In the 1850‘s, despite unquestionable empirical evidence in support, the proponents of germ theory were viciously attacked by the medical establishment of the time who were largely in favor of the theory of spontaneous generation. They continued treating symptoms (sometimes successfully) rather than the cause. It was not until 1900 that this theory was recognised by its own profession as having merit - it then formed the foundation of modern medicine. OK, so in most professions we do not deal with issues that are life threatening or can cause physical harm or disease like germ theory , but we do often deal with the symptoms of problems in our professions rather than looking at root causes.
It is no longer breaking news that the time based cost accounting and time based billing models are less than optimum and are increasingly being criticized both by those within our professions and those we seek to serve-our clients.
Like Germ Theory in the 1800's, value based pricing and management without timesheets is not yet practiced by the majority of professionals. However overwhelming empirical evidence is out there and more and more innovative professional firms around the world successfully operate in a timeless environment. These firms are fully aligned with their client’s interests, their knowledge workers enjoy an atmosphere of collaboration and creativity, and firms profits are no longer capped by the physical hours their people can work.
The late Peter Drucker many years ago in his book, Management Challenges for the 21st Century stated:“The most important, and indeed the truly unique, contribution of management in the 20th century was the fifty-fold increase in the productivity of the manual worker in manufacturing.The most important contribution management needs to make in the 21st century is similarly to increase the productivity of knowledge work and the knowledge worker.The most valuable assets of the 20th century company were its production equipment.
The most valuable asset of the 21st century institution, whether business or non-business, will be its knowledge workers and their productivity.”
For a long time we have relied on “technology” for worker productivity gains. That has now run its course. Future gains in worker productivity are going to come from implementing changes to our fundamental business model.
Firms Of The Past will continue to favor the accepted norm of the time and try to treat the symtoms. Firms Of The Future will look at the causes and seek to eradicate those causes.
Firms Of The Future do not seek to tweak their current business practices by, for example, improving the efficiency of their time recording processes, but instead look to replace the current model with a better, more effective business model .
Ron Baker – economist, best selling author, inspiring speaker, pricing expert, knowledge worker advocate and one of the world’s foremost thought leaders for professional firms-understands more than most that the business model that has served our professions well for decades is failing us, our next generation professionals and our clients . The organisational and management structures we all grew up with were modelled on an industrial age, command and control, paradigm. The challenge, and the opportunity for firms that recognise it, is to understand how to transform their firm to accommodate the demands of the knowledge workers.
Attend one of the Firm of the Future Forums or Masterclasses in the coming weeks in Melbourne on the 5th & 6th March (Masterclass sold out), Brisbane 12th & 13th March and Sydney on the 15th & 16th March and find out how you can become a Firm Of The Future.
Go to www.firmofthefutureforums.com for more information to secure your tickets now. Still some places available.
Same Firm discounts available. Earn CPD points. Price includes copy of Ron Baker's latest book Implementing Value Pricing: A Radical Business Model for Professional Firms.