In this episode of the Watermark Search International Agile Leadership Lessons Podcast, host Robert Atkinson, Partner in our Executive Search Professional Services practice, welcomes guests Rory Channer, founding partner of DCM Insights and Pat Spenner, APAC Managing Director for DCM Insights. Together, they delve into the evolving landscape of client loyalty in professional services.
The discussion centres around the emerging challenges faced by professional services leaders, in particular the decline in client loyalty, what underpins this decline and how to adjust to stem the rising tide of procurement and consensus decision making.
Rory and Pat share the research insights (off the back of 2,941 interviews across Professional Services - Law, Consulting, Accounting, Executive Search, Public Relations and Investment Banking), which combined formed the basis of their new book, The Activator Advantage. They also introduce the "Activator" profile, a key driver of higher performance in business development.
Listeners will gain valuable perspectives on the five types of professionals in the industry: the Expert, the Confidant, the Activator, the Realist, and the Debater. The episode explores how Activators, with their proactive and collaborative approach, can significantly enhance client engagement and drive growth.
Tune in to learn about the impact of consensus decision-making, the importance of consistent value creation, and the role of technology in supporting business development. Whether you're a seasoned professional or new to the field, this episode offers actionable strategies to adapt to the changing dynamics of client relationships in professional services.
Listen to gain insights and advice for current and future leaders.
You can also find the podcast on several different apps, Spotify, Apple Podcasts, Breaker, Castbox, Google Podcasts, Overcast, Pocket Casts, and RadioPublic. Click here to listen & subscribe on your favourite app or read the transcript below.
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Navigating Client Loyalty: How Today’s Partners can Become Tomorrow’s Rainmakers
Agile Leadership Lessons, Episode 12, transcript:
Robert Atkinson, Executive Search Partner at Watermark Search International:
Welcome to the Watermark Search International Agile Leadership Lessons Podcast. My name is Robert Atkinson, and I'll be your host today. For those of you that don't know me, I'm a Partner in our Executive Search Professional Services practice where for the last decade I've focused on appointing Lateral Partners, C-Suite Executives and Non-Executive Directors in Professional Services and Financial Services.
If this is your first time joining us today, thank you, and I hope you enjoy the discussion. Watermark Search International is made up of dedicated Partners who have significant expertise in board, executive and interim appointments.
Our podcast series invites highly regarded executive leaders in to share their knowledge and expertise on agile leadership, spanning public, private, and not-for-profit settings. We ask them how they navigate different leadership challenges and their key lessons from that. Today we'll be discussing the emerging client challenge in professional services, demystifying the changing client behaviour/loyalty, and outlining how professional services leaders can adapt to this changing dynamic.
If I may set the scene for a moment, for as long as the professional services industry has existed, it's growth, not to mention its survival during periods of economic downturn, have revolved around this single tenet: If you do good work and develop a strong relationship with your clients, they will come back to you next time when they need your support.
But there's a growing problem with this belief. One that is rarely discussed openly, even at the highest levels of the largest global firms. Longstanding clients for whom firms have delivered unquestionable value in the past, are today much less loyal than they once were. With this in mind, I'm delighted to welcome two guests to the virtual couch with me today.
Firstly, esteemed author, Founding Partner of DCM Insights and the previous Chief Development Officer of McDermott, Will & Emery, Rory Channer. Welcome, Rory.
Rory Channer, Founding Partner of DCM Insights:
Oh, that's lovely to be here. I'm going to start using that word esteemed. I like that. That's good.
Robert Atkinson, Executive Search Partner at Watermark Search International:
Our podcast coincides with the launch of The Activator book, which Rory has co-authored and I believe will be available to purchase from May the 20th.
And I also have the great pleasure in welcoming APAC Managing Director and Commercial Leader for DCM Insights, Pat Spenner, to the discussion. Welcome Pat.
Pat Spenner, APAC Managing Director and Commercial Leader of DCM Insights:
Thank you Robert. Great to be here.
Robert Atkinson, Executive Search Partner at Watermark Search International:
Welcome both of you. It's a great pleasure to have you both here today and I'm really looking forward to this discussion.
Let's just jump straight into it, shall we? Rory, if I may start with you for a moment, can you tell our listeners a little bit about yourself, your background at McDermott, Will & Emery?
Rory Channer, Founding Partner of DCM Insights:
Sure. And thank you Rob. Great question. And hello everybody. I am a psychologist by training. I started working as a psychologist for the British government and I found my way into designing software using psychology, and then kind of lucked into a difficult client situation where the client was very upset with the software company and I managed to get us out of a lot of trouble and the Head of Sales thought I should be in sales.
And so I moved into sales and that started a sales and marketing career. And I've spent 25 years in various different C-level roles. CMO, CSO, Chief Revenue Officer, Chief Customer Officer, those kinds of things. And eventually ended up in a law firm that was indeed McDermott, Will & Emery, and started to really unpack the go to market model of a lawyer and how they engaged clients and realised that there was likely a better way than the practices that they were using back in 2017 and on. And so that started this journey of, let's go figure out how to do this better. And to your opening remarks around changing economy, as the tide goes down, we're going to see more and more problems and client buying is so evolved now that we have to change. And so I'm excited to be here to talk about that.
Robert Atkinson, Executive Search Partner at Watermark Search International:
Thank you. That's really interesting. Having read the book, I'm well aware that there's a considerable body of research that underpins the book. Can you talk me through that? Give me a bit of context on the quantity and the quality of that data?
Rory Channer, Founding Partner of DCM Insights:
Yeah. It's the largest data set of its kind and it's the largest study of its kind. And not an easy study to pull off. Because you are getting access to very hardworking, difficult to access partners in the world's major firms across the world.
So it took us a little while to get the recruitment going on the study. But the sample size and the sample set is just a phenomenal set of partners and diverse partners across the world in different types of firms. Five kind of sub-verticals of professional services - investment banking, executive search, consulting, accounting, and law made up the sample set.
And we were very keen to make sure that we could see if there were differences in performance across these sub-verticals. And so the data set was more than enough to answer that question. And the study took place over about a 12 to 18 month period. Took a little while to get the study done.
And then it took us a while to analyse and build a full on backend set of statistical models behind the research. So end to end, about an 18 month process. And we completed that process early-ish, mid 2023 I think it was. And published the research in Harvard Business Review in October / November Edition 2023. And of course, that started to ignite everything we now see around Activator which has been a phenomenal journey.
Robert Atkinson, Executive Search Partner at Watermark Search International:
I recall from reading the Harvard Business Review article that it was one of the most downloaded articles that they'd published during the year. Can you tell us a little bit more about that and how they actually how they recall that sort of information and background?
Rory Channer, Founding Partner of DCM Insights:
Yeah, so they won't actually tell you exactly how many downloads, and I asked them a couple of times, but clearly it was indeed one of the most downloaded articles in 2024. And the work itself appeared as one of the Top 10 Management Ideas for Harvard Business Review in 2025. Which is quite an extraordinary accolade when you think about, in some ways, how niche this work was.
Professional services is a big global sector, but it's not the biggest global sector. And I think that lends itself to recognising the amount of interest that it had and the quality of the research. But we had also noted that other publications picked it up and they also received an awful lot of downloads anytime it was talked about. And we were getting told from other publications that this was something that was happening across the world in different places as they talked about Activator. So there was a lot of interest. One of the things I think it did to the world of professional services very quickly, it gave a framework that people could imprint their own partners on.
And they could, like a sorting hat, take it to the partnership and say, yep, this is an Activator. Yep, this is one of the other profiles, an expert. This is one of those. And so we now have provided language, I think, for people to kind of understand what's happening in the go to market motion that these folks have.
And I think that opened up a lot of internal conversation. The amount of chairs of very large firms that said, I've received it several times. I'm getting tired of getting it from my partners was quite remarkable and many folks have read it.
Robert Atkinson, Executive Search Partner at Watermark Search International:
Fascinating. Pat, I'd like to bring you into the conversation here for a moment, if I may. Within the book you describe in considerable detail the five types of professionals. For our listeners, can you briefly summarise the different sort of, profiles of those professionals just to give a little bit of an outline.
Pat Spenner, APAC Managing Director and Commercial Leader of DCM Insights:
Yeah, I'd be glad to. And for folks that are going looking for that HBR article, it's called “What Today's Rainmakers Do Differently”.
And so the five profiles that nature gives us, and to be clear, this is something that we discovered through the data. It wasn't something that we made or necessarily went looking for. So this is what nature gives us are these five profiles. And the five profiles are the expert, the confidant, the activator, the realist, and the debater.
And the best way to think about these profiles is like a university major. So every partner we can statistically place into one of these five categories. Many partners will also minor in one or two of those other profiles. And that's kind of the best way to think about that.
That every individual is a collection of these different kind of behaviours that we were getting after in the research. But every partner we could say, you major in, fill in the blank. Confidant, expert, activator, what have you.
So quickly, the expert, I'll start there, is the reluctant business developer. These are the folks who they have a very deep area of expertise and the way that they go about doing business development is to build their public reputation in the marketplace around that area of expertise. So speaking, blogging, webinars, et cetera. And then the belief is, hey, I've burnished my reputation. I'm now going to rely on clients and prospective clients who realise they have a need in that area to come to me. They'll come find me, is the assumption. So it's a very reactive type of posture.
Second is the confidant. The confidant is in many ways your old school trusted advisor. And I want to use that word, trusted advisor carefully because it's something that many partners will aspire to and is still held out as a gold standard. It's more the way in which that profile came to become a trusted advisor, and that is somewhat through an old school way. So when you look at confidants, they will have a small handful of very deep important relationships with a couple of client firms. And they've spent a lot of time coming to know the individuals at that firm very closely, right?
So these are the partners who would be most likely to say, yeah, I know the names of the three kids of this person, and sometimes our families vacation together, and so on and so forth, right? And the belief there is that, listen, if I can have that kind of a depth of relationship then any time that client firm has a new issue or matter or challenge come up, they're going to come talk to me. Of course they will, right? Because I have that kind of relationship.
And one of the aspects that comes along with confidant is that they're quite protective of those relationships. So they'll often have sharp elbows around protecting those relationships and they can be very hesitant to welcome in their colleagues into those relationships. We may come back to that story because that's an important one.
So activator is the third type of profile. These are the super connectors. They're very prolific network builders externally. And they maintain quite diverse networks, but also internally. So they're very well plugged into their fellow colleagues. And what they specialise in is building that network and treating it as a strategic asset from a business development standpoint. And the way they're doing that is they're flowing value through that network to their clients and prospective clients. And, that's helping them stay top of mind. It's helping them identify and spot the areas where they could potentially be helpful to, and ultimately open up the aperture for business development or new matters or new issues or new ways that we could help them.
So they're quite proactive in that way. Opposite the expert. And they're also very welcoming of having their colleagues into these partnerships. So we found that opposite the confidant they tended to be very like collaborative. Let me find ways to bring in my colleagues who are themselves experts in areas, and that's a way that I can flow value into these client relationships.
Okay. So that's three of the five. We'll go to the realist next. The realist is the honest, truthful, transparent broker in the client relationship. They're the most likely to tell a client, listen you're unlikely to be able to accomplish that scope for this amount of money. So they're very comfortable talking money.
They'll point out the risks of it, and the way that, the reason that they focus on that as their BDMO, is they've seen in their personal experience clients get burned by other professional services firms in the past, right over promising, under delivering. Surprise billing, right? Invoices and the like and overshooting there.
And they really want to position themselves anti to that and be the one that's, I'm gonna tell it to you straight, and that's my reputation. Now, when you talk to clients about working with realists, they'll say, hey, listen, of course I want to work with partners that can shoot straight and give it to me straight. But I also want to work with partners who can paint a picture of what's possible, right? What's the art of the possible here? Help me with the vision. And so that tends maybe not to be the realist quite so much.
And then the fifth and final profile is the debater. The debater is the one that's always bringing the new view of things to the world. Matt Dixon, one of the co-authors on the book, will describe these folks in shorthand as the sharp elbowed opinionated know-it-all. That's a little bit of an exaggeration, but not too much because they're looking to create white space between themselves and their competitors. And they'll do that by trying to reframe the way that clients think about their issues or challenges or problems in a way that leads uniquely back to them and creates that white space. When you talk to clients about working with debaters, they'll say, yeah, of course I want to work with partners that are going to push our thinking here. But if every time I interact with that partner, no matter how big or small the issue, they're trying to push my thinking or reframe me, that can be exhausting at some point.
So you can see sprinkled in there a couple of the downsides of some of the profiles. And maybe we'll come back to how that shows up then in the data.
Robert Atkinson, Executive Search Partner at Watermark Search International:
Thank you for that. Do you typically find in professional services firms there is a correlation between the percentages that you get in these different categories. Is there any sort of insights that you can share with us? And then I think we'll touch on in a moment a little bit about how the Activator profile can influence certain outcomes in time as well.
Pat Spenner, APAC Managing Director and Commercial Leader of DCM Insights:
Maybe I'll take a first crack at that. Then, Rory, you should jump in. Overall across the entire sample, it's remarkable that it's about a fifth, a fifth, a fifth, right? All across. And so activators are about 18%, but each of those profiles at professional services writ large are about a fifth.
It's when you dive into the kind of sub-industry. So when you jump from investment banking to law where you'll start to see spikes in certain profiles. So in iBanking, for example, you'll see this come to a shock to many of you, a higher percentage of debaters that would be running around investment banks.
In legal, it's confidants that about 30% of partners in the law space. So you'll see spikes like that. But the performance data that we'll come onto in a minute was remarkably similar across all of those subcategories. And so there's the activator set of behaviours that sort of started to pop out there as the winning profile.
Robert Atkinson, Executive Search Partner at Watermark Search International:
You touched on the performance data there a moment ago. Maybe Rory, you can pick up on that and talk a little bit towards how the use of activator behaviours can change and can improve the client success outcomes. Can you touch on that?
Rory Channer, Founding Partner of DCM Insights:
Happy to. Yeah so in the study we charted this growth association to activators. So, the performance of activators is about 32% higher than the others.
So if you use the behaviours, you'll drive towards that 32%. The way we got to that was quite complicated because you can imagine we had to figure out how do you create a performance composite score for everybody in the sample. Which was challenging. Even within a firm is challenging. But across firms is super challenging. So it took us a while and there's a variety of ways that we went after it from, cross sell growth, the book a business, new client development, et cetera, et cetera.
And so we created this one kind score that gave us a view on their capabilities to perform business development activities. Since the study, as we've been working with firms to train large volumes of cohorts of partners going through the training programs, firms themselves have been measuring the impact, and there's a broader range that they're seeing on the results.
And for example, 20 to 40% is a good guide of the performance uptick you can get from running towards these behaviours. We think some of the more junior partners have a higher percentage growth curve. And the more seasoned partners may be a bit more towards the 20%. Firms have been thrilled with obviously that impact as they think about those numbers.
And I think this is an evolving journey, right? So we're not going to see this one time. It's going to keep on shifting and changing. We've been very disciplined in the last 12 months of making sure that we are measuring very accurately the impact of moving towards these behaviours. And I think that's going to be a very useful global benchmark set of tools that we've got to show how any one cohort performs against any others in any part of the world in any sub-industry of professional services.
Robert Atkinson, Executive Search Partner at Watermark Search International:
Fascinating. I want to change gears here for a moment and touch on something that I referenced earlier in the introduction. And that's around this concept of loyalty decline and a decline in loyalty in terms of client relationships in professional services. Can you touch on a little bit what underpins that in your opinion and how that cycle is changing for professional services practitioners?
Rory Channer, Founding Partner of DCM Insights:
Yeah, we started the study looking at the client side. So a very large amount of work engaging buyers of professional services and how they were thinking about and what they were considering and how they would go about buying professional services in today's buying market. And it was really clear that it has been shifting for some time.
I think maybe Covid accelerated some of that actually. I think there's some general global trends that are accelerating it. But to trim it into the real kind of levers behind what's happening here. We think there is a broader consensus group buying world that exists today and it's getting more consensus driven, not less consensus driven year on year.
So more people getting involved in the purchasing of professional services, less top down single decision making or executive team decision making. Some of that is likely to do with collaborative work environments and making sure that we're getting broader source of views of who we do want to work with as a provider of professional services.
But some of it, I think is also it's just not a world today where we can have a top down approach to important purchasing. It's exposed executives in a way that it never used to, I think. So gone are the days where you could go play golf and pick up a client and the client's good for the next five, 10 years. I think that's now over. And that's something to be careful about. But also, professionalisation of purchasing has happened in a lot of industries. And for example, in the legal industry in the last seven, eight years, maybe even the last 10 years, the rise of legal operations as a function is new and evolving and has been very dominant in the way legal services is getting procured around the world.
Procurement generally as a function is 20, 30 years old. It's a newer function in an organisation and it's obviously going to use its structure and capability to make sure it's shoring up all forms of purchase and possibly professional services is one of the last categories of spend that formalised procurement went after. And now it's very much in the cross hairs and has been for some time.
So I think these generic global trends have caused these changes to happen. But these changes are not going anywhere, but heading in the same direction they're already going which is, reducing the loyalty. Like considering that this is my atm client and it will be forevermore is not the way of the future, it's going to be much more competitive and hard fought.
And I think with the economic cycle, as you mentioned up front, that we're in now, it creates even more pressure. And with every change of environment, there's obviously changes in the way we operate, and I think today's economic environment is going to be quite challenging for many firms in the next five years.
Robert Atkinson, Executive Search Partner at Watermark Search International:
Can I ask, do you find that consensus decision making inherently impacts one of those professional services types more so than others? And if so, which ones? Do you have any thoughts or comments on that?
Rory Channer, Founding Partner of DCM Insights:
I think it's consistent. The more complex your solution is, the probably more consensus led it's going to be. The more functions involved in the solution the more consensus driven it's going to be. I think one of the remarkable things from the research that we've seen is how little most partners in firms have really unpacked the decision making structure. And they usually fall into a trap of seniorising the decision making power into one or two individuals versus recognising the levels of influence that other folks around the table might have.
And that's a very problematic approach because it's going to end in tears often. But in general, I think all of the sectors of professional services are experiencing the same problem. The size of the deal, the complexity of the deal, will create probably more buyer types involved.
Pat, what do you think?
Pat Spenner, APAC Managing Director and Commercial Leader of DCM Insights:
Yeah, I agree and it goes back to our days at CEB, Rory, studying this consensus buying dynamic. And we saw just systematically the number of stakeholders getting involved in purchase decisions on the client side ticking up, up, up. And one thing we saw of activators and that we actually embed into the behaviour change programs that we do with partners as activators, we're much more savvy about sleuthing out the decision making dynamics inside of this purchase decision making group. And they've developed a pretty good nose for where to go and a lot of times they've sniffed out that there's a head fake. So when you study these stakeholders, we actually studied this in our days at CEB long ago, when you study these stakeholders on the client side, there's a handful of profiles that we came to call talkers.
And they are the ones who are very willing to spend time with the partner and engage with them and tell them about the, it feels good to the partner, right? So this is a client who's willing to spend time with me on this stuff. But it's a head fake because it turns out the more potent profile we came to call mobilisers, and there's a few different types of mobilisers. I'll leave folks to take a look at that. If they like it, The Challenger Customer is a great book for that.
But the mobilisers are the ones that are a little bit more sceptical by nature, but they're much more powerful at constructing consensus around a change path inside their organisation. But they can feel to a partner a little bit more scary to engage with. But activators have figured out that it's those mobilisers that they need to be spending time with and convincing because they're the ones that are going to be able to drive consensus around this change path, that inevitably is what our services as a professional services firm involve. Versus, the talkers and the kind of feel good, but it's a head fake at the end of the day. And so there's really interesting wrinkles in there around this consensus buying and what we saw of activators and how they approach that.
Rory Channer, Founding Partner of DCM Insights:
And I think as an example, what we picked up in the study were the kind of techniques or many little tools that these folks were using that the others didn't have and this example, their ability to ping and check. And not to assume that the person that they're talking to is the one that they should be talking to, is a very simple technique. If you have a couple of questions to just check in on that. But activators have figured that out. So they have this sense that they can't just assume and they're going to ping that idea and just to check whether this person is the right person and who else should we be talking to.
And once you have a frame to know that it's not a one person, there's many people, you can then navigate through to say, okay, am I finding the right people in the right way? And am I checking that these are the right people. And that's a technique that we can teach. It's a very simple thing that you can equip a partner to go understand there's many, and then we need to check and engage and assess.
Robert Atkinson, Executive Search Partner at Watermark Search International:
I'm sure a number of the listeners are thinking at the moment, what are the questions I need to be asking to determine whether I'm talking to a talker or a mobiliser? Thoughts?
Rory Channer, Founding Partner of DCM Insights:
Yeah, we can help you with that. We can definitely help you. So the way the training programs work is they're after these concepts in usable forms. So the one thing busy partners are not going to have any tolerance for learning long, complicated sales methodologies and structures. It's got to be simple things at the most important times. And this is a great example of when you are in a relationship building situation, you're trying to figure out where is the decision making happening and who's really involved. That's a critical moment in the relationship build.
And so equipping partners with just some simple questions or simple things to be mindful of, to check or to evolve or to find out who else I should be talking to. These are not difficult things to do, but they're not front of mind for the other four profiles, they were for the activators. And so it's a good example of how we distil down and then equip and then provide. And without getting into the training, I can't give you the questions.
Robert Atkinson, Executive Search Partner at Watermark Search International:
Thanks. Can you talk to me a little bit about some of the levers that individuals can use to increase their engagement above that of those simple questions you were touching on?
Rory Channer, Founding Partner of DCM Insights:
Yeah, so the simplest form is the three kind of Cs that we documented into the HBR article. Underneath the three Cs, there sits a whole lot of behavioural models that shows you the things to go to. But to keep it simple, the three Cs are a good guide for engagement with clients.
So commit, connect, and create. One of the things that we saw very quickly with activators was their consistency and rhythm to business development. It was just never done when they had time. It was always done. It was a metronomic cadence to engaging clients.
And I think from a client perspective, clients recognise very quickly when partners haven't got any work. If they've not heard from them for a while, right? All of a sudden they're all over them again, and it just feels very actually inauthentic when it's like that. What activators were doing were a consistent engagement style, which meant that they had to flow value, which is the 'create' thing.
If I was to call a client every week and say, how you're doing - that would get very tiring for a client. I'm doing great, right? I'm just checking on you. Do you want to meet for a coffee and just catch up? No. After the second week, I'm not probably doing that, right?
So what activators are doing, they're trying to find value to make the exchange of the interaction, consistent exchange of the interaction useful and helpful. And so that's the create bucket in the engagement style. And what that does, in addition, is then cement a relationship that the client is finding value.
Now does a client, and this would be a partner, that sceptical partner says, what about if I don't provide a value moment? Okay, that's okay. Is the client expecting every interaction with a partner to be valuable? No, absolutely not. But if I'm supplying value at a good moderate rate, then that is a relationship that's forming and it's becoming much more useful to the client. And that flow of value is the thing that the client's really are after.
So you've got commit, you've got create, and then the connect is not just in the people that we're trying to win business from. But in the ecosystem that sits around me, that I can then source additional value.
So I can say internally in my firm, are there people in my firm that could be very helpful to my client in what they know? Of course there's lots, but let me figure out what that is. Is there people outside of my target client list or outside of my firm that could be very helpful to a potential client or an existing client? Of course. There are and how do I engage that network and be very disciplined that your network is not an unending resource. It's a very finite resource. And so activators were very good at making sure that they knew who should be in that network and why. And then engaging the network to source value for the rest of the network. And yes, were they very good at building relationships and networks. Yes, they were, but they were very strategic and precise about it. It wasn't willy nilly. It was very engineered. And again, you can teach those things. You can think about who should be in your inner 20 and why, and what does that look like and so on.
Robert Atkinson, Executive Search Partner at Watermark Search International:
Yeah. That's fascinating. Did you find that with the clients that you work with, do you find that you get any pushback from your partner cohort when you are supporting and training them in these activator behaviours? And how do you work through that, can I ask?
Rory Channer, Founding Partner of DCM Insights:
Yeah. I don’t know the percentage, but you'll get maybe one in four cohorts where there's a couple of rumblings in that cohort. A couple of sceptical, very sceptical partners. I think that's going to happen. They often turn out to be one of the biggest advocates for Activator. I think what's happening there to some of the trauma that's happening to them is that they've got to work through it. And they're doing it quite publicly and I think maybe all cohorts probably have people like that, that are trying to work through and get their heads around what's going on here.
Inside of any professional services firm, you've got a lot of very smart people. And by nature, these folks want to both understand how this thing works and want to learn as much as they can about that thing. And that's no different for business development. And I think sadly, for decades now, business development has been a black box.
And there's these mysterious partners out there that have done very well for many years and no one really knows. And when they mentor, you can't really figure out what I should be doing as a mentee for that person. And it's just created a mystique. And I think one of the wonderful unlocks for this research is it now gives a blueprint of science-based approaches. And that then gives us language and structure. So I think once partners experience that there is a database driven approach to doing this, I think it settles everybody down and opens the mind quite a lot. But the trauma, I think, still sits on many of those folks' shoulders. They have just got to understand more. And I think the proof of the research is taking elements and enriching your approach and watching what happens with clients.
And so I think our job in our programs is to get them to move, to start trying it, to get out in the marketplace, to change elements of their go to market approach. Absorb as much as they can and good things happen.
Robert Atkinson, Executive Search Partner at Watermark Search International:
And can I ask, do you find, and I open this question up to either of you, Pat or Rory, do you find in any way that the younger cohort that are coming through into partnership are in any way different to the slightly older generation of existing partners?
Rory Channer, Founding Partner of DCM Insights:
I'll have a go first Pat and shoot it over. I think a hundred percent. They're different in how they want to learn, number one. And if you think about where they've come from, they've grown up in a world where they could get access to answers very quickly. And so immediacy to information has been their go-to. And if you go back to that black box, that mystique thing, this thing has been locked. It's very difficult to get answers to this thing.
And so I think they're very hungry for those answers. They also have a learning style that is more structured, I think, than previously. I think before we were okay to get information that was in drips, and I think they want a more complete set of information than our generation or other generations.
And the third thing that really strikes me is that they often have had a period of separation from the things that others got when they were coming up. So Covid set a lot of people back in terms of watching how others built relationships at a client dinner or at a taking a client out for coffee or working inside of a firm with others to see how they react to the world of work.
So I think there's been some significant setbacks. I do think there's waves. We go through generational waves generally and depending on what's happening around us shapes a little bit of how we try and experience the world around us. And I think many sectors got away with not being very good at business development in the last few years because times were good. And I think we're now in that next wave, that next evolution where times now are obviously not as good. And we've lost the muscle a little bit and I think that's impacting up and down both mentorship and just generally how we think about going to market. But Pat what would you say?
Pat Spenner, APAC Managing Director and Commercial Leader of DCM Insights:
I agree with all that, Rory. The only thing I might add is that new partners who have just come into partnership, that's a significant inflection point because it's guess what? Now you also get to carry this number. And many firms have not invested time or energy or a systematic approach in bringing their pre partners up the curve on BD, right? You're busy executing and doing what you need to do and the client facing and delivery, but therefore you haven't had that. And then now when you have this generation, lay covid on top of that, wow, that inflection point becomes such a critical one.
And, I think it just magnifies or amplifies the need in the marketplace for these fresh partners just in the last couple of years, who a lot of the language we will hear is they're not up to their fighting weight just yet, and they just they need extra help coming off of Covid and then through this inflection point in their career, it's like, ooh, I’ve got to carry a number now. What does that mean?
Rory Channer, Founding Partner of DCM Insights:
Yeah. Actually, that makes me think of something, Pat. I probably spent hundreds of hours, thousands of hours with chairs. And in the last year, for example, chairs and Heads of HR and Heads of L&D from dozens if not hundreds of firms. One takeaway based on what you just said there has actually been quite surprising, is how very few have in any way systematised their business development learning journey for anybody.
They've got a lot of functional curriculum or leadership curriculum. But there's almost nothing around business development and that's quite surprising. Now many have bought a program and tried it and bought something else and tried to put something in. But it is shockingly empty in terms of how they've been building these skills and behaviours and approaches. And I think that causes an awful lot of stress on the partners and the system just generally. Unnecessarily.
And I think you could go all the way back to universities. Maybe they should be talking more about this as a key component. If you're going into accounting or if you're going into law or consulting. At some point you're going to have to be doing this work as a core part of your job. And it's not a separate part of your job. It's very much the job. So you should get very comfortable with that now and understand the elements of it straight away.
And I think we are of the philosophy that you can start elements of activator in day one of your job at a firm. If you just graduated law school. Very first day, you can bring useful things of business development on your network, on your school network, et cetera, or whatever it happens to be, type of function that you are in. And I think that's a huge miss that firms don't think about that journey from the beginning. And I think you're right, Pat, these folks are making partner and there is no operating system there at all for them.
Pat Spenner, APAC Managing Director and Commercial Leader of DCM Insights:
Yeah. And to some degree, the marketplace for sales training has very much come out of non-professional services B2B, right? I'm a seller, I'm selling an IT solution, a healthcare solution, a widget, a fill in the blank. And these are linear sales methodologies that have developed around those go-to markets.
Professional services is fundamentally different in a world of doers, sellers, where you are the product and the nature of the relationships you're cultivating is going to be an ongoing source of potential business for you. That's a different set of physics. And so I think the marketplace probably to some degree has just felt like, eh, okay, the stuff that's out there on offer doesn't work. It just doesn't quite fit our environment and so we're not going to invest a lot of money for folks that are coming up and aren't yet partners in that. Yeah, because nothing feels fit for purpose. I think there's a dynamic of that going on in the marketplace too.
Robert Atkinson, Executive Search Partner at Watermark Search International:
Yeah certainly. One of the things I've observed over the years is that there's a different approach between some of the large global accounting firms and some of the law firms in terms of how they invest in that sort of up and coming next generation.
And I'm often having discussions with senior associates in law firms who talk about their client relationships. But you realise that if they were to actually move to a lateral competitor, nothing would actually follow them, quite honestly, aside from their reputation. And, there'll be some connectivity and maybe that would lead to revenue in the fullness of time, but it's quite limited.
I would add, however, in some of the larger global accounting firms, they seem to be starting on that journey of business development earlier. And they're given rather more and more responsibility at an earlier stage. But that still seems to kick in typically, four years before they make partner at the earliest.
Which I find really fascinating. But, do you find that there are any particular organisations that are embedding that at an earlier stage in the process? What's your take on that, Rory?
Rory Channer, Founding Partner of DCM Insights:
Yeah, I think there is now the recognition this is a problem that we need to have been solving a lot earlier. So even within the kind of comments around, it's extraordinary that it hasn't been happening. It is beginning to happen. Just as an aside, if you are an associate in a firm and you're fortunate enough to be working under an activator, they're using you right now to engage in their clients because it's very valuable to them and it's very useful for you.
And so they have a very different approach to how they think about young associates that work around them and how they could be very helpful to them. So these things are a little additive. That the activator approach not only is it collaborative inside of the firm, but it's also collaborative up and down the firm.
It's getting younger associates to come and be helpful to them and they're very trusting of that and they can be very structured about how they do that. So I think there is an unlock there. And firms that haven't started down this journey, I'd say don't panic. I would say you can start down this in a very useful way and be very constructive.
Robert Atkinson, Executive Search Partner at Watermark Search International:
And just to continue with that theme for a moment. Do you find that there are any particular firms or organisations which are using technology as, I suppose, equipping their existing staff to really take full value of that activator approach? And if so, how are they doing it and what sort of tools are they using, in your experience?
Rory Channer, Founding Partner of DCM Insights:
The technology question around activator I think is a very interesting one. So every activator in the study was using a lot of technology. It was typically not the firm given technology. Which is interesting in of itself.
I think it's impossible to get the most out of activator without data and technology. I just don't think firms have really figured out how to use the technology that's available today appropriately and within the firm. A little bit back to Pat's point around the sales training methodologies out there for this market. Those technologies weren't built for this market either, typically. They were built for manufacturing or B2B, consumer type chemicals. You name the thing, they were built for different purposes. More traditional go to market approaches than inside of professional services.
We have now seen enough evidence to show that with behavioural change, mindset shift, change in behaviours, that in itself can lead to a real thirst for technological use and more data. And so I think there is a question here about where you start. And sadly I think a lot of firms have fallen into the trap of, if I put the technology in that will change everything. Which I think we know everyone would recognise that the usage of this technology is very limited at best.
So I think there's a lot to be done there. It doesn't necessarily mean we're throwing the baby out with the bath water either. I think there's a way to cut through this. But I think if your partners and associates don't really understand the behaviours they should be driving towards, it's very difficult to supply them with the right technology. And certainly they won't use it if you do.
Robert Atkinson, Executive Search Partner at Watermark Search International:
And I imagine that on occasions organisations are going for that technology solution first, as opposed to that behavioural change.
Rory Channer, Founding Partner of DCM Insights:
Yes. And I think that's a mistake. That's a place where you'll spend a lot of money and time putting that in, and these things don't go in quickly either. So you can spend a lot of money and time putting it in. And the result you're after is typically not what you thought you were going to get.
Robert Atkinson, Executive Search Partner at Watermark Search International:
When reading the book I was struck with the fact that this is one of the first books I've read that touches on the interplay between executive search and professional services. With my own sort of hat on for a moment, if I may, what talent levers are you seeing professional services clients pull to ensure that they're getting up that curve and ensuring that they're attracting the right type of individuals into their respective environments. Can you expand upon that?
Rory Channer, Founding Partner of DCM Insights:
Yeah, I love that question as well actually. We've spent the last year documenting a lot of the change support infrastructure around activator. So sure, at an individual level, we know we can change mindsets and behaviours and get folks moving in the right direction, that's fantastic. But we've also seen now where firms are evolving various other elements of the support infrastructure for that change. And a great place is how they think about lateral hiring or hiring generally.
Because during the study we saw there were firms that had different populations of activators. So as Pat said, the average was 18%. There were standout firms that had more, and we wanted to know why. And the more we looked at those firms, the more you realised that they were pulling inadvertently, they didn't know what activator was, none of us did at that point. But why they had more people working this way, they had changed elements of culture, they had changed elements of hiring, they had driven towards a more collaborative go to market or stance inside of the firm, just generally. And so they were likely attracting more folks that were going to operate in the way that they wanted to operate.
And I think that's a huge unlock for search and hiring generally is to kind of sense whether the people that you believe, quote unquote, are big rain makers, are actually developing clients in the way that's going to be longstanding for you.
You can inherit a book of business and sit on that book of business. We know that's a very trodden road, but that's not necessarily the way that lateral coming in is going to be most successful at your firm. And I think there's a set of ideas and concepts and questions around how to hire these folks and to show you that they are able to activate the networks they have into your organisation, into your firm.
Robert Atkinson, Executive Search Partner at Watermark Search International:
We've found over the last couple of years that a lot of clients in the domestic market here in Australia have a tendency towards being opportunistic in the way that they appoint lateral partners. In part maybe because they feel they know who the rainmakers are within the domestic market or they have unconscious bias towards certain individuals that might collaborate or add to their culture in one form or another.
Do you have any experience or perspective in regards to the impact that can have versus the benefit of engaging in a more risk based sort of approach that covers a broader perspective? Do you have any thoughts on that at all?
Rory Channer, Founding Partner of DCM Insights:
At the highest level I think when firms are bringing in that type of talent, one of the areas, many areas I think they're missing, but one of the areas that they're not considering is, how does this fit within what we need inside of the firm?
If you are looking for a certain type of partner to deliver a service that you know your clients need, that's easier to understand. Because we don't have any privacy lawyers here or we don't have any people that understand this type of international tax situation and we get clients to ask for that so we need to fight someone like that. That's pretty straightforward. If you are trying to figure out, is the network of this person additive to what we have and have we got giant holes in, name the big multinational, and this person is going to help us navigate through to different spots that could be very additive to our relationship map in that firm. No one's seemingly doing that. And that's a blind spot, I think.
Because understanding what this is going to do to our uber network map of our firm could be very valuable. And it could earn a much bigger outcome for us than the book of business that they're bringing or the expertise that they might have that could be useful to other partners.
One of the things I think is somewhat consistent in firms now is that when they bring laterals in, they're not really unlocking the laterals in the right way. And so they're not integrating them as much as they should if they think about what is this kind of thing that they're bringing, it's more than just the expertise. It's more than just the book of business. It's this network and ability to connect dots and flow value through other parts of the firm. That might be a better framework for folks to consider when they're thinking about who they're bringing in.
Robert Atkinson, Executive Search Partner at Watermark Search International:
Thank you. No, that's really interesting. I'm cognisant of time. Rory, Pat, thank you so much for your time and your insights. It's been a fascinating conversation and one that I think resonates so broadly within the professional services industry today. There's an awful lot more in this book that we could discuss today, but unfortunately we've run out of time. So thank you once again. I really enjoyed the conversation and look forward to catching up with you later.
Rory Channer, Founding Partner of DCM Insights:
Thanks for having us.
Pat Spenner, APAC Managing Director and Commercial Leader of DCM Insights:
It's been great.
Rory Channer, Founding Partner of DCM Insights:
Yeah, thanks Robert. It's been great.
Robert Atkinson, Executive Search Partner at Watermark Search International:
Pleasure. Okay.
Pat Spenner, APAC Managing Director and Commercial Leader of DCM Insights:
Cheers.
Robert Atkinson, Executive Search Partner at Watermark Search International:
Thanks everyone for listening in. That concludes our podcast at Watermark Search Agile Leadership Lessons. I hope you enjoyed it, and until next time, I'm Robert Atkinson. Thanks once again. Bye bye.