Simplify Consulting, Grow Your Business

What if the biggest growth opportunity in your consulting business isn’t scaling, but in simplifying what you deliver? This week I’m talking with Abhijit Verekar, founder and CEO of Avèro Advisors, a 50-person consulting firm that’s helping U.S. cities and counties modernize through smarter tech strategy. And also of course now through AI. Abhijit built his success by breaking the rules that most consultants blindly follow. He’s not selling software, he’s not doing implementation. He’s the independent advisor that government leaders actually trust. And now he’s doubling down on AI and Micro-SaaS to deliver faster results without losing what makes consulting valuable: the human experience.

So in this episode, you’re going to discover why being truly independent is your most powerful differentiator in a crowded market; how to use AI to accelerate delivery without eroding your fees and authority; and the surprising way that Abhijit turned government bureaucracy into a high-margin, moat-protected niche. If you ever wondered how to build a consulting business that wins hard-to-acquire clients and stays ahead of technology, this one’s for you.

In this episode you will learn:

• Fear of insufficient work as the biggest positioning obstacle.

• Generalist versus specialist firm dynamics and evolution.

• Distinguishing insightful from standard content marketing.

• Strategic publishing for impactful, resonant messages.

• Current M&A trends, including a seller’s market.

• Key factors for higher valuations: profit, process, team.

• Optimizing client concentration and recurring revenue.

• David’s “Sellability Index” for firm valuation.

• Challenging the “always growing” expectation for fulfillment.

• Leveraging AI for research and strategy as an opportunity.

Welcome to the Consulting Success podcast. I’m your host Michael Zipursky, and in this podcast, we’re going to dive deep into the world of elite consultants where you’re going to learn the strategies, tactics and mindset to grow a highly profitable and successful consulting business.

Before we dive into today’s episode. Are you ready to grow and take your consulting business to the next level? Many of the clients that we work with started as podcast listeners just like you, and a consistent theme they have shared with us is that they wished they had reached out sooner about our Clarity Coaching Program rather than waiting for that perfect time. If you’re interested in learning more about how we help consultants just like you, we’re offering a free, no pressure growth session call. On this call, we’re going to dive deep into your goals, challenges and situation and outline a plan that is tailor made just for you. We will also help you identify where you may be making costly and time consuming mistakes to ensure you’re benefiting from the proven methods and strategies to grow your consulting business. 

So don’t wait years to find clarity. If you’re committed and serious about reaching a new level of success in your consulting business, go ahead and schedule your free growth session. Get in touch today. Just visit Consulting Success – Grow to book your free call today.

Abhijit Verekar is the Founder & CEO of Avèro Advisors, dedicated to modernizing local governments through tech innovation. With 20+ years of experience, he bridges the gap between technology and public service, guiding agencies through complex ERP implementations and strategic IT overhauls. Combining a finance background with creative problem-solving, Abhijit helps municipalities save millions and streamline operations. Under his leadership, Avèro has earned multiple Inc. 5000 honors. A Forbes Technology Council member, he is a speaker known for turning daunting IT projects into success stories.

Connect with Abhijit Verekar
Discover more about Avèro Advisors

Abhijit, welcome.

Hey, thank you, sir. Nice to meet you. Well, again.

Yeah, again, exactly. It’s been a bit, man. But yeah, I mean I really have been very impressed. And you know, as I mentioned before, following along from a bit of a distance, I see your updates on LinkedIn. I know when we worked together back in, I think you said it was 2020, right? So five, almost six years now. A lot has changed with your business in terms of the size, the scope. We’ll get into all that. But for those that aren’t familiar with you and Avèro, maybe just take a moment and just describe succinctly, what does Avèro do? What are you known for?

Yeah, so I’m AV. I’m the founder and CEO at Avèro Advisors. We are an independent third-party consulting firm. We focus on the public sector in the U.S., meaning we work with cities, counties, and all kinds of taxpayer dollars that are being used. We want to make sure that we are helping those organizations modernize by using technology better or by better strategic planning. And now we’re getting into AI, which we hope we’ll talk about.

[02:19] – How Advisory-Only Positioning Beats Software Reselling

We definitely will. It’s hard not to talk about AI these days, but doing it in a way, I want to make sure we do it in a way that’s relevant for people and not just kind of throwing more gasoline on the hype fire. So one thing that I noticed about you, I mean before we hit record you told me that you’re right now in the process, hopefully I can say this, if I can’t let me know we’ll delete it or edit it. But the AI development, so you have a team that’s going to be developing AI offshore, so forth. But you obviously you’re in the U.S., your core team, about 50 people. Prior to that you didn’t do development, you didn’t build technology, you didn’t resell, you know, software. What’s the reason for that? Because a lot of people in the technology space would either be reselling software or they would be trying to figure out how to do, you know, very deep implementation projects or, yeah, development. Why until today have you just really positioned yourselves as advisors? And I know you said it in your intro there, that third party, which I picked up on. So explain that.

So, in the market that we operate in, in the local government or the government sector, historically there’s not a lot of people doing what we do, independent consulting. You’re right. Most people want to build product or resell product or be system integrators. And in there there’s a gap in the market because everybody’s trying to sell our clients the next greatest thing without really trying to understand what they’re trying to solve for or what their infrastructure is.

So our clients tend to be mayors, city managers, they’re CIOs of small and large cities that, because they’re in the government, they’re not necessarily always up to speed with what’s going on in the market. And government has a unique ability to leapfrog bad technologies. So we come in as advisory partners where we have the industry knowledge, we have the know-how of how local government works, and we can help them or advise them as a third party on what the best products or implementation strategy might be. Because it’s never one product. You’re trying to untangle this 30-plus-year-old ball of yarn.

When someone says to you, “Hey AV, you know, we’re looking for somebody to help us to integrate this, so a system integrator or to do implementation,” have you ever faced that kind of an objection? And I’m wondering how do you navigate that to still proceed with them if they’re the right fit?

Yeah, it’s a frequent one. We were on a pitch meeting a couple weeks ago where the client had a bad Microsoft Dynamics 365 implementation. So they put an RFP out. And we live in this RFP world where it’s public and we have to respond to it. We’re really good at it. So we were called in to do a presentation and first ten minutes in, the CIO said, “Wait, so you guys don’t do 365 configurations?” I’m like, “No, that’s not what you need. From what we are hearing, you need somebody to tell you or help you identify your vision, your strategy. How are you going to change business processes? And that’s what you need because you already have a 365 partner that has brought you to this point. So when you look for another 365 consultant, you’re going to get a different kind of Band-Aid. That’s not what you need. We are here to help you change your business fundamentally so that no matter what the software is, it will work for you.”

How’d that go over?

We haven’t heard back yet. They’re still thinking about it.

I’ve found in my experience over the years, I think some of the most successful conversations I’ve had with clients have been the ones that are exactly like what you’ve just displayed here, where you’re very direct and you go against, almost counter to what everybody else is doing. Everyone else is trying to fit in the box that the client has kind of created for themselves. But you’re calling out and saying, “Well, that box may actually not be that, maybe you don’t need a, you know, a square or a box, you need a circle or you need a couple circles. And here’s why.” Has that not been your experience as well?

100%. And you know, there’s a lot of clients that understand that and then there’s a lot more that don’t. And we’re also up against the marketing machines of these software vendors and system integrators. They’re bigger shops, they have better reach. So the education that the client gets is always from a biased standpoint. But that’s not saying that’s all the whole market; there’s lots of clients that understand the value that a third-party consultant brings.

So does that mean that the approach that you take as a company, and we’ll get more into kind of marketing business development here in a few minutes, but that you look at the market and you’re not trying to convert people who don’t see that value, you’re just looking to have conversations with those that do see the value? Just walk me through when you meet new people and you’re exploring, is this person going to be a good fit or not? If somebody, even in the first conversation kind of shows that they have this bias or this belief, just kind of say, “Okay, I guess we’re done here and let’s move on to somebody who sees the value,” or do you still invest in that relationship for the future, just recognizing it might take longer? How do you kind of think about that from a business development, relationship building perspective?

Yeah, I see it as the same pool. It’s people that are trying to, at the end of the day, they’re trying to modernize, they’re trying to make things more efficient, and they may be stuck on a certain track. But as consultants, it’s our job to show them other options. They may take them or not. So it’s always worth the conversation. Because even if they have picked a product, let’s say they’re going with Oracle, they’re still going to need our services because they might bring consultants who are Oracle specialists, but they’re only looking at it from what the product can do, and they’re disguising it as consulting, which it isn’t. It’s more solutioning to that specific product set. So those clients also need our services to help them challenge those assumptions and those behaviors and really put the organization before the vendor or the system that they’re trying to implement.

[08:25] – Winning Trust With Mayors, CIOs, and Public-Sector Leaders

Makes sense. So you mentioned your clients are, they’re mayors, their city managers, CIOs, people kind of at that level. How do you get access to those people? Sometimes, you know, somebody from the outside might look at that and go, “That’s really challenging.” Like, how do you actually create a relationship with a mayor? What has been your experience? How do you go about creating that kind of a relationship?

It’s really hard, you’re right. And you sort of have to be in all the places at the same time, which is why we have a unique approach to marketing. We’ll go to conferences, we’ll do white papers, and we’ll do outbound. But as you know, it’s a very difficult thing to do or be successful at. You can do it all day and not get anywhere. So it’s a combination of all of the above relationships. We’ve been in this business as Avèro for ten years now, so it’s easier for us than it was five years ago because we have a longer roster of clients that can introduce us to other people.

And so we’ll get more into this as well. But just I don’t want to leave people hanging because I’m sure they want to know a bit more of what you just said in terms of you’re doing this marketing, are you doing white papers, you’re doing outbound, you go to conferences. Are in-person events where the magic happens? Or is there something else you’ve done that you find to be the most effective in actually creating these initial meeting points or initial kind of conversations? I think a lot of people find that- most consultants, I would say, are pretty good in moving business forward. Not always great, there’s room for improvement, but they’re good. Like when they get in front of the client, good things happen, right, quite often. But it’s actually getting in front of the client, getting time, attention, having a conversation. So around that piece, what have you found to be most effective for you?

[10:16] – Navigating Long Government Sales Cycles and Procurement

In the world that we operate in, it’s very regulated. It’s a regulated industry. There’s procurement rules, state laws. So the traditional methods of getting in front of people work. I may call a hundred people and get ten meetings. You’re also then going to run into their government practices. They’ll be like, “We love what you’re selling, but we have to release an RFP to do a competitive bid.” So it’s a longer sales cycle. You need a lot of staying power.

And then because of our track record now, it’s becoming easier to get someone else, again, to introduce you and that way get in front of people. But I’m not going to say it’s easy. That’s the tough part. That’s what we are on a daily basis trying to figure out, how do we get there before they release some stupid RFP that does not make sense? Because in our world, then the communications have to stop. We can’t talk to them.

It’s interesting. I mean, the government space and kind of the public sector, I’ve always heard and seen from so many clients over the years, you know, like yourself, that in the early years it can be very challenging because it can take time to build those relationships. I often kind of remember hearing that two years is the minimum that you need to prepare yourself before things actually start to kind of come together. But once you’ve gone beyond that point and you’re now at a place like where Avèro is and where you brought the business to, you’ve created that moat. So for anyone else trying to come in, you already have a bit of an advantage.

[11:48] – Succeeding in Public Sector Work

But I want to ask you, AV, I mean, you chose to work with mayors, with government. They have notoriously long sales cycles and very frustrating rules and things that don’t make sense at all, but they still have to be adhered to and so forth. Why did you even get into this space? Why not just go and target private companies or those that might see the business case more clearly and be able to act on it, not have to go through the whole RFP? Just kind of take us back to why did you even get into that space?

I’ve done this my entire career. Right out of grad school, I was hired by a consulting firm that did local government and tech consulting. So when I started Avèro, that is all I knew. Meaning I knew how to go get business, I knew how to market, I knew how to do the work. And it was just me, so it was easy. And then as a solo operator at the time, I was lucky enough to quickly find and retain some clients. So it started me off.

And now why we stick to it? Because every year when we do our executive retreats or quarterlies, there’s this question that always comes up: “Why aren’t we getting into the private sector?” And to me it’s not going to be that difficult. You’re right, people are more profit-driven, which is much easier. They’re much easier to sell to because you can then say cost savings and more revenue, which is absent in government. But the other point you made about the moat, good luck trying to get into this space if you don’t have staying power, if you don’t get lucky early on.

So we’re trying to take advantage of that, our advantage or head start in there. And in the last two years we’ve had some M&A conversations with companies that are trying to build that capability, but they’re looking at us saying, “Well, we can just buy you and bolt you on.” And I’ve considered it because it would give me access to the private sector markets because these companies have a good practice. But really, at the end of the day, I think I’m giving up more than I’m getting because to have built this for ten years and having sustained it and now it’s only going to go upwards, that is the prize. So we’re trying to maximize on this thing before we go anywhere else. So just being focused, saying ‘no’ to things is something that is hard, but we’ve done successfully.

I think you just hit the nail on the head, man. I mean, the saying ‘no’ to something like that, that comes your way. It would be quote-unquote “easy” to just go that new direction. But often what’s easy may not be the best thing. What’s hard is actually the best thing for you, right? So staying the course and staying focused. Yeah, you’re turning down a lot of quote-unquote “opportunities,” but what you’re actually doing in most of what I’ve seen over the years is you’re strengthening the business or the foundation underneath it. So that makes a lot of sense. For those that are dealing with public sector, government, the sales cycles, procurement, RFPs, any tips on how to speed things up? Like, have you found any ways to actually make the sales cycle a little bit faster over the years?

There’s several ways of doing that. You have cooperative contracts, you have, you’re a minority-owned business gives you some sort of edge. We are a minority-owned business, but it doesn’t just happen because you have a certification. You still have to do the basics, right? You have to know how to do the work, you have to know how to sell, you have to know how to present.

So in terms of seeking opportunities, if you’re in a local community, look around you. You’re in a major city or a smaller city, they have council meetings, they have board meetings. It’s all public. The information is out there. The challenge becomes how do you connect the dots between what’s out there and who you need to reach out to and call? And you need to have a separate, different mindset. You cannot, if you’re trying to enter the public sector, throw out the words, “We’re going to save you money, we’re going to make you more money.” It’s all about efficiency and it’s all about image. People don’t want to be in the newspapers because a system implementation failed or some other thing happened.

Yeah, I think that’s a really good reminder to understand what the client, the buyer is actually thinking, the context changes. You started, you mentioned 2016, give or take, ten years, as a solo consultant in this space, do you think it’s a smart move for people to get into this, into the government space or public sector consulting as a solo consultant? Or do you believe that maybe it’s a much better idea to have like more than yourself to be able to go after RFPs? How do you view that? Like if somebody was interested in getting into the public sector, what do you think they actually need to be successful?

Well, you need to have some sort of a niche. You can’t just say “I’m a consultant, I can do it all,” which is true for most consultants. We are smart people that can solve a lot of problems, but what is it that will get someone’s attention on something that they’re feeling pain on? And this is true for public or private sector; clients will move when they’re feeling pain and when they see an opportunity in most cases.

So yeah, being solo is probably better because in consulting, if you do it right at the right rates, you have the right kind of scopes, you can bank that profit and then use it to hire more people, do more marketing, which is what I did. But that means not paying yourself for a bit. Unless you have cash from somewhere else where you can right away start a team and start marketing, you better have the skill sets that know exactly how to go after this market because it’s a very niche market. It’s not the knowledge about how you close business or how you even chase it is not readily available.

The work that Avèro does, you focus on kind of the intersection of policy, technology, organizational change. We’ll talk about AI as well and how it plays into all this. But how do you approach- because that I think to outsiders that might feel like that’s pretty complex. You have a lot of different moving parts. When you think about putting together an engagement, a project, an initiative, how do you think about the scope of the project or the work to ensure that it’s still going to be profitable for you? Like how do you approach setting all that up to make sure it works well?

Yeah, and it’s a tough one, because you’re making so many assumptions as you price things out and most of the time you don’t have access to the decision makers. Especially if you’re in this RFP phase, which most of our business right now comes from responses to RFPs. And I was just in a meeting where the pricing form, they just took something from a construction bid, put it into a consulting bid for an ERP consulting gig. We’re like, “This doesn’t make sense because it’s milestone-based, but yet you’re trying to say it’s time and material,” and the spread of the dollar just didn’t make sense. But I can’t pick up the phone and call somebody and say this doesn’t make sense because they won’t answer the phone because you’re under a cone of silence or whatever. Plus the questions you’re asking are also subject to public disclosure. So you don’t want the competitors to see your hand.

So it’s tricky. But when you do have a client that, like if you’re already in a contract, you’re trying to sell a follow-on project, much easier because then you can have those dialogues about how we’re pricing this, these are the assumptions, this is what you’ll get at this date or these are the hours that are going to go into it. There’s a lot more freedom there. But when you’re going after RFPs, it’s a lot of guesswork.

[19:55] – How AI Is Transforming Government RFPs and Consulting Work

Are you seeing or have you seen an increase in RFPs that you can clearly tell have been created using AI? Like it just, some parts of them really don’t make sense.

Yes, all the time. I mean it’s accelerated a little bit. But I think it’s better because you know how the way it works is the purchasing department will get a call from, let’s say the CIO, and say, “I need a consultant,” and the smart ones will ask the CIO to put a scope together. Now it’s easy. But then you have the population that decides to do it on their own and they don’t really know what they’re doing. So before they had access to AI or ChatGPT, it was worse. So now at least they can put their bullet points in there and get something that makes a little more sense. Maybe ChatGPT will push back and say your two points here don’t actually line up, here’s a better way of doing it.

And so what are you seeing as the impact of AI right now? I mean you really, for as long as I’ve known you, you’ve been very much into technology, right? And it’s the work that you do, it’s the bread and butter. So you have a deep understanding of that, but you also run a consulting business. I mean, let’s talk through a few things here because one, I’d like to know what have you been doing? Because it sounds like you’re launching a new service offering that is going to be around AI development, which is something you haven’t done before.

[21:23] – Expanding Into AI Development and Micro-SaaS Solutions

Can you just kind of talk through where that idea come from? Because I would imagine there was likely some discussion internally about should we get into development or should we just strictly stay in consulting and advising? What caused you to decide, “Yes, let’s actually go ahead and start to offer some development services?”

So longish answer. So just stick with me, okay? You know the work we do on ERP consulting, which is helping our clients pick between Oracle, Workday, SAP, Tyler, who have you, and the more those technologies evolve, they all start looking like the same thing. It’s becoming pretty homogeneous. They won’t say that; they’ll have different differentiators. But to our client, they’re looking for outcomes. They don’t care. At the end of the day, where this is going is it comes down to: “What support am I getting? How much is it?” and, “Who’s the more likable bunch of these people?” Software is not going to matter.

So because of SaaS and hosted services and out-of-the-box functionality, the software providers don’t have an incentive to solve 100% of your problem. So when a Workday or an Oracle puts a bid into one of our clients, they’re going to give you customization options that’s going to double or triple the value of that bid. So the push is for them to buy something vanilla. So now you’re talking about a product that does 80% of what you need it to do, which is great. Your current product, maybe it was homegrown, maybe it was built by somebody that no longer works there, it does 60% of the automation. So you’re always going to have the 20 to 30% unique niche functionality that the big guys just don’t want to go after. And even if the client wanted it, they don’t want to pay for those enhancements.

So where we are today is we stop at the recommendations phase. We don’t develop product, we don’t resell product. But if a client brings us in to have us assess their procurement system or their permitting system, traditionally our role has been to tell them, “This doesn’t work, go get something else. These are the things you need to look for.” Along the way, we realized that most of these products work. The problem is that it hasn’t been configured well, the people haven’t been trained, the processes behind those have never been changed. So the product has been shoehorned into these old processes.

So we do process redesign work, we help them reconfigure it. But the missing piece is what can we do today to solve that client’s problem? And my answer is Micro-SaaS. That 20% that traditionally we would say, “We recommend you go buy something else that solves this problem.” And now you’re talking about another RFP, another procurement cycle. Instead, I just want to be able to offer that solution. I want to be able to use AI to quickly develop product, put it in front of a client, use APIs to make you work with their existing stack, and you can be a happy client today instead of saying, “Great idea, and now I have to work for another year to get this done.”

Does that go around in the typical requirement for an RFP or will they still be required in general or in your mind to say, “Oh, you know, maybe you’ve now shared with us something that we weren’t thinking before, we didn’t even know that was possible. But that sounds like a great solution.” Can they just say, “Yes, this makes sense for us,” if they want to move forward or do they have to now still go through a whole RFP process?

You know, that depends on who we’re talking to and how risk-averse or aggressive they are. I’ll give you a good example. We are working right now on a pilot project with a police department that has historically tracked their personnel’s overtime hours on note cards. Note cards. So officer writes it down.

It’s not an application called ‘Note Cards’?

Actual note, it’s paper, physical. And that eventually gets put into PeopleSoft, their payroll system. And they’re in the process of upgrading PeopleSoft to Oracle HCM. But this process is not going to be tackled. They’re going to be stuck with this manual process because Oracle doesn’t offer it or the CIO doesn’t want to do it.

And so when we talk to them, they’re a client of ours. And I came up with the concept right away. I was on my way to the meeting and in my laptop was a pretty functioning product that I showed the chief and he’s like, “Yeah, make these changes.” But then he said, “Well, but you know, we don’t want to have to go to IT and beg them for an interface.” I said, “No, no, we’ll fight that battle later. This problem of yours where you take three days and three people to put these things into the product can be solved with this micro product. And if you like it-” Now, it’s a SaaS product that we’re selling, but it came out of consulting. It’s not product-first. It is a consulting recommendation that we can use to solve the client’s problem right away.”

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What’s your thoughts, kind of the big picture of the intersection, the connection between AI and consulting? How are you viewing this? What are you talking to your team about? What are you talking to your clients about?

[28:15] – Using AI to Deliver Faster Without Losing Consulting Value

So two ways to look at it. One is internally we have a team of 50 people and in a traditional assessment type project, you’re going to send three or four people, most of them juniors, who take notes, data collect and analyze and do all of that, make reports. We’re close to wrapping up a product that we are going to use in-house that will enhance that process of consulting. Meaning, instead of sending three people out there to take notes and assess and analyze data, our product will use data already available in the market or that we got from the client. It’s going to analyze it. So when we show up on-site, not with three people now with maybe one smart person with this tool, we’re cutting down the time it takes to analyze. We’re going to show up with ideas, recommendations, analysis, and then find the gaps in our…

The problem is that can go too far. Meaning, we could easily send a link to our product to the client and say, “Hey, use this.” But think about what clients really buy when they buy consulting services; they’re not buying deliverables, they’re buying expertise. They’re buying time with someone like me or you that has been there before, that understands nuances. They want other smart people to bounce ideas off. No matter how good AI gets, I think we’ll still need that.

And they want outcomes.

Yeah. And so how do you preserve that element while making it more efficient? So instead of a six-week long engagement, you can now have a six-day engagement on the deliverable end and then keep the connection, keep the relationship and become a true consultant.

So before you go to… that was kind of an internal example. So on that one, how are you approaching pricing on that? Because I know a lot of people are kind of trying to figure out, “Well, if what used to take us six weeks now can be done in six days, that means that our time is less into this. However, if the outcome for the client is the same, meaning the value that they get is not changed, whether it’s, you know, if anything, maybe they’re getting even more value because they get the benefit of getting this within one week as opposed to six weeks.” Are you charging the same? I mean, there’s also the development costs and even time to create what you’ve created. How are you thinking about pricing in the relation between AI and consulting in that example?

That is a challenge because when you do time and material work, or even milestone work, that does actually take six weeks, that’s how you’re making your money on the rates. But to deliver value instead of six weeks in six days, you’re still delivering the same thing, probably at a higher quality if you’re using the right AI tools. So charging the same amount of money, I think is the way to go. But you have to sell it well because if the client is conditioned to, “Well, if it doesn’t take six weeks, why are you charging me the same amount?” you need to be able to tell the story of ‘why’.

I love the example you shared there of how you’re using AI internally. You said there’s a second way of thinking about AI which maybe is external, or any of the thoughts you have around that.

Yeah. So external is the Micro-SaaS play. It’s not a new concept. It’s been around. It’s how quickly now you can iterate product is the key factor. And you know, when I said all clients, our clients now think they’re consultants because they have ChatGPT. But now people like me and you also think that we’re developers because we can quickly vibe code something. But the missing piece is at the end of the day, it is still a software development project, it’s still an implementation project because the backend architecture, the storage, the security, all of that still needs to be wrapped up.

So this product we’re building for this client, the police department, it’s gone past the proof of concept phase. We have built the front ends. So our development team in India is now finishing up the back end. The actual software developers are now taking that into their hands and they will finish it up. So you still need that component. You cannot just go on Claude or Replit and build something because it will spin your wheels all day. At some point you need to bring humans in.

Yeah, makes sense. So you developed the capabilities by readiness level model.

Yeah.

[32:50] – Inside the AI Readiness Maturity Model for Government Clients

And before we pull up here so that everybody who’s joining us, and for those that are just listening to the audio, you can head over to YouTube and go to Consulting Success Channel on YouTube and you’ll see this, the actual video of AV and I and the model that I’m about to pull up. Before I do pull it up though, AV, how do you think about creating your intellectual property or codifying expertise? I mean, you’ve given several examples through this conversation of taking ideas, finding problems, creating solutions. But just in general, when you’re developing a framework or you’re developing a new model, is there a standard process that you tend to follow to do that or anything you found to be helpful for you?

Yeah, I mean, growing up in consulting and business school and all of that, you’ve seen thousands of models. They’re proprietary to whoever made them, but they’re not necessarily always unique ideas. So what we came up with with the maturity model is this. We came up with that last year. So as we sit here in October of 2025…

It’ll be 26 soon.

I know, man. Yeah, I’m in the future. But last year when we talked to clients about AI, what we quickly realized is they were in this phase where clients were jumping on product and it’s the product marketer’s fault. Microsoft tells you that Copilot will solve every problem you have while being the worst AI product on the market right now. And so clients are conditioned to just buying the thing and putting it into the organizations, which is risky because they’re not thinking through data governance, they’re not thinking through hygiene, they’re not thinking through security and policy. All the non-sexy stuff that as consultants we’ve been selling for years, but it’s kind of being ignored.

So when we went to talk to our clients or prospects and say, “Hey, you really need an AI readiness or AI strategy before you start putting product in,” it kind of fell on deaf ears last year because again, there was a mad rush to not be left behind. And I think it’s still going on to some degree, but there’s more education on the market. So we came up with this maturity model to show clients, look, we think there’s five levels to this. And if you’re at level one, you’re not ready. You need to do again, the non-sexy work of really digging into what you have, what you don’t have, where your vision lies, where this organization’s headed. Do you even have the infrastructure capability to do this? And the way this works is you can graduate to the next level.

You’re seeing the model right now.

Yes, I am.

So maybe walk us through it just to explain what it all means.

Yeah. So five different levels to the model, going from left to right. And if you’re in the Seeker column, essentially means that you’re just starting to think about AI. You don’t have a lot of infrastructure, you’re exploring potential applications, you’re really trying to nail down what you have, what you don’t have in terms of data infrastructure, people and policy. Once you get those things nailed down, then you move to the second level, which is the Pathfinder. And in level one you can take on some pilot projects that don’t really require you to tinker with a lot of your core infrastructure just to try things out.

In the Pathfinder level you’ve kind of covered whatever was in phase one. You’ve checked off the boxes on cleaning up data. You have policies in place, people understand what to do, what not to do. In level two you can start taking on some third-party tools. You can give access to guided LLMs because you don’t want your company or organization’s data just going into free GPT for it to train on. And you can do some small pilot projects.

Level three is what we call Navigator, where you again graduated from one and two and you’re in three now where you can take on basic task automation. Again this is, it’s a fallacy to think that you can do tasks and process automation in level one where you don’t have anything figured out because that’s where most of these failures happen. You’re just buying a product and hoping that it will do the work for you. Again, at the end of the day this is a software implementation, especially if you’re a larger complex organization, you can’t just plug and play these things.

So in level three you can build some custom internal AI products, you become more data-driven. And then you move on to Trailblazer – and we came up with these names, that’s how less creative we are – but you can do some really cool things at this level. Predictive maintenance, demand prediction, performance dashboards, more automation, natural language customer support. You know that chatbot seems so easy to pull off that they’re actually not because you have to again build stuff like RAGs and DAGs in the back end that it really takes some engineering to do.

And then in the Visionary level you’re kind of master of your domain. You have control over your data, you have data hygiene, you’ve used some smaller tools where you can now start digging into some really high-end AI product suites like digital twin capabilities and data integrations and actually having automation that can, instead of just a chatbot giving you answers from your website, you can do things like run a process through a chatbot that’s using AI on the back end. So conceptual model that helps clients. And you know, by the way behind this, if you go on our website, you can download some assessments that will tell you where in this spectrum you may stand.

So we’ll make sure to link to that in the show notes for everybody and also so they know where to go. Has part of that model, like the value of it, been that people can almost see, like it’s almost like graduating to know “Here’s where we are today and here’s where the possibility of what success looks like?” Is that part of kind of why you created or anything else to add in terms of like the value of a framework like that?

[39:27] – Why Frameworks Prevent Costly and Unsafe AI Adoption

Well, the value of a framework is a) it gives you a visual of what the process might look like. Because again, you want to go from here to that mountain, you need the stepping stones, you need to know the path. And you can’t get there before you know that because there’s several pitfalls in there. And I think the marketplace is in that phase. I mean I try all the AI products out there. I have tried most of them. And every day you have a new thing that you can try. But if you start deploying things that were just released that you don’t quite understand how it syncs with your organization, you’re going to be in trouble. So this is our way of showing the complexity of it, that it’s not just a plug-and-play. Because you know, clients used to say “How much for ERP?” and these days it’s “How much for AI, where do I get it?”

So one thing that I’ve heard recently is that there is some concern about AI and that the current models… you’re saying that you’ve tested all the different models and you have to obviously be very thoughtful, I think especially important when you’re working with organizations. If you’re doing stuff for yourself or your own small business internally, maybe a bit of a different story, but for organizations there’s a lot more to be thinking about. But one thing that I read recently was that the cost of the models right now, or access to ChatGPT, Claude, so on and so forth, is very low. And it’s low because VCs are pouring in a ton of money into the space. If that doesn’t change, meaning if the profitability… because I think ChatGPT, Claude, most of these companies are actually losing money. This is what I read, so I don’t know if it’s true. They’re losing money right now. So for every user or every month, they’re actually taking a pretty significant loss, like billions of dollars. If that doesn’t flip at some point, there’s a chance that the only way that these organizations can continue to provide access to their models is by increasing the cost of them significantly. Do you see that being the case? Meaning that you might be paying $20 a month now for ChatGPT or Claude, but maybe in a year or two from now it’s going to have to be a hundred dollars minimum or $200 minimum just for people to have access to that. What’s your take or what do you believe might be happening?

Yeah, it’s very competitive. A new model comes out every day. There’s a different leader in terms of what each model can do. And I think it’s a function of how many data systems, the chips they’re deploying and data centers they’re standing up. There will be a clear leader in terms of how much compute they can put out. And I think if you read up on what Elon’s doing with the Colossus data centers in Memphis, they’re standing up some massive capacity and the constraint will be power and the cost associated with it. So they’re all trying to solve that problem through nuclear reactors or hydropower or solar, what have you.

So I don’t really know. But think about it this way. If GPT costs $20 today and can do the work of a very smart individual for 20 bucks a month that helps improve your life, if they go up to 200 and they give you more features, I think I’d be okay with that. But that’s me. You have to look at it in perspective. But you’re right, the power will be in their hands if they want to jack prices up and now I’m used to this workflow that my GPT or AI stack can do the work of a hundred people. Now I’m stuck. But it’ll have to be a business decision on what that’s bringing in and how to think about that cost.

[43:20] – Scaling From Solo Consultant to CEO and Building a Resilient Firm

AV, so we worked together five or so years ago. Your company at that time, maybe 15 people or fewer, today 50 people. I mean, you’ve made significant progress and gains and growth as a business owner, as an entrepreneur, as a leader. What, for you, has been the biggest challenge personally in navigating the changes that you’ve gone through in terms of revenue growth, team size, growth, just the business, what stands out?

Yeah, so a few things. You, as a consultant that started off solo, you don’t get to do the thing that you’re really good at anymore. So I’ve had to learn how to be a CEO and not a consultant that also is a CEO. Now a bigger team means they’re specialized, they can deliver the project and you don’t get called into most things that the business actually does. So that’s been not necessarily challenging because as a business owner, eventually you want to work yourself out of a job. You want to be so successful that it can run on its own. We’re not there yet.

But the second challenge has been, growth for growth’s sake, this is a learning more than a challenge. We’ve been in the Inc. 5000 list for five years in a row, which is great. All of those plaques hang in my office. But along with that, if you’re not growing up as an organization, as a person, it’s not sustainable. So setting up the infrastructure of the people, bringing in more experienced folks that have done this before because you need to know how to operate at this level in a market like this. You don’t necessarily have the time to experiment, which I did as a solo or even a ten-person firm; lots of time in risk-taking, but that equation changes quickly.

And how do you think about that or make sure that you’re in a position to have protection against those risks? I think a lot of people over the last, call it maybe eight months or so, have found that the sales cycles have gotten longer. There’s a lot more hesitation. Even- I was interviewing Matt Dixon who wrote The Challenger Sale and now The Activator Advantage recently, his latest book. And he talked about even large established organizations that had relationships with somebody, so there was an incumbent, they’re now starting to talk to a lot more people and not just taking on… So if I had to sum it up, it’s that – I mean we have some clients that are having their best years ever, we’re having others that are just, they’re navigating a challenging environment. Whether you want to talk about tariffs or politics or conflicts or wars, I mean, the world’s a very interesting place is kind of how I describe it now, to say the least. That’s been a challenge for some people. What do you do, what do you think about to prepare for those? Because you have a lot quote-unquote “more on the line” now with 50 people than let’s say when you did when you had five or ten people in terms of expenses, costs, all of that. How do you think about that or how do you prepare for it?

It’s challenging. It’s scary. But as a leader, you have to a) anticipate those challenges and changes and the worst thing to do is react to them. You have to be ready, which is why we’ve seen the shift coming in our space. Yeah, we’re about to have our best year ever, but we also have a client concentration problem. One or two clients bring in most of the revenue. And you’re right, sales cycles, even on the government side, as slow as they are, they have slowed down some more. Everybody’s in wait-and-watch mode about what happens.

So with the innovations that we are building, I’m taking advantage of today’s cash flows to build tomorrow’s capabilities. And it’s a very lucky position to be in where most consultants tend to be feast or famine. There’s this famous saying: ‘I don’t want to end up there again because we used to be there.’ But AI or not, we need to always be innovating. I think that’s going to be the next phase of the consulting profession where you have to be tech-enabled. You can’t just be the ideas person.

What’s your North Star? I mean, when you think about success, if we put revenue growth and profitability to the side for a moment, those kind of standard metrics. You talked about Inc. 5000, based on kind of growth and percentages and so forth. Put that to the side for a moment. What for you is success and how do you define success?

Growing people. I’ve always been passionate about that. Yesterday I had a major client in town visiting us and he told me how much he appreciates the team and the people that he saw on day one of the project where he was like, “Ah, I’m not sure about this person, he’s too young or whatnot,” that they’re now killing it on the project, that they are sort of a linchpin on several work streams. That gives me a lot of pleasure to have mentored and given people their opportunity and their shot. And on the other end, it’s the happy client. There’s nothing better to a consultant than delivering results that are useful to someone else.

AV, thanks so much for coming on. I want to make sure that people can learn more about what you’re all doing and building at Avèro. You mentioned also some resources on the website. Can you just give the URL or the best place for people to go to access that?

Yeah. So our website is Avèroadvisors.com and within that you’ll see a link for resources or guides and downloads or something like that https://averoadvisors.com/insights/

We’ll link it up.

Yeah, it’s on there. And our YouTube channel https://www.youtube.com/@averoadvisors has a lot of great stuff too.

So there we go. All right. Well, thank you again for coming on.

Okay. Thanks, Mike.

Important Links:

Abhijit Verekar
Avèro Advisors
Avèro Insights/Resources
Avèro YouTube
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