A typical belief of a Service Business is that:
Selling Services means Selling Time of relevant Expert Personnel
So, by this belief, to grow a service business’ revenue you need to employ and/or contract more people…
IS THIS WHAT YOU THINK?
Firstly, an event you must attend. I am acting as host at an IT@Cork’s Sales and Management Forum event “Managing a Service Business for Growth” on Wednesday March 22nd at the NSC. Another high value IT@Cork event where valuable business insights, networking and refreshments are certain.
Paul Hourican, founder and MD of PFH Computers is one the speakers on the night. Paul is one of the early entrepreneurs of the Cork IT Sector and has built a tremendous national IT services business in PFH. Well worth hearing his views….
SO, back to topic.
following the train of though, “to grow a services business’ revenue, we need to hire more people”. As in bespoke software development houses, more staff means greater ability to sell more ‘Units of Time’. For each Unit of time there is a clear margin. Then different level of expertise have different charge rates. For example, within the same project a Senior Business Analyst may charge out at E200 per hour, while a junior developer may be E60 per hour…
Is your business is focussed on solving particular business needs and selling expert time as a solution?
DO YOU use high-level expertise every time?
How Many times, in the past, has your company solved the same business needs in the past?
You know all about re-usable code in software development, whereby when developing a system component/module that is likely to be used in other systems in the future then you’ll develop it in a general manner, parameterised, configurable etc. Then it is reducing future project effort and reducing risk.
NOW, a thought (to be further expanded at a later date)…
If you were asked to provide a service to solve the same problem in 20 different client businesses, would you approach it differently than solving it in 1?
YES, you would. You would stand-back, define an approach, a process of gathering information with review points, decision points and actions. You can then decide on the level of expertise required at each point and whether your high-level expertise need to be at every stage…. This is the basis of Productising a Service.
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