Although often forgotten when people discuss industries, professional services account for over $2 trillion in annual revenue and over nine million jobs in the U.S. alone. Many professions comprise the professional services industry including accounting, architecture, law and management consulting. Some of the largest firms have hundreds of thousands of employees although the average firm has less than 10. COVID-19 presents the same challenges to all of these firms as they focus on their people, clients and operations.
These challenges can be pressing for owners of small firms who are splitting their time serving clients and managing their firm’s operations.
Whether a firm has one person or several thousand, the leaders need to develop a three-prong strategy around their people, clients and operations to weather the storm and thrive in the new normal.
Over the past few weeks the focus has been on transitioning the work force from offices and client sites to working from home. Most of the technical issues have been addressed. As video conferencing technology has replaced in-person meetings, many organizations are making the move to a virtual environment. Now leaders need to focus on the challenges and uncertainties their employees are facing by engaging in intentional and transparent communications. Working from home is easy for some, but can be difficult for those caring for young children, elderly parents or possibly a family member suffering with COVID-19. Moreover, as the shelter in place orders are extended and the news of layoffs and economic uncertainty mounts, employees are understandably concerned about their own job security. To be certain, the leaders who need to support these employees, rally the troops and keep morale high are likely facing many of the same issues. Strong leaders know frequent and transparent communication can significantly motivate employees to stay engaged.
For many professional services firms, the last several weeks were spent providing crisis management, addressing any deferred projects or rescoping ongoing work looking for cost savings. As the initial shock is over for most, such firms, as well as their clients, are now focused on how to succeed (or at least survive) in the new normal. It is key that professional service firm leaders determine how to help their clients succeed. Chances are they will need to adapt in order to maintain relevance. With the knowledge of the client’s industry and challenges, client service professionals must develop an approach that will help their clients succeed in the new normal.
While most firms have been focused on people and clients, they need to pivot quickly to managing their own operations. Is the back office functioning adequately with staff working from home? Does the firm have liquidity to weather the storm? Do dramatic cost cutting steps need to be taken? Many leaders of professional services firms are most comfortable with and gravitate towards managing their people and clients. That is the secret sauce of most successful firms. Unfortunately, today’s environment demands they also assess operations and make difficult decisions. Cash is king, and short-term liquidity should be the firm’s operating priority.
The answers are not simple, but the professional services industry has navigated stormy waters before and will again. A balanced focus on people, clients and operations coupled with a realistic assessment of the economic environment and market are the key to success.
DHG ranks among the top 20 public accounting firms in the nation. With more than 2,000 professionals across the United States, we combine deep experience with a strong commitment to personal service. We are passionate about helping our clients succeed—and we do so through a resourceful approach to solving problems, providing results and helping our clients achieve their goals.