IT Services & Solutions Blog

The Only Way to Structure a Professional Service Firm

May 18, 2016 / 0 Comments / Blog, David Maister, organization, professional services, roadmap

Have you ever read something that changed your thinking, really changed it? I’m not talking about merely sharing a different point of view or even teaching you something new. I’m talking about turning your worldview upside down, making you see something in a completely different light. Stopping you short with an “Aha!” moment.

I have. Nearly twenty years ago I began reading the writings of British management guru David Maister and, in the words of the day, they completely blew me away. To this day his thoughts, as expressed in books like Managing the Professional Service Firm, still ring true. I have even held on to my original copy, though it’s now well worn, heavily highlighted and thoroughly dog-eared. I would say that Maister’s book is required reading for anyone leading a professional service firm, whether it be in the technology, law or financial sector.

You see, Maister’s critical insight — his core idea — was that professional service firms  have a different mission, and, thus, need to be organized very differently than firms that design and manufacture products. One of the ways that firms can be organized differently he contends is by finding a way to align the successful outcome of the firm with equally beneficial outcomes for employees. As an example, firms can offer stock options, more autonomy, involvement in policymaking, partnerships and the like so that employees have a stake in the firm.

Why should you care how a professional service firm is organized? Because when it is organized correctly, clients receive a consistently high level of service from a stable team of professionals. And these same professionals, with both the time and the dedication to study the client’s business closely, will continue to provide growing value year after year.

Happily, at Solugenix our situation is even simpler, since the owners are employees, too.

There are takeaways for both professional service firms and clients. For clients, how the firm is organized is an important consideration because it directly affects how it can engage with the client. For the firm, Maister’s ideas provide a road map for long term sustainability and success. Even if total employee ownership is not practical, one can make sure that the investors’ expectations and time horizons are compatible with the business of professional services.


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