In my work with mid-size and large professional services firms, I encounter a mindset that is almost endemic in firms of a certain size. As these firms grow, often by acquiring smaller businesses, they accrete new skill sets. They enter new markets. They serve new industries.
Each year, they inch closer to a standard modeled by the market leaders in their industries: to become truly “full-service”—offering every conceivable relevant service to buyers across the nation or the world.
The thinking goes like this: “If we can be our clients’ one-stop shop, they will never need to go elsewhere. Prospects want to know that we can handle any challenge that comes their way.” At the same time, firm leaders carry an underlying belief that the key to growth is to expand the pool of potential buyers by adding services and entering new markets.
Our research shows that some buyers are indeed looking for a full-service experience. They appreciate the convenience of working with a familiar partner as new challenges arise.
But that isn’t the way most buyers’ minds work. The majority of professional service buyers are tasked with solving a specific problem rather than a range of possible future problems. As a result, they seek out the firm most likely to be able to solve their immediate issue in the shortest amount of time.
In this scenario, what kinds of firms do most buyers perceive as most qualified?
Specialists.
Because specialists focus on one thing (or, sometimes, a related group of things), they get really good at solving those problems. I won’t go into more detail on the advantages of specialization here because I’ve written about it before.
Instead, I want to provide a few examples of large, successful firms in different industries that have thrived by specializing. My goal is not only to demonstrate that large firms can specialize, but also that they pay no penalties for their narrower focus. In fact, it helps them attract and win exactly the kinds of clients they are best suited to serve.
Legal Industry
Quinn Emanuel
This firm focuses exclusively on litigation law, almost unheard of for a firm of its size. With more than 1,300 employees in 33 offices across four continents, they have built a reputation as one of the most feared law firms in the corporate world.
Consulting Industry
Health Management Associates (HMA)
With over 700 consultants working in all 50 states, HMA has grown to become the leader in its category. By focusing exclusively on solving the operational challenges of healthcare organizations—and with its deep insider expertise in Medicare and Medicaid regulations—it has grown quickly into the leading consultancy for public and private healthcare organizations across the nation.
Altman Solon
By focusing on a specific sector (telecommunications, media, and technology), Altman Solon has become the largest strategy consulting firm in its category. With 18 offices worldwide and over 600 professionals, they demonstrate that specialization is no barrier to growth.
Cornerstone Research
This research firm concentrates on just one thing: delivering economic and financial analysis for commercial litigation and regulatory proceedings. They have over 1,000 employees across the US and Europe.
Architecture Industry
Populous
This architecture firm went all-in on stadium and entertainment venue design, and it paid off. Since their inception in 2009, they have grown to 1,600 employees in 34 offices on four continents. They have designed some of the most iconic structures in sports and entertainment, including Wembley Stadium in London and the Sphere in Las Vegas.
Technology & Software Industry
Bishop Fox
This cyber security firm has built a reputation for exposing IT system weaknesses by simulating attacks on them. Their tenacious, offense-is-the-best defense approach sets them apart from other competitors in their category. Despite their signature approach to IT security—and in fact, because of it—they are a fast-growing firm with almost 400 employees and plenty of venture capital interest.
Epic
This software company has not only remained privately held (and employee owned) but has stuck stubbornly to its mission of helping the healthcare industry be more productive and connecting healthcare providers with their patients (if you have used MyChart, you have used their software). With revenues of $5.7 billion, Epic has grown to become the dominant player in the industry—thanks to its powerful focus.
Accounting Industry
Highly specialized large accounting firms are harder to come by. There are, however, at least a few specialized mid-sized accounting firms. Here are three representative examples:
Pinion focuses on serving the agricultural industry. With roughly 700 employees in 26 offices in the US and Australia, they have been serving the industry since 1932.
Stambaugh Ness specializes in the AEC industry, generating over 80 percent of its business from that segment. They serve over 1,400 AEC firms in all 50 states.
Your Part-Time Controller (YPTC) offers outsourced accounting services exclusively to non-profits. Today, they are a top-100 accounting firm.
There is no reason that these, or firms with similar focus, couldn’t continue to grow and challenge the industry giants.
As you can see, focus has helped firms in many industries achieve leadership status. While generalist firms also make it to the highest levels of success, they must constantly battle people’s natural inclination to seek out specialists.
Specialization may not be for everyone, but don’t operate on the faulty assumption that it limits your growth opportunities. Unless your niche is simply too narrow to support significant growth (this is rarer than you think), it will be easier to attract and close new business if your firm is closely aligned with the needs of your prospective clients. All it takes is focus.
