What Are Examples of Professional Service Firms?
It's less of a riddle than a fact of life: If he has only one head, how can he possibly wear multiple hats? Answer: He's a small-business owner, torn between running his business and doing the behind-the-scenes tasks that keep the business humming along. With every task – be it an accounting, a legal or a marketing matter – he switches gears and dons the appropriate hat.
As you may know, this requires some juggling. So, while the answer to another question may elude you, it won't for long: What is a compelling way to reduce the number of hats a small-business owner wears to wearing only one hat? Answer: by outsourcing the necessary tasks to professional services firms, which have perfected the practice of wearing only one hat.
Begin With a Professional Services Definition
This is one business definition that won't leave you scratching your head. Professional services firms literally offer professional services that can span multiple industries, including finance, legal, marketing and virtually every type of consultant you can think of.
As Mind Tools puts it:
- Professional services firms sell knowledge and expertise, while other types of organizations tend to sell tangible products.
This knowledge and expertise can be appealing to small-business owners, who cannot be experts in everything. They may be comfortable dealing with management, sales and marketing matters, but they are not schooled in these disciplines. Nor are they practitioners of them. Similarly, they did not go to law school or pass the certified public accountant exam. Their business specialty represents their area of expertise – not on the ancillary issues that have sprung up around it.
These firms possess something else that many small-business owners consider to be in short supply: time.
Professional Services Firms Have Time on Their Side
Time – or rather, the lack of it – is one of the main reasons that small-business owners turn to professional service firms. Running a business is a job that's full-time plus, leaving little, if any, quality time to address the financial, legal and marketing issues that cross their desk, demanding attention.
Read practically any survey of small-business owners and they often cite a “lack of time,” as one of their top 10 worries or problems. For example, Guidant Financial spoke with more than 2,600 business owners across the country, and they said that managing their time was their third-biggest challenge, behind lack of cash flow and marketing/advertising dilemmas:
- Entrepreneurs struggle with constant interruptions due to emails, phone calls and messages. They also deal with busy meeting schedules, last-minute deadlines and the responsibility to perform multiple job functions. That's why time is such an issue.
If this scenario sounds familiar, wait until you hear the fourth biggest problem cited by the same business owners: performing administrative work, including bookkeeping and payroll:
- Administrative work represents a serious challenge to many small business operations.
You can see where this “perfect storm” can converge: There sits the professional services firm, presumably with an arsenal of talent and expertise, ready to be deployed. And there sits the small-business owner, spending another late night in the office, not knowing which hat to put on next as he moves from one task to another.
Consider How Professional Services Firms Can Help You
So without even doing any soul-searching, outsourcing can provide relief to you and your small business by:
- Putting certain services in the hands of experts. And if you vet the firm carefully, it should produce well on your behalf, too.
- Freeing up time that you need to focus on your core business, not on those ancillary issues you're not an expert on anyway. If you run your business on the principle that people should undertake tasks that play to their strengths, working with a professional services firm should be a natural extension of this principle.
Small-business owners also outsource certain tasks to:
- Relieve their core staff of tasks they may not specialize in, either, freeing them to do what they do best.
- Reduce or at least control costs, especially by lightening payroll and benefits expenses and office overhead bills.
- Achieve a standard of excellence that may have proved elusive.
- Gain access to new markets, thereby gaining an edge over competitors.
Learn From Business Owners’ Favorite Outsourcing Moves
With the exception of marketing and business development, many small-business owners pass off tasks to professional services firms that form the periphery of their business, outsourcing company Accountability says.
- Many daily tasks prove critical to efficient business but aren't areas of the core business.
In addition to accounting/bookkeeping, legal and marketing functions, a list of professional services and tasks includes:
Administrative, which can run the gamut from appointment-setting and returning phone calls to monitoring social media accounts, which can be a huge time drain for small-business owners. A cottage industry has sprung up in the administrative arena, in the form of virtual assistants, who will never need to set foot in your business to make their presence known.
Content marketing, which could be grouped with marketing but has become such a force that it merits a category of its own. As the cornerstone of an inbound marketing strategy, it can drive more customers to your website – if it’s done skillfully by writers with talent.
Customer service, which isn’t getting any easier as customers grow more demanding and expect answers 24/7. As you may have learned from personal experience, many Fortune 500 companies outsource this function. But this is not to say it’s right for your business and the personal touch you may have developed with your customers.
Graphic design, which is usually a sporadic small-business need. But when an artistic need strikes – for a website overhaul, an ad campaign, a new brochure, – it demands the skill of a graphic designer.
Information technology. Some of the more common outsourced tasks include website hosting and maintenance and data collection, storage and backup. ”Using outside vendors or cloud solutions to manage your IT functions makes you more agile as a company and provides flexibility as your business grows,” Big Commerce says.
- Logistics, if you're a retailer who wants to focus on selling and merchandising, whereas a professional services firm handles fulfillment, storage and delivery.
In addition to focusing on tasks that are not directly tied to your core business, Entrepreneur makes a grand point about hiring an outside firm to handle those tasks to point out a weakness of yours or a member of your team.
- If a business' team tends to struggle with particular day-to-day tasks, those might be the tasks to outsource.
In this way, outsourcing can relieve you and your team of feeling frustrated with a task you don't enjoy and on results you're probably not particularly proud of, while allowing you to fortify your business or improve your work-life balance at the same time.
Vet the Professional Services Firms Carefully to Ensure a Good Fit
Compared with deciding whether to outsource, and then which tasks to outsource, you may feel on firmer ground, if you decide to interview a few firm representatives. They won't be employees, and they won't be business partners, but over time, they could become more than adjuncts to your business: you might come to regard them as an invaluable part of your extended team.
Before you sign a contract with a professional services firm:
- Align your goals with their area of expertise and portfolio to ensure a good fit.
- Seek referrals from other small-business owners or your local chamber of commerce.
- Ask for references, and speak with them candidly about their experiences with the firms.
- Be clear about your expectations. Do you expect a firm representative to attend staff meetings? To visit your place of business once a week? Do you want to see regular progress reports? The better you can visualize your notion of a successful collaboration, the better you should be able to articulate it and make it happen.
- Trust your gut instinct and choose someone with whom you believe you can develop a friendly and trusting rapport. A like-minded collaboration should put you at a distinct advantage over one that is “strictly business.” You can let your guard down, too, while also keeping your hat on.
- Mind Tools: Professional Services Organizations: Understanding How They Work
- Guidant Financial: 7 Common Small Business Problems and How to Overcome Them
- Big Commerce: Six Services Every Scaling Small Business Should Outsource
- Entrepreneur: 5 Things Small Businesses Should Outsource
- Entrepreneur: Using Professional Service Providers to Grow Your Business
Mary Wroblewski earned a master's degree with high honors in communications and has worked as a reporter and editor in two Chicago newsrooms. Then she launched her own small business, which specialized in assisting small business owners with “all things marketing” – from drafting a marketing plan and writing website copy to crafting media plans and developing email campaigns. Mary writes extensively about small business issues and especially “all things marketing.”