The current COVID-19 pandemic has severely curtailed revenues in services businesses. Services businesses are those with activities performed by an individual or a team, expertly, for the benefit of their customers. A company or a person may outsource work to another business (e.g., legal, IT Services, floor cleaning, cutting hair, shipping and logistics) because it’s not a core competency or it can be done more effectively and efficiently by a third party.
During the 2009 economic downturn, I was working for UST Global a California-headquartered IT services firm. When I joined it was a $375M company with development centers in India. I created and ran the Management Consulting business, helping double our revenues and opening up Europe. To build the new business lines, we took the road less traveled. Many of those lessons are applicable in today's environment.
Some themes:
Necessary services
– What is core to your customer staying in business? Encourage your team to explore new services or those things that others are reluctant to do. Be willing to get your hands dirty.
- Software Testing – Testing is the least sexy or loved of all IT services. I grew the UST test team to over 1,400 FTEs, won three awards and expanded revenue from our existing clients. It was an in-road to new clients and Europe as a new territory with large deals in Prague, London, and other cities.
- Compliance and Regulatory – Is your customer required to fulfill government requirements to operate? Can you accelerate compliance in a more cost-effective manner? Is there an opportunity for you to take on some of their monotonous or tedious work?
- Legacy Modernization – In an emerging world of social media, mobile and emerging technologies why did I choose to double down on this market? It was untapped, we had few true competitors and we were willing to get our hands dirty. We found millions of dollars in waste, reduced end-user complaints, and we were then able to sell more lucrative transformation services. There were mainframe systems we examined that had not been tuned for more than a decade. We won recognition as the top modernization firm beating out IBM and others.
Project Management
– Write out your tasks and activities so that you can measure progress. Do you know what your metrics of success are and how to measure them?
- How will you stay on task? Flexibility in your plan being adaptable will serve you better than a rigid checklist
- Circumstances change. Make a plan to adapt to the vagaries of the current business environment.
Be bold
– Where can you be opportunistic? What are the services that allow you to be a market-maker?
- Canlis, a top-rated fine dining Seattle restaurant, started drive-through burger and bagel take-out during the virus outbreak.
- We married a creative studio with traditional IT services. The addition of a creative studio allowed us to sell to a broader audience (Marketing, Sales) at each customer. I hired a top-ranked Art Director to run the business instead of another IT person. During that time we won the maintenance contract for 60 websites for a major pharmaceutical company, created the number one downloaded mobile tax app for H&R Block, and much more. We were able to sell more integration services to each client as a result.
People.
Please don't forget your team. Few businesses have a bigger investment in their business than their people. Have a plan that outlines how you will continue to support, mentor, and grow them. People who are performing at their peak are happier and more confident. That translates to happy customers.
Has this article given you some food for thought? What's the state of your services business, of any size? Post your comments or message me directly.
Onward.
