Even though my clients hire me to help build the infrastructure to grow, there's still sometimes a disconnect.
From the deeper questions I ask about "standard" tasks or when I insist we consider the long term when making a "short-term" fix... there's some confusion why I'm not just making it quick and shaving off their time commitment.
But that disconnect comes from a common misunderstanding.
Namely that there are 3 main ways you spend time that contribute to your business' bottom line.
And counterintuitively for the professional services owner, the balance of where that time is spent vs where you generate profit and profit growth is the exact opposite of what might be expected.
Let's look at those three things and take them in order.
Delivery ($): Where Most Time Goes
This is what you do for clients and all the resourcing that supports it.
Whether it's legal work, accounting, marketing, some form of consulting... it's about delivering a solution that has some kind value to a client.
And for most of you here, that might be how you describe your entire business and define your day-to-day life.
Influx of new clients, cases or projects... well, you better get to work. That's where your compensation comes from, right?
Not quite.
Just because it's the biggest piece of the time pie, that doesn't make it the most valuable.
Whether you're working on a billable hour here or not, you might just be trading time for money. That's not a business, it's a job.
And if you're feeling the pain points of having too many jobs to do and you have to be in too many places at once, this is where you need to focus.
Good news is...
Any job that goes toward supporting the client - from delivery of the billable work to delivery of the invoice to delivery of the next new hire via recruiting - plus the management of it all - it's all delegatable.
Yes, that's right.
Deliverables can be delegated. They are jobs. And they are not how the business makes its money even though that might be how you are making your money right now.
If you don't want to give up the direct client delivery right away (or maybe not ever), you can start delegating other delivery work....
Administrative work.
Back office stuff.
Lower value client delivery.
Because as you'll see, there's more to your business than just Delivery.
So let's move up a level into something higher value.
Development ($$): What Makes Delivery Possible
And by Development, I mean business development. The work of prospecting, marketing, getting people into consultations and then getting them from consultations (or some other conversion process) into signed-on-the-dotted-line clients.
In some firms, quality business developers (aka sales people) make more than the CEO. Because without them...
Delivery doesn't exist.
Development is worth more than Delivery for exactly this reason. Without a predictable stream of client work, your business looks like the Richter scale readings during an earthquake.
Frantic, volatile, and all over the map.
When you're feeling the cyclicality in your sales cycle and month to month revenue, that's inconsistent Development.
But it's not even Development that makes your business the most money.
It's this next one that matters most...
Decisions ($$$): Your Top Driver of Profit
Are you making the Decisions that will move your business forward?
Or are you too stuck moving the needle on Delivery and Development to even give this much thought?
When you feel, think or experience the following...
- This random chaos keeps hijacking my attention away from Delivery and Development.
- We decided to do X to grow profit/ease the chaos but it's months later and it still hasn't happened
- I've delegated off Y but they keep missing the mark. Like they're "getting it done" but not changing my business for the better.
- Growing always feels like more work and massive risk so maybe we'll just stay small for now (or forever).
- Despite the "upgrade" to our systems, I'm still chasing exceptions and editing work.
- I've got some people doing excellent work and following best practices and others doing their own thing, making money, but with gaps that I try not to think about too much.
- I think my people know what to do but don't have the "why" or the context to do it well without me.
- I get what I need to do today and this week, but the next 3 months, 12 months, 3 years... that's anyone's guess.
- Can I retire? Can I sell? How do I get out of this rut?
...It's very likely a problem in the Decisions area, not Delivery or Development.
There are thresholds in your business evolution where mo' money will be mo' problems if you don't have Decisions in order.
This is the space where Fractional COO work thrives.
And why I ask my clients those extra questions or spend time on the exceptions.
Because it's where the big opportunity and Return on Investment sits in your business.
Making these improvements is what causes your business to stop looking like the minute by minute stock chart...
And start looking like a 100 year rise in wealth.
If Decisions keeps getting pushed because Delivery and Development are eating up all your focus, it's time to learn more about our Fractional COO services.
Or book some time to talk with me here.
