Two aspects of professional work create the special management challenges of the professional service firm. First, professional services involve a high degree. Managing The Professional Service Firm by David H. Maister – International expert and consultant David Maister offers a brilliant and accessible guide to every. Managing The Professional Service Firm has ratings and 48 reviews. Pavel said: Очень толковая книга. Будет полезно прочитать и тем, кто не работает .

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International expert and consultant David Maister offers a brilliant and accessible guide to every management issue at play in professional firms. Professional servicee differ from other business enterprises in two distinct ways: Second, professional services are highly personalized, involving the skills of individuals.

Such firms must therefore compete not only for clients but also for talented professionals.

Managing the Professional Service Firm – Wikipedia

Drawing on more than ten years of research and consulting to these unique and creative companies, David Maister explores issues ranging from marketing and business development to multinational strategies, human resources policies to profit improvement, strategic planning to effective leadership. Maister, one of the world’s leading authorities on the management of professional service firms, is the author of several successful books, including Managing the Professional Service Firm, True Professionalism, and Practice What You Preach, and coauthor of The Trusted Advisor.

When it comes to understanding these firms, David Maister has no peers. Heskett Professor, Harvard Business School; co-author of Service Breakthroughs David Maister’s name is synonymous with the latest thinking in professional service firm management.

This book suggests why.

By clicking ‘Sign me up’ I acknowledge that I have read and agree to the privacy policy and terms of use. Free eBook offer available to NEW subscribers only. tye

maisteg Must redeem within 90 days. See full terms and conditions and this month’s choices. Tell us what you like, so we can send you books you’ll love. Sign up and get a free eBook! Price may vary by retailer. Add to Cart Add to Cart. With varying refinements of language, the mission of most professional firms is: To deliver outstanding client service; to provide fulfilling careers and professional satisfaction for our people; and to achieve financial success so that we can reward ourselves and grow.

The commonality of this mission does not detract from its value. Simply put, every professional firm must satisfy these three goals of “service, satisfaction, and success” if it is to survive.

Management of a professional firm requires a delicate balancing act between the demands of the client mansging, the realities of the people marketplace the market for staffand the firm’s economic ambitions. Many factors play a role in bringing these goals into harmony, but one has a preeminent position: To see the importance of this factor, we shall briefly examine, in turn, its relation to the three goals of the firm.

Consider three kinds of client work: Brains, Grey Hair, and Procedure projects. In the fir type Brainsthe client’s problem is at the forefront of professional or technical knowledge, or at least is of extreme complexity. The key elements of this type of professional service are creativity, innovation, and the pioneering of new approaches, concepts or techniques: The firm that targets this market will be attempting to sell its services on the basis of the high professional craft of its staff.

In essence, their appeal to their market is, “Hire us because we’re smart. Few procedures are routinizable: Each project is “one-off. Even though such projects may involve significant data collection and analysis activities normally performed by juniorseven these activities cannot be clearly specified in advance and require the active involvement of at least middle-level project management professionals on a continuous basis.

Consequently, the ratio of junior time to middle-level and senior time on Brains projects tends to be low. Grey Hair projects, while they may require a highly customized “output” in meeting the clients’ needs, involve a lesser degree of innovation and creativity in the actual performance fir the work than would a Brains project. The general nature of the problem to be addressed is not unfamiliar, and the activities necessary to complete the project may be similar to those performed on other projects.


Clients with Grey Hair problems seek out firms with experience in their particular type of problem.

Review of Managing the Professional Services Firm by David Maister

In turn, the firm sells its knowledge, its experience, and its judgment. In effect, they are saying, “Hire us because we have been through this before; we have practice at solving this type of problem.

The opportunity is thus provided to employ more juniors to accomplish these tasks. The third type of project, the Procedure project, usually involves a well-recognized and familiar type of problem.

While there is still a need to customize to some degree, the steps necessary to accomplish this are somewhat programmatic. The client may have the ability and resources to perform the work itself, but turns to the professional firm because the firm can perform the service more efficiently, because the firm is an outsider, or because the client’s own staff capabilities to perform the activity are somewhat constrained and are better used elsewhere. In essence, the professional firm is selling its procedures, its efficiency, its availability: The problems to be addressed in such projects, and the steps necessary to complete the analysis, diagnosis, and conclusions are usually so sufficiently well established that they can be easily delegated under supervision to junior staff.

For Procedure projects the range of possible outcomes for some steps may be so well known that the appropriate responses may be “programmed. However, it is usually a simple task in any profession to identify types of problems that fit these categories.

The choice that the firm makes in its mix of project types is one of the most important variables it has available to balance the firm. The choice of project types influences significantly, as we shall see, the economic and organizational structures of the firm. Consider what will happen if a firm brings in a mix of client work such that its “proper” staffing requirements would be for a slightly higher mix of juniors, and a lesser mix of seniors than it has i. As Figure suggests, the short-run consequence will be that higher priced people will end up performing lower-value tasks probably at lower feesand there will be an underutilization of senior personnel.

The firm will make less money than it should be making. The opposite problem is no less real. If a firm brings in work that has skill requirements of a higher percentage of seniors and a lesser percentage of juniors, the consequences will be at least equally adverse: As these simple examples show, matching the skills required by the work to the skills available in the firm i. People do not join professional firms for jobsbut for careers.

They have strong expectations of progressing through the organization at some pace agreed to explicitly or implicitly in advance. The professional service firm may be viewed as the modern embodiment of the medieval craftsman’s shop, with its apprentices, journeymen, and master craftsmen.

The early years of an individual’s association with a professional service firm are, indeed, usually viewed as an apprenticeship, and the relation between juniors and seniors the same: The senior craftsmen repay the hard work and assistance of the juniors by teaching them their craft.

The archetypal structure of the professional service firm is an organization containing three professional levels. In a consulting organization, these levels might be labeled junior consultant, manager, and vice president. In a CPA firm they might be referred to as staff, manager, and partner. Law firms tend to have only two levels, associate and partner, although there is an increasing tendency in large law firms to recognize formally what has long been an informal distinction between junior and senior partners.

Responsibility for the organization’s three primary tasks is allocated to these three levels of the organization: The three levels are traditionally referred to as “the finders, “the minders,” and “the grinders” of the business. The mix of each that the firm requires i. While the pace of progress may not be a rigid one “up or out in five years”both the individual and the organization usually share strong norms about what constitutes a reasonable period of time for each stage of the career path.

Individuals who are not promoted within this period will seek greener pastures elsewhere, either by their own choice or career ambitions, or at the strong suggestion of the firm.


This promotion system serves an essential screening function for the firm. Not all young professionals hired subsequently develop the managerial and client relations skills required at the higher orofessional. While good initial recruiting procedures may serve to reduce the degree makster screening required through the promotion process, it can rarely eliminate the need for the promotion process to serve this important function.

The existence of a “risk of not making it” also serves the firm in that it constitutes a degree of pressure on junior personnel to work hard and succeed.

Managing the Professional Service Firm

The promotion incentive is directly influenced by two key dimensions: These factors are clearly linked maistef a firm’s leverage structure and its growth.

For any given rate of growth, a highly leveraged firm one with a high ratio of juniors to seniors will offer a lower probability of “making it” to the top, since there are many juniors seeking to rise and relatively few senior slots opening up.

A less leveraged firm, at the same rate of growth, will need to “bring along” a higher percentage of its juniors, thus providing a greater promotion incentive. The “rewards of partnership” the high levels of compensation attained by srevice partners come only in part from the high hourly or daily rates that the top professionals can charge for their own time.

Profits also come, in large part, from the firm’s ability, through its project team structure, to leverage the professional skills of the seniors with the efforts of juniors.

The successful leveraging of top professionals is at the heart of the success of the professional firm. As demonstrated below, a significant portion of partnership profits derives from the surplus generated from hiring staff at a given salary and billing them out at multiples of that salary.

By leveraging its high-cost seniors with low-cost juniors, the professional firm can lower its effective hourly rate and thus reduce its cost to clients while simultaneously generating additional profit for the partners. The market for the firm’s services will determine the fees it can command for a given project; its costs will be determined by the firm’s abilities to deliver the service with a cost-effective mix of junior, manager, and senior time.

If the firm can find a way to deliver its services with a higher proportion of juniors to seniors, it will be able to achieve lower service delivery costs. The project team structure of the firm is therefore an important component of firm profitability. The relationship between a firm’s leverage structure and its three goals is illustrated in Figurewhich shows the principal forces tying these elements together. Guru Associates, which engages in a variety of projects, nevertheless has a typical project which requires 50 percent of a senior’s time, percent of a middle-level person’s time, and the full-time efforts of three juniors.

No one is expected to bill percent of each’s available time. Nevertheless, if the firm is to meet its economic goals, it will require that seniors and managers are engaged in billable work for 75 percent of their time, and juniors 90 percent. Guru Associates currently has four seniors. If it is to meet its target of 75 percent billed senior time, its available senior time will be four times 75 percent, or the equivalent of three seniors working full-time.

This implies six projects, if the typical project requires 50 percent of a senior’s time. With six projects, the firm needs the equivalent of six full-time middle-level staff, according to the project team structure.

Each project requires davis of a middle-level person. At 75 percent target utilization billed hours divided by available hoursthis means that the firm must have eight middle-level maistfr. Similarly, at three juniors per project, the firm needs eighteen full-time juniors, or at 90 percent billability, twenty juniors.

Simple calculations such as these show that, with eight seniors, the firm would need sixteen managers and forty juniors. The proportions remain constant: Unless there is a change in either the project team structure i.

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