Intuit Accountants News Central

Three Ways to Differentiate Yourself in a Crowded Profession

Article Post Date
March 30th 2011 by Jason Blumer

I recently returned from a VeraSage Institute meeting in California and I lost a lot of sleep. When you are in a meeting full of thought leaders who  are blazing trails in the professional firm space, it makes you rethink how you run your own firm. I’m still thinking through what I learned.

Tim Williams was there and he passed out his most recent book, Positioning for Professionals:How Professional Knowledge Firms can Differentiate Their Way to Success. What a great book. I highly recommend it!

He gets to the heart of the issue in the CPA space – we sell commodities and we all look the same. Freakin’ boring. Our profession is good at doing what we’ve always done and copying everybody else. Certainly, if this continues, the integrity of our profession is in jeopardy. But it doesn’t have to be.

Three points in the book stood out to me:

  1. Size is Not a Strategy. With the current state of demographics in our profession, mergers and acquisitions are a popular strategy for older CPAs to retire, but from my experience, companies that get big suck. They can’t redirect their efforts when they need to, they can’t pivot quickly and they rely on sheer mass to make money. We’ve all experienced the “big” company that doesn’t seem to care about our needs. They treat us like just a number. It seems “getting big” is a strategy CPA firms are trying their hand at, but I think that is dangerous. It seems like a lazy path out of proper succession planning for those retiring. The opposite option would be to take three or four years, build heavy value in your firm and client base, and then sell it for more money. I think retiring CPAs are leaving money on the table. Here is a quote from Tim’s book that says it best: “The most exceptional private companies have chosen not to focus on revenue growth, but rather to be the best at what they do. Many, in fact, place significant limits on their growth, choosing instead to focus on doing great work, providing great service and creating a great place to work.” You go boy!
  2. Positioning Within a “Category of One.” Tim quoted authors W. Chan Kim and Renee Mauborgne who created a new positioning category called “blue ocean strategy.” This refers to companies looking to position and brand themselves so well that they ultimately create their own category in which to operate. What a novel idea! No more copycat strategies. This takes courage and innovation as the leader of a firm. This means saying “no” to the wrong types of clients. It also means you have to know who qualifies as the wrong type of client before you can say no to them. Creating your category of one will mean taking an inventory of your team’s strengths, and then tightening your market so tightly that no one (clients and staff) is confused anymore as to what which category you have chosen to operate in … and the great part is that your fees will reflect a market where you dominate.
  3. Build Brand Boundaries. A number of things in Tim’s book seems counterintuitive to how professional firms should operate their practices. For example, as pointed out in #1 and #2 above, choosing not to grow and turning down clients is a hard sell. Tim’s brand boundaries are another counterintuitive approach to marketing a professional firm. Instead of struggling to make your brand right for everyone, he teaches the benefit of tightening up your brand so that everyone knows exactly what you stand for and why. As Tim puts it, “No sacrifice, no strategy.” Tim defines four areas where you should sacrifice your brand: (1) Calling, (2) Customers, (3) Competencies and (4) Culture. 

Calling closely relates to the book Start With Why by Simon Sinek, required reading for our participation in the VeraSage Institute. In essence, people do business based on why you do business, not what or how you do business. We so often make our techniques and our products our ultimate sales focus, but our customers want to know what we believe. Clients can align with a belief, and remain long-term customers of companies if they can get behind why you do what you do.

Customers is another area where you must tighten your definition of what your brand means. This process focuses on knowing who your best client is, and then developing a practice around that type of client. Tim reminds us that a “one size fits all” client marketing strategy is really a “one size fits none” strategy. He also speaks to our fear of going too narrow with our customer definition: “The narrower your positioning strategy, the more leverage you have in the marketplace.”

Competencies are simply capabilities that can be delivered in dependable, differentiating ways, so it is “competencies” we need to focus on, not capabilities. Tim provides a chart to help us move our firms toward High Differentiation and High Customer Value. Other variations of this model (Low Differentiation-High Value or, worse, Low Differentiation,-Low Value) don’t hit the mark of service required of today’s innovative professional knowledge firm.

Culture is also a huge part of what makes your firm different. Culture runs through everything the company does, and is the sticky part of your company that draws clients and keeps employees. It is your set of beliefs and values, or how to work at your firm often summarized in your tagline. The more memorable, differentiating and polarizing your culture message, the better. Make the culture definition very clear – you want no confusion on this front. How about these as examples: “Nurture Stupidity,” “We are not a democracy,” “Make mistakes faster” or “Don’t clean your desk.” These are certainly not for every company, but the owners who believe them have made it clear for clients and staff how to operate within the culture of their firm.

As we remake what the professional firm is and can be, it’s awesome to know that we are living in an era where disruption is so available to us. Tim’s book has been a great catalyst for that in my own firm since leaving VeraSage. I trust his book can help you disrupt your market too.

Share and Enjoy:
  • Facebook
  • Twitter
  • LinkedIn
  • Digg
  • del.icio.us
  • StumbleUpon
  • Technorati
  • Google Bookmarks
  • RSS
  • Print
  • PDF
  • email

When commenting, please be polite and use the site for your own personal, non-commercial use. For the full legalese of dos and don'ts, see our Online Community Terms of Use. Thanks!

No Comments »

No comments yet.

RSS feed for comments on this post.

Leave a comment

You must be logged in to post a comment.

 
© 2014 Intuit Inc. All rights reserved. Intuit, the Intuit logo, QuickBooks, ProSeries and Lacerte, among others, are registered trademarks and/or registered service marks of Intuit Inc. or one of its subsidiaries. Other parties' marks are the property of their respective owners. Terms, conditions, features, pricing, support and service are subject to change at anytime without notice.

The views expressed on this blog are those of the bloggers, and not necessarily those of Intuit. Third-party blogger may have received compensation for their time and services. Click here (to read full disclosure on third-party bloggers.  This blog does not provide legal, financial, accounting or tax advice. The content on this blog is "as is" and carries no warranties. Intuit does not warrant or guarantee the accuracy, reliability, and completeness of the content on this blog. After 20 days, comments are closed on posts. Comments are subject to moderation. Comments that include profanity or abusive language will not be posted. Click here to read full Terms of Service.