Lessons from financial investing and a technique called Cascading Buckets can improve the results of your business development efforts for your consulting firm.
I learned investing from reading One Up on Wall Street, the Investor’s Business Daily, and Rich Dad, Poor Dad. Actually, that’s not true. I read those excellent sources but I’m still less apt to follow their advice and more apt to sink my money into a Venezuelan cacao company in the vain hopes that even if the investment doesn’t return zillions, at least I’ll wallow in an endless supply of chocolate.
One investing idea did stick, though: the importance of creating a portfolio with a mix of investments (e.g., cacao and Brazil nuts.) Portfolios balance risk, improve your return, and taste better.
Apply the portfolio concept to your quest for consulting revenue. In other words rather than focusing on whoever’s within reach or on whatever tactic is easy, think about the mix.
The components of your new business portfolio are:
- Current Clients – Active clients represent the easiest and fastest source of new business. You (should) have a strong, trusting relationship, and you’re positioned to jointly identify additional, value-creation opportunities.
- A1 Prospects – The A1s in your contact list are decision makers with whom you possess a strong relationship. (See my segmentation scheme, referenced here and detailed in this book.) Often these are past clients, and they’re the second most likely source of new consulting projects in the short term.
- Outer Core – Following my segmentation approach, the remainder of your network core populates this group; the B1s and A2s who, with nurturing, could evolve into clients.
- New Blood – Folks who, today, are new to your network or are just finding out about your services make up tomorrow’s network core and new clients. You need a constant supply of fresh prospects to build a sustainable, lucrative consulting business.
Now, let’s distribute your time and effort on the Five Marketing Musts (explained in this book), including networking, across your portfolio using Cascading Buckets (which is the name of either an excellent technique or an episode of I Love Lucy).
In Cascading Buckets you fill each bucket with as much time and as many contacts as you have, until you reach the limit for that bucket, then you pour your efforts into the next bucket.
For instance, if your active client list consists of one company, you’ll probably spend little time filling the Current Clients bucket before moving on to A1 Prospects. However, if you’re servicing 20 active clients, you’re likely to hit that bucket’s limit, at which point you move on.
The specific time/effort limits are:
- Current Clients: 25%
- A1 Prospects: 30%
- Outer Core: 25%
- New Blood: 20%-100% (no limit)
This portfolio approach is self-balancing. The fewer high-likelihood prospects you have, the more you’ll focus on bringing in New blood.
Many of your marketing activities will touch more than one bucket. The key is to constantly ensure you are building your portfolio of prospects. The Cascading Buckets approach prevents you from devoting all your visibility-building energy to existing clients or to general marketing.
What do you think of the portfolio approach and Cascading Buckets for your consulting firm?
Text and images are © 2019 David A. Fields, all rights reserved.