Feature

posted 1 Jan 1999 in Volume 1 Issue 5

Practice management solutions are easy. It's identifying the real problems that's difficult!

For some partners the move into a management position, or indeed into the role of managing partner, in a professional service firm, can be an unsettling and frustrating experience. Gone are the old certainties associated with advising clients on professional matters. In come the new challenges of dealing with increased levels of ambiguity, with fewer absolute rules to follow and even fewer cast iron guaranteed solutions to management and business dilemmas. Confronted with such circumstances many partners seek certainty - solutions which will work. As consultants we are regularly asked to 'just tell us what to do' usually associated with 'and by the way we don't need any of that theory stuff - just keep it simple'. By Tom Kennie & If Price.

This paper examines one approach to help partners deal with the transition into the messy world of management - without falling into the trap of seeking simplistic (and often inappropriate) solutions. We introduce a set of 'Practice Management Guidelines' - a series of key questions for Managing Partners. We also introduce the Practice Development Toolkit - an aid to undertaking a health-check of your firm, and PROFSIM - a computer based tool to help simulate a professional firm.

The 'Solutions' Dilemma

Solutions to business and management problems clearly exist. Libraries of books have been written on 'solutions' Guru reputations have been made on the back of 'solutions'. Many consultancies have 'surfed in' on waves of the latest 'fad solutions'.

So what is the problem? Well so often, while the solution worked, at least once - it works only in the particular circumstances in which it was first discovered. Solutions become fads when they take on a life of their own, underpinning waves of consultants and even institutions dedicated to 'spreading the gospel according to ......' . What matters is the word not the result. Such 'magic bullets' solutions have several flaws.

First, they will be (and are) solutions to other people's problems - solutions which (may have) worked in the unique situation perceived by the person later writing about their effectiveness.

Second, 'the solution' is likely to be 'kept simple' and described as a linear set of rational steps to be followed. The trouble is that for every complex business problem there probably is a simple solution - but one which is highly likely to be wrong! Complex business and management problems can rarely be solved by one single set of actions. To be really understood, the problem needs to be viewed in an overall context; including the non-rational political, emotional and 'unwritten rules' of the issue. Only by doing so can the impact of different solutions be considered. This is not to suggest that simplified models of reality cannot be useful in resolving business management problems - they are and can be. But they have limitations - which may be considerable.

Thirdly, and linked to the second point, most solutions are one dimensional - a financial/work planning solution, a performance measurement solution, a new 'strategy' solution etc. Much less recognition is given to the need for a more integrated approach, one which recognises the 'trade-offs', 'dilemmas' and 'deals' which are necessary in the 'real world'.

Fourth, solutions are identified after the event. A degree of post hoc rationalisation will have taken place. The messiness of the original situation will have been forgotten; either inadvertently or to help fit the solution to the reality. A high degree of filtering and over-generalisation will have taken place.

An Alternative Approach

One of the current themes in management literature is the idea of 'best practice'. Identify it, copy it/adapt it and implement it and, so the prevailing view seems to suggest, nirvana will follow! But is the concept of 'best practice' sensible? We have all seen: 'very bad, I don't believe what I have just seen, practice' so 'better or good practice' might also exist - but 'best'?

We both faced this after we succeeded in winning, in conjunction with the Royal Institution of Chartered Surveyors (RICS), a UK Department for Trade and Industry (DTI) 'Skills Challenge' award. The DTI funded a project to identify 'best practice' in the management of small to medium sized professional practices. The work was initially undertaken with 12 Managing Partners of firms of chartered surveyors, although subsequently the outcomes have proved to be transferable across the professional services sector (and more recently into public sector organisations employing professionals). The challenge was to project manage a process which would synthesise 'best practice' and capture this for further dissemination.

The initial approach involved a review of current definitions of 'best practice' in the field. In the process we uncovered several very useful frameworks. These ranged from the UK 'Investors in People' standards, the National Vocational Qualification standards for owner managed businesses and customer service, the European Foundation for Quality Management (EFQM) model of quality, the US Baldridge award framework for business excellence and the International Standards Organisation (ISO) 9000 series of quality management systems. In addition we also identified several frameworks designed more specifically for the professions, including the Institute for Chartered Accountants in England and Wales (ICAEW) Practice Management Aims and the Law Society's Practice Management Standards. All contributed to our thinking - particularly those which approached the issue from a self-assessment 'diagnostic' viewpoint, rather than from a more prescriptive 'do this' standpoint.

Out of this initial work with our collaborating partners we devised our own framework. The aim was not to replicate what had already been produced. Intuitively we all recognised at the time that 'prescription', for all the reasons already mentioned, had its limitations. The alternative focused on identifying the key management challenges faced by the Managing Partners involved. We found ourselves developing, not traditional standards such as 'best practice is' but rather questions such as 'how well do you understand ...?' Questions proved a more effective way of synthesising the knowledge and experience of the group with the relevant material from all those other sources.

The Practice Management Guidelines Framework

The framework we eventually used to synthesise the various strands of thinking is illustrated in Figure 1. The model tries to capture the inter-linking between the various aspects of the process of managing either an entire practice or a business unit within a larger firm.

For each element of the model we worked to identify the most critical questions which the Managing Partners and we jointly felt as practitioners, managers, consultants and academics, were of most relevance. The complete set of questions became a set of guidelines that have subsequently been published by the RICS (Kennie and Price, 1997). Details on how to obtain the full publication are provided in the references.

To illustrate the approach the following text is taken from the section concerned with leadership and culture.

Leadership and Culture

Professional practices employ independent professionals: people who may even be more skilled in certain aspects of the job than those who 'manage' them. To lead such people it is not enough to simply be in charge, or to be 'the final expert' whose job is essentially professional quality control. Managers of professionals may perform both functions but they also have to inspire, or incentivise, or cajole, or ......., these independent professionals to work together to achieve a common purpose. It is, as others have said before, like herding cats.

This guideline has seven elements. First is self-awareness and personal development. The leader who is aware of, and able to make allowance for, his or her own personal attributes is more likely to be able to accomplish the second element, understanding others and building effective relationships. Without such understanding it is unlikely that the leader can provide either a shared sense of purpose, or develop a set of reward systems that lead to the achievement of the overall purpose. Reviewing performance objectively requires clear objectives. Self and peer understanding are also the foundation for understanding the 'informal' myriad of subtle interactions that can govern many aspects of behaviour within the practice. A further characteristic of practice leaders is, we suggest, the ability to develop others and above all to stimulate change; to keep the practice responsive to its changing environment.

Some Critical Questions

4.1.1 How well do you know and develop yourself?

How well do you know your personal aspirations from the practice? What are they?

How well do you understand your preferred style of operating at work? What is it?

How easy do you find it to question your assumptions about people and their actions?

How easy do you find it to question your assumptions about business issues or problems?

What personal targets have you set for your own continued development of self-awareness and interpersonal skills?

When you decide on a course of action, how committed are you to taking personal responsibility for making it happen?

How do you ensure your management actions set the example you would like to be followed?

4.1.2 How clearly do you understand others and the process of building effective business relationships?

How well do you understand the aspirations of others, especially your clients, partners and employees?

Do you fully understand what creates a sense of self-motivation in your fellow partners? What do you think they want to be famous for?

What gets your employees out of bed in the morning and motivates them to work for you?

How do you modify your style of operating and communicating to suit the needs of a particular task or to relate to others?

How easy do you find it to listen to others and explore their point of view when the circumstances dictate?

How easy do you find it to clarify and communicate your own point of view?

How do you assess the level of diversity which is appropriate for the practice?

How do you harness that diversity?

4.1.3 What shared 'sense of direction' do you provide?

What shared sense of direction and common purpose have you established for the partners and the practice?

Over what time-scale does the vision extend?

How much involvement of other partners, or of staff, went into creating that vision?

How do you check the degree to which the vision is shared by others in the practice?

What actions do you take to communicate, maintain and reinforce the 'vision'?

How do you know the practice is 'on track'?

4.1.4 What formal and informal performance review and reward systems exist?

What formal systems exist for assessing people's performance and aspirations?

How do you clarify the specific goals/challenges/objectives for your fellow partners and staff?

What actions and behaviours get rewarded in the practice? Are rewards based solely on seniority or are they related to all aspects of job performance?

Does your reward system reinforce your practice strategy and encourage co-operation as opposed to competition between groups?

How do you deal with under performers and those who 'don't fit'?

4.1.5 Do you understand the 'culture' and 'unwritten' rules of the practice?

How would you characterise the culture of your practice?

Have you considered whether it needs to change? If so, in what ways?

What are the 'unwritten' rules which exist within the practice and which govern behaviour? Do some of these inhibit performance?

If you could write the "Ten Commandments" for the practice, what would they be? How do they compare with reality?

4.1.6 What amount of time and effort do you spend on the development of others?

How do you identify what capabilities and skills you will need in the practice for the future?

How do you establish the needs of individuals for growth and development?

How do you translate these needs into your succession planning processes?

What proportion of your time do you devote to the coaching of your team members?

How do you balance the needs of individual professionals for freedom and challenge with those of direction, constraints and constructive feedback?

4.1.7 How well do you stimulate changes to aspect of the practice's operation?

What mechanisms do you have in place for assessing the need for change. If you need to change how will you make it happen?

How much time do you spend reviewing whether the practice's plans and strategies are still appropriate to its current business environment?

What are your current priorities for improving the practice's business?

How do you encourage the practice, and everyone in it, to continually or periodically question ways of doing things: in essence are they involved in a process, formal or informal, of continuous improvement?

What example do you set when it comes to continual improvement and development?'

A similar set of questions exist for each of the other elements of the Practice Management Guidelines framework.

The Practice Development Toolkit and PROFSIM

The original project, developing the guidelines was completed on schedule in May 1997. Since then we have continued to develop additional tools to help Managing Partners ask the right questions of themselves and their firm.

First came a set of self-assessment questionnaires to enable both a health-check on different aspects of a firm and, where people are ready to be so bold to benchmark their firms' performance against others.

Second was a computer based simulation of a professional practice - PROFSIM. This can be used to help new and experienced partners to understand the impact of different business decisions on the financial performance of their practice.

Information about the Practice Development Toolkit and PROFSIM can be supplied on request (see contact details at end).

Conclusions

We argue that managing a modern professional practice is not about applying imported solutions - solutions which often have their origins in the wider world of corporate business. We suggest that the identification of some of the key questions facing a firm and its individual partners is essential. To help, we have provided a brief outline of three sources of potential assistance. The first a set of Practice Management Guidelines; second, a toolkit for conducting a health-check on the performance of your practice and third, a computer based simulation to help demonstrate the impact of different business decisions on the performance of a firm. Rather than focus on 'best practice' we believe that more attention needs to be given to 'better' practice but more importantly to 'better process' - the means by which any 'better/best' practice can be implemented- but perhaps that is the subject of another paper...

Professor Tom Kennie is a director of Ranmore Consulting Group. He consults extensively to the professional services sector. He is also part-time Professor of Practice Management at Sheffield Hallam University. For further information about the Practice Development Toolkit or PROFSIM contact Tom Kennie at: Ranmore Consulting Group, Ranmore Manor, Ranmore, Surrey RH5 6SX. Tel: 01483 506230 Fax: 01483 283040

Email: tkennie@compuserve.com

Professor If Price is Director of the Facilities Management Graduate Centre (FMGC) at Sheffield Hallam University. FMGC is now the largest integrated centre of research and post-graduate education in this sector in the UK. His book Shifting the Patterns (Management Books 2000) has recently appeared. If Price can be contacted c/o: FMGC, Sheffield Hallam University, Unit 7, Science Park, Sheffield. Tel: 0114 253 4032, Fax: 0114 225 4038;

Email:i.price@shu.ac.uk

References

Kennie TJM and Price I. 1997. Practice Management Guidelines - Key Questions for the Leaders and Managers of Modern Professional Practices, 43pp. Royal Institute of Chartered Surveyors. Copies of the guidelines are available at a cost of £9.50 from RICS Books, Surveyor Court, Westwood Way, Coventry CV4 8JE, Tel: 0171 222 7000 Fax: 0171 334 3851