If agencies can reframe what they offer in terms of providing solutions, not services, and recast the skills and talents within their business, then they will move up the value chain, argues Tim Williams.
The next time a client requests a set of 'deliverables', remember that this is not the real reason your firm was hired in the first place. You were hired to deliver business and marketing outcomes. The deliverables are just a means to that end. No doubt even your day-to-day client contacts may forget that fact from time to time, but it's your job to remind them. Otherwise, you risk being seen (and treated) as a supplier instead of a business partner. The executives on the front lines of your firm must understand that you're in the business of providing solutions, not services. Services can be procured from a lot of other sources, often at lower cost, and the professional buyers in client organisations know that. But if you present your offering as effective solutions to business problems, you're putting your real value in perspective.
The framing effect
Behavioural economics teaches that one of the easiest, and most powerful, ways to enhance the perceived value of what you do is to reframe your offering. One of the most impressive examples of this principle is Howard Schultz's reframing of the 50-cent cup of coffee into an experience that made a caffeine fix worth four dollars. Starbucks reframed the product as an experience and has been extracting incredible value from it ever since.
Before you jump to the conclusion that this doesn't apply to professional services, stop and think about how little effort goes into framing the services of most firms. Visit a typical agency website and you'll see their offering isn't actually framed at all; it's just a bullet-point list of commonly provided services. And if anyone should know better, it's agencies, who would never recommend this kind of lacklustre approach to their clients.
If what you sell are services, that's what clients will tend to buy. If on the other hand, you package these services as solutions intended to produce marketplace outcomes, your clients and prospects will place much more value on what you do.
Moving up the value hierarchy
There is, in fact, a value hierarchy for professional firms. The least valuable offerings are services, which are associated with 'labour', and are seen as widely available, and aren't easily scalable.
At the very least, consider packaging these services as programmes – unique combinations of services designed to achieve a desired outcome that is important and relevant to current and prospective clients.
Taken one step further, these programmes can sometimes be turned into products – branded solution sets that produce value for your clients (and recurring revenues for your firm) independent of any notion of labour or time spent.
Speaking of time, this is by far the worst way to frame what you do. Time (hours) simply represents effort, and no reasonable buyer of professional services would want to buy effort. While you may feel pressure from your clients to be 'efficient', this is only because you're choosing to sell units or cost instead of units of value.
Under the hourly rate system, clients push for 'efficiency' only because they don't want to pay more than they have to for a particular output or outcome. If what you sell is the output or outcome itself, you'll soon see that the emphasis shifts to where it truly belongs: are we being effective?
Not just effective, but efficacious
A better word still is 'efficacious'. Yes, that is a real word. In the pharmaceutical business, efficaciousness is an absolute requirement, defined as 'the power to produce a desired effect'.
The concept of efficaciousness is infused with the kind of energy that can inspire teams inside professional firms to produce positive outcomes for their clients.
As Pine and Gilmore observe in their outstanding book The Experience Economy, if you just sell services, you're in the service business. But the goal of professional firms is to renovate, recharge and reform the business success of their clients. By recasting the skills and talents that reside in your business, you can move up the value chain to where you really belong: the transformation business.