It’s been a doom-and-gloom year for employers. You’re probably tired of hearing dire predictions about major economic changes with the potential to swallow up your profits. After all, if your business made it through the COVID-19 pandemic, what can’t it survive?
Yet, there’s an undeniable trend none of us can (or should) ignore: the Great Resignation. It’s monopolized talk among business leaders since mid-2021, the year in which 1-in-5 adults quit their jobs.
The quits rate remains high in Q2 of 2022, punctuating the magnitude of this relevant, if exhausting, reality.
Even if you haven’t paid close attention to the resignation phenomenon on a larger scale, you’ve likely noticed how difficult it’s been for your firm to meet the rising demand for consulting services with a volatile team.
While the exact conditions we see today may never show up again, this moment presents an opportunity to insulate your consulting firm by demonstrating that you’ve paid attention to the key lessons of this historic, workforce-wide event.
It’s time to:
82% of small businesses fail due to cash flow problems. And cash flow is directly related to profit (the number you really care about).
While the world is focused purely on hiring and retaining talent, you could be overlooking an opportunity for change — one that’s always been there but never been more important to notice. Being intentional about generating profits can make up for gaps in your team and combined skillsets.
It’s common for professional service providers to misunderstand profitability because most entrepreneurs are programmed to think of profit as a single numeric calculation:
This reductionist approach sidesteps how much control you have over that final number. Not to mention, you may be in the habit of assessing your profits retroactively, which tells you more about yesterday’s happenings than tomorrow’s potential.
To transition your firm from reactionary to forward-thinking, try purposefully impacting and predicting your profits.
That could be an intimidating prospect, so we recommend starting with some basics. An easy way to conceptualize the variables that affect profit is with the profitability trinity: the symbiotic relationship between budgets, timelines and utilization. You should be able to collect accurate, real-time data about all three.
Can you currently calculate (a) the total you spend on each client and project, (b) the estimated vs. actual hours dedicated to each client’s work and (c) the amount of your employees’ time that’s applied to billable work?
If the answer is no to any (or all) of the above, your first step in restructuring for resilience should be to establish streams of meaningful data.
READ NEXT: 5 Techniques To Optimize Employee Utilization
The easiest way to set up these streams is with technology built for consulting businesses — ideally, one comprehensive platform rather than separate systems that don’t speak usefully to each other.
Review each step in your client work journey to find the tasks for which you could most readily benefit from supportive tech.
Do you spend unnecessary hours on admin tasks to transition a prospect into a client?
With software that easily converts quotes into projects, you can apply your precious time to more growth-oriented work, and your consultants will never overlook a deliverable.
Would you struggle to explain to a client why you’ve gone over budget on their project?
An adaptive project management platform with a client portal increases visibility, minimizes missed communications and reduces confusion for everyone.
Are your consultants manually deducting their hours from a single client-based timesheet?
Automated time-tracking on a per-project basis can help you zoom in on where that time is going and make smarter decisions about hiring in-house and contracted consultants.
Does your team struggle to meet ad-hoc requests promptly?
It could be time to institute a ticketing system that can show you how long it’s taking your staff to reply to requests and flag any being ignored.
Given the looming economic uncertainty, you might think now is a risky time to adopt new tech. But wise investments in hard times can be utterly transformational — even life-saving — for your business.
Some less technical practices can also help you fortify your consulting business in anticipation of a prosperous post-Great Resignation period.
Confidently making it through this period means being fully transparent about the organizational culture you aim to create with your consultants and leadership team.
Want more ideas for lessening the adverse effects of the Great Resignation? Download our latest guide for consulting businesses.