The Secret Weapon for Boutique Professional Services Firms Battling with the Large Firms
One management consultant for a boutique professional services firm said he sometimes compared competition between his company and larger competitors to a mouse scrambling between the legs of a herd of elephants. Children’s cartoons to the contrary, elephants aren’t really scared of mice. Still, boutique professional services firms can capitalize on some important advantages to compete with larger players.
What is a Boutique Professional Service Firm?
Professional services firms may offer investment, accounting, legal, consulting, or other kinds of professional advice. Typically, smaller than the top competitors in their industry, a boutique firm will stand out by specializing in specific types of services or industries or applications.
For example, some boutique consulting firms might specialize in healthcare, government, or energy consulting. They may also drill even deeper by concentrating on data management, logistics, or some other horizontal focus.
How Boutique Professional Services Firms Typically Gain Business: Land and Expand
At least one-third of larger firms have reported losing business to boutique competitors. On the other hand, some observers say that these smaller companies may not directly lure business away from their bigger rivals. At least, they don’t necessarily start gaining business by trying to compete with larger firms for the exact same services.
The smaller consulting companies may attract clients at first because they can provide tightly focused niche services. Often, their larger competitors concede on these specialized offerings because the economies don’t work for them. Big firms also tend to have larger overheads to support so they have to provide services that appeal to the volume and kinds of clients that can sustain them.
At some point, clients who felt satisfied with these niche services may eventually move more and more of their consulting needs to the niche firm, even though that’s not why they started working with them in the first place. In that case, some formerly very specialized firms may expand with more general services. That’s when the larger firm will start to lose business and not when one of their clients initially sought a niche service that the large firm didn’t even offer.
What Other Competitive Advantages Can Niche Consulting Firms Offer Clients?
It’s plain to see how boutique consultants can get their foot in the door by specializing in areas that competitors may not offer. How can these smaller firms keep that business and even expand upon it once they have gotten past introductions? Some clients mention that boutique firms may cost less, though that’s not always true. They tend to have shallower organizations, so instead of typically dealing with junior consultants and having senior partners supervise, clients are more likely to have more access to experienced members of the team.
Besides these benefits, smaller firms tend to excel in innovation and adaptability, two very important features in this age of digital transformation. More than other positives of working with boutique firms, clients can gain the most advantages by adapting some of the characteristics of the smaller consulting firms.
To illustrate this, look at the value of digital transformation and intellectual capital to most boutique professional services companies:
Digital Transformation
In the Information Age, all organizations need to understand how they can use and build upon their own digital infrastructure to work more efficiently, satisfy customers, and grow their market share. Boutique firms that already emphasize these qualities are in a better place to share their experiences with their clients.
Very often, these smaller consulting groups have relied on better tech to provide the edge they can use to gain traction over much larger — but more traditional — rivals. Through this experience, they can pass on insights to their clients.
Valuing Intellectual Capital
Smaller consulting firms typically already value their intellectual capital as not just their main asset but also their most important offering. Not only can they excel by providing thought leadership but also by demonstrating that they know how to manage and protect information and when the time is right, to share it.
They also understand that the true importance of their information doesn’t stem from the knowledge of just one or a few people. Boutique firms can excel because they’re good at sharing ideas, reaching consensus, and communicating and collaborating. They have the processes and the software in place to help them protect information and then use that data to work together. That too, is a positive trait that boutique firms can pass on to their clients.
How M-Files Serves Professional Services and Clients
At M-Files, we offer secure and smart information management systems for professional services firms, such as accountants and business consultants. It can be a competitive advantage because you can use our tools to provide your clients with the information they need, when they need it. Our state-of-the-art security will help build your reputation as a firm who knows how to protect your own information and your client’s valuable data. We also make information seamless by easily integrating with popular business tools from Oracle, SAP, Salesforce, Microsoft, and many more.
Large or small, we invite you to check out a free demo to see you exactly how intelligent information management will help sustain and grow your business.