True Professionalism

Preface

There are relatively few new ideas in business, if any at all. How often can one repeat the basic advice of “listen to your clients, provide outstanding service, train your people, look for and eliminate inefficiencies and act like team players?” The problem, clearly, is not in figuring out what to do. Rather, the problem is to find the strength and courage to do what we know to be right.

Professional firms expend immense effort trying to get their people to do the “right” things through systems, structures and monetary incentives. Not only have these frequently failed to create excellence, but they also leave a bad taste in the mouth. “Do it and we’ll pay you” smacks more of prostitution than of professionalism. In discussing recommended courses of action with my consulting clients, I repeatedly find myself saying “This is not only good business, but it’s the professional, ethical thing to do!” When something is presented as a management tactic, it is easy to argue with and dismiss. It is harder to argue with a matter of principle.

Principles (or values) are the most effective management tools a firm can use. Successful firms are different not because of different goals, clever strategies or special managerial tactics—these are all remarkably similar worldwide. Successful firms are clearly differentiated by a strict adherence to values, i.e., by their professionalism.

Do You Maximize or Minimize the Bill?

An example will illustrate the point. Any firm that emphasizes and rewards its professionals for large amounts of personal billable hours (or “utilization”) creates an incentive for people to find ways to maximize the bill on every engagement (perhaps even only subconsciously), in order to get credit for as many billable hours as possible. Not surprisingly, clients are increasingly suspicious that this system encourages inefficiency, since the more time it takes the professional to do the work, the more the professional gets paid. (In the practice of law, for example, some corporate clients now hire firms of “legal bill auditors” to examine their outside lawyers’ bills for waste, inefficiency and, in extremely rare cases, fraud.)

Clearly, the ethical and professional thing to do is to work hard as the client’s agent to achieve the client’s goals at the minimum possible cost to the client on each transaction. It is one thing to charge high fees for productive work. It is an entirely different matter to be inefficient and waste client resources on unnecessary or unproductive activities.

A true professional feels no pressure to run up a client’s bill, knowing that any reduction in revenues caused by being efficient will be more than recompensed by the reputation earned for being honest and trustworthy. A provider that is not efficient in spending the client’s money soon loses the client’s trust and confidence.

Is this an ethical point or a “good business” point? Of course, it is both. Either argument leads to the same conclusion: a good reputation is more valuable than the extra income earned through inefficiency. One would like to believe that this is obvious. However, it often happens that when I make this point, many professionals are skeptical. They frequently ask, “How long does it take for the market to recognize your trustworthiness and efficiency and then reward you with new business?” The answer is “very little time.” Clients are intelligent people and, since they usually employ more than one provider, they can easily recognize differences in quality, cost, service and attitude. They can, and do, move their business around quickly and reward efficiency promptly.

Evoking the moral argument is not necessary—although it’s still the real one. One should be efficient not only because it’s good business, but because it’s the right thing to do. Doing the right thing is good business! Yet one still hears the argument in professional firms that “I know what I’m doing could be done by a less costly person, but if I delegate it to someone who charges less than I do, our revenues will go down.” Do people making this argument need a lesson in business or a lesson in professional ethics?
Supervising Client Projects

Another example is found when supervising client engagements. In my book Managing the Professional Service Firm (The Free Press, 1993), I suggested asking junior professionals about their experience on work assignments to determine whether or not it was usually true that

• When tasks and projects were assigned, they understood thoroughly what was expected of them
• They understood how their tasks fit into the overall objectives for the engagement
• They were kept informed about the things they needed to know to do their job properly
• They received good coaching to help improve performance
• They received prompt feedback on their work, good or bad

• They felt that they were a member of a well-functioning team

  Every time I discuss this idea with professionals, I ask them what benefits might come from achieving excellence in these areas (i.e., doing all the above thoroughly, every single time). They always provide the following list:

• Motivated staff
• Better-quality work-product
• Better trained, skilled staff
• Less wasted time
• Lower “write-offs” of unproductive work that can’t be billed
• More timely delivery of work
• Greater ability to delegate, since staff will be better trained
• Freed up partner time to focus on high-value added activities
• Clients would notice better service, more teamwork, more motivation

• Quality, efficiency, higher profits and better client service.

  Not a bad list of benefits! The business case for doing well in this area is clear. A little bit of extra time invested in supervising would reap large financial (and nonfinancial) benefits. However, many professionals remain skeptical and argue that they are too busy to do all this, and point out that “clients won’t pay for supervision time.”

  Apart from the fact that this is faulty business reasoning (the return on investment for good supervision is huge), there is a profound moral issue here. Clients entrust professionals with their affairs. In effect, they say, “Here’s my baby, please look after my baby!” As the professional service provider, you cannot say “Well, I did the right thing. It was the junior staff that dropped the baby on its head.”

  When you accept an assignment from a client, good supervision is not optional. Rather, diligence in supervising a client’s transaction is an ethical issue, a matter of responsibility for due care. It’s about professional responsibility and true professionalism. The fact that it’s the high-profit thing to do is wonderful, but you should do it because it’s the right thing to do. Nevertheless, in most professional firms, excellence in project supervision remains the exception, rather than the rule.
  Caring for Clients

  A final example might help. In chapter 17, I point out that whenever a professional is trying to sell something, there is only one question on the client’s mind: “Why are you trying to sell me something?” There are two possible conclusions the client could come to. First, he or she might believe that the professional is trying to sell something just to get more revenue. Or the client might believe that the professional is trying to sell something because he or she is interested in the client, truly cares and is sincerely trying to help.

  Under what conditions is the sale made? Even if you leave the moral argument aside, it should be clear that new business will be won only to the extent that the client believes that the professional is interested, cares and is trying to help. Again, the noble path wins. One could argue that the professional’s task is to make the client think that the professional cares, i.e., professionals must learn how to fake sincerity. (Indeed, many sales training courses in professional firms are filled with such tips and tactics.) However, faking sincerity is a prostitute’s tactic, not a professional’s. It may work occasionally, but not as often as real sincerity.

  Is this moral counsel or business advice? Either way, the conclusion is the same. You will get hired, rehired, obtain referrals and have lessened fee sensitivity to the extent that you care passionately, both about your work and your clients. The only remaining question for the professional is whether or not he or she has the courage to do so.

  What Is Professionalism?

  This book, although it covers many topics, is mainly about professionalism. I begin with a few reflections on “having fun” and “continual self-improvement” because I believe that true professionalism means the pursuit of excellence, not just competence. Many professionals confess that they are “cruising” below their full potential, and few feel passionate about the majority of their work. Many professionals, I have learned, are not having fun. Low morale and enthusiasm are common.

  In significant part, this situation has resulted directly from the financial measures firms have used, especially the emphasis on “production,” which measures only the volume of work, and not its caliber. The prevailing ethos in many firms is “It’s about the money, stupid!” Strict financial controls may get people into compliance, but they will never inspire the extra level of intensity and dedication that creates excellence.

  While “having fun” can have many possible meanings, there is a difference between “happiness” and “contentment.” True professionals commit themselves to the pursuit of happiness, and do not allow themselves to lapse into self-satisfied contentment. Professionals and professional firms can restore the fun (and morale and enthusiasm) by committing themselves to a path of true excellence and strict adherence to the highest values. This path will result in greater professional accomplishment, and the (superior) profits and satisfaction that flow from it.

  To accomplish this, individuals and firms must recognize that there is a difference between “espoused values” (what they say they believe in) and “values in action” (how they actually live their professional lives). (The terms are borrowed from Chris Argyris.) This book is about trying to align professionals’ real-world actions with their true (espoused) values.

  In practice, what this means is that individuals and firms must rethink what they manage, measure and discuss. If you value something, then you must monitor your performance in that area, accept nothing less than excellence and actively work to learn what to do differently every time you fall short of excellence. Firms must provide help and counsel to those who are encountering difficulties in living up to their standards, in order to help them get back on track. Phrased another way, professionals have to decide on what subjects they are prepared to give “nagging rights.” Professionals are used to being nagged about their production levels. Yet they are rarely nagged about such areas as levels of client service, supervision of junior professionals or collaboration with each other.

  Once professionals have confirmed their core values, they need to design systems that provide consequences for noncompliance. By leaving each individual professional to decide for him or herself what level to achieve in key value areas, firms are in effect saying that the firm, as a society, has no standards that must be adhered to. Excellence in these areas becomes a matter of personal professional choice. This is insufficient if firms are to live up to their values and reap the benefits that flow from the accomplishment of excellence.

  Consequences for noncompliance need not be, and should not be, punitive. Professionals must live by the slogan “You’re allowed to fail, but you’re not allowed to not try.” If someone is exhibiting difficulties in achieving excellence in teamwork, or project supervision, or client service (or any of the firm’s other core values), then this needs to evoke a response from the firm that is characterized by concern, support, assistance, counseling and everything else possible to help that person become aligned with the firm’s values.

  Doing this will require a special form of management. It will require managers (or leaders, or coaches) who are close enough to know what is going on in their groups so that they can quickly detect when there is noncompliance with firm values. These managers/leaders/coaches must also have the desire, the skills and the time to help other partners improve in areas that are valued.

  It is the combination of enforced, common, agreed-upon values and the existence of helpful coaches that will restore teamwork to a professional firm. Common goals and common values define a team. By selecting a few coaches willing to serve their colleagues by accepting responsibility for collective results, firms are more likely to ensure that they live by shared values.

  None of this is about new compensation schemes. The primary mechanisms I propose are new measures (to monitor performance in new areas) and new forms of management (to provide feedback, guidance and support). Values will not be preserved if the attitude is, “If you don’t do well according to our values, we’ll just pay you less and allow you to carry on in the same way.”

  If all these fail to get a particular professional aligned with a firm’s values, then, yes, ultimately, a compensation adjustment may be required. Compensation adjustment for a professional who performs poorly according to values should exist as a second-order consequence. “Exit” may in an extreme case have to be a third-order consequence for a professional who continually fails, over a long period of time, to live by a firm’s values. However, both compensation adjustments and exit are signs of failure of the core system: sincere efforts by all professionals, supported by their colleagues, to live up to the highest standards in the areas they value.

  As noted, the task is not only to clarify and establish values, but find mechanisms to enforce them. Based on ideas contained in this book and Managing the Professional Service Firm, I often propose the following package to enforce values.

  Professionals agree to be coached and managed to strictly enforced, agreed-upon standards. Appoint team leaders who are judged solely on the performance of the team, with their own personal statistics being deemed irrelevant. The team leader’s job is to coach team members and to act as the primary agent in introducing the consequences for noncompliance with excellence standards. Preferably, these consequences should consist of help, support, encouragement and concern.

  Teamwork is mandatory, not optional. Require every professional to belong to a team, “donating” a minimum number of nonbillable hours to the team, jointly scheduled by the team, with strict accountability for projects committed to.

  There is continual investment in getting better. Every team submits a quarterly nonbillable hour budget, showing which actions will be taken in the four areas of (a) generating better business, not just more business; (b) lowering the cost to the firm of performing selected professional tasks; (c ) becoming more valuable to clients on current tasks; and (d) disseminating skills both horizontally and vertically.

  Enforce excellence in wise management of client resources and firm finances. Measure and track profitability at the engagement level, holding professionals accountable for the profitability of their matters (revenues and costs), not just personal billable hours.

  Excellence in client satisfaction is an enforced standard. Institute mandatory client feedback on every transaction, with full managerial follow-up, and use the results in performance counseling and compensation. Eventually, the firm should offer an unconditional satisfaction guarantee.

  Excellence in managing those you supervise is an enforced professional standard. Institute mandatory “upward feedback” for project supervision performance on every transaction to enforce good supervision of matters, with strict accountability for results.

  Personal professional growth is a nonnegotiable minimum standard. Require every professional to demonstrate personal professional/career progress every year (zero tolerance for cruising). Personal progress on a personal strategic plan should be a matter of strict accountability.

  All partners must show a sincere interest in clients’ affairs and a sincere desire to help them. Require all professionals to demonstrate an understanding of their clients’ business and thereby contribute to business development.

  Departmental resources are considered collective assets, and cannot be allocated autonomously. The team leader is responsible for staffing all engagements. No professional has the autonomy to staff his or her own job.

  The firm’s primary marketing focus should be on relationship building. Allocate specific nonbillable budgets to be spent nurturing designated key existing clients, the total of these to sum to at least 60 percent of all nonbillable marketing hours.

  Be intolerant about the pursuit of excellence. Be prepared to fire any professional that does not participate in these programs. “You’re allowed to fail, but you’re not allowed to not try!”

  I don’t believe that this is the only possible package. Some individuals and firms will substitute different values and different enforcement mechanisms. But if they are to achieve excellence, the values must be clear and the enforcement mechanisms real.

  Summary

  Little of this is new. Tom Peters once quoted Ray Kroc, the founder of McDonalds, to the effect that, to succeed at McDonalds, “You must be able to see the beauty in a hamburger bun.” Most so-called “sophisticated” professionals laugh when they hear this, but just a few moments of reflection should make it clear that Mr. Kroc was right. You can’t become the dominant world leader in as business as basic as hamburgers (or any other) without truly caring, passionately, about what you do. A more recent work, Built to Last by James Collins and Jerry Porras, supports this point. They show that truly visionary (and successful) companies have discovered that there is no conflict between the pursuit of profit and having a purpose beyond profit.

  The lesson is clear: Believe passionately in what you do, and never knowingly compromise your standards and values. Act like a true professional, aiming for true excellence and the money will follow. Act like a prostitute, with an attitude of “I’ll do it for the money, but don’t expect me to care,” and you’ll lose the premium that excellence earns. True professionalism wins!