Case Study provided by Jon Christensen, CEO, Kleinschmidt Associates
During the past 35 years in the architecture and engineering (A&E) industry I have watched with deep frustration the slow deterioration in the assumed level of prestige and value of our services. While clients push us to compete on price, we fear losing, especially during recessions, so we race to the bottom of the pricing curve without considering our value proposition. Then, we work extraordinary hours – many times without charging projects – in an effort to meet ridiculously low budgets. This approach can make our work unsatisfying and stressful, which in turn results in unengaged employees who are constantly looking for better employment options.
I believe that we bring enormous value to our clients, and even beyond that, we pay a great service to people’s lives throughout the world. While A&E companies have a long history of striving for excellence in the work that is so critical to human survival, it is time for us to focus on ways we can deliver excellence in how we lead our companies. In turn, we can regain some of the confidence and stature that the industry has lost during the most recent decade and recognize the value our services provide.
June Jewell’s new book, RAISE Your Value, provides a strong argument for increasing our perceived and delivered value, as well as a clear path to transforming your firm into a highly valued consulting practice with better clients and higher fees.
Our company, Kleinschmidt Associates, provides a strong case study of how the application of these concepts can dramatically impact your sales success and financial results. In 2017 we reached out to June for business training as part of our Kleinschmidt University Leadership Academy.
Following several years of decreasing win rates in our competitive pursuits, we recognized that we were investing significant time pursuing projects with clients where we had no solid relationships. Our Go/No-Go (GNG) process was not effective, and much of our energy was put into price- based bidding for thankless clients.
As a result of our work with June, we identified the culture traps holding us to the same ways of thinking. In turn, this recognition enabled us to transform our sales process to focus on our best clients, including:
- Categorizing our top 40+ clients (by revenue) into A, B, C, etc., and instantly implementing a No-Go on pursuits with any clients below level C.
- Ending relationships with two high revenue clients who were pricebased, and otherwise difficult to work with – our toughest step, but an important statement to ourselves that we could do this and still succeed.
- Creating a Foundational Client list made up of mainly Type A and B clients and developing proactive relationship-development plans to ensure we had strong and deep relationships.
- Added the ‘Existing or Anticipated Client Rank’ to our GNG worksheet to minimize the chance of falling into our old culture traps.
Our Foundational Client focus (Client Categories), along with other improvements in our Business Development and Sales Process (improved Client Management Training, marketing collateral, social media use and GNG Processes) dramatically altered our sales success. As you can see from the metrics below, we significantly reduced our active pursuits while improving our New Work Won by 5-fold:
- 2016 – 137 pursuits, $2.3M Won
- 2017 – 155 pursuits, $4.4M Won
- 2018 – 113 pursuits, $9.8M Won
What we learned from our experience working with June and implementing the concepts she summarizes in this book is that these activities create a synergistic circle of opportunity. By focusing on our foundational clients, we treat them better. By limiting our pursuits for difficult clients or price-based opportunities, we have more time available to pursue really exciting projects. By winning exciting projects, our employees became more engaged. Together, all these factors lead to better results. Over the past 5 years, by following this approach, we’ve seen our New Work Won increase to over $40M and we’ve almost doubled in size from 120 employees in 2017 to over 220 in 2022.
These changes were intimidating at first – imagine severing ties with a client who represents 5-10% of your annual revenue. And at times, the process can seem overwhelming. However, I am confident that if you follow the steps outlined in this book, you can replicate this level of success. The 5-Step RAISE Your Value Formula is a simple, clearly defined approach to achieving exactly what Kleinschmidt achieved in less than a year, and it continues to build success today.
Get your entire team on board and make the RAISE Your Value approach part of your culture and values. You will not regret it!
Jon Christensen, President / CEO