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Scaling Sales in Professional Services: What Goes Wrong and How to Avoid It.
Scaling a services firm takes more than hiring salespeople and boosting your marketing budget.
This is a common, major, and costly oversight. The cost of this mistake is typically $450k to $3 million in direct costs and lost sales.
At Collective 54, we call these avoidable things that are simply down to a lack of experience “dumb taxes”.
This cost is incurred before the founder realizes they skipped the steps needed to build the foundations correctly because they have not done it before. It often takes 2-3 years for founders to run out of patience with burning cash and not growing. Then, they take action to fix it.
The solution is creating a systematic, replicable sales and marketing process that can grow along with your business.
Last year, I spoke at the Collective 54 Founders Summit. The topic of scaling a sales team in a professional services firm was popular. Many founders are stuck in sales, and growth is always top of mind at C54.
At Mindracer, we run several deep dive assessments each month with founder-led ProServ companies. Our data shows that 100% of those teams secure most of their business via referrals.
We ask them to share the referral program details and found that only 37% of those companies had a documented referral program.
100% of the companies wanted to grow sales. Only 43% had a documented sales methodology. I could go on – there are over 20 data points on the assessment.
Each item without documentation is a knowledge gap between the founder and the next hire. Each knowledge gap creates risk and reduces efficiency.
If you’re in professional services and want to grow revenues, here are some pitfalls and priorities to consider.
What to have before you start scaling:
Common Scaling Challenges:
Breaking Out of Founder-Driven Sales:
Many professional service firms start with the founder making all sales themselves. This approach doesn’t scale. Shifting from a founder-driven model to a sales team requires more than just hiring salespeople. It also requires processes to maintain the quality and personal touch that clients expect.
Lack of Defined Sales Processes:
Without a clear, trainable sales method, each salesperson may use their own methods. This can lead to inconsistencies and inefficiencies.
Professional services firms need processes to:
- Identify and qualify prospects.
- Manage stakeholder relationships during the sales process.
- Sign contracts.
Inconsistent Lead Generation:
Before hiring salespeople, it’s best to have a steady flow of leads. The founders should have closed some of these leads. They should also have a benchmark for the process before making the hire. Firms often rely on sporadic word-of-mouth referrals or the founders’ networks. Then, they hire a salesperson to “go sell.” The founder does not understand a non-referral sales process. Both sides, the founder and the hire are disappointed in the end.
Targeted marketing and customer profiling can help generate leads. This is a good step toward hiring salespeople. It lets the founders win more business. This proves the lead-to-close process works in their firm. It also allows them to document that process to train the new hire. This process also creates the revenue to pay for new sales hires.
Strategies to Scale Your Sales Effectively
Develop a Robust Lead Generation Engine:
Utilize thought leadership and content marketing to create a pipeline of leads. Refining your messaging and marketing to your Ideal Customer Profile will help. It will attract the right clients. Document this “how to get leads” process. It will help your marketing and business development hires succeed.
Standardize the Sales Process:
Document your methods for winning clients. Train all team members on them. This standardization ensures consistency in all interactions. It also scales the company’s client acquisition philosophy without the founder’s direct involvement.
Leverage Technology:
Implement CRM systems to improve reporting and leverage data in all marketing decisions. Use technology to reduce the admin burden on sales teams. This includes recording calls and using AI to summarize takeaways. These tools can show customer behaviors and sales trends. They can help with forecasting and strategizing.
Focus on Training and Development:
Regular training is crucial. It keeps the sales team updated on best practices. It also motivates them to improve. Skill development must be ongoing. It should use recordings of the best and worst calls, and learn from client feedback. This will help the company adapt to changing market demands.
Cultivate a Strong Growth Culture:
To grow, the firm must grow revenue. They must create a culture that rewards finding leads and winning clients. It should also promote teamwork and shared learning. It is vital to recognize and nurture talent. Their mindset must align with growth goals. This is key to long-term success.
Connect with Experts:
Scaling sales is tough. It often needs outside help to avoid costly mistakes and move quickly. A strategic advisor can help you. They can provide insights and tools to streamline your sales.
In conclusion, if you’re ready to take your professional services firm to the next level, consider exploring expert insights and community support so you can avoid dumb taxes and grow your firm.
Mindracer has been a Collective54 member for almost three years now – it’s been an outstanding community for us – our long-term plans have evolved, our metrics have improved and we have made some highly valuable connections, partnerships, and friendships among the team and community members.
Apply for membership at Collective 54.
Subscribe to Collective 54 Insights for regular updates and best practices.
Connect and network with author of this post and managing partner at Mindracer. Dan Morris on LinkedIn.
The right strategies and support can transform your business. They can shift it from founder-driven sales to a high-growth company with a much higher value.