Join this session to learn what an expert network is and how it can be a game-changer for your firm. Member Thom McLeod, Founder and Managing Partner at Tenzing Consulting will share with members the myriad ways an expert network can accelerate growth, enhance client offerings, and foster innovation within your firm. We will explore how to identify opportunities to leverage expert knowledge to create value-added services and differentiate your firm in a competitive market.
TRANSCRIPT
Greg Alexander:
Hey, everybody. This is Greg Alexander, founder of Collective 54 and host of the Pro Serve Podcast, which is what you’re listening to right now. If you’re not familiar with this show, it is for founders and leaders of boutique professional services firms who are trying to make more money, make scaling easier, and make an exit achievable. On this episode, we’re going to talk about the expert network, which is a very innovative and creative way to scale a professional service in a relatively stress-free and flexible manner. I think it’s something that many of our members could leverage more, and they don’t. To help me explain the concept and share some in-depth knowledge on it is a member of Collective 54, Thom McLeod, who has built his entire firm on this unique concept of an expert network. I might even go so far as to say he is an expert network. So we’re going to tap into his knowledge and hopefully learn from him. With that, Thom, why don’t you introduce yourself to the community?
Thom McLeod:
Sure. Hi, everybody. It’s been great to be part of the community. I’ve gotten a lot of value from quite a few of these podcasts and sessions myself. So I’m really happy to be able to make a contribution back and hope that you all get some value out of it. I’m a co-founder with Bill Angelony of Tenzing Consulting, and we founded it about 22 years ago in a very practical way. We were just bootstrapping a boutique essentially. So we’re all boutique founders, most of us are. A very practical way to bootstrap our boutique was to use contractors, and at a very simple prosaic level, that’s what we started out doing. But what it’s evolved into is a much more elaborate, much more intentional talent strategy, taking advantage of the mobility, flexibility, and nature of the gig economy in the professional services space. So that’s kind of how we all got here.
Greg Alexander:
Tell us a little bit about the niche that your firm plays in, the types of clients you solve, the problems you solve, etc.
Thom McLeod:
Absolutely. So we built our network, which is now well over 1,000 experts worldwide that we’ve recruited. We curate that network, and these are folks we know and trust to deploy on engagements with our clients. Our main areas of specialty are procurement, supply chain, and manufacturing. So any companies, any clients, for example, that have physical supply chains, they may even be service companies or companies that we would focus on. Our clients range from large corporates, corporate clients in the tens of billions of revenue, to smaller, let’s say mid-cap or even small-cap companies, many of which are private equity-owned. Private equity firms really like the idea of experts to be able to go into their companies and operators who really know what they’re doing. So that’s kind of where our niche sits right now. I did mention that we are global. This network we built is about two-thirds in the US, but the other third is mostly in Europe and other parts of the world.
Greg Alexander:
Okay. So let’s start with the basics. Provide us a working definition of an expert network.
Thom McLeod:
Got it. Well, let’s start with a working explanation or a definition of an expert. What do we call an expert within the context of Tenzing? We’re looking at people with functional expertise in procurement, supply chain, and manufacturing. But also, there’s very often an intersection of that expertise with a particular industry. So procurement in aerospace is very different from procurement in food. A supply chain for a large automotive company doesn’t look anything like the supply chain for a chemical company. So expertise has both a functional and an industry dimension. When you intersect those two dimensions, you really have an expert who knows what they’re doing. The other thing we’re looking for is typically people with 15 to maybe 25 or 30 years of experience. We love it when they’ve worked for consulting firms because then they are good at consulting. But what we’re really looking for in an expert is an operator, someone who’s run the function, done the job. As we like to say to our clients, someone who’s sat in the chair, they really know what you do and know how you and your people do it. So they can be more effective as a consultant, advisor, and co-executor within their business. That’s what an expert is. Now, what’s a network? It’s a bunch of those, right? So rather than being random, we built the expert network kind of organically over time based on the demands of our clients. If they needed something we didn’t have, we went and recruited more of it. We built it very intentionally. I’d like to say strategically, but it wasn’t like we thought way ahead and recruited a lot of people we weren’t sure we would need. We were very responsive to the market. Building this network is not just scraping people off of LinkedIn. It’s not just a drawer full of resumes. We know what we’re looking for. Our recruiters really understand what an expert is, they know what qualifies as an expert, and we take them through a rigorous screening process, including technical interviews and so forth. By the time you add all that up, you have a network. Our network started with maybe 12 people we knew when we bootstrapped the company, and now it’s 1,400 experts around the world that our clients have come to trust.
Greg Alexander:
Wow. That’s an amazing story, it really is. I’m going to ask you some very basic questions, and of course, more detailed questions will come from the private member Q&A. So why would an expert enroll in your expert network? What do you provide them?
Thom McLeod:
Got it. Well, at its most basic level, it’s access to work. When we’re looking for experts, we’re mostly looking for people who have chosen to do this as a living. Occasionally, there are people who are trying consulting, maybe kind of passing through consulting, and they want to see what it’s like. But mostly, these are folks, this is what they do. This is how they’ve chosen to work. This is how they’ve chosen to take the vast experience they have and really put it to work and balance their own lives. They can work as much as they want or as little. Some work a lot, some work a little less. So we kind of have to meet all those experts on their own terms.
Greg Alexander:
So, what you’re bringing to them? Well, one of the things, I’m sure there’s many, but what you’re bringing to them is that you have a client, the client has hired you for a piece of work. And of course, for experts, that’s the golden ticket, so to speak, right? So when you work with clients and you tell them what your delivery model is, do they express any concern that it’s this kind of federation of experts? Because the people you’re competing with, the McKinsey world, they have a different model. It’s full-time employees for the most part. So help me think, help our audience understand how you explain it to a client?
Thom McLeod:
Got it. Let me just maybe do a little code on the last question. So what the experts are getting from us is access to work, but we also treat them in a highly professional way. We don’t just see them as cogs in a machine. Each expert has their own unique expertise and style of working. We can fit style to a particular client. If they do great work, then we’ll be calling them again. That’s a nice way the ecosystem really works. Back in the early days of Tenzing, 20 years ago, the gig economy was still fairly new. It was well known for graphic arts and things like that, but not for professional consulting. There were a lot of questions at the beginning as to whether this was a real business. I don’t get those questions so much anymore. One of the things we definitely help our clients understand is that we are a consulting firm that takes responsibility and stewardship for every assignment, even if it’s just a single expert. More often than not, it’s a team. We’re not a staffing service, and the client doesn’t have to worry about us just throwing people at them that we don’t know or haven’t vetted, and then having to manage it. There is a layer of value we are adding to that. This allows us to operate with economics that are much higher margin because we’re adding that additional value. We’re not subject to a lot of the same constraints or concerns that people would have with a staffing service.
Greg Alexander:
And relative to competing with the big guys, you know, the big three who have full-time people. In the eyes of the client, what are the advantages of hiring a firm like yours who has 1,400 experts across the core?
Thom McLeod:
Right. Well, I used to work for large firms too, so it’s pretty easy to explain the contrast. I have enormous respect for those firms and I never try to diss them with a client because clients hire them for very good reasons. Their brand really does matter. The work they do is very high quality. What they don’t have that we have is people with true experience. Instead of getting a team which might be a very large team from another firm with a lot of young people on it who are extremely hard-working and very bright following methodologies, operators really know how to get from point A to point B. They’ve seen the problems before, they know what solutions work and don’t work. They’re not operating from theory. Especially in private equity, they don’t want to take a chance on a fairly young team that is kind of learning on the job. That’s a big contrast. The other thing is that a lot of other firms don’t really do implementation work, but we do. In procurement, for example, we will actually conduct negotiations on behalf of a client if they want us to, or sit in the room with them and really have a hands-on role in getting things done. Many of our experts are qualified to be interim leaders in a company. A lot of our clients will come to us and say, “I need an interim head of procurement. I need an interim head of support,” and we have people who are qualified to do that. Other consulting firms don’t really bring that to the table as a matter of course. I will add just one other quick thing. I don’t diss other consulting firms for a very good reason. Some of them are our partners. The firms that recognize they don’t have what their clients really need have turned to us. Some of the top firms whose names you would know actually bring us in and introduce us to their clients as Tenzing in order to complete or execute a strategy that they recommended to a client or to provide an interim executive. Even they recognize our value and allow our brand to shine with their own clients.
Greg Alexander:
Yeah. And the good thing complements them. Sometimes that’s the right thing that the client needs. Those firms understand they don’t do that. They bring you guys in. Regarding internal operations, you’ve been around 22 years, you’ve scaled a substantial firm. How has this model allowed you to scale easier than the full-time employment model?
Thom McLeod:
Got it. Well, I’ll say just as a little disclaimer at the beginning, we’ve started building an employee base now too. So we really have a hybridized model. What it allowed is that in a very low-risk way, my partner and I initially sold all the work in the firm, but then eventually other people in the network also provided leads and helped us sell. That was a very nice scalable model. It was linearly scalable in the sense that every new client we could acquire, we had virtually limitless staffing. We didn’t have the problem of having to hire ahead of the curve to have capacity to serve clients. We waited for the demand to evolve, and then we would recruit and staff behind that. I don’t know if you can really call that in the strictest definition. I know that you have a very strong point of view on what scaling really is. Let’s just say that allowed us to have very low-risk linear growth. Scaling now for us is adding a more permanent layer of engagement leadership stronger on methodology where the experts are enhancing our ability to deliver. They’re providing that specificity of expertise that is needed for the task at hand. We’re trying to give the client the best of both worlds. They can have a highly professional consulting engagement that’s executed using very proven methodology, but they also have that expert in there really delivering the work. So they get the best of both in my opinion.
Greg Alexander:
Earlier you mentioned recruiting, I would imagine that’s now a core competency of yours? Because you’ve got to 1,400 experts and I’m sure that’s growing. So, do you have in-house recruiting? Do you contract that out? Is that a core competency? Is that, is that a must? If, if you’re someone that wants to embrace this business model?
Thom McLeod:
It is absolutely a must and I’ll tell you what’s interesting is that our network grew very rapidly over the years and it hasn’t grown as fast in the last couple of years. One of the reasons why is that it’s big enough. Now, it has a critical mass that most of the talent we need exists in the network. And when it doesn’t, our expert recruiting process which is much quicker and more efficient than employee recruiting can find the experts we need like in hours or even a couple of days. So when a client comes to us with a new fill from the existing network, we can recruit very fast. So recruiting for experts is a little different than recruiting for employees. There’s so many things that, you really need to have in an employee which really looking for an expert is, do they have the expertise and can they bring it to the table? And very often we’ll complement them with another member of our team to help deliver that to ensure that the client gets a good experience. But the recruiting is really key, and our recruiting process is incredibly fast. Like I said, a couple of days, most of the requirements can be filled too.
Greg Alexander:
Okay. We’re at our time window here. So I’m gonna leave it there. Let me give the audience a couple of calls to action. So first, if this concept is of interest to you as a way to scale your firm, the expert network, look for the meeting invite that you’ll get members, and you’ll have a chance to attend. Tom’s Q and A session which will be one hour in length, will go into much greater depth than the podcast allows today. Secondly, if you’re not a member and you want to become one, go to collect54.com, fill out an application and one of our team members will get in contact with you. And then third, if you’re not ready for either of those things, you just want to learn more. I would point you to my book, “The Boutique: How to Start, Scale, and Sell a Professional Services Firm” which you can find on Amazon written by yours truly. And with that, Tom, thanks for being on the show today. I look forward to our upcoming session and congratulations on quite a remarkable way to scale a professional services firm. Very impressed with your story.
Thom McLeod:
Thank you, Greg. Great to have a chance to get back.
Greg Alexander:
All right. Thanks, everybody.
Note: This transcript was generated by Gong.