great deal of hard work, dedication, and comfort with rejection. Aligning firm and personal interests increases the chances of success. The professionals within the firm are well positioned to understand the product and speak knowledgably about it. While it is possible to educate a professional salesforce or marketing firm about the firms services and attributes, it is expensive and, if not managed appropriately, can be less productive than the partner model. Further, it is a powerful message for clients to realize that the firms personnel are personally dedicated to the firm and its success.

By utilizing the firms partners and members, the firm preserves its financial resources. While the firm potentially loses revenue through the loss of billable time, it is able to preserve its financial resources that would otherwise be spent on outside services or a dedicated sales team.

The relationships developed during the marketing process are the same relationships that continue during the firms work with its clients. An important determinant of professional services firms success is their client relationships; this is an important characteristic of the partner model. The sales approach is grounded in the concept of establishing relationships rather than selling services. It is important to establish a strong bond with your clients from the start.

The partner model, while relatively efficient and appropriate for small-and some mid-sized firms, is not without its disadvantages:

When using firm partners or professional staff to drive business, ensuring the efficient allocation of resources is critical. Typically, as firms grow and the number of clients increase, management is faced with the decision of offering additional services to leverage existing clients while continuing to develop new business. It is difficult to quantify but it is much easier to expand on an existing relationship than to develop new ones. Exhibit 5.1 illustrates the issues surrounding allocation of resources as the firm continues to grow and increase its client base.

The most efficient use of human and financial resources is traditionally found along the slope of the line. As a firm grows at some point management will be faced with the opportunity to develop additional services through leveraging its existing client relationships. As a general rule, professional services firms should, as they increase in size and client base, begin to offer additional services (as opposed to adding new clients) as a means of securing efficient growth.

The small firm, including the traditional litigation boutique, is represented by Firm X. Exhibit 5.1 shows that Firm X has relatively few professionals as compared to its larger competitors and that it is offering only one or two primary services. However, within its target

market, Firm X is specifically focused and proficiently services its clients. In fact, by specializing in the services it offers, Firm X, even with its limited human resources, can experience great success. Firm X is also uniquely situated so that it can, as discussed earlier, preserve resources by specifically focusing its marketing and business development efforts.

The mid-size firm, represented by Firm Y, is at a fork in the road. Firm Y must determine whether to offer new services to existing clients as a means of increasing its revenue or focus its resources on developing new clients. Firm Y may be able to expand on its existing relationships by offering additional services more efficiently than developing new client relationships. If Firm Y offers additional services to existing clients, it can increase revenue without being forced to expend the human and financial resources to develop new clients. Financial modeling, which is discussed in Chapter 15, is critical when determining whether to expand your human capital and increase your financial obligations.

There are, however, always exceptions to the rule. For example, a specialized commercial litigation firm, which is represented by point Z on the exhibit. As a general rule, Firm Z should offer additional services to its existing clients to maximize its efficiencies and capitalize on its human resources. However, this is where pragmatism and theory diverge because Firm Z is, with its numerous attorneys, focused solely on

high-stakes commercial litigation. Despite its extensive supply of human capital and singular focus, Firm Z is profitable and successful. Firm Zs success originates and is in large part attributable to its ability to differentiate itself from its competition and focus on a specific segment of the marketplace.

Marketing and developing business are not easy tasks, and in fact, are one of the most difficult tasks faced by the professional services firm. As a result, a great deal of diligence, perseverance, and discipline is required to do both well. The firm should set specific expectations and well-defined goals to ensure the diligent pursuit of developing business for the firm and furthering its reputation. An effective tool to ensure the appropriate level of effort in the pursuit of business is to require professional staff to attend regular marketing meetings. Each meeting should focus on the firms goals and the means by which those goals can most efficiently be obtained. In addition to defining the firms target market, the participants should discuss their network and marketing ideas. The meeting should begin with a brainstorming session and end with the allocation of specific business development or sales-oriented assignments. The assignments can range from entertaining an existing or potential client to speaking at a forum or symposium attended by existing or potential clients. It is imperative to provide direction and make each person accountable for his or her actions or, as the case may be, failure to act. Peer pressure as a form of accountability is a powerful tool that should be incorporated into the firms approach.

A large Houston-based law firm focuses a great deal of its marketing efforts on its partners. The firms sales volume is, therefore, reliant on the diligence of its partners. Every month, each practice area holds a marketing session. After the partners discuss their ideas and identify their current network, each partner is given an assignment. There are no quantifiable penalties for failing to complete your assignment. However, the desire to succeed and the fear of letting down partners and peers significantly outweigh the inertia that professionals must overcome to market the firm and develop business.

Conversely, a mid-size accounting firm in Seattle uses the carrot as opposed to the stick. This firm has instituted a series of incentives to encourage its professionals to market the firm and develop business. For example, the firm awards two round-trip tickets to the professional who brings in the most new business in a given quarter. Further, the firm shares fees with the professional(s) responsible for originating every client. Significant accomplishments can result from ensuring that the incentives of the firm and its human capital are aligned.

Managers or the management committee of a firm must understand the boundaries of the firms human capital. Certain members of the team