Leadership in professional services - developing leadership capabilities in Partners
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Leadership in professional services - developing leadership capabilities in Partners
- 1. Leadership in professional services Developing leadership capabilities in Partners Click to add Title Alex Swarbrick and Sharron Swann
- 2. Welcome to the Roffey Park Leadership in Professional Services Webinar Alex Swarbrick Sharron Swann Senior Consultant HR Director Roffey Park Reeves & Co LLP
- 3. Send us your questions… Host Melissa Green Roffey Park
- 4. Where we’re going in this webinar What makes Professional Service firms different? What does effective leadership in Professional Services entail? – What’s attractive about the Partner role? What do we see as the leadership development needs of Partners? What helps Partners to develop leadership capabilities? Discussion and questions
- 5. What makes Professional Services different? Sector – UK- a global leader – Significant part of economy Staffing – People are the product – Careers not jobs Sources: Structure • Department for Business Innovation and Skills • “UK Professional Services Sector Outlook: Third quarter 2012” (Barclays) • 2012 Accountancy Age survey • City UK report – Partnerships
- 6. What makes Professional Services different? Skill mix – Finders – Minders – Grinders Shared values – Values of Professions – Values of firm Strategy – Expert – Experience Sources: • Managing the Professional Service Firm’ David Maister (2003) – Efficiency
- 8. What’s attractive about the Partner role? Professional and Personal Status Autonomy Intellectual challenge Recognition Lifestyle and income Stakeholder in the business
- 9. Partners as leaders Positive aspects of Positive aspects of A B Specialism v whole firm Independent decision making v collaborative Operational v Strategic Process v people Negative aspects of Negative aspects of – coaches and mentors A B Polarity management Copyright © PMA 2002
- 10. Partners as Leaders What do they need to be good at? Strategic thinking Influencing skills Ability to address conflict Navigate organisational politics Self-awareness Less about IQ More about EQ
- 11. Partners as Leaders What do they need to be good at? Strategic thinking Influencing skills Ability to address conflict Navigate organisational politics Self-awareness
- 12. Partners as Leaders Benefits of specialists as leaders – Specialists like to be led by specialists Technical expertise is an enabler, a door opener Focus on facts and IQ; less practiced in using EQ Can be collaborative and committed to the organisation, not just their specialism
- 13. Developing Partners as Leaders Fast paced Delivered by people who are recognised as experts in their own field Intellectually stimulating Evidence base to any theory Experiential Practically relevant Feedback and self awareness Importance of role models
- 14. Reeves’ Partners Leadership Programme Scoping the need Psychometric (FIRO B) 360 feedback 1:1 Coaching 3 x 2 day modules – Leading self – Leading clients – Leading the firm Projects Evaluation
- 15. Outcome Emotional intelligence More productive collaboration across the firm and among the Partners People leadership more effective – Especially performance management
- 16. In conclusion... Different Technical and people business Require skilful leadership – more about EQ than IQ The development must fit Organisational culture where good ‘leadership’ is valued.
- 17. Time for discussion and questions
- 19. What next? Leadership Development in Professional Services Round Table March 19th 2013 Reeves’ office in London
- 20. For more information on Roffey Park contact Melissa Green Marketing & Business Development Manager tailored@roffeypark.com +44 (0)293 851644 +44 (0)7825 616281
Editor's Notes
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- Hello, and welcome again to this Roffey Park webinar on Leadership in Professional Services firms. I’m Alex Swarbrick and together with Sharron Swann, we’ll be sharing with you some insights and practical ideas on this topic. We’ll be drawing on our experience, including a leadership development programme for Partners in Sharron’s firm, Reeves, as well as insights from Roffey Park’s research in this area.When we started thinking about this webinar, Sharron and I had a lively and lengthy conversation about Professional Services firms; what makes them different, about leadership in those firms, about Partners as leaders, and how to develop Partners’ leadership capabilitiesAnd what we’d like to do in this webinar is recreate some of that conversation with you. [click]
- SharronSo today’s webinar is structured round a number of questions, which are: What makes Professional Service firms different? What does effective leadership in Professional Services entail? Including what’s attractive about the Partner role? What do we see as the leadership development needs of Partners? What do we know helps Partners develop those leadership capabilities?And we’ll add some facts and figures about the sector so set this all in context.For the purpose of this webinar, when we’re referring to professional services as a sector we’re including accounting, legal services, plus construction and infrastructure services including architecture and ICT. However the focus of the case and a number of the examples are accountancy firms.Our intention is that you’ll have some practical ideas and actions to take away.You’re welcome to raise comments or questions along the way, and there’ll also be time for discussion and questions towards the end.[click]
- Alex[Click]The UK is recognised as a global leader in Professional ad Business Services. According to government figures, the sector accounts for almost 20% of our national output, 14% of exports, and has the potential to grow further.Looking at how the sector is performing currently, recent reports show Accountancy having made a good recovery, with a slight increase in turnover figures, whereas for legal firms the picture’s more mixed; the largest firms seeing profit growth while the sector as a whole has still been contracting in 2012.And in terms of jobs, the Professional Services sector saw small growth in Jobs in the first half of 2012.But, as we know, this is a global industry, and the sector is facing increasing competition from India and China, driving price sensitivity, and pushing some firms towards being even more specialist, focusing more and more on high value work.[Click] StaffingAnother feature of the sector that’s different is that People are the product. Firms typically are selling the time, knowledge and expertise of a limited number of individuals, and the rewards of working in professional services has meant that historically people join firms for a career not a job.[Click]The structure of Professional Services firms also tend to be different, Partnerships being a common structure; and there are features of Partnerships, which we’ll come back to, that present unique challenges. They tend to be hierarchical, expert based, where knowledge and expertise is power, and influence comes with technical expertise. But more on that shortly.[Click]
- Sharron There’s also a distinct pattern of skill mix in Professional Services firms, involving a balance between specialist experts who win the business, managers who look after the business that’s been won, and administrative staff who undertake much of the non-specialist tasks; sometimes caricatured as Finders, Minders, and, Grinders.[Click]There’s been lots written about the nature of Professional values, and professional services firms typically have clear declared values. Some will be based on the specific values of that particular profession, and some will be the specific values of the firm. But clearly articulated values tend to be a common feature of professional service firms.[Click]A further feature of professional service firms which is unique, is about how they position themselves in their market; in other words their strategy.You may well have read David Maister’s classic ‘Managing the Professional Service Firm’ where he makes the distinction between the Expert, the Experience, and the Efficiency models. So, here’s the theory bit, and what he means by that.[Click]
- Alex [click]We’ve illustrated the distinction this way. The vertical axis is about Value in the sense of unit price, and expertise in the sense of knowledge specialism. The horizontal axis about project volume. What the theory says is that firms will typically pursue one, or a blend of, these three. [click] So, a firm may focus entirely, or in part, on being expert – where the engine of the firm’s performance is highly specialised, skilled individuals, supported by a number of enabling functions. Here the ratio of specialists : non-specialist is higher than in the other approaches.[click]In the experience based approach the value is less located in a limited number of highly specialist individuals, but more in the firm’s collective experience. So, the specialist : non-specialist ratio might be lower than in the expert approach.[click]And in what Maister describes as Efficiency, the strategy is about delivery of high volume projects, where the value comes from the efficiency of the processes and systems, rather than individual specialist expertise. So greater numbers of non-specialists would be involved, which can help in the face of price competition. Well, enough from us; what about your firm? We thought it would be interesting to test this out in a poll at this point. The poll will appear on your screen and we’d like you to choose the extent to which your firm adopts predominantly one of these approaches, or a blend of more than one.[Poll](Words through poll about the blend in Reeves)[Click]
- SharronSo, it’s time to come to our next question, which is about effective leadership in Professional Services firms. We’re starting now to look at what effective leadership in Professional services entails, but to begin with, and we’re going to focus particularly on Partnerships. And to begin with, what makes the Partner role appealing? From experience, it’s a mixture of things:Professional and Personal Status (ad lib)Autonomy – partners enjoy considerable autonomy in their particular professional specialism and the intellectual challenge that goes with technically complex projects.Recognition – both within the firm and outsideLifestyle and income Stakeholder in the business - Equity partners have a stake in the success of the firm and how rewards are divided. The shadow of this can be the competing priorities and different agendas among partners.Partners obviously are the ones who influence the strategic direction of the firm.Referring to Maister again, he makes the point that some of these factors which attract people to the partner role, also make them virtually un-managemable![Click]
- AlexWhen a senior technical specialist becomes a Partner, the role requires a subtle but enormous shift in behaviour, style of leadership, and way of thinking – while still requiring them to excel in their particular technical specialism. And this presents some tensions to be managed.Their whole career to date has been built around technical knowledge, and generating income. [Click]Where their focus has been predominantly their specialism, as a Partner their attention needs to shift to the whole firm. [Click]Where they’ve previously been able to be fairly independent in decision making they now need to be collaborative. [Click]Where their role had a strong operational element, it’s now more strategic. Their environmental scanning needs to include a fuller appreciation of the market, the external environment. [Click]Where previously the role didn’t require them to be good coaches and mentors, now it does. Now they need to be skilful delegators and developers of senior non-partners. [Click]But what we see is that theses features of the leadership role aren’t clear cut, either/or choices; they are more both/and. So, Partners need to be both specialists leading an area of practice, and at the same time need to have a clear focus on the firm as a whole. And the challenge is that simply doing more of one, to the exclusion of the other ultimately starts to create new problems until the balance is redressed again. And this principle applies to other tensions or dilemmas inherent in the partner role; balancing personal success with firm-wide success; balancing independent decision making and autonomy with collective decision making and collaboration. Managing these dilemmas well, sometimes described as ‘Polarities’, takes self awareness and starts to look a bit like this.The box at the top left represents the positive benefits of me focussing on the firm, the wider business strategy, [click] but if I do that more and more, some negative consequences will start to occur, as I perhaps neglect my area of the practice, my own technical specialism, [click] so I start to redress the balance, doing more of that , more autonomy, more looking after my area of the business [click] until again some negative consequences start to occur, so I redress the balance again.[click]
- SharronSo that’s a shift in the role, which struck us as being about moving from vertical to lateral, from a narrow, deep specialism to a broad firm-wide perspective. In some cases, moving out of the silo.And that raises our next question; to be an effective leader, what do partners need to be good at?Given all that we’ve seen and been saying, for a Partner to be an effective leader they need to develop and apply some skills, abilities and behaviours which haven’t been so needed in their careers to date.Apart from strategic thinking, Partners need well developed influencing skills. They need the ability to address conflict, to navigate organisational politics; and underpinning all this, they need well developed and realistic self-awareness.The leadership aspect of the partner role is less about IQ, the logical rational capabilities that have got them this far – and more about EQ, the emotional intelligence needed to work with their fellow partners, juniors as well as the external environment.This is the aspect of their leadership which is about having a positive effect on the performance, motivation, engagement, satisfaction of those they’re leading. In my experience, Partners’ approach to delegation is central to this; and something which in our experience many partners in many firms don’t do well – partly out of the habit of holding billable work to themselves, partly because they’ve never felt personally responsible for the development of others.But before we look more closely at partner development, what about in your organisation. Delegation is widely reported as an issue for many Professional Service firms; typically, Partners and senior specialists under delegating work, to the detriment of themselves, the firm, and the development of non-partners. So another poll will appear on your screen, asking you to say to what extent this common problem is an issue where you are too. POLL(Alex and Sharron chat)So how do you help partners to develop these capabilities? Roffey Park have done some research on the topic of ‘The Expert as Leader’ which looked at just this question so, Alex ,tell us what came out of that.[Click]
- SharronSo that’s a shift in the role, which struck us as being about moving from vertical to lateral, from a narrow, deep specialism to a broad firm-wide perspective. In some cases, moving out of the silo.And that raises our next question; to be an effective leader, what do partners need to be good at?Given all that we’ve seen and been saying, for a Partner to be an effective leader they need to develop and apply some skills, abilities and behaviours which haven’t been so needed in their careers to date.Apart from strategic thinking, Partners need well developed influencing skills. They need the ability to address conflict, to navigate organisational politics; and underpinning all this, they need well developed and realistic self-awareness.The leadership aspect of the partner role is less about IQ, the logical rational capabilities that have got them this far – and more about EQ, the emotional intelligence needed to work with their fellow partners, juniors as well as the external environment.This is the aspect of their leadership which is about having a positive effect on the performance, motivation, engagement, satisfaction of those they’re leading. In my experience, Partners’ approach to delegation is central to this; and something which in our experience many partners in many firms don’t do well – partly out of the habit of holding billable work to themselves, partly because they’ve never felt personally responsible for the development of others.But before we look more closely at partner development, what about in your organisation. Delegation is widely reported as an issue for many Professional Service firms; typically, Partners and senior specialists under delegating work, to the detriment of themselves, the firm, and the development of non-partners. So another poll will appear on tour screen, asking you to say to what extent this common problem is an issue where you are too. POLL(Alex and Sharron chat)So how do you help partners to develop these capabilities? Roffey Park have done some research on the topic of ‘The Expert as Leader’ which looked at just this question so, Alex ,tell us what came out of that.[Click]
- AlexThe study involved seven organisations across sectors from insurance to medical, construction to scientific. And the main findings were this. First of all organisations recognised a number of real benefits in appointing technical specialists to leadership roles. It was widely acknowledged as giving them credibility inside and outside the organisation; they’re able to hold other technical specialists to account within the firm, and specialists like to be led by specialists. In other words, non-partners like to be led by experts in their professional discipline.What we also found was that technical expertise was more of an enabler, a door opener, and once in a position of leadership, it’s relevance starts to decline. We found that ‘experts’ can have a tendency to focus on facts, and are less practiced in using their emotional intelligence. - which at one level seems a bit of a caricature of technical specialists; BUTWe also found some common perceptions that weren’t supported; for instance we found that technical specialist leaders weren’t always individualistic to the detriment of commitment to the firm.[Click]
- SharronWhat also stood out were some clear practical pointers to how experts, technical specialists, like to be developed.AlexThere were clear messages about how best to approach the development of technical leaders and partners which are important to keep in mind. The learning needs to be fast paced - recognising that partners have the intellectual capacity to grasp concepts quickly.It’s important that it’s delivered by people who are recognised as specialists in their own field; without this, they’ll lack credibility in the eyes of the partners.Highly intellectually stimulatingEvidence base to any theory – Partners / technical specialists are used to critiquing and analysing, so will want to know the robustness of concepts offered.Experiential – space and time to review and reflect on own management / leadership stylePractically relevant – the learning needs to be focussed on people’s actual jobs – Feedback and self awareness – essential to develop self awareness and a decent understanding of how they affect how others feel and behave. Importance of role models – and a good question to ask yourself here is ‘what’s the managing partner like as leader?’[Click]
- SharronSo maybe now’s a good time to look at what we did in Reeves and how the development programme we ran for our partners played out.To set the context, Reeves is an Accountancy firm which has been around over 100 years working predominately in the South East of England. We’ve grown considerably through mergers, most recently with a firm in the City, growing the number of Partners to over 40.The rationale for the leadership programme we ran was that we needed to embed the culture of being One Firm following the merger (demolish the silos) ; partners with quite different backgrounds and experiences needed to start working more collaboratively, and we needed to continue developing non-partners and maintaining the firms reputation as a developer.So Alex tell us about the programme.AlexAfter lots of conversations and meetings with key stakeholders in the programme including participants, the first cohort of 12 partners started in April 2011 and completed the programme in February 2012, with a second cohort of 12 planned. Prior to attending the first module, partners completed a psychometric (FIRO B which focuses on needs and behaviours in working relationships) and 360 feedback which was presented to participants 1:1 in the first of their coaching meetings.This was followed by three two-day modules focused on: Leading Self, including themes such as purpose as a leader, authentic leadership, presence and gravitas, and integrity as a source of power. All aimed at stretching and growing their self-awareness.Leading Clients, with issues such as building trust in client relationships, commercial and strategic awareness and key client managementAnd the third module was:Leading the Professional Services Firm, including coaching skills to improve performance in others, influencing without formal authority and communication strategy and vision , and equipping them to work more productively and constructively as a partnership group. Because behavior change and skill development were key, the whole programme was underpinned by one-to-one coaching sessions by the programme tutors before the programme, between the modules, and after the third one. This reinforced the learning, offered powerful support and challenge to partners, and ensured their development was ‘live’ and highly relevant. And through the course of it we saw some changes, didn’t we?Sharron[Click]
- SharronWe’ve been gathering stories and measures of the impact in all sorts of ways. One thing we’ve seen is that staff at all levels have reported moving away from a ‘just do it’ mentality to richer, more open discussions between Partners and managers. For Partners, building awareness and understanding of how they relate both to each other as the leadership team and to their staff and clients has been powerful. For instance, one partner in the first cohort, who’s happy to be quoted , found the programme’s focus on Emotional Intelligence was powerful. “Roffey Park helped us develop a clear process for stepping back and dealing with issues in a more considered way,” he says. “I can now take the time to think issues through properly from various angles and assimilate as much information as possible when making decisions.”We’re seeing our Partners now capitalising on the breadth of expertise right across the firm rather than relying too much on selling within their own specialism. “What we’ve noticed is a much greater degree of cross referral and team working than we had previously,” says Reeves’ Managing Partner Clive Stevens. Many firms have gone backwards - we haven’t.” “Communication and people management has improved,” adds Clive. “We have more direct conversations about performance, developing and rewarding those who do perform well, and being more open with those who don’t.”[Click]
- AlexSo where are we, and what have we been saying?Professional service firms are unique in structure, strategy, skills, how they organisae themselves. As well as being technical specialist businesses built on chargeable hours, at their centre they are people businesses.They require skilful leadership, with particular qualities – both strategically and relationally, and for Partnerships that includes shifting focus and priorities from their own specialism to the firm as a whole, and the collaborative decision making that goes with that. And the skill of negotiating decisions with fellow partners, rather than the more autonomous decision making as head of a specialist area.The skills Partners need are in addition to the technical competence which has served them through their career, and are much more about EQ than IQAnd to develop those skills, and practice the behaviours necessary for the role, it’s important to ensure any development is intellectually stretching, relevant, experiential, delivered by credible experts in their own field, and ideally underpinned by 1:1 coaching where Partners can in confidence further explore and apply their learning.And the key thing, which came out both from our research and our own experience; you can invest in developing individuals’ leadership capabilities, but ultimately the benefit of that is dependent on establishing an organisational culture in which good ‘leadership’ is valued and recognised as much as technical expertise and fee earning.[Click]