We’ve helped several overseas firms establish their US presence and build their project-based and full-time consulting teams. Reflecting on the elements that are common across the most successful market entries, we propose a framework for geographic expansion:
the 3Ps of Consulting Market Entry.
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The consulting market in the US is a tempting target due to its sheer size, estimated at around $95b or 38% of the global consulting market. Anecdotally, we’ve seen strong growth in the US from consulting firms based in the UK, Europe, and Asia. Those firms are penetrating the market with fresh ideas and a different route to market. Consulting firm Partners leverage senior-level relationships at global clients based in their home markets to establish an initial portfolio of project work in the US. It’s an effective path towards establishing a global consulting presence.
The US consulting market is as tempting to an international consulting firm as a flame is to a moth – so bright and attractive! But it can burn you if you aren’t careful.
Many firms have found that their biggest constraint to growth is not the ability to sell work in the US, but the ability to deliver on sold work. The reasons are many:
The personal network you’ve accrued in your local market can look surprisingly thin in the US, particularly when specific skillsets are required.
Visa issues can constrain the ability to use foreign consultants to deliver work in the US (without a proper Visa, you may be able to sell work in the US but not deliver on it).
And even if visa issues can be circumvented when sending consultants into the US from overseas, clients may not receive a 100% foreign team very well from a cultural perspective…even if they are reluctantly willing to swallow the travel budget.
Partners making a big client pitch without a capable team on the bench can confront a term we’ve coined Fear of Selling Work (FOSW), which can consciously or subconsciously impact your ability to close major deals. FOSW is heightened as project delivery risk increases. We’ve developed a framework below for how to counter FOSW while enhancing your US consulting brand.
The 3 Ps of consulting market entry: Prototyping, Positioning, and Partnerships
Particularly as consulting firms start to get client traction, it can be too easy to power through in execution-mode without taking a step back to think through how to strategically grow a US presence.
As you embark on US market expansion, consider three strategic principles that should be applied to US market entry in general and talent acquisition in particular: 1) Prototyping, 2) Positioning, and 3) Partnerships.
Prototyping. Apply design think fundamentals to your market entry strategy.
As tempting as a “go big or go home” approach can be when business development traction starts to pick up, it can be fraught with risk. A walk-before-you-run approach can not only help mitigate near-term financial risk, but it can also establish firmer footing for longer-term market positioning. Some firms are intent on running out of the gate. We love running! But if you’re going to start off running, at least be nimble in your approach.
Consulting firms that take an agile approach to growth initially overweight their teams with independent contractors (“1099s” as they are often called in the States, based on IRS classification). In the earliest stages of market entry, you are still trying to determine which messages resonate with clients and which skillsets are required to advise clients on those issues. Independent consultants help a firm align revenues and costs. While 1099s can cut into project margins with higher variable costs, your firm-wide P&L will likely be in better shape over the long-run with fewer full-time consultants on the beach. This approach also allows you to bring in resources with precisely the industry or functional skillset required for an engagement (see our post, Accelerating Your Shift Towards Adjacent Practice Areas.)
Independent consultants can also be used to establish cultural fit requirement for your US team. Is it more important to have resources whose sensibilities match those of the existing international consulting team or those of the US-based client? In some cultures, consultants are expected to gently guide clients towards a new way of thinking; in others, clients pay consultants for direct, blunt feedback. As one Boston-based client of ours says, “If your baby is ugly, we’ll tell you.” It will be an iterative process to determine how US clients prefer to receive messages, and how your talent strategy should reflect those cultural considerations.
As you develop client traction over time, it makes sense to shift the balance of consultants you deploy away from 1099s and towards full-time W2 employees. With experience, you not only will have more confidence in your ability to keep those W2 resources fully-utilized, but you’ll also have more confidence in precisely what types of resources (seniority, skillset) will be foundational to the success of the US firm.
Positioning. Best-in-class firms use talent acquisition as an opportunity for brand building
By the time you’re ready to start making full-time hires in the US, you have a brand-building opportunity on which 9 out of 10 firms fail to capitalize.
Even within a firm’s market of origin, boutique consulting firms struggle with brand awareness relative to the biggest players. This can make a pull strategy challenging when working to attract both clients and talent. As such, it will likely require active messaging to the consulting talent market in the US to attract A-team resources that are inspired by the work in which your firm engages.
Most third-party recruiters will conduct 1:1 outreach to candidates that meet the checklist criteria, but are incented to withhold your firm name altogether until later in the process (more in the Partnership section).
We suggest a 180-degree re-framing of your talent acquisition strategy. Yes, the checklist of requirements remains critical to talent acquisition execution. But the time and financial investment you make in talent acquisition could and should positively impact your business development activities concurrently.
You are growing. You are hiring. You are getting palpable client traction. This is the message that should be getting out to the consulting community with your brand front and center. Your recruiting partners should not be masking your name in candidate outreach, but rather pulling out the proverbial bullhorn to drive brand awareness of your consulting firm.
Talent Acquisition partners must act less like recruiters and more like best-in-class marketing agencies.
A talent acquisition approach should not be constrained to masked 1:1 outreach to people with the right keywords on LinkedIn. A smarter strategy employs all the best practices of inbound marketing and inside sales to candidate acquisition.
First, it leads with the thought leadership and content that inspires your consulting firm’s work. This ensures that you aren’t just identifying those that check the right boxes, but those with whom your consulting thought leadership resonates. These individuals are much more likely to have longer-term stickiness with the firm because they believe in your mission.
Second, a modern candidate engagement approach should employ best practices of marketers that target buyers of any other product or service. Messaging should be driven by buyer personas – current pain points, perceived aspirations, etc. You must earn the right to propose solutions (a role at your firm) to your buyer (a candidate) by proving first that you understand their needs and motivations.
Finally, messaging should be 1:many rather than 1:1. By working with partners that are tightly connected to the consulting community, your messages will reverberate across the relevant consulting community. At Talent Response, we have successfully rolled out multiple tools – both proprietary and those common to a modern marketer’s toolkit – to drive candidate engagement.
Together these approaches should not only allow for a more engaged set of qualified candidates, but also buzz in the consulting community about the content of the firm’s work and the proof that content is getting serious traction with clients (“we’re hiring!”). We’ve seen this approach lead not just to a bigger funnel of qualified candidates but also generate leads for relevant projects in your niche. In many cases, lead sources are other consultants that know of client challenges their firm isn’t positioned to address on its own. When you message is getting out there, there are more chances for those opportunistic connections.
Partnerships. A partnership strategy can help establish your presence and reduce risk.
As with any market entry you might advise your clients on, a partnership or joint venture is one arrow in the quiver to reduce risk and accelerate market penetration. As we mentioned in the Positioning section, boutique consulting firms tend to struggle with brand awareness. That struggle is even more apparent when entering new markets.
You are already taking on a high-risk market entry. Project delivery risk – either of having enough resources or, more likely, having the right resources to deliver in a brand-consistent way – can compound the overall market entry risk. It makes sense to engage partners that can help you mitigate that risk.
Our clients turn to us to help them understand the consulting market beyond their areas of expertise. How do independent consulting rates and salaries tend to differ by US city? By seniority level? By area of expertise? How realistic is it to staff an entire consulting team after I’ve sold a major project? After how many hires will a 1:1 candidate outreach strategy typically fall short? How do I balance the need for full-time hires dedicated to the firm mission with the desire to keep full-time utilization rates high?
At Talent Response, we are collaborative teammates that iterate and prototype alongside consulting firm Partners to identify the right approach to grow your firm – from a business development and a human capital perspective. We welcome the opportunity to discuss a different approach to consulting talent acquisition with firms looking to penetrate the US consulting market. Contact us anytime to tell us more about your goals and learn more about our approach to scalable talent acquisition for boutique consulting firms.
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