Be both commercial and professional
I spend a lot of my time working with professional firms helping them manage themselves and their firms better. Initial discussions often focus around current pressures – on fee income, on work loads and on relationships.
These pressures are creating tensions within partnerships. With profitability and client loyalty a thing of the past, we need to pay more attention to running our firms as businessmen.
Many professionals feel that there is a dichotomy between being commercial and being professional. They argue that we are being forced to compromise our professionalism by adopting a more business like approach. As a result, people feel uncertain and threatened by plans to change the way that client services are delivered. Partners block decisions and challenge attempts to manage them and their client work. Many partners’ meetings reflect these tensions with difficult and prolonged discussions which reach little agreement and have no effective follow through.
This is the first in a series of four articles to address these issues. The overall theme will be to provide solutions to the challenges of managing professional partnerships. Each article will look at a particular problem and offer practical help and advice.
This article will set the context. It will consider why traditional management techniques do not work well within professional organisations and why professionals are so difficult to manage. It will also offer some answers to the apparent dichotomy between being both professional and commercial. Does one have to be sacrificed for the other or can we reconcile the two?
The second article will look at the apparent conflict between being both client focused and having some control over our working lives. The third will air the vexed issue of professionals’ reluctance to talk about money and the problems that that causes. The final article will consider the importance of following our instincts when working with clients.
Why traditional management techniques don’t work in professional firms
As anyone who has investigated the Management section of any good book shop knows there are huge number of publications available on every aspect of management. In addition, academia has researched and written about strategy, marketing, growth, leadership and entrepreneurship for many years. Most of this work focuses on large product based companies. We however trade as partnerships and provide intangible professional services. These distinctions are important and require fundamental differences in approach.
For example, research indicates that the longer a company is in existence the less it is likely to fail, yet we are seeing some long established firms disappearing. Traditional turnaround strategies focus on the need for a swift reduction in internal overheads which can include removal of the existing management team. This is not easy to do in partnerships where the managers are also the owners!
This brings us on to the second problem. Partnerships are not an easy structure to manage. Within them, planning and decision making requires consensus. Even where management responsibility has been devolved, individual partners can still block implementation. Limiting access to information or imposing sanctions is impossible to do as this would destroy the trust that is essential amongst partners.
Thirdly, professional themselves are not easy to manage. By their nature they are independent and articulate. They enjoy analysis and debate. Human resource management techniques, such as job descriptions and appraisals, do not sit easily with people who prefer to manage their own workload and be the judge of their own competence. Professionals will not do as they are told, and can become mischievous and difficult if they feel that their professionalism is being threatened.
Finally, the delivery of a service rather than a product causes problems in applying traditional marketing and quality control techniques. We cannot provide a sample of work to clients, we cannot easily impose quality standards. These issues are fundamental to our approach to managing our services, our firms and our people.
Commercial versus professional?
Many professionals currently feel that their professionalism is under threat. Solicitors face the challenge of a reduction in accessibility to legal aid. Doctors have had to become budget holders, whether they work in hospitals or as GPs. Lecturers are uncomfortable with the increasing emphasis on the quantity rather than the quality of students. Are we being asked to compromise our ability to provide what we define as a professional service?
To answer this we have to look at the effect of adopting such an approach in practice. Let us take an example. Hospital managers are seeking reductions in overheads and waiting times for patients. They are therefore asking their professionals to be more accountable. However, no manager of a hospital should be asking his or her professionals to compromise their professional judgement. Whilst to do so might appear to provide short term savings, these would be far outweighed by the tensions such an approach would create in the working environment. In the medium to long term, it would be very damaging. Good professionals would leave rather than compromise. Patient care would suffer both directly and indirectly. Fire fighting would increase as working relations became strained with little co-operation or communication. All of this would have a damaging effect on attempts at cost savings and efficiencies. New people would not be attracted to join as the reputation of the hospital deteriorated. Professional indemnity claims would increase. The overall result commercially would be extremely damaging to the organisation.
This is the same in any professional environment. To be competitive today, we have to do more than deliver a quality professional service. That is the minimum that clients now expect, and rightly so. We need to provide that additional “something” which makes us better than our competitors and adds value to the client relationship. As managers of professional firms, we need to create an environment which achieves this – where people work well together and share skills, expertise and client connections. We must not compromise or lose our professionalism otherwise we run the risk of creating the hospital situation described above. We need the maximum contribution from all our people to achieve success for the firm. Professionals will leave rather than compromise and will cause untold damage to working and client relations if they feel that they are under attack.
How do we tackle this?
First of all we need to understand the essence of professionalism. We entered our professions with certain expectations. We may have wanted to help people, to defend truth and justice. We may have sought an intellectual challenge or have identified a certain quality of life associated with working in a professional environment. We all have different drivers and values.
There are a number of key elements which distinguish a profession from an occupation. These include affiliation to a professional body which regulates entry and standards, and requires formal training followed by a period of practical learning. In addition, we provide a service to society. All of these impact on us and the way that we can be managed.
We observe external and higher duties of care than those imposed by our workplace. Managers must accept this and work within these parameters. Consider the debates that many firms are having at the moment over the profitability of legal aid work where partners are committed to providing access to justice to certain sectors of society. There will be occasions when these professional drivers take precedence over apparent profitability. The partnership must make the decision based on its values and then look at how to manage the work most effectively. As a result, partners may need to compromise and look at the way that the work is carried out and balance that against their value of providing a service to the public.
Secondly, we are committed to the continuing development of the profession. This reflects the unhappiness that many of us feel about the current treatment of young professionals. Too many are not being given the opportunity and the time to learn. Again, some firms may feel that this is so fundamental to their values and drivers that they will continue to support trainees and provide them with as wide a training as possible, regardless of the short term cost to the firm.
When making decisions about our firms, we need to go back to the core values of both our professionals and the business. We must talk these through with each other as otherwise we can make false assumptions. One accountancy firm I worked with recently was having difficulty implementing certain key decisions. One partner was seeking to grow the firm whilst another was blocking all discussions about it. Each had decided that the other was being difficult and selfish. In fact, they both wanted to improve the quality of the service being provided. Once we had established that, it gave us an agreed basis and framework within which to move the firm forward.
Many firms are reluctant to open this discussion on values because they are worried about airing sensitive issues. However, these values are fundamental to our beliefs and behaviours. In my experience, if these issues are not discussed, they will fester and re-surface. Discussions will be unhappy or threatened. Much time will be wasted with the firm unable to make decisions, let alone implement them.
The mechanism to openly discuss people’s values is often contained in the development of a “mission statement”. This is the usual management technique which precedes any discussions about business or strategic plans. Although perhaps too glib for many professionals, there is validity in going through the exercise of discussing and agreeing some commonality of purpose. There are a number of ways of doing this. For example, asking people to list their core values or to produce a picture of the organisation as they see it now and what they would like it to look like in the future. This visual exercise can be a quick way to talk through current problems and future expectations. It must include as many people within the firm as possible as everyone is needed to implement future plans.
In conclusion.
There are particular problems in applying traditional management techniques to professionals and their organisations. We need to be aware of these and develop effective tools to better manage our firms and the people who work within them. We require to address and resolve the perceived dichotomy between being both professional and commercial by identifying the core values of the firm and its individuals.
The next article will look at how we balance our needs against those of our clients.
Fiona Westwood is a solicitor who specialises in providing management and training consultancy services to the professions. More information about her and her firm is available by telephoning 0141 339 0240www.westwood-associates.com