One of the barriers in a consulting firm is having every form of competition and figuring out how to reinvent yourself to stand out from the crowd. Having the mindset of reinventing yourself plays an integral role when you are a solo consultant because it helps you provide different types of value to clients. President and Managing Director of North Highland, Alex Bombeck, has always believed that retooling and reskilling himself is an effective way to build relationships. He shares how he got into the media advertising space and how he operates his business from the perspective of his clients.
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Retooling Your Skills for Consulting in Media Advertising with Alex Bombeck
I’m very excited to have Alex Bombeck joining us. Alex, welcome.
Thank you very much. I’m glad to be here.
I’m excited to have you on here. For those who don’t know you, explain what you do.
I’m President and Managing Director at a worldwide consulting firm called North Highland.
How long have you been at North Highland?
I’ve been at North Highland for four years.
Before you became President and Managing Partner at North Highland, what were you doing?
Before moving my family down to Atlanta for the job here at North Highland’s headquarters, I was living in Connecticut and working in Manhattan where I’d worked for 22 years. In my last job in Manhattan, I was the Chief Digital Officer of a global communications agency called Havas Worldwide.
How did you get into that? Out of school, did you get right into the media advertising space, or did you have a couple of different jobs before you got there?
I had the proverbial waiting tables job as I was looking to get my first job, but I’d always targeted marketing and advertising out of school. That was what I went to school for. My degree at business school was with a focus in marketing. I had a good idea I wanted to go and join an ad agency. My first job was as a media planner. That was the easiest route in and gave me a good perspective into the media side of the business. That side was very different back then. It was limited to out of home radio, broadcast, print, and newspapers were all the channels you had. Nothing like it looks like today, but early on, I tried particularly into the data and analytics side of the business because that was the data and analytics exercise for the most part because on the media planning side, you weren’t very involved in the creative.The sole asset of any consulting firm is its people. Click To Tweet
It was the early ‘90s. The folks on the account management side said, “No, you’d be better suited to help us over here,” so I spent a few years on the account management side of the business before being lowered by an old boss into helping him start up an interactive division of a global promotions agency. That was in 1995. Not long after, Al Gore invented the internet and it first took a foothold as being something that brands and marketers were considering as a way to reach their audiences. I sat in a meeting with a client before leaving to go join this gentleman and the CMO of a global rental car company asked our managing director at the time of the account what our plan was around helping them with these banner things and otherwise. Everyone looked at each other and I raised my hand and said, “I’ll figure it out.” At that point in time, there was so little known about digital and interactive that whoever got up first that morning and read whatever had been published that morning tended to be the smartest person in the room on the topic because there wasn’t that much to know. It was one big game of experimentation and creativity on how to apply this new technology that led us to engage these organizations, audiences or their own employees. At that point, that was my first foray into what I would consider to be more of a consultative type of relationship with clients. Even though in the media days we were still consulting in that we were providing them with advice and strategic direction on how to spend their media dollars, we’ve got an opportunity or a challenge in how do you apply these new tools and new technologies in a creative way to help them advance their business.
Beginning in 1995, even though for almost fifteen to seventeen years after that, I have almost exclusively worked in the digital and technology space of communications, it was all very much akin to consulting because it was about driving the strategy. It was about people, process, and technology. It was about rethinking how clients went to market and how they would take advantage of new opportunities or new competition that was being thrown in their way as their competitors figured out how to leverage digital and technology to their advantage. Fast forward then in 1999, I joined Havas and one of their predecessor agencies. In that world, people are buying and merging quite all the time. I would always laugh that it was never good to have had me work at one of your agencies because I worked early on at Backer Spielvogel Bates, which then disappeared off the face of the planet and then worked at Ammirati Puris Lintas, which then disappeared off the planet, which was a surprise because in its heyday, it was the top. I went on to go work at eventually what is now Havas Worldwide and worked there for fifteen years.
When I looked at your rise to the top, it looks like a very clear path to senior levels within an organization. Was it a smooth path, or did you ever encounter some real challenges along the way as you were working to climb that ladder?
The challenges you face are typically in numbers. When I was in the traditional advertising business, one of the reasons I jumped over to the digital side was not because it was some big sexy thing that everybody wanted to be a part of because at that point people were still questioning whether it was going to be a thing or not. What I did know is that being one of 3,000 people competing for that next promotion, those are your odds. The game became incredibly political and not always the people that rose to the top are those who are necessarily the best position to drive success. Through my career, I’ve constantly looked at where do my skills and where do my value add the most to the organization. Because of who I am, I would often look to new areas and to new ways to do that versus trying to compete for something that is already being done by other people.Barriers in this business often come in the form of competition. Click To Tweet
If you look at the positions I’ve had in some cases, they were either positions that hadn’t been created yet. There was a need for somebody to come and lead that part of the organization. I came into the position because I was bringing something new to it that hadn’t been there before. Barriers in this business often come in the form of competition and reinventing yourself and how do you continually retool and reskill yourself so that you have something that everybody around you doesn’t have.
For most of our audience who are consultants and running their own shop or playing an integral role in a consulting firm, this applies just as much. Even if you’re a solo consultant, having that mindset of always reinventing yourself and always looking at ways that you can improve and catch onto new best practices so you can provide a greater value to your clients and into the marketplace is key. Will you say that that applies now, just as much to what you’re doing when you are part of North Highland where you have 3,000 consultants that are part of your company?
It’s probably the cornerstone to this business as you just indicated. The sole asset of any consulting firm is its people. The importance of its people being relevant to clients’ needs at all points in time is what differentiates you. We invest very heavily here at North Highland in our people in ensuring that their skills are up to date and relevant. The other thing that’s important when you look at skills is how you can bring people with different skills together so that they can offer a bespoke solution to a client that isn’t all just developed with somebody that’s done something 100 times and offer the client a new way of doing that. I often refer to that as how you cast your team and each team needs to be cast in a way that’s going to meet both the cultural needs of your client and the opportunity itself, because that’s where you can differentiate yourself. Otherwise, you’re coming in and repeating something that’s been done before, which is great. It’s the best practice but then when you’re speaking to clients, it starts to feel very much like a sea of sameness. If you’re not coming in and bringing a new view, a new lens, and a new skill to the table, then that offering becomes a commodity very quickly.
Speaking of clients, most people recognize the importance of building relationships. You’ve worked with many Fortune 500 and Fortune 100 organizations. What have you found as the most effective way to build relationships with decision makers at Fortune 100 companies?
Know their culture. If you don’t understand their culture and understand how decisions are made within their organization, and this may sound fairly trite, but influence doesn’t always come from the top in every case, and so understanding the role that the different parts of the organization play in the decision making process is critical. I couldn’t emphasize enough the importance of your relationship with a procurement organization or a supply chain organization, depending on where they’re positioned at your client, because they may not be an ultimate decision maker, but it is understanding how they influence that process that is critical.Influence doesn't always come from the top in every case. Click To Tweet
Depending on where you’re at, the culture may be one where it’s your immediate buyer and other cases it could be helping them understand how they’re going to be able to leverage the work you do for them outside of their immediate organization. Some clients are heavily driven by grassroots types of initiatives. Being able to share that with the buyer and help them understand how they’re going to be able to use the work you do for them and market it out from there can be critical. If you don’t understand that and you’re approaching it exclusively from a pure value to that one person and not understanding how their ecosystem works out around them, it becomes very difficult.
How do you identify who to connect with, who to build a relationship with in the organization? Let’s take a hypothetical ideal client that you want to win business from. How do you first go about identifying who you should reach out to? Who you should build that relationship with?
I’ve always operated from the perspective of our job as a consulting firm is to help our clients be successful, to make them successful in whatever way they are measured. If it is not clear to me how we are going to help the person that we are targeting, if there’s no clear path to what success looks like, then it’s probably not the right person to be working with because once you can identify what successful looks like for that individual and then understand your role in enabling it. It makes the discussion fairly straightforward from that point because they understand how you’re going to help them meet their objectives. If you’re having to convince somebody that you have a creative value to what they’re trying to achieve, then the discussion has become far more complicated. It’s you having to constantly convince them as opposed to them seeing you as an asset or a catalyst towards them achieving success faster or greater success when it is achieved.
You want to identify what’s going on in the mind of that buyer and then ensure that you can provide value for them, help them in some way, as opposed to just taking your own methodology or your own ideas and trying to ram them down the throat of a buyer, and go through the whole education process. Educating buyers can take a lot longer than just finding out what it is that they’re looking for help with or where they want to improve and then figuring out how to position your offering in a way that it aligns and resonates with them.
I would agree with that and understanding their “ask” and how you might want to reshape it. The biggest trouble a consulting firm or a consultant can get themselves into is when you just do what the client has asked you to do because they’ve already determined it’s the right answer. Depending on the situation, it may be fairly straightforward but getting into the head of the buyer and understanding what is motivating them and how they have come to ask for what they’ve asked is critical. Where you can be the additive to them is to be able to help reshape the path forward. What we don’t want to be doing as consultants is necessarily reinventing the wheel or turning every project into a custom project. We’re an industry that is built off of best practices and repeatable patterns. As we say in marketing, there are only five real marketing strategies in the whole world, and everything is just some degree of variation off that. The reason is because there are five proven ways to market a brand. In consulting, you’ve got to find that blend between those repeatable proven processes and approaches to doing work and then understanding the nuances of that client, their culture, and how they’re going to achieve success and blending those two together.You've got to find that blend between those repeatable proven processes and approaches to doing work. Click To Tweet
You’ve identified a buyer within an organization where you believe that you can add value to. What is working best and has worked best to then create an initial conversation with them? What was the best outreach approach or the best way to start dialogue?
My perspective was fairly different when I arrived at North Highland than what I find in some consulting firms. North Highland had a blend of this but if you come from the communications world, from the agency world, you would never enter a meeting with a client without bringing them an idea. You would do enough homework to be able to offer them at least a well-thought through idea on how to help them drive their business forward based on what you understood their needs to be. The same needs to hold true in consulting, that you need to show up at that first meeting having done enough homework to be able to bring them a perspective to, which they can react. What I hear at some consulting firms or from some consultants is you’re out over your skis a little bit when you do that because you’ve not had a single conversation with them. What if you come in with an idea and they either say, “No, that won’t work,” or they’ve tried it before? My response to that is, “That’s fine.”
The point of bringing them an idea is to demonstrate that you can think comprehensively about their industry, about their business, that you have some degree of understanding about them and that you have brought forth something that demonstrates that. Even if it’s wrong, they should recognize that if they’ve tried it before, it’s probably because they did some homework and thought it was a good idea, too. The fact it didn’t work could have been due to something in their organization that you can never know about. The fear of rejection mantra that consultants have to live by is to be able to bring clients’ ideas right out of the gates. They can understand the way you think and what would it be like to work with you. If you show up to the first meeting and your plan is to do nothing but just ask them questions, then you haven’t put yourself, your team, or your own brand forth in a way that allows them to understand your ability to think dynamically and creatively about their business.
What would you say are some of the main challenges that consultants and consulting firms run up against when they’re looking to work with Fortune 100 and world-class organizations?
There’s an overall dynamic that’s happening in the consulting industry and has been for the last couple of years relative to the way procurement has gotten engaged in the buying of consulting. One of the biggest challenges we face is on the rate side. There’s been incredible margin compression to the extent that procurement organizations have driven some of the work down to a level where you’re seeing staffing organizations competing to place people, if it’s role-based consulting, into those roles. While it sounds good at the beginning, we’re starting to see the pendulum swing back because a lot of inexperienced or not well-qualified labor was being put into the consulting pool that was then turning out bad work. We were literally fighting on price only. If you’re fighting to win engagements, if you’re trying to compete on price alone, then that is a very bad situation because that’s not the way consulting should work. It should be a value exchange, not just a price war. That’s a challenge.
The other thing that is both challenging and very exciting for us is the way that all these industries on the professional services side are starting to blend together and the recognition that you need a diverse set of skills to be able to solve for clients’ problems. If you look at the agency side of the business and some of what they have to offer, particularly in the IoT and digital space and what role that could play in solutions. That’s a little bit different from what a consulting firm might have. You’re seeing this race towards the ground where these two types of organizations both have a value proposition, but on their own, it’s not as competitive.
I saw an article after an earnings release from one of the major marketing communications holding companies, and it went through all the reasons on why their share price has gone down and why they are taking a hit. One of the comments that was made was the CEO/Chairman of this holding company had said, “Consulting companies continue to think that they’re going to encroach on our business, and it’s just not true.” The response was, “It is true and they have encroached and they’re part of what’s creating this problem for you.” The same thing holds true for the consulting firms, except they operate differently. They’ve recognized that the agencies are encroaching on their business and have been for a while, so they do quite the opposite. They go and buy agencies. You look at the big four consulting firms; they’ve been on a buying spree now for a couple years. Accenture has forecasted that it’s going to spend $1.4 billion on acquisitions this year. While it’s going to come in many different ways, shapes and forms, a significant area of acquisition for them is this agency-type space, where they don’t have or haven’t had historically a large body of workforce. The competition on one side is pricing, the competition on the other side is the diversity of skills that are required to go and drive effective solutions for clients these days.
You mentioned pricing and the pressure from procurement. What are your suggestions to the consultant and firm owner that is in an organization where they’ve had a good conversation with a senior level buyer or an executive in the company and now their proposal has gone to procurement, and the procurement person have no understanding of the value? They’re looking at the numbers and looking at it from a very different perspective, and now they’re starting to get pressure. What’s the best practice in your experience? What should a consultant to do at that point?Get creative in your pricing strategy. Click To Tweet
If you’re a consultant and you are looking to create a partnership with your client that is based off of value exchange, then you need to avoid providing them with any scope of work or entering into discussion that includes any reference to hours, time, rates per hour or rates based off of time. The second you do that, you’ve put yourself squarely in the sights of procurement and you put yourself squarely into a very easily-assessed competitive set, because now I can put your rate up to somebody else’s rate and I can compare amount of time. It takes the whole conversation down a bad track. If you’re a large consulting firm, you’re talking about staffing 100 or 200 people for months or years at a time, then it makes more sense because you don’t always know what the work itself is going to be and you just have to go down that path. If you’re a sole proprietor or a single consultant out there, or you’ve got a small firm and you’re looking to engage a client, focus on the value exchange. Get creative in your pricing strategy. Look at risk-reward type of options, if you feel very strongly about your position. Gain share opportunities are always super exciting for consultants. My advice would be, unless you are pressed into a time and material discussion, avoid it at all costs until it becomes something that is unavoidable. If you’re a large firm, that’s different because you have different sizes of agreements.
Can you elaborate a little bit on the gain share opportunity and why that’s so exciting for consultants?
It’s effectively putting your money where your mouth is. It’s getting to a scenario where if you believe so strongly in your skills and in the value that you can offer a client, you’ve done your homework to the extent that your modeling and analytics are such that you believe you can make a demonstrable difference to their business, and they are willing to allow you to share in that benefit, the upside for a consultant typically is going to exceed any possible value based or fixed fee pricing. The challenge typically means that on the front end, you’re working at costs. You have to be confident in your perspective. You have to understand clearly the attribution model related to the outcomes that you are forecasting, how much control you have over them, making sure that you haven’t entered into a gain share deal where you’re only controlling a smaller portion of the variables or they haven’t been taken into account. You need to know what you’re doing and have done the homework.
From the client side, there’s a fear of gain share. While they’re super excited about it because they’ve got nothing to lose if it doesn’t work, their fear tends to be, “What if this thing is a runaway hit?” All of a sudden, they started doing the math and say, “If your idea works, then I could end up paying a three-person team a couple of million dollars.” The response is always, “All you’re doing is paying me a share of the profit that I’ve created for you and a share that you felt my time and effort were worth.” It’s always a fun conversation because it’s exciting to be in a gain share deal, but it’s like Vegas money. You’ve got to be prepared to go in with what you’re going to lose because that’s the odds you’re playing.You’ve got to be prepared to go in with what you're going to lose. Click To Tweet
I always talk to consultants who ask questions about taking on equity and tell them stories about my early days consulting where I have a drawer full of papers that have hundreds of thousands of shares on them. We’re supposed to be worth millions of dollars, and they’re worth what the paper is. You certainly have to be careful and be very selective in those deals, but the opportunity is extraordinary if everything aligns. There are certain criteria that people should be careful about when they’re entering into those, but done properly, are very exciting. You are running and playing a role in managing 3,000 staff and 60 offices or so around the world. It’s hectic, to put it mildly. How do you balance and manage all of that?
For one point of clarity, we do have 3,000 people and 60 plus offices as part our Cordence Worldwide network. North Highland is the chair consulting firm as part of this consortium of firms called Cordence Worldwide. That represents the 3,000 consultants and 60 plus offices. North Highland itself is probably closer to about 1,800 or 1,900 consultants and we have 24 offices.
How do you manage all that? Is it all about systems? Is it people? What does your life look like when you’re at that level of managing that number of consultants and offices?
You’ve got to have a small-ish group of absolutely terrific leaders. You’ve got to have a core senior leadership team that you can trust and depend on without having to always be engaged with them on a daily or weekly basis and you know that they’re making the right decisions on behalf of the firm. That’s something that we’ve worked very hard on, and I trust those people implicitly, but it’s important that you don’t have too many of them. I talked to some of my colleagues at other firms and they say, “I’m getting my direct reports together,” and they talked about having fourteen to fifteen people. That’s not terribly reasonable and it’s important that you always have an immediate group of people that you can get together with that is in the single digits, if you’re going to be successful.
Systems are absolutely a prerequisite to being able to handle anything of scale. When we look at firms that approach us about wanting to be acquired or you’d look at your average consulting firm that gets to be $10 million to $20 million and they start to struggle, most of those struggles come in two shapes. One, simply their size starts to place them out of certain deals because the buyers are nervous about going with somebody that’s too small. The second always tends to be the systems. You hit a critical point of inflection where you can no longer be organized or efficient or understand where you might be experiencing leakage or margin erosion in your system. For me, the system is critical because it allows me to quickly know who to talk to and what I should be talking to them about, and that even holds true for my immediate direct reports. They’re managing anywhere from $50 million to $100 million worth of business.
I could sit and talk to them all day everyday about things that are going on with them and their teams, but that’s not effective, but because we’ve got systems in place, both from an HCM perspective, PSA, etc. and then a plug for sales force, I know how to have an efficient conversation with them about which accounts and about which teams that are under them. We can be very efficient with our time because I need to be able to spend more of my time with my clients and helping to drive value there than working on internal operations. That’s probably an important point to make. In my position in some organizations, when you get to my level, it becomes a very internal or operational role with meetings. You meet with the people who meet with clients, but you don’t always spend as much time with clients.What we need to do is create an environment where our people can spend as much time as possible with clients. Click To Tweet
The reason I’ve been in this business for more than 25 years, is because of my passion for being with clients. It’s critical that no matter what level you are at in a consulting firm that you maintain that activity in the field. It helps you understand the dynamic of what’s going on out there. It informs you of the challenges that your teams are facing. It also helps you understand how the systems that you’re enabling with are helping them do their jobs better or not. At the end of the day, what we need to do is create an environment where our people can spend as much time as possible with clients, helping drive value for them and not caught up in systems and administration. For us, the systems are designed to help create that balance between client-facing time and management of the business time.
I want to thank you for coming on and sharing a bit of your journey and your wisdom and experience. What’s the best way for people to reach out, to learn more about your work, and to connect with you?
I’m on LinkedIn regularly. If you message me via LinkedIn, I will be sure to respond in a prompt manner.
Alex, thanks so much. I appreciate it.
Thank you, Michael.