Your consulting firm will periodically face a conundrum: should you look for more clients who want what your firm provides, or should you pivot your firm to provide what clients seem to want?
Because you are analytical or creative or just like pretty colors, you have created a heat map of problems that prospects have that are even remotely related to what your consulting firm can provide.
The heat map shows the range of problems and highlights where demand for consulting services is highest.
(Even if you haven’t created such a heat map, you probably have some intuitive sense of what it would look like for your consulting firm’s market.)
One, common response to this type of market assessment is to maintain a flexible offering.
However, the vast majority of clients are looking for consultants who specialize in their particular situation. So, as a generalist, you lose far more opportunities to specialist consulting firms than you gain by staying flexible.
In addition, it’s considerably more difficult to scale a generalist consulting firm than a firm that has focused its attention on a specific target and precise, client problems.
Another common response to the market assessment is to claim you’re a specialist in multiple areas.
With multiple specialties, the more spread out they are, the less credible your consulting firm is for any one group of prospects. (“We work in the chocolate and automotive industries” doesn’t give the impression you have a cohesive focus as a firm.)
The obvious solution is, therefore, to specialize your consulting firm. As a specialist, you will know your target market’s issues intimately, can speak their language and demonstrate deep experience delivering the outcome they want.
Unfortunately, by specializing your consulting firm, you may miss the hot spots in the market. In addition, specialist consulting firms tend to calcify very quickly. If your firm has won a number of consulting projects with General Motors’ chocolate modeling division, you may start to think of yourself as an automotive modeling specialist.
Specialists (like most consultants and consulting firms) define themselves by what they’ve done in the past. If the market needs in the future don’t match your past, then you’re stuck without demand for your consulting firm’s capacity.
Hence the conundrum: specialize your consulting firm and end up searching for clients that need your specialty, or be a generalist firm that’s less attractive to prospects?
The best answer is for your consulting firm to act like a self-aware, iron ingot, concentrating your weight solidly in one place while constantly being drawn toward the magnetic pull of market demands.
Specialize and define yourself by market needs, not by what you have done in the past. You can adjust your consulting firm to market changes, you can’t adjust the market.
Always listen to the market. Prospects, contacts and industry publications will clue you in to what how their needs are changing, if you ask the right questions then carefully attend to their responses.
Gradually follow shifts in market needs, without allowing your consulting firm’s focus to become diluted and diffused.
Annually, conduct a Threats & Change analysis. Are client needs altering? What could make your consulting firm’s target market dramatically change? If the market shifts, how will you pivot your firm?
You don’t have to be prepared with fully-baked consulting offerings at the ready for every market change; however, you should at least know some escape routes in case today’s hot consulting offering no longer excites prospects tomorrow.
How do you balance the benefits of specialization with the need for flexibility in your consulting practice?
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