Interviews
- »One on One with Ed Hess
Grow or Die. It’s probably the most common business axiom, and the least accurate, according to the new book “Smart Growth: Building an Enduring Business by Managing the Risks of Growth” (Columbia Business School Publishing). To better understand the book’s implications for firms, Consulting’s One-on-One sat down with the book’s author, Ed Hess, a former Arthur Andersen strategy consultant and current professor at the University of Virginia's Darden Graduate School of Business.
- »One on One with Summit's David Litherland
When prospective employees interview for a job, they obsess over making a good, lasting impression. Firms should do the same. To learn how firms can avoid typical pitfalls, Consulting’s One on One sat down with David Litherland, managing partner of Summit Search Group, an executive search firm specializing in placing professionals within professional service firms.
- »One on One with PwC's Tom Craren
Senior executives are becoming immune to traditional marketing. Marketing consultants tell us that to pierce through the white noise of corporate communication, firms should consider “content marketing”. Instead of more traditional marketing, providing valuable insight and perspective in a blog or electronic newsletter can serve as a more effective door opener. One of the best examples is PricewaterhouseCoopers’ “10-Minute” series. For almost three years, PwC has boiled down complex thought leadership into small electronic pieces an executive can read in about ten minutes. To learn more about PwC’s marketing efforts, Consulting’s One-on-One sat down with Tom Craren, the firm’s brand strategy and thought leadership leader. His team of 20 writers produces between two to three 10-minute pieces each month, along with more detailed white papers.
- »One on One with Stanford Hospital's Kate Surman
Transitioning healthcare companies from paper to electronic records presents huge consulting opportunities.
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»Consultants on Consulting
Consultants on Consulting gives management consultants the chance to share their views, expertise
and insights into topics they feel passionate about. Each consultant's piece outlines ideas and
strategies for change, and further enhances the author's role as a thought leader in the profession.
8
28
2009
»Corporate Social Networking for Consulting Firms
By Geoffrey Hyatt
How can we use LinkedIn for our firm? It’s a question you may have heard from the managing partner, or you may have even thought yourself. It is a smart question with a not-so-obvious answer.
In the past three years, the majority of us have at least taken a look at the popular social networking tools on the Internet, such as Facebook and LinkedIn. These tools help us, as individuals, to map our unique, personal relationship networks. The process can be somewhat tedious to maintain, but it can be both personally and professionally useful. However, the network access is limited to your singular network; you cannot access the networks of your colleagues. Most regrettably, you cannot access the valuable combined network of your firm. Because these networks are structured for personal use, your firm has no rights or ability to access the data of its staff members who may use these tools.
However, your firm does have a relationship network of its own. It is where most of your clients originate. It is where you do your prospecting. It is a unique asset of your firm. In an up market or a down market, it is the asset that drives revenue, billability and growth. So, how does the firm get a LinkedIn-type view of this relationship network?
Taking Luck Out of the Equation
I know the importance of relationships in the consulting business. I worked for six years at The Boston Consulting Group, first in Munich and then in Boston. When a colleague needed to know who at the firm had any pre-existing relationship to a prospective client, he or she would typically ask several peers.
The colleague might also send an inquiring e-mail office-wide or firm-wide and hope it was read by whoever might be able to assist. These methods of “searching” the firm’s relationship network are obviously inefficient, but much worse is that they are incomplete. They do not reliably reveal the best relationships for that prospect. They rely on effort and luck.
Enterprise Relationship Management (ERM) systems enable a consulting firm to understand its entire extended relationship network. These systems, such as ContactNet (from Thomson Reuters), Visible Path (from Dun & Bradstreet) and BranchIt, actively scan, analyze and compile internal company data, including address books, CRM systems, e-mail traffic patterns, and time and billing systems to understand and map all relevant relationships. The systems are configured to fit the unique privacy requirements and culture of each firm. Dozens of leading consulting firms, law firms and financial services firms have deployed such systems across their global offices.
The ERM systems analyze data each day to identify relationships between the employees of the firm and their contacts. The system therefore builds a comprehensive database of the firm’s extensive relationship network. Searching this database gives a complete and instant answer to the question: “Who knows this prospect?” Consultants no longer rely on serendipity to find the connections that can impact their success.
A Contact is Not a Relationship
Many professional services firms employ a customer relationship management (CRM) system to maintain accurate contact information for clients, prospects and other individuals of interest. These CRM applications maintain a contact’s correct name spelling, current title, phone number, office and e-mail addresses and even notes from recent meetings. CRMs can be useful for preparing mailings, phoning contacts and recalling recent interactions as you pursue prospects.
A point of contact differs from a relationship because it is just that—a singular point. A relationship, on the other hand, can be viewed as the line connecting two contact points. While a CRM system holds specific data about a contact, ERM technology, which can be integrated with an existing CRM system, measures the relationship.
It understands not only the line, but also the “thickness” of that line, because not all relationships are equal. Each relationship has a different strength. Your relationship with an individual you’ve just met may not be very strong. Each time you communicate, the strength of that relationship increases. If you don’t communicate for years, the strength of that relationship decreases. Relationships are dynamic: if they aren’t building, they are declining.
So, while a CRM tool may tell you where to reach Joe Smith, ERM technology can tell you who knows Joe Smith best, how strong that relationship is, how often they are in contact, and when they last connected. For a consulting firm, the value is in the relationships, not in the contact information. Relationships must be built and maintained. They are so valuable, so important, and yet most firms still have no comprehensive automated way to track and use them.
Striking While the Innovation is Hot
Every consultant instinctively pursues new business opportunities that present the greatest potential. Often, it is the business with which he or she already has a strong relationship. With ERM, the number of those useful relationships increases, not because ERM creates them, but because it unveils them so they can be used.
Take, for example, the consultant who completed innovative work for a client that could be applicable to at least 50 other firms in related, non-competitive industries. But the innovative work is time sensitive, and the consultant wants to approach each of these 50 prospect firms within the next 90 days. Most of us would look at that ambition and say it is impossible.
Actually, if that consultant can search for those 50 companies in his firm’s ERM system and find for each company all of his colleagues’ introductions to each one, the task is manageable. Existing relationships within the firm will facilitate introductions and help to get those first meetings. Without an ERM system, the relationships exist, but they remain needles in a haystack. ERM is the magnet that identifies and draws out those relationships.
Cesar Brea with Force Five Partners, a marketing strategy consulting firm, views ERM as essential for business development, as well as for conflict clearance. “When I first used ContactNet for ERM at a leading interactive agency a number of years ago, we relied on the system to identify possible areas of conflict between firms we were already working with and those we were pursuing. It also was vitally important on a number of occasions in helping us realize parent-subsidiary relationships between existing and prospective clients that we hadn’t been aware of previously. Making those relationship connections allowed us to more easily and confidently initiate those prospect conversations.”
When the agency implemented its ERM solution, consultants were given the opportunity to opt out or participate anonymously, but none chose to do so. “The application provides a variety of different levels for addressing participation issues in graceful ways,” he explained, “but when we made it clear to people the enormous benefit of the software and how it actually worked, as well as the fact that we were dealing with information actually housed on the company e-mail and exchange servers, no one really had an issue with it.”
In today’s competitive environment, Brea sees ERM as an essential tool in consulting business development: “It is a brutally competitive time out there right now for consulting, especially in North America. From a business development perspective, you really can’t afford not to implement an ERM system—in one deal you pay for a tool like this.”
Relationships are one of the most valuable assets of any consultant. They are also extremely important to the health and growth of every consulting firm. As better technology becomes available for managing relationships, the sophistication of using relationships as a strategic asset increases. Just as we can each use the public social networks to improve the use and reach of our own individual networks, our firms can use the Enterprise Relationship Management systems to increase the use and value of our corporate network.
Geoffrey Hyatt is vice president and general manager of ContactNet for Hubbard One, a Thomson Reuters business. He was founder and CEO of Contact Networks, a company acquired by Thomson in 2007.
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