5 Reasons Your Consultancy Isn’t Scaling

Every business seeks success. If you’re a consultancy owner and your business is struggling but you can’t pinpoint the reason, this article is for you. Our aim is to identify the most common factors preventing your consultancy from scaling so you can begin working on a solution immediately.

When one starts a business, they have a vision. While generating profit is undeniably one of the driving forces behind every company’s sustainability, there is always a purpose. It can be immensely frustrating when, despite the effort you put in, your business isn’t growing.

It is particularly true of consultancies. Due to the popularity of this business model, it is increasingly difficult to cut through the noise, making attracting and retaining clients a challenge. If you are not generating sufficient profit, you cannot hire more staff, which means you cannot take on additional clients, and therefore, you cannot generate enough profit. This is the loop in which many consultancies find themselves—they are capable of sustaining their current operations, but they are unable to scale.  

Scaling a Consultancy Requires Consistent Effort 

Due to the competitive nature of the market, consultancies require a high level of maintenance. Simply put, the moment you reduce your efforts, your competitors will seize the opportunity. That being said, it is clear that you cannot have a sudden surge of initiatives and hope to sustain that momentum indefinitely. Rather than implementing numerous new strategies all at once, it is more effective to establish a process that you can consistently follow.

The best first step is to identify the roadblocks that prevent you from scaling. Interestingly, the reasons why most consultancies fail are typically the same and can often be easily resolved if recognised. So, let us define them.

1. You Are Trying to Sell 

The era of aggressive marketing and sales has ended. Of course, this doesn’t mean you should terminate your sales representatives and expect clients to find you on their own. Both components are as essential to your success as they have always been, if not more so. What we are discussing is the mindset. Today's customer is empowered: they research you long before your sales team makes contact with them. A competitive landscape also enables them to easily seek alternatives at the slightest inconvenience - for instance, if their inquiry takes too long to be addressed.

With that said, if you want to be successful, you need to stop focusing on trying to sell and instead shift your effort towards adding value. From the moment they land on your page and throughout the time they are your client, every interaction must be meaningful and aimed at solving their issues. You need to demonstrate that not only will they receive their money’s worth, but also a trustworthy companion who is genuinely interested in contributing to their success. 

2. You Waste Time on Manual Labour

Time management is key to any successful business. Therefore, it is one of the vital skills for a fast-paced environment such as consultancy. The issue we have observed with many of our consultancy clients is that, while they are aware of this fact and follow strict to-do lists, they still find themselves with little time for executing tasks that would drive the growth of their business. Instead, they are caught in a never-ending cycle of repetitive yet essential tasks, such as invoicing and others.

Do you find yourself needing to dedicate 2-3 days a month to compile monthly reports? Or do you need to pursue every new client for days on end to ensure you have all the documentation required from them? These and many other issues are the culprits preventing you from dedicating time and effort to scaling-focused tasks such as strategising, building relationships, and enhancing your services. The solution is straightforward - automate the processes you frequently repeat. Not only will this enable quicker execution, but it will also reduce the risk of errors. Depending on the software you use and its integrations, you might also gain a wealth of new data and insights that you can subsequently use to identify new opportunities. 

3. You Outgrew Your Software 

If you’re already using some form of software to automate your workflows as the previous point suggested, it might also be the root of the problem. Not every digital tool is designed to scale with the user, and when that occurs, the refusal to upgrade becomes a barrier to growth. For instance, if you are using a CRM that is limited to 50 contacts with no options for expansion, this means the maximum number of clients you can have is 50. This will hinder your ability to attract and nurture new leads, ultimately stunting your growth.

The wisest course of action is to choose the solution that can grow alongside your business. When searching for one, examine the packages on offer - can you add new functionality as you progress, or is it limited to a precise SLA? The flexibility of the plan suggests that the software can be adapted to your needs rather than requiring you to structure your work around it. Another significant factor is integrations - whether they are available, with whom, and if the vendor offers a custom API option. Integrations enhance the functionality of the solutions you’re using, thereby expanding your reach and supporting your growth. 

4. Your Processes Are Outdated 

One aspect of automation is that it isn’t the ultimate solution or a quick fix. Simply put, the software will do precisely what you instruct it to. If you have outdated or broken processes, you won’t achieve new results by automating them. Instead, you’ll obtain the same outcomes, albeit faster. Therefore, if you have new software and it’s not delivering results, it’s time to reassess your internal operations.

The clearest signs that your processes are ineffective include the need to work around them, lack of remote work support, and inefficiency. Consider your day-to-day operations. Is there something your business does differently that is not particularly convenient? For instance, do you copy and paste information from a spreadsheet into software instead of exporting or importing a .csv file? Are there certain tasks your team can only accomplish when present on-site, such as putting a project plan together? Do you check off all the items on the to-do list and still feel as though you haven’t progressed from where you were at the beginning of the day? If you’ve answered yes to any of these questions, the problem lies within your processes, and they need to be reviewed. 

5. You Don’t Know Your Customer 

The reality is that the way you perceive your business is likely very different from how your clients perceive it. For instance, if you’re an IT consultant, you may believe that the primary service you provide is disaster recovery and backup, but your clients are actually more drawn to your cyber security services. This means that if you continue to focus your efforts and emphasise disaster recovery, you won’t capture the interest of your potential clientele. That said, this doesn’t mean they won’t need your key service; rather, the principal reason for their interest in you is different. In other words, you are returning to our initial point and are attempting to sell rather than solve the issue.

Determining whether this is your issue may be the trickiest task on the list, as you will need to analyse your current clients, understand their buyer’s journey, and interview them about their experiences with you. We strongly suggest following the Jobs-To-Be-Done methodology to identify the audience’s perception of your services. From there, you can begin working on aligning your communication and messaging with what resonates best with your potential audience. In other words, this approach will address the direct problems your target audience is attempting to solve, positioning your services as the optimal solution.

Summary 

While the consultancy market is densely populated, it is not impossible to succeed. Most businesses encounter the same set of problems that are, at their core, not particularly difficult to resolve. The challenge lies in accurately identifying them. The reason your consultancy isn’t scaling is most likely related to the five issues we’ve outlined above, or possibly even a couple of them. Be honest with yourself; if you want to solve the problem, you must first acknowledge that you have one.

No business is perfect, and hardly anyone gets it right from the start. There is no shame in making mistakes; however, there is nothing worse than denying yourself growth by succumbing to your ego. Consultancies are often established by senior specialists who know the ins and outs of their industries, so it may be difficult to admit faults. However, being a good specialist and running a successful consultancy are two vastly different things. View your business growth as a journey filled with learning opportunities rather than a challenge that questions your expertise.

Are you ready to embark on that journey? Because we are - just give us a call.