Creating a Firm of the Future is not for everyone as it requires leaders of firms to think about why, how and what they do very differently than they have in the past.
The guiding principles for a Firm of The Future are largely set out in 2 books; one jointly authored by Ron Baker & Paul Dunn titled The Firm of the Future: A Guide for Accountants, Lawyers, and Other Professional Services (Wiley 2003) and more recently refined in Ron Baker’s latest book Implementing Value Pricing-‐A Radical Business Model for Professional Firms (Wiley 2011).
The Firm of the Future model looks at the value a firm creates for their clients (output) rather than the time spent on a file (input). To do this, firms must rid themselves of pricing their services by time and recognise that all professionals are knowledge workers, not machines, and they should not be treated like ‘widgits’ on a production line. Firms of the Future recognise that value is created outside the firm not inside it, and that clients do not buy time, they never have and never will, so they have stopped trying to sell something that no one buys.
We assist and work with many firms that have made, or are making, the transition to becoming a Firm of the Future. Some are now very public about their move and are reaping the rewards and competitive advantages that come with any early adopters.They confirm that advantages to their clients include greater price certainty and piece of mind, improved relationships and communication, and sharing of risk. For the firms themselves, their culture, especially in terms of supporting team work and collaboration, has improved, there is less hoarding of work by individuals, and they have happier, more creative and productive teams of knowledge workers released from the shackles of timesheets. Increased profitability is also a benefit as is the fact that clients who agree their fees up front have a tendency to pay quicker.
Being a Firm of the Future is not just about moving away from time based billing-‐ far from it. Discovering your firm’s purpose, fostering a culture of innovation, better and more focussed client selection, better scoping and project management, using leading indicators predictive of performance (instead of lagging retrospective metrics like KPI’s), eradication of annual performance appraisals, all go hand in hand in a timeless environment. All of this will be far more attractive to professionals of the future than simply leveraging people and time.