Moving Beyond One-Off Projects in a Boutique Consultancy

There is a wall that I see many boutique consultancies hit, and this wall is preventing their businesses from growing at a sustainable, organic pace. 

The wall I’m referring to is the inability – or, often, the lack of strategy and intentional efforts – to move clients past one-off projects into a value-driven long-term relationship.

Based on my extensive work with both high-performing consultancies and struggling businesses, the ability to develop new clients into long-term engagements makes a world of difference.

So that’s what I’d like to discuss in this article: what 'The Project Wall' is, why boutique consultancies seem to struggle with overcoming it, and why every consulting business should prioritise it.

'The Project Wall': why boutique consultancies struggle with it

An overwhelming majority of boutique consultancies I’ve spoken to or worked with in the last few years exhibited the same pattern of behaviour: constantly having to ‘hustle’ to win new business to keep the consultancy afloat.

So much work, time, and mental health goes into this single task. It never comes as a surprise that consultancy owners and leaders feel burnt out after a few years. This constant uncertainty, financial instability, and dependency on recruiting new clients are stress-inducing!

How do these consultancies end up in this vicious loop? Simple, really. Their services were never designed for long-term collaboration. Instead, the service portfolio is centred around delivering one-off value. 

They tend to focus on a few immediate problems they can resolve for clients and typically don’t have the expertise to provide the more profound value a long-term engagement would require.

Why breaking through the project wall is imperative

Predictable, recurring revenue is the foundation of the financial stability of a consulting business. Growth without predictability and financial stability is simply not possible. And on the rare occasions when it is, it’s not sustainable in the long run.

The only way to achieve such financial stability is by deriving a large percentage of the revenue from long-term clients. 

My regular readers know I’m a big advocate of the 70/30 revenue split. For those unfamiliar, here is a brief explanation. 

The 70/30 revenue split refers to the target I advise boutique consultancies to set, where 70% of their revenue is derived from work with existing clients and 30% is generated by new clients. This split puts revenue stability first, leaving plenty of room for business development.

Existing clients fuel stability. New clients fuel growth.

Recommended reading: How to Balance Hunting and Farming for Sustainable Consulting Growth

The current system that I see so many consultancies operate in – one where 80%+ of revenue comes from new clients – is broken. 

Competition is fierce. Prospects have more options than ever. They are also significantly more independent in doing their research. The decision-making process has become more complex and involves more stakeholders than ever. The cost of client acquisition is too high.

Relying on one-time projects is like running a race with ever-changing finish lines. Each completed project leads to another wall, another beginning, with no momentum or cumulative growth.

If a boutique consultancy cannot develop existing clients, it will always have an existential struggle.

Developing existing clients provides consultancies with the following:

  • Stability: Revenue from existing clients is the lifeblood of any consultancy. It gives peace of mind and a steady cash flow. This stability helps leaders plan resources better, reducing revenue volatility and lowering the need for constant new client acquisition. With reliable income from existing clients, pipeline forecasting becomes more accurate.

  • Expertise depth: Long-term client relationships push consultancies to deepen their expertise. Understanding a client's broader context, from industry trends to regulatory challenges, allows the consultancy to offer more valuable insights and solutions. The longer a firm works with a client, the more nuanced and comprehensive its understanding becomes.

  • Cross-selling opportunities: Trust built over time opens doors for cross-selling. Firms can identify opportunities to offer additional services from different departments or new regions. This expansion increases revenue and strengthens client relationships.

  • Social proof and referrals: Existing clients are invaluable for generating case studies and referrals. They can showcase the immediate and long-term impact of the consultancy's work, making it easier to attract new clients through proven results and word-of-mouth recommendations.

  • Pilots and validation: Trusted clients are ideal for testing new services and methodologies. Before launching new offerings, firms can gather critical feedback from these clients, ensuring better-aligned services and more robust market positioning.

  • Process standardisation: Repeated work for existing clients allows for process optimization. Identifying inefficiencies, improving methodologies, and forecasting needs become more straightforward. Standardised processes lead to greater efficiency and effectiveness, something more challenging to achieve with new clients.

  • Lifecycle discovery: Long-term engagements reveal typical client journeys. Consultancies can track how their solutions are adopted across different departments and understand the broader impact on the client's organisation. This insight helps refine services and demonstrate value over time.

  • Better profitability: Developing existing clients boosts profitability. Acquiring new clients is expensive and time-consuming. In contrast, existing clients already trust the consultancy, leading to lower BD costs. In my experience, long-term clients often have larger budgets for projects, and with established processes & knowledge, the consultancy can deliver services more efficiently. This reduces costs & increases margins.

What jumping over the wall entails

Moving clients from a one-off project delivery to a long-term partnership is a multi-step process. It’s not just calling up current or past accounts and asking, “what else can we do for you, dear client?”

The two most important steps of the process are 1) developing an inbound motion and 2) executing a deliberate service design strategy. 

1. Developing an inbound motion

Inbound motion is about creating an inbound way of managing a consultancy's pipeline, forecasting the business reliably, and ensuring existential stability. Simply put, it’s about getting prospects to come to you instead of chasing them.

Failing to set up and optimise inbound motion bears severe costs, including:

  • Poor scalability: Consultancies forfeit the chance to attract multiple clients without increasing resources. In an era of labour shortage and high people costs, they end up missing out on non-linear growth (decoupling growth and hiring).

  • Low-cost efficiency: Acquisition costs are much higher, while profits are significantly lower.

  • Team stress: Constantly chasing, pitching, contracting, onboarding, delivering, and retaining clients creates enormous pressure, often creating retention issues.

  • Poor client development: Overloading a team with all the above new client activities leaves no time to develop existing clients—a vicious cycle.

  • Lower quality prospects: A consultancy misses out on pre-qualified prospects more likely to convert because they came to this consulting firm.

  • More challenging client retention: Chased clients are non-ideal clients (often a source of frustration for everybody), making it harder to keep them engaged and loyal.

  • Weak pricing leverage: Without a solid inbound motion, consultancies may be compelled to lower their fees to attract clients, leading to diminished profit margins.

  • Talent attraction: Poor visibility means poor appeal to top consultants who might consider joining.
Recommended reading: The Two Most Visible Indicators of a High-Performing Boutique Consultancy

So, how can a consultancy develop strong inbound motion? By being deliberate about setting up these foundational elements:
  • Laser-sharp positioning: A consultancy's ability to clearly define its expertise domain and target audience is fundamental. Laser-sharp positioning ensures that the consultancy addresses the specific needs of its ideal clients.

  • Attractive value proposition: An irresistible value proposition showcases what sets the consultancy apart and why clients should choose it over competitors. It communicates the unique benefits and solutions offered.

  • Expertise-driven thought leadership: By openly sharing problem-resolution expertise consistently, actively engaging with the audience, and providing valuable insights, consultancies build credibility and trust.

  • Frictionless buyer journeys: Streamlined, user-friendly buyer journeys make it easy for potential clients to engage with the consultancy. Simplicity is paramount.

2. Executing a deliberate strategy of service design

So, a consultancy sets up and optimises its inbound motion. Qualified prospects are entering the pipeline. Now what?

Now is the time to impress the prospects with the initial project delivery and encourage long-term collaboration. This is where strategic service design comes in.

To design a portfolio of services that facilitate long-term relationships with clients, I advise boutique consultancies to consider these factors:

  • Trust-building entry services: Offering entry or discovery services that are both appealing and confidence-building can lead to long-lasting client relationships. These services provide a glimpse into the consultancy's expertise.

  • Repeatable, proven methodology: A well-defined and repeatable methodology with predictable outcomes is reassuring to clients. It showcases the consultancy's ability to deliver results consistently.

  • Excellence in service delivery and impact: Proven by outcome-based client testimonials, service excellence is a testament to the consultancy's commitment to client success. These testimonials provide social proof and build trust.

  • Value-driven recurring services: Shifting clients from one-off projects to recurring work requires developing services that can be delivered weekly/monthly/quarterly. This could be subscription-based access to proprietary data, advisory support, etc. It could also be vertical service integration, i.e., progressively deepening the consultancy's service offering, providing a spectrum of solutions that span from broad strategic advice to highly specialised, granular recurring interventions.

  • Key account management: Consultancy leaders and consultants should be trained on best KAM practices. This involves regular client check-ins, consistently gathering information on their pain points, setting up KPIs on KAM performance or outcomes, etc. The primary KAM goal should continuously be deepening the relationship with a client and not mindlessly upselling them. It’s about discovering meaningful opportunities that will significantly impact the client’s business by gradually expanding and deepening the understanding of the client’s business, goals, industry concerns, etc.

In one of my earlier articles, I provide a few examples of the most visible indicators of a high-performing consultancy, particularly those related to developing existing clients.

Risks to avoid past the wall

There is no strategy in the world that is entirely free of risk. Fueling financial stability through existing client development is no exception.

These are the risks that I want boutique consultancy owners to be aware of and design strategies to avoid:

  • Shifting power dynamics: Consultancies risk losing power in sales due to revenue dependency on existing clients. Clients becoming too dominant in the relationship can lead to price erosion and scope creep.

  • Pleaser syndrome: Firms with a large percentage of revenue generated by a limited number of clients often feel pressured to please these clients at all costs. This pressure can result in becoming order takers instead of trusted advisors, which negatively impacts pricing power and the consultancy’s perceived value.

  • Erosion towards hourly billing: Over-reliance on existing clients can lead consultancies to transition into hourly work instead of value-driven project work. This shift means their contribution is measured by hours worked rather than the value delivered, resulting in the devaluation of their services and income.

  • Growth limitations: While it’s possible to be successful with the 70-75% strategy, relying on this strategy as the primary source of growth or stability is unrealistic. Consultancy firms must remain proactive in adding new clients to the portfolio, or growth will stall in the long run.

To avoid these traps, I recommend that consultancies establish non-negotiable boundaries with the consultancy's clients. Unreasonable demands from clients should be pushed back against. Remembering that a consultancy's expertise is its value, not its availability to do endless small tasks, is essential. 

Moreover, being proactive in managing client relationships can help mitigate these risks. Regularly reviewing the client portfolio and ensuring it aligns with the consultancy's broader business goals is a valuable exercise.

In conclusion

The project wall represents a significant barrier for boutique consultancies, hindering their ability to achieve sustainable growth and financial stability. 

Many consultancies fall into a cycle of constantly chasing new clients for one-off projects, leading to burnout, financial instability, and limited long-term success. 

To overcome this, consultancies must strategically shift their focus towards developing long-term client relationships, providing a stable revenue base, opportunities for more profound expertise, and enhanced profitability.

Implementing inbound motion and designing services for long-term engagements are critical steps in this transformation. 

By attracting clients through precise positioning, compelling value propositions, and thought leadership, consultancies can reduce the stress and inefficiency of constant client acquisition. 

Additionally, offering trust-building entry services, establishing repeatable methodologies, and delivering value-driven recurring services help convert initial project successes into ongoing partnerships. 

Key account management practices further deepen client relationships, ensuring that consultancies maintain high service standards and continuously address client needs.

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