Want to build a sustainable consultancy? In this article, bdg | better decisions group CEO Christian Kiock shares the 4 things they did to achieve exactly that.
You’ll learn...
Read time: 6 minutes
You can’t rely on rainmaker founders to always bring in new business. It’s simply not sustainable. Instead, you should focus on identifying your target market, developing your niche, and establishing recurring revenue.
That’s how you become a leader in consulting.
In this article, better decisions group (bdg) CEO Christian Kiock shares valuable insights about how his company went against the grain to establish his target market, engage with his niche, and create recurring revenue through support contracts and productization.
The result?
A sustainable business model that will continue to succeed long after the founder leaves.
To keep their heads above water, many young consultancies feel the pressure to win as many projects as possible.
While this strategy may work in the short term, it will ultimately damage your reputation in the future.
To establish yourself as a leader in your industry, you must avoid the temptation to gobble up any project that comes your way.
This self-restraint will allow you to develop expertise and earn a reputation. After all, when clients are looking for someone to help them with a problem, they’re looking for an expert, not a jack-of-all-trades.
Christian Kiock, CEO of bdg, learned this lesson from hands-on experience. During his interview with Sammy on the LEADERS IN CONSULTING Podcast, he noted:
“Beggars can't be choosers, as they say. We basically took whatever we could get initially just to survive. We started from nothing … and then we had to do everything really top-notch, high quality, because otherwise we wouldn't be able to stick with these customers. Maybe they give us some more work. Basically, there was no alternative to being the very best for our customers we could possibly be.” - Christian Kiock, CEO at better decisions group
By providing top-notch, high-quality services, Christian’s company was able to grow its client base and discover specialisms in energy, manufacturing, retail, and real estate.
Here are Christian’s top tips for developing a niche in consulting:
With a clear focus on your target customers and niche, you can achieve long-term success.
One of Christian’s core goals when building his company was to make his business sustainable. To build the machine, not be the machine.
A fundamental part of realizing this ambition was to build recurring revenue.
Better decisions group sustains long-term relationships with its clients: about 7–9 years on average, with about 10% of their revenue consisting of recurring revenue. They achieve this through ongoing support contracts and standardized services.
Application support contracts:
Better decisions group offer application support that helps their customers iron-out the inevitable teething problems that occur soon after implementation.
“A support contract is like an insurance, isn't it? You hope you don't need it, but when you need, it's there. Some of our customers actively ask for it.” - Christian Kiock, CEO of better decisions group
Christian has noticed an increasing demand for these support contracts because they offer security and peace of mind to the client. Many customers sign support contracts with terms of 18 to 24 months.
Productization of services:
Productization is a growing trend in consultancy because it leads to more sales, faster payments, enhanced scalability, streamlined processes, and more.
Better decisions group saw how productization could aid them in their quest for more recurring revenue.
So how do bdg productize their services?
They pre-build 80% of a service. This allows space for them to differentiate themselves from their competitors while substantially reducing project delivery times and costs.
“It's not necessarily recurring, but it's also the scalability of it, isn't it? You don't have to develop everything from zero to 100% from scratch every single time. That's what can be a limit on scalability.” - Christian Kiock, CEO of better decisions group
The benefits?
If you’re looking to build a sustainable consulting business, productization is the way forward.
In the consulting world, the endgame isn't just about landing a series of one-off projects. The ultimate goal is to create a sustainable, scalable business model that can continue to thrive, even in the absence of the founding members.
Christian Kiock and his team at better decisions group (bdg) provide a textbook example of how this can be done effectively.
By clearly identifying their target customers, honing in on a niche, and employing innovative strategies like support contracts and productization, bdg has established a business model that is not only successful but also sustainable.
What steps will you take to make your business model viable in the long-term?
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Want to build a sustainable consultancy? In this article, bdg | better decisions group CEO Christian Kiock shares the 4 things they did to achieve exactly that.