for you and your business

Profit Improvement for Professional Firms

I spoke this morning at the Professionals Partnership Event, on Profit Improvement for Professional Firms.

Talking about profit improvement to a large audience is always difficult: to make meaningful improvements to profit you need to know the detail. And what might work for one firm might not for another... or even two different departments or offices in the same firm.

Previously I have picked one sort of business to talk about: in January I talked about profit improvement in law firms. I chose solicitors, as most people in the audience, if not all, would have used a solicitor such as for conveyancing their home, or for legal matters in their business and so would have been able to relate to what I was saying - perhaps picturing the solicitors they had used in their minds, and recalling how they were charged for the work.

That was fine for some of the audience, but less so for others - the farmers in the audience for example! I thought I did will to mention the surprisingly short payback period of using robots in egg production, remote monitoring of pig activity when fattening pigs, and the use of small robots to increase arable yield. All good ways of improving farming profits, but none of which were of use to the solicitors in the room!

So a seminar format is not ideal for conveying meaningful detail on how to improve profits. Today I spoke about just two things.

Firstly the importance of knowing the data, and the granularity of that data, and secondly my view that as professionals we all know broadly what we need to do to improve profits: things such as marketing to improve our client base, charging appropriate fees for client work, getting good utilisation of our staff, and keeping control of our costs. But my contention is that there is a disconnect between knowing what we need to do and doing it.

Not being willing to discuss our clients, and unwilling to make up an example, which would be unmemorable to most of us, I used the analogy of health and fitness.

I went through my personal 'Profit and Loss Account' of weight and fitness to draw parallels of knowing what I needed to do to improve, but not doing it (despite having a personal trainer telling me to!)

Fitness and diet offer huge granularity of data: Calorie and macro-nutrient data from MyFitnessPal: Calories burnt, intensity of exercise, heart rate and power data, courtesy of sports watch.

I stepped away from the lagging key performance indicators and showed how I developed actions to improve my own health and fitness and then came back from the analogy to business again to show how we can take the same approach to improve the profitability of our firms.

I dipped into half a dozen books to show that the information is there to help you improve profit. Some needed no explanation why they were included in the bibliography that I passed round. Others, such as "Happiness by Design" by Paul Dolan, and "The Chimp Paradox"by Dr Steve Peters, perhaps less so!

From the feedback received and requests to deliver the same seminar at other events I think I managed to explain how Happiness by Design can be adapted to Fitness by Design, and then adapted again to Profit by Design. If nothing else I had a lovely morning talking about two things that I am passionate about.

Adrian's seminar, "Profit Improvement for Professional Firms: Profit by design and through the analogy of fitness" can be delivered in-house to professional firms who are actively seeking ways to improve profitability. It can be delivered to partner / shareholder retreats, or other meetings of partners and directors. For more information, please contact enquiries@cbslgroup.com