I'm reading David Maister's forthcoming book, Strategy and the Fat Smoker. Like much of David's written material it's accessible and easy to digest. I'm only part way through but something he says early on struck a chord:
Any business that tries to deliver all four virtues of quality, cost, variety and speed is doomed to failure
Yet that is exactly the way most professionals attempt to compete. I can't begin to count the number of professional websites where almost identical claims are made in an attempt to embrace all four qualities. The net effect is that potential clients have no way to assess which firm might best fit their needs. For many clients, they might as well get hold of the phone book. blindfold themselves and stick a pin on the page marked 'accountants.'
When I was in practice I made a conscious decision that I would never compete on price and that I would never take on work I didn't believe we could execute against. That takes courage - something David notes is rare and therefore a source of competitive advantage. You've also go to have unshakable belief in your business model. That's not the same as a rigid belief. It is one of the reasons I believe in value pricing. People will pay a premium (relative to the general perception of market value) if they know what you stand for and if you can clearly demonstrate differentiated knowledge and ability. The same is true for existing clients.
That meant at times, I'd enlist the services of firms that were better qualified than ours to handle specific problems. It wasn't that I didn't want to do the work. I knew the client would be better served elsewhere. In the long run, it meant the client was better served overall.
These are principles I follow to this day. Last week for instance, I mentioned to a colleague that I will not work with certain companies because I don't share their values. We're incompatible from the get go and any relationship is bound to be problematic for both parties. In some cases that has meant turning away otherwise very good business. That's always a tough call but in life I've found material reward is but a fraction of the total reward for undertaking an assignment.
David makes the point and he's right - following certain principles involves an emotional investment in the things that matter to you. With that comes pain and pleasure. Fortunately, the upside far outweighs the inevitable lows.
If the rest of the book as as good as the start, I shall enjoy David's insights. More later. In the meantime, Brian Sommer has a 50K foot summary on the book as a whole.
For an entirely different take, check Jason Holden's article on firm selection which is an add-on to Stefan Topfer's piece in similar vein.
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