How Consultancies Can Get Started With Value Proposition Design (Without Getting Overwhelmed)

“What is your consultancy’s value proposition?” I often ask consultancy owners and their firms’ leaders this question – typically during the introductory call with a qualified prospect. 

The ability to answer it + the answer itself give me a good idea of the type of consultancy I will be working with.

• Some commence a 5-minute monologue outlining the services, the years of experience, and the impressive credentials of the consultants. This tells me that their value proposition is not client-centric, and there’s a good chance this consultancy has a lower win rate.
  
  
• Others explain that the value proposition depends on the prospect’s unique needs (huh?). This often indicates that the consultancy tries to be everything to everyone and is in the race to the bottom, often competing on pricing.
  
  
• A few have no idea what I’m asking them. This often tells me that the consultancy’s owners don’t have a viable growth strategy mapped out.
  
  
• And now and then, I receive a concise, impressive answer that, in under a minute, tells me what problems the consultancy can solve, what types of clients they target, and the outcomes they achieve for these clients. This is when I feel the firm is on the right track and may only need my help improving its financial performance. 

The majority of answers, however, fall into one of the first three categories. And that means we usually start work in the same place: designing (or re-designing) the value proposition. 

In this post, I’d like to share a straightforward value proposition design approach that Florian Heinrichs - a former Accenture marketer and consultancy marketing expert - and I co-created in the context of a joint client. 

I aim to explain that value proposition design is a manageable process. It’s about taking a thorough – and honest! – look at what and how the consultancy does, evaluate how closely the consultancy’s offering matches the prospects' needs, and then crystalize the learnings into an impactful definition.

Value proposition design is straightforward but requires commitment

Many small and medium-sized consultancies skip the value proposition design step altogether. The founders often come together based on their shared area of expertise; they come up with a list of services that their consultancy will offer and then leverage their network to get things going. 

Unfortunately, as the consultancy grows, the owners find it more and more difficult to win enough projects to maintain sustainable growth and establish financial health and stability. (This is often when I get a call request from these owners)

I also witnessed many consultancy owners putting together a value proposition statement by summarizing all their services and slapping on all external messages. There is no intentionality. The consultancy looks like 1.000 other consultancies doing the same. 

Why is that? Why are so many consultancies failing at this foundational task?

Based on my conversations with consultancy owners and leaders, I see two main reasons:

1. Consultancies don’t see it as a foundational or important factor in their operations.
   
   
2. Consultancies hesitate to start designing (or re-designing) their value propositions because they don’t know how and think of it as a complicated, resource-consuming process.

Answering the first reason: Value proposition design is one of the most crucial aspects of establishing the growth foundations of a consultancy. It impacts everything: how the consultancy positions itself on the market, how it pitches its services, how it is managed internally, what types of clients it takes on, and what kind of prospects to confidently say no to. It’s a compass that consultancy owners use in their decision-making.

As for the second reason: I understand where the consultancies are coming from. There is a lot of literature on value proposition design. While I, due to the nature of my work and a genuine appetite for the subject, devoured so many of these books and took time to process and take in the learnings, consultancy owners may find it overwhelming. 

That’s why Florian and I felt the need to simplify the process for consultancies. To make it less intimidating. 

Now, this is not to say that this is a 1-day process. It does require a great deal of introspection, reviewing old projects, conducting in-depth interviews with the target audience, and thinking long and hard about how to create a concise narrative that encompasses the consultancy’s expertise, how it goes about it, who it helps, and what it helps achieve. 

However, these are all pieces of a puzzle. What simplifies the process is understanding how these puzzle pieces come together. Understanding the end goal makes every step more intentional and manageable.

The value proposition canvas

Here is the canvas that Florian and I have developed to help consultancies understand the large picture that puzzle pieces will come together for.

I go into more detail explaining the elements of the canvas in this article on the template that consultancies can use to introduce themselves, but here’s a quick recap:

1. Clients come to us because… This is a high-level summary of the overarching problem area the consultancy helps its clients with.
   
   
2. They usually struggle with… Here, consultancies provide specific pain points typical clients struggle with within the overarching area.
   
   
3. They typically are… Here, it’s about stating what type of audience the consultancy works with/targets – the industry, the types of companies, and the job titles within the companies.
   
   
4. What they can achieve with us… It’s about explaining the prototypical outcomes the consultancy achieves for its clients.
   
   
5. Here’s how we help… In this part, the consultancy should give a high-level summary of what working with it entails.

When a consultancy fills in all these boxes with its specific answers, it will have a value proposition statement that they can use in pitches, that they can turn to when making strategic and day-to-day decisions, that they can go back to when determining whether to take on a specific client or not. 

Examples of value propositions designed based on the canvas

To further help consultancy owners picture the final destination of the value proposition design process, I’d like to offer a few examples of what this could look like.

Example 1: A boutique data analytics company (focus: supermarket chains)

1. Clients come to us because their sales forecasting process delivers inaccurate results.
   
   
2. They usually lack internal expertise on what data points must be considered and which advanced models can be made operational and provide the most reliable outcomes.
   
   
3. They typically are Sales Leaders, COOs, or Chief Supply Chain leaders of multinational supermarket chains, with important stakeholders such as CFO, CIO, Inventory & Warehouse leaders, and Category leaders.
   
   
4. We help our clients achieve a more accurate sales forecasting system that, on average, reduces costs by 5-10% and delivers forecasts with >90% accuracy.
   
   
5. How do we help? Our client work usually involves a feasibility study - a comprehensive assessment of existing forecasting processes, available data sources, and technology infrastructure - followed by a 4-6 months engagement encompassing data cleaning & integration, model selection, testing/piloting, and implementation/operationalization. 

Example 2: A digital marketing consultancy (focus: international e-commerce)

1. Clients come to us because their digital advertising ROI is low.
   
   
2. They usually struggle with the lack of knowledge of the latest digital advertising best practices and optimization strategies.
   
   
3. They are typically senior marketing officers of large international e-commerce brands with large advertising budgets.
   
   
4. We help our clients develop internal capabilities to set up cost-effective digital advertising campaigns that increase the ROI, on average, by 30-50%.
   
   
5. Our work with clients typically starts with an audit of their current digital advertising strategies and performance, leading to developing a customized, effective digital advertising strategy. We then facilitate the hands-on implementation of this strategy, including campaign setup, content development, performance monitoring, and real-time optimization. We also provide comprehensive training to the client's marketing teams, equipping them with the knowledge and skills to manage and refine their campaigns in the future independently. The engagement concludes with a detailed review of results and recommendations for ongoing improvements, ensuring we boost their immediate ROI and build their capacity to sustain these gains over time.

Example 3: A boutique strategy consultancy (focus: regional publishers)

1. Clients come to us because they want to diversify their revenue streams.
   
   
2. They typically struggle with the lack of expertise in setting up paywall-based and advertising-based revenue strategies, and their past experiences with trying to set it up on their own resulted in significant drops in user engagement.
   
   
3. These are typically chief revenue officers at regional news publications and online platforms.
   
   
4. We help our clients identify the bottlenecks of their unsuccessful attempts to diversify their revenue streams and create internal stakeholder alignment around a roadmap that enables them to launch and successfully grow the new streams within 6-12 months.
   
   
5. Our client engagements start with an audit identifying bottlenecks in prior revenue diversification efforts. We then co-develop a data-driven roadmap for revenue diversification tailored to each client's unique context. Our roadmap integrates paywall and advertising strategies while considering user engagement. We drive internal alignment through workshops, and with our continuous support, we empower clients to successfully grow their new revenue streams within 6-12 months.

Example 4: A boutique sales consultancy (focus: enterprise software)

1. Clients come to us because of their poor sales closing rate.
   
   
2. They find themselves investing increasingly more resources into the sales process just to maintain the same level of sales revenue.
   
   
3. They are typically national and regional sales leaders of large enterprise software vendors.
   
   
4. We help our clients diagnose the root of the problem and modernize their sales process, consistently resulting in a 20-40% cost reduction in sales and typically a 10-20% increase in sales revenue in Year 1.
   
   
5. Our work with clients typically entails an in-depth analysis of their current sales processes and performance metrics. We identify the underlying issues contributing to low closing rates and high sales costs. Leveraging our extensive enterprise sales expertise, we design and implement a modernized, efficient sales process tailored to their needs. This includes streamlining sales operations, enhancing sales training, and integrating advanced sales tools. With our ongoing support and monitoring, clients can reduce sales costs by 20-40% and increase sales revenue by 10-20% in the first year.

All of these examples are relatively easy to process. They deliver the most valuable information to a prospect in under a minute. They explain who, why, what, and how. And this is where consultancy owners should target to end up upon completing their value proposition design process.

Every statement in the value propositions above requires careful consideration and analysis, gathering information, interviewing past clients and prospects, comparing the financial outcomes of past projects, looking at cost optimization opportunities, and so on. 

These value proposition statements do not come together out of thin air. 

In conclusion

It’s never too late to start with the value proposition design process. Whether it’s a newly formed consultancy or one that’s been around for several years and whose growth has stalled – the importance of getting the foundational blocks right can’t be underestimated.

Value proposition design is not a feel-good exercise. It’s about setting up work parameters based on which all internal operations and external messaging will be based. It’s about the DNA of the consultancy.

This a critical skill to master in every consultancy. 

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