We’re pleased to announce the release of our 2017 High-Growth Study. This annual study is part of our commitment to the ongoing study of the world’s fastest growing and most profitable professional services firms.
This year’s study does not disappoint. You’ll get a window into firm financial performance, strategy and marketing, and learn what the fastest growing firms do to set them apart.
Download the research summary here.
At a Glance
In this study, we analyzed three years of financial and operational data from over 500 professional services firms across all industry segments and firm sizes. The combined sales of these firms were $87 Billion.
The industry breakdown of participating firms is shown in Figure 1.
Financial Performance
High-Growth firms (defined as 20% compound annual growth rate or greater) made up less than 30% of the total sample and accounted for over $500 million in new growth. This underscores how these exceptional firms lead their respective industries.
The growth rates for each of the research groups (High-Growth, Average-Growth and No-Growth) are shown in Figure 2. These High-Growth firms clearly stand apart from their peers.
And when it comes to profitability they are no slouches. They are 50% more profitable than their Average-Growth peers and twice as profitable as their No-Growth counterparts (Figure 3).
Importantly these impressive firms also outpace all their peers on the important metric of revenue per employee by $28,000. That is an important difference.
Strategy
So how do they achieve such standout financial performance? Part of the answer lies with the strategies they choose to pursue.
High-Growth firms are much more likely to target a highly specialized niche, giving them a competitive edge. They are also more likely to promote fewer, more focused services to their target clients.
As the research report documents, these High-Growth firms are nearly three times as likely to favor technology as a differentiator. Conversely, the history of their firm is rarely used to set them apart.
But they don’t do this blindly. High-Growth firms are dedicated to understanding their target audience. In fact, more than one-third of these firms conduct systematic, structured research on their target audience at least quarterly – a practice unique to High-Growth firms. Armed with this powerful understanding of the marketplace, High-Growth firms are able to align their services and marketing with the changing needs of their audiences.
Marketing
So how do they pull off this tremendous growth? The answer is intense focus and effort, yielding much greater results.
Part of the magic is the marketing mix they choose. They do not simply use more techniques. Rather, it is their unique combination of both digital and traditional marketing techniques that produce greater results. The report explores why this is the case.
There is even a section correlating which marketing techniques provide the most favorable balance of effort invested to benefits realized. Think of it as a Return on Effort analysis.
Another factor that likely contributes to the performance of these firms is their tendency to monitor more variables in the new business pipeline. In other words, they are in a position to better understand what produces desired outcomes and what needs to be adjusted. Better analysis and management yields better results.
How to Learn More
In the coming months we will be sharing additional results and insights from this massive study. But many findings will be shared only with our clients and study participants. So if you would like to get the full story, we encourage you to participate in our next study. Here is a link to sign-up. It’s free and confidential—and you will get access to critical information not available to the public.
And in case you missed it earlier in the post, here is the link to the current research summary again. Enjoy!
How Hinge Can Help:
Hinge is a global leader in helping professional services firms grow faster and become more profitable. Our research-based strategies are designed to be implemented. In fact, our groundbreaking Visible Firm® program
