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LEADERS IN CONSULTING
The “LEADERS IN CONSULTING” show is dedicated to helping Partners and Managing Directors of Consultancies grow their business faster.
If you want to learn best practices from other Leaders in Consulting, this show is for you.
Each episode features an interview with a consultancy Partner, Managing Director or Thought Leader, discussing topics like:
1. How to set up a winning strategy for your consultancy
2. How to upsell and cross-sell more
3. How to win big whale leads and convert those to clients
4. Hiring and keeping valuable team members
5. How to become a thought leader by building your personal brand.
LEADERS IN CONSULTING
Ep. 137 — 55% of Consulting Firms Run Negative EBITDA While the Top Performers Hit +27% — Here Is What Separates Them - with Connor Budden
Use Left/Right to seek, Home/End to jump to start or end. Hold shift to jump forward or backward.
55% of the professional services market is running negative EBITDA.
Most blame the market. Top performers don’t.
Connor Budden, Global Director at SPI Research, joins Sammy to unpack what nearly two decades of benchmark data reveal about performance in consulting and professional services. While many firms point to difficult market conditions, SPI’s data shows that top-performing firms continue to grow and protect profitability by operating differently. Connor explains the five performance pillars behind SPI’s maturity model, why leadership has the highest impact on firm performance, and how the best firms build stronger systems across talent, client relationships, AI adoption, and project focus.
You’ll learn:
1. Why market conditions do not explain the full performance gap
2. What the top 5% do differently across leadership and operating maturity
3. How high performers use feedback, focus, and client outcome tracking
4. Why AI adoption works better through small, compounding improvements
5. Where to start if your firm wants to move toward higher performance
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Connor Budden is open to connecting about professional services performance, benchmarking, and operating maturity.
If you would like to exchange perspectives, reach out on LinkedIn: https://www.linkedin.com/in/connor-budden/
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Sammy and SAWOO offer a B2B community-building service that establishes you as a
thought leader in your industry and helps you build genuine, human-to-human relationships with your dream clients.
Get in touch with Sammy Gebele on LinkedIn: https://www.linkedin.com/in/sammygebele/
More episodes and insights: https://www.leadersinconsulting.com/podcast
Sometimes this is a tough message for leaders to hear. You know, you you have a lot of consulting leaders looking at the market, understanding that we're in tough times, and maybe their business not performing as well, and they get to the conclusion that we're not performing as well because the market is in a downtime. The data that we have shows that high-performing organizations will be high performing even in a downtime market.
SPEAKER_01Welcome to the Leaders in Consulting Podcast. I'm Tammy, your host and founder of the community. In this show, I speak to CEOs, partners and MDs of consulting firms about their best practices and hard-worn insights. If you're keen to join the conversation, visit leadersinconsulting.com to find out how you can connect with peers at our summits, peer coaching sessions, and monthly confidential forums in your city. And now let's get started with the show. Today I'm very happy that I have Connor Budden with me, Global Director at Service Performance Insights. Connor, welcome to our show. Thank you, Sami. Good to be here. So um tell me about your company. What what are you doing?
SPEAKER_00So SPI research or service performance insights um research is a company that focuses on the professional services industry. Um so we look at any companies within professional services globally, so be it IT consulting, management consultancy, agencies, accountants, lawyers, anyone that trades their time for money really. Um and we do research that is focused around what is it that are the KPIs that those businesses kind of need in order to function and perform at a good standard. And then we look at kind of who performs well, who doesn't perform well, what is good look like, and all of that stuff. That's that's kind of us in a nutshell.
SPEAKER_01And I find that highly interesting. And you already like you you were one of our speakers in the London summit in 2025, and um I really like the data-driven analysis um that that you basically showed there, and that's why I'm happy that you're here with us now. And um, yeah, you you do data-driven. So everything we talk about now, um, on what data set is it based on?
SPEAKER_00So we have a yearly survey that we do. Um, we're actually coming up to our 20th year next year. Um, so so that's a big milestone for us. Um we do a yearly survey and we ask lots of questions across companies that give us the results of of kind of different KPIs. So if I give an example, you know, what is your on-time project delivery? So, how often do you deliver a project on time? And then what we'll do is we'll look at that and we'll kind of say, well, you know, if this is what your on-time project delivery is, what is the correlation or the statistical analysis that we can perform around that for how that correlates to performance? So obviously, we're not just asking about on-time project delivery. We ask lots of questions, it's quite a long survey. Um, but we capture kind of 165 metrics and then we compare them and look at the relationship between those different metrics as well, because all of them are connected in some way. So we can kind of predict, well, if you're here in this particular metric or these 10 metrics, and we expect this other metric to look something like this, or we can create a range for it. So it's all about giving that kind of how do we know what good performance looks like, and not just across the obvious things. It's not just about eBIT DA or profit margin or utilization. Yes, they are absolutely key, but it's about what really drives services kind of under the head.
SPEAKER_01And I I like that approach a lot because many don't know it. I'm a mathematician originally. So I I studied like um part of my studies was time series analysis and and data analysis and finding out what what are the factors really influencing the outcome. And so I'm super happy that now we have like um a kind of objective view on what really drives performance, and we double-click on on some pillars that drive performance, so that of course the goal is to um that you disclose and help all of our consulting leaders listening. Um, well, how can I become one of the top performing companies um and and and grow even in hard times? Because um, you you told me beforehand um market conditions may change, but top performance um doesn't change and and they're still outgrowing the market.
SPEAKER_00I I think I think this is exactly it. Sometimes this is a tough message for leaders to hear. You know, you you have a lot of a lot of consulting leaders looking at the market, understanding that we're in tough times, and they see their business not performing as well, and they get to the conclusion that we're not performing as well because the market is in a downturn. The data that we have shows that high-performing organizations will be high performing within even in a downturn market. So, as I mentioned earlier, obviously, we have 20 years of data. Whether you take the 2007-2008 financial crash, you look at the Greek debt crisis, you look at COVID, any of these kind of global crises across the world, regardless of the don't get me wrong, there is a muted impact across the entire industry, but it is muted. You know, high performers, their e evida is gonna get impacted one, two percent. We're not talking five percent changes in in uh in a in a downturn market. These guys are still very high performing and they're still comfortably in the range of high performing organizations even during recessions or things like that. Um and and you know, that's a tough message for guys to hear sometimes because they wanna they want to be able to blame something external, whereas actually there's probably a number of levers they can pull internally that would help them.
SPEAKER_01Yeah. Yeah, and I I like it that you compare basically also within markets, so of course, restructuring. Now in this time, it's it's an easy market, so to say, because many companies are restructuring and other markets um or are tougher, but um you compare within a market and still there there's a big difference between companies that are high performing and not high performing. Um, can you can you give us um just a a snippet of data? What like the average in a high performing company looks like in terms of growth? Um so um growth in terms of revenue and also Ebitta.
SPEAKER_00Yeah, so so we tend to band it into different levels. So we we band them into levels one to five, um, and level five is your top five percent of of organizations, and we would regard high performing as level four and five, um, which which makes up 20% of our population. And then obviously non-high performing is everyone else. Um, and so those kinds of if we look at just the level five population, their kind of growth year on year, looking at last year was you know 23.2%. Um, so we're talking, you know, that's that's big growth, that's that's a lot of effort, and and people are doing a really good job there. Um, if we look at kind of the Ebdah numbers or the EBITDA numbers, there we're kind of seeing, you know, 27% EBITDA. Um, and that is, you know, these are some phenomenally high numbers, and companies that are experienced those two things are are obviously in a very good place. Um of course, you then contrast that to the companies that are non-high performing. What's happening at the level one firms, you know, those firms are seeing growth rates of 1.7%, and their ebada is actually negative, you know, we're seeing minus 2% ebada in in level one. Um, and actually that continues into level two. We also see negative 1.9% in in level two, and those that level one and two makes up 45% of the market. So if you're thinking, okay, I'm nowhere near 27%, I'm I'm nowhere near high performing, okay. But is your eBitDAR positive? Even if it's not, you're probably still quite close to average at that point because most of the market had a very tough year last year.
SPEAKER_01Yeah, and that's that's also what we see in our community. Like we have events in six cities in Germany and and then in London right now. And um, yeah, there's a small very small fraction. And I I I think gut feeling-wise, I would also say like Marx one out of five is happy uh out of the consulting leaders, and the rest is struggling. And um, and the main themes are on the one hand, um, how do I suddenly uh keep in in win clients, um, which was not a topic two, three years ago, and then all this AI impact on the consulting industry, and we'll double-click on that a little bit later. And uh, so they they have different reasons, uh, which I find interesting. You you say it the external environment has an impact, but if you look at the same kind of um bucket of consulting leaders, even within the same industry, some are still growing and um are very much profitably growing, so it's not an excuse. Um if if you want to be high performing. And and what I found super interesting, and that's why I'm happy that you're here, you you basically um systemized it into different levels and and looked at these um levels of what do high performers do differently. Um can you briefly walk us through these five core operating areas or levels that you uh determined?
SPEAKER_00Yeah, so so we have kind of the the first level, which is um yeah, we call level one, that's kind of our our heroic level. So at this point, you know, the maturity within the company is quite low. Um, and and that kind of that's around 30% of the population. Then above that, we then have piloted. Um, these guys are in level two. Piloted means they have kind of functional excellence, is the way I would describe it. So they're a little bit siloed, but functionally, you know, the guys are doing some stuff that's well and some things are automated. Um, we then get to level three, which is deployed. Um, that then gives us a little bit of project excellence. So we then have some areas where collaboration starts to happen across the business. Um, and then you get to institutionalized, which is our level four. Um, at that point, we're looking at portfolio excellence. So things happening cross-portfolio, teams are starting to work together and gel very well. Um, and then we get to the point of um optimized, which is our level five. And these guys are in a category of their own, right? They have achieved basically collaborative excellence. These guys are on another level, everyone is working towards the same goal, regardless of what it is. You know where you stand, you know where you're going, the KPIs are clear. Um, and and these guys really are in a league of their own. The interesting part, I will say though, Sammy, is that often they don't think that they are. As in, even when you talk to those leaders and you say, Congratulations, you know, you're high performing, you're doing really well in your market, they it doesn't feel like that to them. But when you start to drill down and you say, Well, look, your your KPIs look like this, you know. If I if I said to you, your Ebot DAR for your company is now 27%, you'd probably be be really happy with that, right? Like, you know, it's it's not going to be a bad thing. Um and yet these these guys who are in these companies, they're always, yeah, they they've got some particular behaviors, which I'll dive into a little bit later. But there are some particular behaviors that they have that explain kind of why that's the case. But yeah, when we get into leadership a little bit more, I'll share a bit more about that. Very good.
SPEAKER_01And then you also have like operating pillars, like um you just mentioned leadership. Um, you have four others. What are these um operating areas that we um some of them we dive into?
SPEAKER_00Yeah, it no, exactly that. So we kind of break it into five pillars. The first one you mentioned is is leadership, of course, which is kind of around um, you know, what's the vision, what's the strategy? Um when we talk when I talk about leadership, that's what I mean. You know, what's the roadmap? What are we setting? We then have client relationships. This is the um the sales engine side of the business. So here, how are we building and nurturing those client relationships? What does that look like? Um, and what are we doing in that area? Then we have the talent pillar. And so the talent pillar looks at some of the obvious things like um, you know, attrition, how is our talent being trained, how long does it take to onboard someone, um, that kind of stuff, but also things like um, you know, how much is our talent used? So what does utilization look like? Um, and those kinds of metrics. Uh, then we have service execution, which really is our delivery pillar, you know, in professional services, this is the heartbeat or the engine of the business. Um, so in here we have all of our kind of project metrics. Are we delivering on time? How much scope creep do we have? How much are we making use of our PMO or um a standard methodology in order to deliver those projects? And then finally, we have, of course, finance and operations. Um, so this is the pillar which of course looks at a lot of the financial metrics um for the business, you know, what is what is our eBit DAR? How are we tracking against different margins, different rates, what's our billable consultancy rate, um, all of those kinds of things.
SPEAKER_01And um, if you could only choose one of those pillars to improve your organization if you're in level one or two or three, which one, which one would it be that you double click on?
SPEAKER_00So so I think if if there was one that was a different level to the others, if we had four level twos and a level one, I would always choose a level one. If they're all equal, I would always choose leadership. Um and the reason is is because leadership, uh and it sounds obvious when you say it, but it's interesting when you see it come out in the data. Um, because we we measure the different pillars and we look at what's the impact that that pillar has on performance as a weighting, and leadership has the highest weighting impact on performance um of any of the pillars. And what's also really interesting about that is leadership from our perspective, all of the questions there are subjective. Um, and so it's really interesting because it has the highest impact. And if I were to go and, you know, if if they were the same and I said, okay, what do we need to do? Getting clarity around vision, sorting out what our mission is, all of those things start to enable the other pillars in lots of different ways to function better as well. Because if you know the goal that you're aiming towards and you know what it is that the business, the direction the business is going, whether you're in service execution or talent, you can probably guess what the guy in finance is going to be thinking, right? If if you know that that's the end goal, you know roughly 80% kind of where he's gonna be going as well. And so you can align much easier as a team. Um, so yeah, lead leadership is by far the way the the place that I would focus, and you know, talking about difficult messages to deliver earlier, sometimes that's super hard to tell people because you know, often the people that contact us are leadership, and you kind of have that conversation say, Hey, look, actually, some of this stuff is stuff you could be doing better. Um and yeah, but no, though those conversations, ironically, leadership is sometimes is impossible to fix, but sometimes it's the easiest to fix. Um, because once you tell people that, you know, if you say go and sell more business, that's quite difficult. If you say set a clear strategy and you know get get everyone on board and aligned with it, that's much more within your control, and you can turn that around in a shorter time frame. Um, so often we see those businesses actually move quicker if they've got the rest of the foundations to move with them.
SPEAKER_01Um, yeah, I had to think of our own company, um, where we set uh a very big audacious goal um of having um two million active community members by 2034 um all around the world. But um yeah, at least everybody knows what we aim to do. Um and and all the decisions go into this direction of helping leaders. And if we help leaders, more leaders want to be in the community because they get value out of it and want to invite their peers. So I I get the notion um absolutely of having a North Star where you go. Um can you can you maybe with a story or one or two stories of super high-performing companies because you talk to so many companies uh like on leaderships? Um, can you walk us through one, two, three case studies where you say this is how um out like really outstanding leadership looks like? And you mentioned one thing having a North Star, but maybe there are two, three, four things that you say, okay, this is what you can look out because we have consulting leaders listening now. So this is how they could self-assess and say, Oh, okay, yeah, maybe there are some things we can start working on.
SPEAKER_00Yeah, yeah, yeah. No, exactly. So, so so first, let me let me go back to what I referenced a little bit earlier about the behaviors. So, you know, I've I've been talking and interviewing a lot of the high performing leaders um in the last couple of months, and there are two behaviors that really stick out. They're really obvious, and they are so far, having spoken to, I think I'm just up to about 70 companies now, um, they are in present in a hundred percent of cases. And uh it might be 95% just to save myself something, but you know, uh it's it's very, very clear. The these things are very obvious. And those two behaviors are one, um, and I I mean no disrespect to the high performing leaders, but one, they are a little bit paranoid. Um, we we say in the call and I say, congratulations for being a uh high performing company. And you know, the next question is, okay, but that's great, but what can I do better? You know, you you can instantly see there's a little bit of paranoia around I might be high performing, but I might not be next year. What can I do? Um, or what do I do to keep it? What do I do to make sure I don't lose it? Um and as I mentioned as well, a lot of them don't necessarily feel or realize they're high performing either, um, which isn't necessarily a bad thing, but that plays into the second behavior, which is all of these guys, without doubt, are, you know, they are humble. Don't get me wrong, they know what their business does well. But when I say they're humble, what I mean is is they don't think they have all the information, they don't think they know what is best, and they're constantly hunting for where is the next little bit of information I can get. Um, so you know, I I would argue, Sammy, or I would be interested in in the population of the leaders in consulting group, because by virtue of the fact that they're in the community, it automatically means that they're hunting. And so I would guess that your community probably has um or will have a disproportionate higher number of higher performers. The reason being that even if they're not high performers right now, they have the behaviors that are going to start to pull their businesses in that direction in in the short time, right? Um, so that that's kind of on that piece. In terms of back to your actual question, sorry, in terms of kind of what do we see in high performing for leadership, I think that high performing leaders, and and this fits in with the humility point, they they disperse the power and control that they have within the business. You know, we we we're gonna talk more about AI later, but you hear lots about AI being that, you know, the power of AI isn't really interacting with it one-on-one, it's orchestrating and managing a bunch of AI agents talking to each other. Well, guess what? High performing leaders are already doing that with their human agents, um, and I have no doubt that they are already better equipped to do that once they start to transfer some of those skills to AI. Um, and so we look at we look at the leadership within high performing, and you see a much more dispersed, it's it's less hierarchical. Don't get me wrong, that doesn't mean that there isn't someone that makes a decision because they absolutely do make decisions, they absolutely do take control of situations, but they're someone that looks and observes and then inputs where it's needed. It's not constant, it's the machine is running, the machine runs fine without me. And if the machine doesn't run fine without me, that's something I need to fix. And so often it's about kind of driving that, um, which I think you know part and parcel leads to some of that high performance.
SPEAKER_01So two, three things that came to mind. Um one. I was a consultant in my first job, and I um I mean directly out of university, had no clue what uh good leadership looks like. Um it was a growing company, but it was uh doing the exact opposite of what you just said. It was very uh tailored to the one uh to the two leaders, and they kept all the information in terms of client relationships, and they were really good at that, but they kept everyone out, and everyone else was basically just delivering whatever they were hunting, and they were the rainmakers, and I always felt uneasy with this because I thought, well, how can that work indefinitely? I didn't see it, and it fell apart, unfortunately. Um, so I really loved the company, but uh the the system was uh not a high-performing system, according to what you just said. Um, and then I I spoke to uh Matt Dixon, um, and and he is also doing res or did research with um also uh service companies um with a little bit different angle. His angle was uh what are the traits of um companies that are really good at winning new deals and and expanding existing clients, so more only SAIS related. And what he said, or what they found out was that the best partners in a consulting company that outperform others are the collaborative ones, um that that are not shielding but are bringing in as many other partners because the more touch points they can build within the target account, the higher the chance that they can land, expand, and and also provide value. So it it absolutely plays into what you were just observing as well. Yeah, yeah, no, completely agreed, completely agreed. So can you um give us hands-on stories of because you talk to leadership and you you gave an answer on a high level, but what um what I what I would like to get out of is a hands-on story of how you see it unfold in real life. So um can you take one or two companies, maybe uh explain in which industry they're they're operating, and and then basically double-click and dive dive deeper on on how that looks like in practice, because the theory is understandable, yeah, um, but the stories, stories just stick better in the mind.
SPEAKER_00Yeah, I think um I think lit le leadership's a hard one because it's always it's always in the in the approach and the style of the individual. Um because because leadership is different between people. But absolutely if I take an example and and talk about it in an abstract manner, you know, one of the highest performing firms at the minute that was seeing some of the leaders, not some of all of the leaders in that business, um, approach problems in a similar way. They have different styles, but they approach problems in a similar way. And it looks like they they take a particular issue and they'll take it to their team first, and they'll democratize whatever the the um solutions going to be to what the problem is. Now, that's not necessarily new. Um in it doesn't, and it's not always completely democratized, but what it does is it drives buy-in in the team, right? This is just about getting people aligned and and driving buy-in. And then the other thing that they provide, and they do this very well, is they say, look, this is this is an experiment. Like we don't necessarily know what the answer is. And so we need to set a target for this. And so um they they they they make up a target. They say, okay, let's let's target 5% as an example. We don't know if we're gonna hit 5%. We've never done this before. We're gonna go 5% as as our example. And so they they gather around it, and then the leader of that professional services team then takes the other side of the argument to the internal leadership. And in the company I'm talking about, they're an embedded service organization. So they sell SaaS on one side and they implement it on the other. Um, so he then takes the the other side of that view, and internally he will then protect his team whilst they're working against this particular goal because they're going to come under pressure to hit all sorts of other KPIs, and he will say, Yep, that that's fine, we're doing our best to meet those things. But actually, here's the other thing that we're focused on, and I will prove to you that this is what we should be focused on. Um, and so if I if I give the give the more detailed example here, you know, I I think it's there's no issue with sharing this, but they're in their example, they were trying to work out what are the best metrics that professional services can track in order to help the business overall across the business, right? Because they're an embedded service of this actually. And they decided to look at um to look at adoption. So they were kind of saying, right, once we implement the system, what does adoption look like? Um set themselves a target of of five percent to increase adoption by. And what this meant was they looked at here is the service usage now, here is the service usage post uh engagement from the professional services team. What is the change in adoption? And what is the value in change in adoption? Right? Because if you're using more seats, let's say that you you you've got a hundred seats and the business is currently using 50 of them, um, the PS team engages, and by the end of the PS team engagement, they're now using 60 of those 50 seats, right? So that that 10 difference, how much did the PS engagement cost? Well, if the PS engagement costs $10,000 and the difference in seats has a has a sticker price of $20,000, then you probably argue that that's worth it. You're not actually seeing $20,000 difference in your bottom line because the customer is already committed to paying uh $100,000, but the customer's actually using more of the product, they're deriving more value of the product, and now we're starting to get to a reduction in churn on the other side, right? Because if they're more, if they're using your product more, they're stickier. And so they're driving these other metrics. It's yes, you can measure milli against utilization. Yes, I'm a cost center and I have a profit target to hit, but I'm also doing these things, and this is the value that those things drive as well. And so it's about kind of thinking about those things and what else you can be doing to support your business. Now, I've given the example of an embedded service organization. That absolutely does not mean that that doesn't apply to professional service organizations. And the reason is is that I I so when I did this and when I was talking to the to the different high-performing leaders, it was interesting because about half of them have come to the same conclusion of the two new metrics that they're gonna track. And I'm I'm kind of coming onto your next question a little bit here as well about you know it in client relations, but the two new metrics that they're gonna track. And I haven't seen these metrics on social media, I haven't seen a white paper about them. It's not to say that it isn't there, but I believe that these companies have converged on the same ideas without having shared notes or talked about it between them. And so one of them is about adoption. Um, and I've talked about adoption in an embedded service organization. If we look at within a professional service organization, let's say that you're a Salesforce implementation partner as an example, right? Um, one of the interesting things is if you drive adoption of the Salesforce platform, you have a happier, stickier customer who you've done the implementation for because there's more of them using it. It means that they're more likely to come back to you. But it also means that you can turn around to the publisher, which in this instance would be Salesforce, and say, hey, look, I don't just drive implementation, I drive adoption of your solution, which reduces your churn risk, which then makes the publisher more likely to recommend you as an implementation partner. So you're driving more business from their direction to you, and you're driving more business from the client direction to yourself. This is, you know, kind of what you touched on earlier a little bit as well, right? It's it's that making sure that you're you're doing things that are in the interest of the client and actually everyone, everything else kind of falls into place.
SPEAKER_01Can you take one more example of um a classical um professional service firm or a consulting firm? Um and and how leadership, like what what did they hear up to now? Um the leadership or what stuck with me, the leadership behavior that um sticks out for how for high high-performing companies are on the one hand, you um get your your team involved in basically um discussing uh goals and and setting um setting goals that make sense. Um goals are defined in terms of client value. Um we'll double-click on client value in a second, and uh they they then shield the team from distractions so that they can focus on on um uh yeah winning and and and reaching those those goals. Is there anything that I missed right now in terms of behavior? And can you take one other example of a service firm that you talk to, a professional service firm?
SPEAKER_00Yeah, of course. Um no, I think I think you're on the money in terms of the behavior. I think when I look at the the services firms, the PSOs, so professional service organizations, those firms within leadership do have qualities around how they drive their how they drive improvement as well. And so non, I mean, I'm gonna use AI as the example. I know we're gonna talk about AI later, but it's top of mind, everyone's talking about it. Um, leadership's approach to AI within professional service organizations is different to the non-high performers. So the high performers have a different approach to the non. When you talk to a non-high performer, um, they're talking about how they're gonna see these gains, how it's gonna be all of this change that they need to make, and all of these things that they need to do at the same time. You look at high-performing organizations, and what's interesting is they are doing less, but they are doing more that is sustainable. So these guys are looking for one, two, three percent incremental change. And part of the reason is because it's a new topic, people don't know how to do this stuff, and everyone's learning on the fly. And so what's happening is is the leadership there is giving their team time to adjust to the new world as they're adopting it at the same time, but also they're making sure that any of the changes that they're making are sustainable and they're permanent, and so they're looking for compound the compounding effect of an incremental 1% increase in lots of different areas slowly that is gonna be permanent in the company, rather than these bigger, you know, 100% ROI AI initiatives that are gonna completely change the way that delivery is done or whatever. Um, you know, they they break it down, they go, okay, they go, let's let's deploy AI within, you know, what's a pain point? Okay, a pain point is submitting expenses. We don't like submitting expenses or it's a ballake or whatever. Okay, we're gonna deploy AI within this area to say, right, read the receipt, scrape all the information off the receipt and put that in automatically. But then I'm gonna deploy a second AI agent because you can you can get a vendor to do that first bit already, they can just do that parsing. I'm gonna deploy a second AI agent. Instead of an individual sitting and approving that expense receipt, I'm gonna get AI to read it, and I'm gonna use AI to de-risk 80% of those expenses. So I'm just gonna get rid of the admin for 80%. I'm gonna give it the ability and the power to approve or reject expenses on behalf of the organization. Um, however, that being said, if it's a big ticket item, if it has something strange with it, if it isn't clear or doesn't have a very high confidence level of whether or not it should be approved or not, then loop a human in and see what we do. And you see, you know, you see the difference. That the difference here would be I want, you know, high performers would say, I want AI to do this little bit here. Whereas non-high performers would go, we want AI to do expenses. Like that, just the broad statement, there's so much involved with that. You've got different taxes across different countries, you've got different expensing rules across different countries. You know, there's so it's very, very intricate that to tackle that large problem is very difficult and breaking it down into this very small part of go. Actually, no, we're gonna do the approval or the rejection. And guess what? The approval or rejection is already defined because we have to teach humans that. So it's documented somewhere and I can feed it to something. Um, so yeah, sorry, back to your point about leadership, it's about the ability to break down the problems into areas that can be chunked off and they can be incremental compound increases in the performance or efficiency in the company.
SPEAKER_01So, what you just said uh reminds me a lot about uh a good sports coach. So a good sports coach is basically, and I know that you're rowing um like almost professionally, like really, really good. Oh, uh I saw your hands, you pull in really hard, and you told me how high your heart rate goes. I mean, that is amazing. Um, in these in these really, really uh it's it's a tough sport, but a good sport, I think. But um I could relate to um what what my coach is doing with me. I'm doing triathlon, um, and and she breaks down um the goal towards my A-ways in little chunks and and makes it kind of achievable. It's not easy, so it's uh uh I mean almost every week there's one session where I think coach, really? Why? I uh I almost feel the pain when I read the plan, but still it's it's it's good to have little little like stretch a little bit, but it it's never unreachable. Yeah, um, so that's one thing, and then the other one is um that I I just remembered with the analogy of a coach that um the coach wants the team to execute and win. Um, whereas um the hero, um, which is not good, uh, the hero complex is a consulting leader wants to win himself, he wants to be or she wants to be the hero. So that's a different mindset that uh heard between the lines. Um, what what a what a really, really great leadership is doing.
SPEAKER_00Yeah, yeah, completely agreed, completely. So, so let's um so I'm I'm jumping forwards a little bit. Let's talk about talent because I think that's very pertinent to the talent.
SPEAKER_01So that's that's another pillar. So let's let's go into talent.
SPEAKER_00What all the good consulting firms do there? What do you see? So, you know, you you you just mentioned about um you know people making that heroic effort versus trying to bring the team with them. One of the things that high-performing organizations do, and it's really interesting, and they they call it different things, but they do the same thing fundamentally. And I'm I'm gonna term it hire hiring for integrity. And you know, as a as a mathematician and as someone that is a data guy, how do you hire for integrity, right? Integrity is uh, you know, it's a subjective view on what a human does or doesn't do. But it I'm gonna define in in my world, integrity means that an individual is always going to do what is in the best interest of the team, even when no one is looking. So if no one's there, they're still gonna do what's best for the team, even if it means that they have to do something for slightly longer or whatever the case may be. And so high-performing organizations hire for this, sometimes unknowingly, and sometimes extremely deliberately. Um, the most deliberate example that comes to mind, and I thought this was excellent when I was when I was listening to them. Um the way in which they do it is they firstly they tried to identify what it was that made their organization special. And they found they had lots of these high-integrity individuals. And then they started to find a commonality of these high-integrity individuals, which is they were mostly ex-military. And so if you think about it, it makes complete sense because ex-military personnel are in a situation where whatever they are doing in a battalion, they have to do it as a team, right? And if each, you know, if each person is doing what they should be doing, then as a team, they will be better off. They're not doing something individually for them, they're receiving orders, they're working against those orders, um, and that they're doing it as a for the whole always. Um and so, you know, that that depends on very good communication, a whole host of other things. But then the question becomes okay, well, I don't just want to hire ex-military people. So how do I how do I pivot from having you know this skill set that I want here? How do I find that in the rest of the market? And um what they did is it's obvious when you say it out loud, they just took a couple of those ex-military individuals who had very high integrity and said, right, you're part of the interview process and you're essentially looking for cultural fit. And by cultural fit, what we mean is we want you to look for would you trust this person when you're in the trenches of work next to you to do what they need to do. Um, and so it is a gut feel, like it's not that it's scientific in the sense of you can kind of put roughly a circle around where you think it is, you know, this person has it and they have it a lot, and this person has some of it, but not quite as much, you know, but you can't re-quantify it to a number. Um, but you introduce those steps into the process, and to your point, you then start to see the absence of these heroic efforts. Doesn't mean that people don't do heroic things, but if if they're not doing it for them, they're doing it for the team, and that changes that slight change makes a completely different outlook in terms of the team's performance.
SPEAKER_01I find that super interesting, and why? Because as you said, it's it's kind of you cannot ask one question and then, yeah, you know by the answer, this is a high integrity person. And I mean, these are all smart people in the consulting space. Uh, they don't answer in a dumb way. So uh you can they can kind of sense what what the other side wants to hear, even though they might not have the inclination to be that way. Um but this gut feeling is something that uh that is just there, and you you you cannot pinpoint a word or sentence or um an answer to that. But I get what you say when if the gut is saying not hell yes, then it's simply a no. Um and and then the the tool that you mentioned is well, then put the the the people that fit your culture best or that represent your culture best into that interview process because their gut feeling is the right sensor, so to say, to say, yeah, that's a right fit or not.
SPEAKER_00And and the other thing is, is even though you can't measure it at the point where you're doing the interview, what you can measure is the output. So, you know, did that individual come in? Were they successful in the company? Did we continue to think that they acted with integrity whilst they were here during their tenure? And if they did, great. You know, the person that was involved in that cultural check scores a high grade, right? If they didn't, then the person that did that cultural check scores a lower grade. And so what you're doing is you're working out, okay, even though I can't measure there and then, I can measure the things that I put in place to see are they successful in driving the outcome that we want. Um and you know, it's I I don't like things that we can't measure, but I accept that they exist, and I'm I work out a way of indirectly measuring them, even if I can't measure the thing that I want.
SPEAKER_01I I like it. And uh now going back to hard numbers in terms of um um the the metrics that you use to say, okay, um high performing companies, the the the output or or what you see in terms of maybe also pricing is different. So, what is the the the the recite of having uh really good talent and making good decisions on whom you hire?
SPEAKER_00So, so you know the the data shows us the difference between high performing organizations and and non-high performing is in in the talent pillar specifically, you know, we see higher utilization. Utilization can be as much as 10% higher. Um, but utilization is a combination of two things it's um how how many people do you have and how much work do you have. So it's a combination of do I have enough capacity to deliver the work and do I have enough demand to deliver against? Um and so it's finding that balance between the two. The other part that's interesting here is how high performers, if we look at attrition rates, um, and we talk about involuntary and voluntary attrition, the involuntary attrition, so the number of people that that firms fire um or get rid of, doesn't change dramatically between high performing and non high performing. And that's interesting because I thought they would. Very different because I thought high performers would be more aggressive at cutting and they would be um and non-performers would be less, but but that that's not what the data shows. Last year, the data actually shows that involuntary attrition is very different between the two. Involuntary attrition and high performers is a lot higher. So a lot of people in high-performing organizations, you're more likely to self-select out. You're likely to say this isn't the workplace for me, actually, this doesn't fit. And when you start to think about it and you put it in the context of in of integrity that we just talked about, it makes complete sense because what's happening in the workplace is, or I'm hypothesizing what's happening in the workplace, is they're creating a culture with which if you don't fit and gel to that culture, naturally you're going to remove yourself. That's not to say that you're not a high performer, it's just that you're not the right fit for that high performance company because there are different blends of high performance and they don't all look the same. But it means that people are much more likely, I think it's by about double the difference between involuntary and voluntary. Um, you're almost twice as likely to voluntarily self-select out than you are to be fired by a high performing company. You know, just to complete the picture of all four of the different stats, um, that the non-high performers in terms of voluntary um attrition is roughly the same as their involuntary. Um so they hover around sort of sort of four, four or five percent. And then you look at the in um, you look at the voluntary side for high performers, uh, and that's closer to seven, eight percent. Um so that's a really interesting difference that you start to see there.
SPEAKER_01Yeah, I that's super interesting. And um I had to think because you mentioned also culture, so in the end, there's a certain culture. So one cultural trait that you identified is integrity. So if you have integrity as one of the cultural pillars, that's that has a positive impact on your performance. But what I also heard out of it, you're very, very um deliberate in expressing or your culture in some way so that everybody feels uh the culture compared to a company that doesn't focus that much on having one type of culture that they all follow. And and so if you don't fit, you feel it and you don't like it, and then you say, Well, I don't I I um I don't like that, I don't like the job. It's maybe also just a gut feeling, and you're kind of unhappy, and and then you say, Yeah, I'd rather leave.
SPEAKER_00Yeah, let me give a really clear example on a slightly contentious topic, um, but a really clear example, right? So, and this is where you can have two firms that are high performing that have different cultures. So you might have a firm who is um they they both have integrity as their underlying, you know. I I'm not saying that you have to have it to be a high performer, but it's very common in high performers. Um, and so you have one firm that says, look, we all work from home with super high integrity, with the right personalities, that works because you all trust each other and you know that what you're doing is right, even if the other person can't see, right? That's where integrity really comes in and plays very strong. There is a different set of personality profiles that you have that would benefit from seeing each other more. And so you can have another high-performing organization that says, Hey, look, guys, we're gonna come into the office two or three days a week, and we're all gonna be here together and we're gonna get on and crack on and do X. And there's then gonna be the other extreme, which is we're in all the time five days a week, right? Now, all of these three different models can work and they can all be high performing, but they are different, and different personalities will prefer different versions of that, right? Um, don't get me wrong, I love working from home, but I get my energy from people, and so my preference would be one of the latter two. It would either be being in the office all the time or be in the office two to three days a week. Working from home full time for me, I don't get as much energy, and I can't drive and galvanize as much stuff around me as I can if I'm face to face with people.
SPEAKER_01So, in the end, it's not you you copy exactly what a high-performing company does. You basically um have to understand the drivers as a leader and then adapt it to whatever style you have as a leader or company.
SPEAKER_00Yeah, exactly that. Just decide on your identity and then lean into it, right?
SPEAKER_01Yeah, yeah, very good. Now let's let's go into the the third pillar of five uh that you mentioned, which is um client relationships. Um and uh what what do high performing companies do differently there and and does it have an impact on on revenue?
SPEAKER_00Yes, yes, of course. Um so so I mentioned this a little bit when we talked about leadership. Um, you know, there there are two two new KPIs that are kind of coming out of things. I talked about adoption, but the second KPI that is coming out, and these high-performing companies that are talking about with me that comes up a lot is um is actually churn reduction. And so this applies to both embedded service organizations and professional service organizations. Um, and I can give you the two examples where it's different. But if we talk about embedded first, you know, you have a piece of software that you've deployed and you're working to um the measurement that you're making is does my professional services team engagement reduce the chance of a customer not renewing their software at the end of a term? Right. And so if it's a three-year engagement, it doesn't matter how long the engagement is, but three-year engagement, let's say let's do a measurement for all of the customers where my professional services team engages in the last six months before renewal. Is there a change in the amount of reduction that we see in churn? And so let's do what we need to do. First, we need to measure it because you don't expect what you don't inspect. So you need to inspect something in order to expect something as the output. Um, and so let's give ourselves a target. So here we give ourselves a target of five percent. So I'll have a five percent reduction in churn where PS is engaged just before the renewal. Then I'm going to see how that plays out, measure what happens. We know that the value of the contract that we're working against might be a million, it might be a hundred K, it might be 10 million, whatever it is, um, on the software side. And we also know that through the data that we've done and we've measured it for a little while, that if PS engage, there is a 13% less likely chance of churn. So now we get into an interesting debate, which is we have our million-pound contract. Well, should we just give the customer for free £50,000 professional services? Because our million-pound contract is 13% less likely to churn if we go and put in this £50,000 for free uh consultancy. The answer is, of course, absolutely. If the contract is £50,000 and you have to give them £50,000 of consultancy in order to get there, well, no, that's not worth it. You would take the chance on the churn rather than try to decrease it, right? So that there is some numbers that you have to play off here. I'm a customer-centric person, I would rather always give it to the customer. We have to appreciate that ultimately, you know, making money is the business that we're in. And so we have to keep the finance guys in mind and bring them on that journey. So we need to explain to them why we're giving free of charge, what that's doing for us, which then gives us leverage to run our business in the way that we want. So that's the example of how embedded service organizations might look at that. When we look at professional service organizations, you go, well, well, Connor, like we don't we don't sell the software. So actually, the churn for us is is different. Yes and no. It is in the sense of it's not always revenue that you're making margin on. However, you might have sold the the software through you, but let's say that you haven't. Um, it's not always revenue that you're making margin on. But what you then need to measure is what is the difference in impact that you can have through the reduction of churn to the publisher, and how is the publisher then going to compensate? Look at the work in which you're doing. Because I guarantee the publisher is measuring, right, with this partner, I get this level of churn. With that partner, I get this level of churn. Therefore, partner A is better than partner B. Okay. And if they're not measuring it, start measuring it for them. Tell them actively, I am partner A, and here is my churn rate. And guess what? It is lower than everyone else. And if they're not measuring it, you'll then get the leadership on that side of being like, oh, maybe you're right. And if they are measuring it, they'll be able to give you the results and tell you where you sit. And if they're not, then you're already going to start to create that perception of actually we should be the partner of choice where you want a long-term client engagement because we land it, we make it stickier, we drive it forwards, etc. etc.
SPEAKER_01So, in terms of a um professional service company that's implementing software, absolutely understandable. In terms of a company that's not implementing software but doing other things um for for the client. Uh, do you have a story there?
SPEAKER_00Yeah, so let's let's take a management consultancy, right? Um, so an example of management consultancy, they might deploy a um a strategy. Um and I thought this was really interesting because when I when I heard this, I often you kind of feel where you know the conversation is going. And this one I I didn't. So they they they go in, they they help a company define what their new strategy is, and they often give, you know, a one, three, five-year plan, whatever it might be. And the interesting thing that I found is as part of that discussion, these guys will talk to not only leadership, but they'll also talk to management, they'll talk to middle management, and they'll get a feel for what's happening in the company. Naturally, as your consultants are in and out of an organization, they will build relationships, they will build friends, um, and and that will just happen as part and parcel of doing business. What this company do is at certain points throughout the throughout the strategy that they've deployed, they will go back and they will start to ask questions to the friends or the people that they've built relationships with. We're talking, you know, a 10-minute call here or there. They might take them out to coffee and they'll be like, hey, look, just quick couple of questions on work. You know, we did this strategy piece. Um what what are you hearing at the moment? What does it look like? And what they're trying to work out is the strategy that we deployed, can I hear it at the lower levels in the organization? They're not talking to, they're not talking to the people that they engage with, they're not talking to the the leadership, they're talking to people in the middle management of the company saying, Can I hear six months down the line some of the strategy at that level? Can I hear it two years down the line? Can I hear it three years down the line? And guess what? They can't hear it six months down the line. Well, they go back and they go, hey, were you guys happy with this? Did it did it not meet your requirements? And they go, no, no, no, we were very happy. And they're like, okay, well, what why can't we hear it in middle management? And don't get me wrong, you know, there is always the caveat here that says, I've not spoken to all of middle management, I've only spoken to some of them. Yeah, because not everyone necessarily is going to remember everything in the same way, and that's fine. Um, but it starts that conversation, and then the reaction from the client is, oh, you're you're measuring how much we're actually using this. And the answer is, well, yes, because we we gave you something of value, at least we think we did. Um, and we want to know that you're actually getting value from it and you're actually using it. Because if you're not, we need to change what it is that we're doing for the next client or however we deliver for yourselves in future, right? Um, so I thought that was really interesting. It's it's about creating those touch points, creating the measuring of the immeasurable, yeah. Um, in order to work out are you doing something that that is beneficial for your clients?
SPEAKER_01I like um that story because it shows a mindset that um high performers apparently have, which is they want their clients to get value out of what they do, and they do it beyond the contract itself, and they are unpaid for these uh feedback sessions and going back to management and just holding the mirror up and saying, Hey, you wanted to achieve that, we did this strategy. Um, apparently, there is no uh impact felt on middle management or low management, so that there must be something that is not right, even though you might think it is right. And it feels like this either is it it's something where you they have a servant mindset kind of where they really want the client to succeed, or at least they are conscious about well, yeah, we did this one project, we made money on that, but if I want the client to come back, that client has to feel impact. And um, it's not revenue now and maybe not an engagement in the second, but um it will deepen the the long-term trust and relationship that I have with someone who engaged with me in the past. Um what the the question is basically that I want to ask you. So that's my assumption, but what do you see is basically the level behind that that that um that these high performers have or the mindset?
SPEAKER_00I think it you know you you you described it in a very eloquent way that that is that is nice. Uh I would back on my earlier description, I would describe it as that slight paranoia. Um, it's it's uh are we giving the best that we can? Did it actually happen? And yes, I might listen to what you're saying. I'm still gonna go and check. Yeah, I'm still gonna inspect what was the outcome of of the input that we did. Um, and so so yeah, I would that that's the way that I I would think about it. I'm sure there's a better way of phrasing it than paranoid.
SPEAKER_01Absolutely get it negative connotations, and even thinking about my own company in the past, I I um I must admit I we we didn't do it in the in the I think even until last year to really like go the steps of well, I know we deliver good work in what we are doing, um, which is in our case also helping B2B organizations um win new clients through community-driven approaches and to build trust. And and we did everything right, yeah. They built trust, they built relationships, but did we really dive deep and say, okay, you don't have a good COM yet, you don't uh really know what the pipeline value is. But do I sit down with everyone um who who's directly using our product? Do I ask them, well, how many meaningful conversations did you get out of the last two, three events uh that you did? How many um like deals are in the pipeline? Could you could you assess what what's your what do you think? What is your uh probability of closing that? And in a in a way, do the work that they should do themselves if they were a high-performing organization, but I know they don't, so I go the extra mile that is unpaid, you could think unpaid, yeah. Um, but but try to make them successful and also deliver something on top, which is uh data that they don't have themselves. So um I I really can relate to that. And I think every consulting leader uh can think about the last two, three projects that they did last year. Did they follow up? Did you follow up? Did you really assess if what you did had an impact? Um, and and did you go back and and basically had a conversation that is frank and say, well, it had or didn't have that impact?
SPEAKER_00Yeah, I completely agree. I mean, I'm we're very, very lucky. Um, as you know, SBI research is very lucky in the sense of our engagements with people are very easy to measure if we have an impact or not, because firstly, we measure all of the KPIs, and then our second touch point is measuring all of the KPIs. And so we know on stage one, here are the things that we recommend that we fix. This is how we think we should go about it. And we can see in stage two, when we go back, like you know, because we have multiple touch points naturally, do that did those metrics change? Um, and so you know, we're in a very fortunate position for that. But the other thing that you get from that extra work that you do is then when you're talking to new clients and they ask you, why should I do this? What's it? You know it, you know it intrinsically because you've been measuring it on behalf of your clients and you've been helping them through that journey. You have real use cases that you can say, yeah, it was this, it's now this. And this is the impact that we had.
SPEAKER_01Yeah, yeah, really. I mean, you you your product is the system um that enables it automatically, but everybody can build a system that enables that automatically if we think about it. And I know that consulting leaders have a lot of pressure of delivering work, of winning new clients, and and the next revenue is more important than the one that is already signed and paid, um, and and maybe even last year. Um, but apparently high performers don't stop there and they reserve a part of their um manpower. It's an investment to do exactly that. And I I really believe that if you're doing that, you know it. If you don't do it, you know it. And and that's one thing you could change. Now, we looked at three of the five of the five um areas that you measure, which was leadership, client relationship, and talent. Um, and and we for the sake of time, we don't double-click on on the other two ones, uh, which are service execution and finance and operations. But because, as you said, you you don't only measure, you also basically give advice on how how leadership can can improve and and move up the stages from a non-performing to a high-performing company. Sh what is the best strategy for me as a consulting leader if I want to move up? Do I just pick one where I think, well, we are really bad at, for example, client relationship and we only focus on that now? Or should I think about it differently if I want to improve my company?
SPEAKER_00So, my my advice would be to think about it slightly differently because each company is operating within its own context, right? So, you know, if if you're a startup of the five pillars, hands down, client relationships or sales is going to be the most important. Because if you don't have revenue coming through the door, uh you know, and when I say startup, I use the term very broadly. If you're a software startup, you need revenue to come through the door to build a software product to be able to burn it, right? So you need to be selling to investors. Um, if you're a consulting startup or professional service startup, you know, you need projects that you need to be delivering against in order to pay the wages of the labor and the skill that you've got in the company. So very early stage, um, I would absolutely focus almost 100% of your energy on just that that client relationships piece. Um, depending on so each of the different pillars can go up in their maturity, depending on where the pillars are to each other. Um, with that as a base rule, if you're in startup mode, it's sales. Sales and client relationships is what you need to focus on. If you're beyond startup, then the answer, unfortunately, is that classic consulting answer, which is it depends. Um, so it's a little bit, well, is it is it your talent that's slightly behind? Could we improve that? What would be the impact on the bottom line? Is it leadership that's slightly behind? You know, there are cases where we have conversations with business, just going to make up some numbers here. Let's say that leadership is at a two, client relationships is at a three, talent's at a one, service execution is at a two, and finance and options at a two. Um, you might think, oh, actually, we should start with with talent because talent is the lowest of all of them. Generally, that's not a bad, bad rule of thumb. However, there are some instances that are more specific, which, given the context that the company is working in, it might be better off to start with leadership because we can see that some of the things that are in talent are highly influenced by the leadership pillar, and those are the things that are dragging talent down. And so actually, we would say, you know, yes, we're gonna focus on leadership. We know there will be a knock-on impact on talent because all we think all these things are interconnected anyway. And so it's about what's the context that you're working in. So I'm sorry I don't have a straight answer for you there, Sammy, but it's it's specific to each business, I think.
SPEAKER_01Yeah, I understand. And yeah, maybe also um, yeah, get get outside help on an assessment um is is is maybe not a bad idea. I mean, you're consulting businesses that want outside help and to get a clearer view on their own organization. I don't know how many consulting companies really do that for themselves. And there are experts, um, like they can use, of course, your company, but there are there are experts out there that that can help you do that. One other thing that we touched on in our pre interview was um do high performing companies like is it like if when I work in there, do I feel stressed because I have to juggle many projects and boards at the same time? Or or how how does uh that feel? Because um I I talk to many consulting companies and I especially see how the leaders, the partners who are also part of um a bigger organization, sometimes they are super focused and and and and do um fewer things um and and and and sometimes they don't have time for anything and not uh I feel like not even think. Um so so you see so many companies, what do these high performers do there?
SPEAKER_00High performers, you know, the the they're the there's a clear winner here. High performers, on average, do they have less projects per project manager? So project manager is split across fewer projects, and um they have less consultants per project, and consultants are split across less projects as well. So it means that all of the the project team is less split, they are fully dedicated to a particular project and they are in in the detail of it, or they are you know only split across one or two projects at a time. Um, the other thing that they do very well, which is a little bit of a side point, is they they do very well at matching the same resources with each other. And so if you and I were working on on the same project, we would then get split across the same second project as well, which helps us because we're working together constantly and and you know, we'd build a good working relationship and go from there. Um, but but that's a little bit of a side point. So so high performers do a very good job of keeping their consultants focused and and keeping them on a particular path or around a particular project. That being said, there is of course the fact that some companies deal with many, many, many small projects and they deal with many they they don't have the large projects for someone just to sit and focus on. They have to, by nature of the way that they function as a business, they have to split themselves across small projects, right? Because projects don't take 12 months or something like that. They work on a 30-day or a two-week um turnaround. Now, the key for those companies and the difference of those companies in the high performing and non is the way in which they group the types of projects together. And so they're essentially doing the same thing. They're trying to get the consultant more focus in a particular deep knowledge or a deep area set. Um, and so what you might do is you might say, okay, well, you know, I'm I'm very familiar with banking and capital markets. So you might give buy-side projects to one particular consultant and give sell-side projects to another particular consultant. Or it might you might give all implementations to one consultant and all upgrades to another consultant. Um, that's the way in which you can start to work with those things, even if your projects are on a much smaller scale. I say that's the way you can. That's the way in which high-performing firms do it, and we see some of the benefits in that. Don't get me wrong, there's always benefits in in cross-training as well, but using that as your default assumption seems to drive uh, or the data would lead us to believe that it drives higher performance and higher outcomes for both the clients, happier consultants, and ultimately higher revenue for the business.
SPEAKER_01Very good. So I we we could talk for hours uh still, Connor, but we are slowly uh coming to an end of the time that we have together. So uh one last question and then um a quick lightning round if you still have a couple of minutes left. Perfect. So imagine we have a managing director, owner of a consulting company with 50 million revenue, and um they they listen to everything we just talked about. Broadly speaking, they're not in the high performance area yet, but they want to be. What would be the high-level steps they should or could take in the next 90 days to make progress towards becoming a high performer, which then in the end has a positive impact on revenue growth and um higher um profit?
SPEAKER_00Yeah, yeah, yeah. So, so um probably a bit of expectation setting first. You know, no one, if you're not a high performer already, becoming a high performer in 90 days is incredibly unlikely. Um, you know, when we look at firms that are level one and they go on that journey to get from level one to level four, i.e., the bottom of high performance, um, you know, that usually takes a firm around three years to make that journey. But the the to your question, what can we do within 90 days that starts to put us on that path. Um, honestly, you know, uh and it doesn't have to be ours, but take an example like our framework, look at where you sit across the different pillars that we have and plan that we are here, and then start to take affirmative action to move your company from level one to level two. Like on our website, it's it's free. You can just go access it, you'll see what the maturity model is there. You can assess yourself against it and you can use it. And there are others, right? You don't have to use ours though, there's plenty out there. But choose a model that works for your company and then start to align around it. Why? Because immediately you're starting the first step of leadership, which is you're starting to provide a clear direction and vision, and people know what you're gonna say when you're not in the room because they can go have a look at the model, it already exists, right? Um, you know, I I know what you're gonna say for your community if you're not in the room, Sammy. Is does this thing contribute to us getting to two million community members? Does it contribute to it? Yes or no? If it does, let's go and do it. If it doesn't, don't worry about it. Obviously, not every business has such a clear North Star. And so that's why some of the models are really helpful. Because I might be in a you might be in a detailed part of finance, and I might be like, okay, well, should I do this or not? Okay, let me check the finance pillar. Where are we today? Does this thing, do I think this thing moves us from level one to level two? If so, how? Okay, it does. Great, let's go and do it, or let's make a business case for doing it. If it doesn't, well, I can just bin the idea now. Yeah, that that that would be that would be my advice.
SPEAKER_01Very good. Thanks a lot. Now, rapid fire questions. Uh, because you talk to so many consulting leaders, what is the biggest challenge that you see consulting leaders are struggling with right now, but not talking about it openly?
SPEAKER_00It's not a lightning round if I take too long to answer. Um I would say they're struggling with AI and they're struggling to work out how they deploy AI in a meaningful way. And then they're not talking about it. They just happen.
SPEAKER_01Yeah. Well, at least they talk about it in our community, I can say. But it's a it's a it's a different setting, so it's a safe space. Um that's why you should join your community, right? Because that I couldn't have said it better, kind of.
SPEAKER_00Um what are senior leaders underestimating right now? They're both simultaneously underestimating and overestimating AI. Um, they're they're underestimating the impact that AI will have in some very skilled parts of their business. There have been two studies that have been released recently, one from Anthropic themselves, um, talking about AI's capabilities and how much is being used. And another one from MIT. Um, this came out uh a couple of weeks ago, and it talks about the AI iceberg. And everyone so far has been panicking about job loss, how AI is going to take over everything. And this this iceberg talks about how we're talking about the tip of the iceberg and how we're not talking about the massive part which is underwater. Um, and both they're both of them point to the same thing. AI is much more disruptive in areas that we're not talking about at the moment, um, with regards to you know anything that requires large synthesis of information across across areas um or across um different disciplines, different silos, you know, that kind of strategy and advice and and consulting, let me be clear, it's not being it's not replacing experience. Experience is different, um, but there is an element that AI can do very well and very quick. And I feel like that's being underestimated.
SPEAKER_01Okay, very good. Because you talk to so many consulting leaders, what what habit do you see in the highest performing ones if you can choose only one habit that they display uh display, these high performing leaders?
SPEAKER_00Yeah, feedback, feedback and change. So um they constantly, whenever they're doing something, okay, I did that, did it work? So it's that check of did it make the impact that I thought it would, they measure it, they work it out, and then they either embed it as a new behavior or it gets chucked and they try something different. So experimentation, feedback, and change is by very nature part of the way in which they work and do business and function as an organization.
SPEAKER_01That sounds a lot like um I can relate to it as a smaller, as um, not startup maybe anymore, but as a smaller company that's always iterating and trying to learn and never stop. So uh I I could relate to a lot of things because I also feel paranoid all the time. I always think we have to be better. And recently one of my um leadership mates said, Sammy, you're never satisfied, you're never happy. You said, Well, don't you see if we don't move, um something could happen, and I don't want it to happen, and I want to always keep on getting better, it will never stop with us. Um so I I really could relate. Um, is there anything that consulting leaders could help you with? Because I mean they're listening to us right now.
SPEAKER_00Yeah, I I think I think from our perspective, you know, what would we ask of consulting leaders? We would, you know, we we do an annual report each year. And um, if you participate in that report, you get a free copy of it, or you can buy it from us for for around uh $2,700. Um, of course, if you participate, it's free. Um, you know, and and we give out the maturity scores and the high-level stuff. So from my perspective, our next survey will open in um in September. It would be taking part in that, you know, giving us feedback around what they think is interesting and keeping an eye on that area, really. Um that that would be what would help us.
SPEAKER_01Okay. Now we'll definitely also be involved as a community and um and basically uh make everyone aware that there will be this um questionnaire and report coming out. And um, yeah, if enough of us participate in this community, then we also will have an assessment of one of your things that you think might happen. That's um how is the everyone who is in the community performing compared to the average of the market? Um, so let's see if the hypothesis where you come to the community because you're open to learn, you're open to develop, um, already puts you in a higher bracket automatically. Yes, yes, completely agreed, completely agreed.
SPEAKER_00Where can people get in touch with you best if they want to reach out to you, Connor? If they want to reach out to me, I'm very contactable on LinkedIn. Really happy to connect with with anyone that kind of wants to talk or or even just share ideas that they have of things that they're doing. Um yeah, LinkedIn's definitely the best place to catch me. If there's anything that if there's anything that people want around our research, our website's the best place, which is just www.spiresearch.com.
SPEAKER_01Very good. So you put your um LinkedIn proof into our show notes. And yeah, thank you so much for being on our show. Thank you for having me, Sammy. Awesome. Thank you for listening to the Leaders in Consulting podcast. To learn from and go with fellow consulting leaders in person, apply to join our monthly confidential forums and peer coaching in your city. Visit leadersinconsulting.com for details. See you soon.
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