At our recent TSW conference, I overheard this lament, “I wish getting alignment on our professional services strategy was as simple is getting your car aligned!” And thus was born an idea for some research and a blog post to explore this concept.
Car owners know that their wheels need to be in alignment, and it’s not hard to tell when they aren’t. Your car might seem to drift to one side, or maybe your car is driving straight, but your steering wheel isn’t centered or vibrates at higher speeds. Any of these problems is a clear indication that you’re out of alignment. If you don’t get it fixed, there are lots of problems that will likely ensue: your tires will wear unevenly, you’ll get worse gas mileage, there’s a higher risk of tire blow outs or poor traction. In short, it’s plainly foolish and counterproductive to ignore or overlook the problem.
At TSIA, we believe that the same exact principles apply to professional services alignment, that is, the alignment between the PS charter and overall company objectives.
Now I can imagine that some readers are surprised that this is even a topic of discussion. Don’t companies typically establish an overall strategy and then just manage it down to and through the business units? Don’t company goals and PS goals just sort of line up naturally? The short answer is, they don’t.
How Well is Your Professional Services Strategy Aligned?
In working with PS leaders on their alignment to company objectives, TSIA uses the “PS Charter & Strategy Cohesion” construct below:
This framework is one of the key assets that we use in our Professional Services Strategy Alignment Workshop/Advisory Sprint offering, an element of which is a self-assessment by stakeholders as to which level of PS charter and strategy cohesion they believe exists in their organizations. Looking back on these engagements as a whole, we have typically found organizations to be in the 1-3 range in terms of PS charter and strategy cohesion, with most landing somewhere just shy of 2. Of course, there’s some selection bias here. Organizations that are well-aligned would be rather unlikely to engage TSIA to help them gain alignment. That’d be like taking your car in for an alignment when it’s just recently been serviced and is showing no signs of trouble.
Partly for this reason, we decided to take a broader poll of PS leaders within the TSIA Professional Services membership community to get at something closer to a benchmark data point on this topic. The group was selected mostly to create a cross-section of PS member companies: large, small, hardware, software, technology-as-a-service, etc. The results of this poll are predictable and instructive.
As suspected, a broader cross section of Professional Services members reveals a somewhat better overall state of alignment than we see among the subset of companies who are literally raising their hands and saying, “We have an alignment problem!” But also as suspected, this result suggests pretty clearly that solid alignment between company objectives and PS charter and strategy is extremely elusive. Although there were some 3s and 4s, there were no 5s, and by far, the most common self-assessed score was a 2, yielding an overall PS charter and strategy alignment score of 2.5.
The Terrible, Horrible, No Good, Very Bad Problem of Professional Services Strategy Alignment
Few in the tech industry and approximately zero tech PS leaders should be surprised by the fact that we have a general PS alignment problem. Let’s face it, there’s a certain level of misalignment baked into the cake. A key distinguishing characteristic of most TSIA members has always been that they are product companies with embedded or captive services capabilities designed primarily to fuel product growth and/or customer success. Within these companies, PS almost invariably constitutes a fraction of company revenue or profitability. PS leaders may or may not have a “seat at the table,” and may or may not have any mindshare with company management or other stakeholders. We all know the story.
But the truth is that what’s already difficult is getting more difficult every day. Gaining alignment between company and PS objectives was hard enough in the good old days when company objectives were clear and predictable. Nowadays, we’re dealing with multiple, well-documented and well-known industry transformations that are resulting in widespread upheaval in tech operating and financial models. So, company objectives to which PS needs to try and align are moving and changing at an unprecedented pace.
This is presenting itself in a number of ways. Here’s just one: In the core PS benchmark (Q4 2017 snapshot), we ask respondents to rate the importance of 4 basic PS charter elements on a scale from 1 to 4 (with 4 being extremely important). The latest result is shown below:
In technical benchmark analytical language, we refer to this kind of result as “peanut butter,” or a result in which there’s no completely clear pattern. Yes, PS revenue growth rates a little higher and PS profitability rates a little lower, but all of the items are bunched right around 3, meaning that all four objectives are all generally rated as equally important.
Now ask yourself, from a PS perspective, can PS profits AND PS revenue growth AND topline product sales AND customer product adoption all be equally effective at the same time? Of course not. Flailing around for a core mission or trying to be all things to all stakeholders are tell-tale signs that your charter is poorly defined and that it is very likely only loosely connected to corporate objectives, if at all. In short, it’s a sign that you just might have an alignment problem.
Let TSIA Be Your Go-To Professional Services “Technicians”
If achieving professional services alignment were as simple as pulling your car with its vibrating, off-center steering wheel into the nearest garage, we wouldn’t have the pervasive problem that we’ve talked about here. But it’s not, and so we do. Unfortunately, the problem can’t be solved in a blog post, but I can provide a couple pieces of advice.
First, your poorly aligned car doesn’t drive itself to the garage, and neither does corporate-PS charter and strategy alignment just happen by itself. In fact, perfect PS charter and strategy alignment is a rather unnatural act, maybe even non-existent. So, getting closer to full alignment is clearly something that must be deliberately sought. Second, car wheels that have been aligned don’t stay that way indefinitely, and neither will your PS charter or strategy. Because the tech ground is constantly shifting, it’s not good enough to achieve some level of alignment and declare victory once and for all. Instead, it has to be an ongoing process, not a single, heroic event.
If you want to talk to us about your alignment, contact us today, especially if you’re the person that I overheard at TSW. No, it’s not as easy as taking your car to a mechanic, but we can definitely help.
In the meantime, be sure to register for my upcoming webinar I’m hosting tomorrow at 8 AM PST, “The State of Professional Services 2018.” If you’re looking to align your professional services strategy, a great place to start is to know and understand the most recent industry changes and drivers, as well as the likely outlook for the world of professional services in the next 12 months based on current TSIA data. I look forward to sharing my research with you and answering any questions you might have.
About the Author
Bo Di Muccio, Ph.D., is vice president of research, Professional Services, for TSIA. He is also the chairperson of the TSIA Professional Services Advisory Board. Using his nearly 15 years of experience in technology industry research, analysis, and consulting, Di Muccio develops and delivers research and advisory programs that help some of the world's leading technology companies build and optimize their professional services business.
Read more from Bo on these topics:
Professional Services | Tips for a Successful Professional Services Organization | Project Performance