doesn’t pretty much everything in human existence start there?
- “Our approach to design — grounded in provable methods and testable ideas — allows us to maximize the creative potential in all our projects and create success for our clients.” — Huh?
- “We believe every project can make life better.” — Let’s not overcommit to any outcomes.
- “We are deeply committed to active collaboration with our clients, emphasizing thorough research and analysis of each situation’s particular human, technical, and economic circumstances. The result is exceptional architecture that resonates within its place.” — Wait; what?
#7 – A Key Person Leaves and All Your Opportunities Dry Up
Imagine, if you will, that Jony Ive, the Chief Design Officer of Apple, were suddenly to defect from the company and take up shop at Microsoft. Do you think that all loyal consumers of Apple products would instantly jump ship to Windows Phone? Of course not. Might they pay a lot more attention to what Microsoft is doing? Good chance. Would they consider Microsoft products, possibly for the first time? Probably. But, they wouldn’t instantly up and leave. Of course, it’s much simpler in a product company. Customers build relationships with the products themselves rather than with the individual people who design them. But, the point here is that the products Apple designs are bigger than any one person. Despite Jony’s (fictional) departure, he leaves behind a legacy of technology and design thinking that customers expect to continue. In short, the quality of the company’s product is not tied to any one key individual.
In an overly diverse firm, when a key employee leaves clients follow almost instantly. The reason is that the firm hasn’t built the collective knowledge and team depth to serve the client going forward, and the client knows it. There’s not sufficient depth in expertise for the client to even think about staying.
The best way to think about this is to reference a legal practice. In law firms, non-competes don’t exist (maybe that should tell you something about the legal defensibility of your agreements). When an attorney leaves for another firm, clients are presented with the option of whether to take their business with the attorney or keep it with the existing firm. While clients are probably much more likely to follow their attorney, a well positioned firm can substantially increase the possibility that clients will stay.
For instance, when a firm with 200 IP attorneys loses a key person, clients have reasonable confidence that capable experts are still available to help them. It’s feasible that they could truly build trust and a relationship with the firm beyond their primary attorney. When a leading IP attorney leaves a 200-person diversified practice with only 1-2 other IP attorneys, clients could have valid concerns that the firm simply can no longer serve them — like it or not they’re essentially forced to jump ship.
Recommended Next Steps
If you operate in a small or mid-sized firm (less than 2-300 people) and more than 1-2 of these indicators rang true, there’s a pretty good chance you have a positioning problem. Take the next step to learn what effective positioning looks like then resolve to take action. Here is some useful content that might help: