The Consulting Growth Podcast
Joe O'Mahoney is Professor of Consulting at Cardiff University and a growth & exit advisor to boutique consultancies. Joe researches, teaches, publishes and consults about the consulting industry.
In the CONSULTING GROWTH PODCAST he interviews founders that have successfully grown or sold their firms, acquirers who have bought firms, and a host of growth experts to help you avoid the mistakes, and learn the insights of others who have been there and done that.
Find out more at www.joeomahoney.com
The Consulting Growth Podcast
Mastering Consultancy Growth: Insights from Robert Garner | Episode 1 - Robert Garner & Prof. Joe O'Mahoney
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Robert Garner's journey from KPMG partner to successful consultancy entrepreneur offers a masterclass in professional services growth and value creation. Drawing on his experience founding Avail Consulting (which he successfully sold) and later serving as Group CEO of Tribal Group, Garner shares the strategic frameworks that transformed his businesses from startups to multimillion-pound enterprises.
At the heart of Robert Garner's approach is a disciplined focus on what he calls the "four-by-four matrix" – aligning four specific service offerings with four target markets to create sixteen strategic focal points. This clarity of purpose allowed his team to methodically track progress and avoid the common trap of unfocused expansion. "Too many smaller organisations spend too much time working IN and not enough time working ON," Robert Garner explains, revealing how he and his co-founder limited themselves to 40% utilization to preserve crucial time for business development.
For consultancy owners preparing for eventual sale, Robert Garner offers invaluable insights into what buyers truly value. He emphasizes the importance of developing annuity revenue streams where possible, building robust operational systems well before they're critically needed, and cultivating leadership teams that extend beyond the founder. His operational due diligence work with Garwood Solutions has given him unique visibility into the common pitfalls that diminish consultancy valuations.
Perhaps most reassuringly, Robert Garner challenges the widespread fear that growth inevitably dilutes company culture. His experience demonstrates that with intentional leadership, strong values can be maintained through significant scaling. The real threat to culture isn't size but rather leadership that fails to create appropriate frameworks – or as Garner puts it, "It's okay to take risks; it's not okay to take uncontrolled risks."
Whether you're growing a boutique consultancy or preparing for eventual acquisition, Garner's systematic approach to professional services growth provides a blueprint for building firms that deliver exceptional client value while commanding premium valuations in the market. His insights reveal why some consultancies plateau while others achieve remarkable exits.
Prof. Joe O'Mahoney helps boutique consultancies scale and exit.
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Introduction to Robert Gardner
Speaker 1Welcome to the Consulting Growth Podcast . I'm Professor Gero Armani , ceo of Equity Sherpa . We help owners of consultancies quadruple the equity value of their firms over a two to four year period . If you'd like to know how we do this , visit equitysherpacom .
Speaker 1Okay , so I am here with Robert Gardner , who is a partner and founder of Garwood Solutions , but has also founded and grown a couple of other successful consultancies prior to this and has an interesting background and is probably one of the foremost experts in the growth and merger and acquisition of consultancies . And so we're going to you've got the privilege of your company for the next hour or so , rob . So thank you very much Pleasure for the next hour or so , rob . So thank you very much Pleasure Now , rob . You've been pretty successful in the whole growth area and before we do a deep dive on some of your perhaps recommendations and lessons around growth and mergers and acquisitions , I was wondering if you could give us a bit of background and I realize there's a few companies that you've been through over the years A bit of background about how you got to where you are now , please .
Speaker 2Yeah , of course , joe . Thanks very much . So very brief introduction . So early career in IT consultancy , having graduated with a master's in technology many years ago now Pertinent career , I think , probably for this conversation starts in terms of joining KPMG in the mid-90s and then subsequently becoming a partner around 2000 . And then from there I stayed with KPMG for about four years post becoming a partner , during which time , obviously , kpmg Consulting was sold to Atos already and I found myself as a partner in Atos KPMG . I decided that that Atos already and I found myself as a partner in Atos KPMG , I decided that that wasn't where I was going to spend the rest of my career and , with another consulting partner , left at that point in time .
Speaker 2We created a business called Avail Consulting , which was a startup . So two of us , no client , no staff , but we had been raised a little bit of funding off the back of a business plan that we'd written . So we did have a little bit of money in the bank Roll forward sort of six years we were 80 , 90 staff . We were turning over the low teens of millions . We exited that business , selling it to the tribal group . My business partner left and I went on and joined the tribal group themselves and became managing director of their government division , so not only running my own company that I'd taken into the group , but running five or six other businesses that they'd already acquired within that space .
Speaker 2I stayed with Tribal for a couple of years post-acquisition of my own company . So we're now around 2011 , at which point I stepped out of consulting for two years and actually became a trust chief exec in the NHS and ran two NHS organisations . For people that are listening , that are familiar with them , they were commissioning support organisations that were being set up as part of the Lansley reform at that point in time . I did that for a couple of years and then the phone rang and it was Tribal asking me whether I'd be interested in returning , which I did , and I returned in 2013 , initially as group managing director and then , laterally , as group chief exec , looking after what was by then a international software and services business in the education sector , so very much rooted in the software side of it and in student management systems for schools , colleges and universities . I did that for three or four years and then decided that I was going to actually pursue a kind of more plural life and step down from tribal in 2016 .
Speaker 2And since then really have had a balance of two things so a small portfolio of board positions , mostly in the professional services space , and I chair a couple of small businesses and I also sit on the board of a couple of others . But also in that journey then founded Garwood Solutions , which is an advisor to the advisor's business , as it were . So we focus on professional services as a marketplace and are quite inclusive and provide services and advice around kind of growing operational efficiency and kind of M&A . And we're a small group of individuals in total with associates we number about a dozen , but people with similar backgrounds to myself . Those people are trading off the basis of having led reasonably large organizations and had fairly senior kind of roles within them . And that's really where Garwood sits . And over the last , we formed Garwood in 2018 . And since 2018 , we've worked with about 35 , to 3 million turnover right up to , quite frankly , eye-watering numbers in terms of turnover and staff , but in staff probably anything from kind of 2030 right through to several thousand , in fact , wow .
Speaker 1Okay , and does the excuse my ignorance here . Does the reward scale for you ? Does the reward for you scale proportional to the size of the firm ? Is it as a percentage , or is it a fee , or how does that work ?
Speaker 2So strictly in Garwood . It's dependent on what we're doing . I mean , it's very much what we're doing . So it can be a large organisation and we're doing a small piece of work . It can be a small organisation . Okay , we scale our fees a little bit , but not greatly . Actually , it's very much based around the outcome an organization is trying to achieve and what sort of level of support they want . We'll scale our input accordingly . So , yes , if we're working we're currently working , actually with one of the big four and in that regard then , yes , actually the number of days that are consumed goes up because of the scale of the organization . We would scale days but not be , as it were .
Speaker 1And just a quick couple of questions on Garwood . So do you act on both sides of the equation ? So I know you definitely help consultancies that are looking to grow and sell , but also I presume there's the big four , for example , who would be looking for suitable buy .
Speaker 2Yeah , we work both sides . So we work buy and sell side , so sell side , as you're quite rightly helping organizations to both grow and actually set out their stall in the market and take those organizations to market . We work with buy side organizations , but typically around helping some of them with due diligence where they've identified the target , yep , but actually they're looking for some due diligence support . We don't try and replace the well-established resilience market in finance or anything like that with the other accountants . Actually , what we're looking for , and very much looking at , is around kind of a sort of strategy and operations . I would suggest so you , is this organization you know structured to deliver , perhaps , the growth plan that they've put forward ?
Speaker 2Yeah , most organizations are going to have to put forward a growth plan as part of the mergers and acquisitions deal , or in fact , actually are they capable of doing more than that ? Is this a potential platform that you could then , you know , acquire other organizations involved onto ? So kind of how's this business run , what's its sort of operational capability and actually also a little bit , what's the capability of the leadership team to do those things as well ? So we'll look at that from that point of view . We also work with organizations on my side where we're helping them do sort of excuse me , no , worries at all , we'll just step out for a minute . Joe , we've pwned phone on a . Some organisations picked it up on a speed dialer about three times a day , oh no okay , okay .
Speaker 2I'll just get rid of this so that doesn't happen again , Okay don't worry . Right , I'll try and pick that one up again .
Speaker 2Yeah , so we're want due diligence on the buy side yeah , so we do operational due diligence on the buy side , so working with organizations to seek to understand the kind of largely sort of operational and strategic capability of a target ,
Garwood Solutions and M&A Advisory
Speaker 2and do that for a range of organizations but actually most notably for private equity buyers .
Speaker 2Actually we'll do those sorts of things . And then we also work with a small number of corporate buyers where we might be helping them a little bit more with sort of valuation and deal structure . Again , we're not trying to replace the sort of financial due diligence or the role of , effectively , the financial advisor or the corporate finance advisor , but I think what we bring to it is a range of experience of probably slightly more specific deal structures for professional services . There aren't many kind of corporate finance organizations that specialize in professional services and understand the market quite as well as we do . From that point of view . We tend to then get involved with kind of corporate buyers that are looking at the market but want a little bit of kind of industry specificspecific knowledge around kind of valuation and deal structure . So we tend to do those things .
Speaker 1Okay , great and okay . So that leads me to ask and we've kind of done a deep dive . I want to talk more also about some of your previous experiences . But as we're discussing the buy side , when you are acting as a buyer , on behalf of a buyer and someone , they present this beautiful growth plan and strategy going forward what are your best questions or what common areas of focus where perhaps there might be areas of concern , sort of uncovering areas where you might think well , this sounds great on paper , but in practice and you've mentioned the leadership team and whether they've got the capability what else would you be looking at there ?
Speaker 2We tend to look at a range of things . So , leadership team , absolutely We'll look at the market context . So I want to understand a little bit about the kind of addressable market . So if someone's claiming that we can grow this business from an X to a Y business , but we established that actually Y would make the market leader by some country , mile or something , now hang on a minute , guys , can we have a dollop of realism in this in terms of what you're doing ? So definitely look externally , so we validate it in terms of what's happening in the market , the size of the addressable market , and actually try and establish a little bit of not only the sort of size but also what are the kind of current market drivers and what's happening externally in the market for that business operating , then I think what we're looking for is we're looking internally at the data to start to substantiate the kind of claims . So we want to look backwards , but we also want to look in detail at what's in their near to medium term sort of pipeline . How can they justify the kind of growth curve in terms of what they're proposing ?
Speaker 2What we're really looking for is we're looking for confidence that there's a market that could support that kind of level of growth , confidence that there's a leadership that can execute that kind of growth , and then confidence from , quite frankly , a kind of pipeline sales management point of view , that there , yeah , the capacity , both in terms of what's already in there and also in their kind of sales team , yeah , however they arrange that you appreciate that many professional services firms don't have a sales team as such , but they're sort of sales carder they've then got both the capability and also the kind of headroom to execute on the sorts of things they're looking at . We'll then look , you know , depending on levels of comfort . We'll then look at , you know , perhaps in a little bit more detail at some of the sort of service propositions , whether the value propositions have been tuned to that and actually are aligned . So , yes , a great market opportunity , there's a good leadership team , sales have got headroom and they can deliver , but we don't have the product to take to market . What does that look like ? What's that value proposition piece ? So we'll have a good look around all of that .
Speaker 2Okay , try and just establish whether an organization's kind of growth is reasonable , overambitious In one or two instances , perhaps modest , too modest , okay , it can go all ways . Nice to hear that happen . Sometimes it does , particularly in slightly smaller businesses . If I'm honest , you will find from time to time you will find management teams that don't quite understand the value of what they've got and what can be done with it in the market . And actually our role then is to actually help them to kind of realise , potentially , if we sell side clearly , but help them realize that value If we're buy side , in that situation we come across an organization like that , well then it's to help the buyer understand that there's an awful lot of headroom in this business and it could do quite a lot more .
Speaker 1Okay , that's interesting and you mentioned the sort of product and service side of it you know . Do you have the stuff to sell ? And you know , certainly from my perspective and I presume from yours what I'm seeing in the industry is sort of the pure play management
Evaluating Growth Plans in Acquisitions
Speaker 1consultancies with the traditional leverage model . Don't get me wrong , they're still there , but you're increasingly getting it mixed up a bit with software and other passive income services and there's also a big push in the market , even when you're doing quite traditional consultancy , to productize things quite heavily , even if it is based on people rather than technology . Is that something that you encourage with firms and , if so , does it cause any challenges for firms ? So let's imagine a typical leveraged consultancy based around people selling day rates and they're coming up to sale and they suddenly think , right , we need to productize some of this and perhaps get some software in . Is that something that you generally encourage and , as I say , does it raise any issues ?
Speaker 2Lots of questions in there , Joe .
Speaker 2Yeah sorry , no , no , no , let me try and pick them up one at a time . So the advantage of the blended business model it typically is that you're getting some form of annuity revenue stream , whatever that happens to be , and you've got confidence over that recurring revenue stream , which , in a sales situation , is fantastic because it gives a buyer confidence that there's a base level of revenue that's committed out over a longer period of time . That's going to help with evaluation and all of those kind of things . So that's good . Trying to create something that's not there , a little bit more difficult and actually a little bit artificial , and it doesn't always have to be technological . So my view is look , actually , if there is something here that naturally lends itself to creating a productized but an annuity revenue more than product , yes , let's do it , because actually that's going to help . I think the product point of view is about . From my point of view , it's about kind of cost of sale , clarity of vision actually , and I'm , I suppose , naturally inclined to say I quite like framework , the way things work . So actually it's not necessarily a strict methodology from a to z , but actually we have a framework here that we're taking to market , that sits behind our product , we can articulate that framework , we can give a client confidence that we , a have done it before , b we've got all of the kind of tools that we require to do it , and actually , what we're not doing is kind of completely bespoking a solution there and then for the client , what you do need to do in those circumstances and a solution there , and then for the client , what you do need to do in those circumstances and why I like the word framework as opposed to methodology is you need to demonstrate that you can apply that framework , you can synthesize it , to their situation and their circumstance , and that , for me , is something that I do think adds value . The organizations that I see , though , that are doing very well in the current climate , have got a pretty strong focus , though , and I think you've got three separate things here . You've got something which is about annuity revenue , you've got something which is about product frameworks , and you've got something which is about focus , and I think the organizations that I see that succeed well are those organizations that are pretty strongly focused and understand , really , their strengths and weaknesses .
Speaker 2The day of the kind of jack-of-all-trades management consultant , I would like to think , is behind this . I'm sure it does still exist , but that's not where I would take an organization . So I would take an organization almost in reverse order in those things . So I would take an organization . So I would take an organization almost in reverse order and those things . So I would take an organization through a very clearly defined process about focusing the organization in terms of its I hate the usp or whatever , but it's a terrible phrase but but focusing down on those things where they have , you know , real value add for a client and they can articulate what that value add provides . So let's get some focus . Behind that focus , let's get some clear frameworks for how we do things . And if some of those things we can then drive into annuity structures and we can sell on a recurring revenue basis , all the better kind of thing .
Speaker 1Okay , brilliant , thank you . And I guess this is a related but more general question , and I realize many companies will come to you at an early stage looking to sell , perhaps in a couple of years time , what other than the leadership team , which I realize is a common challenge . But there's not much you can do about it if you are that person other than you know . Maybe a bit of training , go on , you were going to say something then .
Speaker 2Yeah , no . Well , I think really the leadership team is something we will look at in that circumstance . I can think of a situation with a client we've worked with relatively recently where actually part of the recommendation was helping them to build out their leadership team , Because actually often what happens is too much of it sits on the shoulders of the founder . In that situation Any buyer knows that that founder is selling a reason and normally that reason has things like I want to have other life choices and do other things over time , and perhaps even retirement comes into the phraseology and all of those sorts of things . So actually what we've done is we'll work with organizations to make sure that they've got a leadership team in place .
Speaker 2That's about post-deal , not just pre-deal , and therefore any buyer can see that actually they're buying into a strong and capable leadership team to take the organization forward and you don't get that kind of horrible situation which we've all probably seen in the past , where an organization's acquired the leadership team effectively , start to depart from almost day one , or certainly day one post-urnout , and actually there isn't a long-term and mature leadership team that can take the organization forward . So I do think there is things you can do with the leadership team . I take your point and I think where you were heading , which is if you're representing your founder , there's not a lot you can do about the founder . You have to work with the founder , but actually you can very , very successfully work around the founder . You have to work with the founder , but actually you can very , very successfully
Product Frameworks and Revenue Models
Speaker 2work around the founder in terms of putting those complementary and perhaps slightly longer term kind of positions in place that's a really good point , thank you .
Speaker 1Aside from the leadership , what are the most common challenges that you see that smaller organizations face in getting to the point where they are presentable ?
Speaker 2So I think that into a couple of different categories . So one category tends to be kind of maturity , of sort of back office operations , and we often end up doing a lot of work with organizations around that . So helping them with a process , a bit of systems , small organizations that are on a growth curve with a mute to an exit , probably up to that point that we've got engaged , everybody knows everybody , pretty much everybody knows what everybody's doing . The founder , owner , leader of that organization probably has got quite a lot of the funnel and pipeline in their head . They've got a finance team or person that's helping them once a month with a hopefully a set of management accounts , but maybe not even once a month I mean we've seen once a quarter , you know . But actually what we'll come in and do is help mature that , both to help them secure the growth but actually also to help them secure the confidence of a buyer downstream , and that's a really well-run organization . They're downstream and that's a really well-run organization . They're on top of their numbers , they know exactly where they are . And so we'll help organizations , as I said , with a bit of process around it and we'll help organizations with the systems that can drive the kind of mi around it and help them with a specification of some of that mi .
Speaker 2Get up to a certain size and we'll talk about inflection points . You know up to 10 people . You probably carry most of it in your hand . You know 10 to 20 people . You need to formalize a bit . You know 20 to 50 . You need to formalize a bit more 50 plus . It's about making sure you're always ahead of that curve , not chasing that curve . Yeah , if we think that in the next six months we we're going to reach 50 staff and we're going to need to formalize things , let's do them now and then when we get to 50 staff , we're kind of growing into it , not something we've reached a critical . We need to very quickly change things . So operations is a key point in that .
Speaker 1It strikes me these days especially that professional service automation in fact we had a conversation about this not so long ago professional service automation software is now so cheap and very often is charged by the head . There's very little to be lost in getting involved with some of that quite early on .
Speaker 2No , certainly I wouldn't say a whole PSN , but there are certainly kind of point solutions for aspects of what a PSA can do . You're talking about , you know , $5 a head , you know which for me personally it's a kind of no-brainer at that level and get some of those basic building blocks in place . You're probably talking about an integrated PSA . You're probably more into the sort of $20 a month or something like that for an entry-level PSA per head . But actually you know that itself can pay huge dividends .
Speaker 2When I was founded and growing my own business , PSAs weren't around . I'd have loved one , quite frankly , but we built the kind of point solutions for the three key elements that I think you get in a PSA , so your funnel and the pipeline management , your opportunity management , your resource management and then actually your kind of project financial management and separating project financials from financials . And we built point solutions for all of those . And the idea that a PSA subsequently came along and wrapped them all into one integrated solution was fabulous and I'd have loved to have had it at the time . It would have been fantastic , it would have saved you a lot of work , it would have saved us an awful lot of work and , quite frankly , given us a lot better solution as well .
Speaker 1It would have saved us a huge amount of work . Yeah , why interrupted ? You said number one , you said sort of back office numbers and visibility .
Speaker 2Leadership , absolutely Back office , absolutely Kind of operational management , and then I think you go into kind of two areas so I think one of which is around sales . So what is your sales management approach ? What is your sales process ? What is your everything from ? Yeah , how do you market this organization ? What routes do you secure new opportunities through right through to well , who's doing it and what's their focus and how are they remunerated , and all of those sorts of things .
Speaker 2So we'll look at that side of it . And then , on delivery , what we tend to look at and what I tend to look at there , I've never been to tell another consultant how to kind of deliver . That's not my job . In that case , they know their kind of products , their delivery model , far better than I would ever know it . But what I can help them with is the sort of what I think of as being the sort of quality assurance around it .
Speaker 2You know , how do you maintain and build quality in what you're doing , how do you not have the buy-in shocks , as it were ? And so , therefore , I'll talk about what I would think about as being what I would refer to as a sort of delivery assurance framework . So how do you get you know for smaller projects , how do you get people to do kind of peer reviews of their project , whether that of the whole project , of the risk structure for it , whatever happens to be ? And then , actually , how do you get from peer review to kind of concept of a kind of manager review right through to actually , if it's a very big project and really important , we'll bring in someone externally to review the delivery and help us to kind of manage the quality . And I think that's all the quality assurance framework around consulting delivery and some organizations incredibly well established actually , in smaller organizations less so .
Speaker 1OK , thank you , that's brilliant . One of the questions I wanted to ask you about your previous life was that you've been Garwood aside you've been very successful and you've been partnering to all different organisations and you know , with the work with the tribal . Now , talking to you , you have and talking to you in the past , you've got a very . I like the way you logically break down problems . Just in this conversation , two or three times you said well , let me break down a bit , let's be clear on what we're talking about here , and I can see that that's a quite . It's something I try and encourage in my students , which is ironic because I'm not very good at it myself .
Speaker 1My as my wife tells me as my wife tells me , often my head's a mess and I need to be clear . And aside from that , what's enabled you ? And you know a lot of people say , well , well , luck played a part in being in the right place at the right time . Aside from all of that , what personal skills have allowed
Common Challenges for Growing Consultancies
Speaker 1you to achieve the success that you have in your career ?
Speaker 2Well , great question , probably one reflection . I think I'm going to break that down , but I'll break it down in time sequence . So the first time my career really started to change when I joined kpmg in , as I said , in the mid 90s , became a partner in 2000 and my partner case was based around the growth of a new market for kpmg . So I've gone in with to kpmg with some background and some prior experience in working around the sort of criminal justice sector as a marketplace and brought that with me specifically actually within criminal justice , policing actually very specific , no , no , very specific , very , very specific , and I've done quite a lot of work within the sector within kpmg . I got the space to expand that . So we went from policing to criminal justice . We went from criminal justice to a broader definition which then started to include things like national security , biological sequence of how you get from one to the other . They're all partners in the true sense of the word in terms of partners .
Speaker 2But actually I started there and worked with a broader base of organizations and what I had to say and what KPMG as a firm at the time had to offer kind of resonated with those clients and my partner case was growing . What was a sector in KPMG from something that was measured in the hundreds of thousands to something that was measured in the millions . And I didn't do that on my own , I wouldn't claim that responsibility , but I certainly led a lot of it and I set out quite a lot of the sort of framework for what that was going to be and how we were going to execute it . So that was my first kind of experience of growth and I think that's where I really started to learn about sales and sales management . I'd come from a small consulting organization where I didn't really have that responsibility . I was very much a delivery consultant , but actually rivaling the big four . I kind of started to understand my responsibilities were much broader and how I was going to do that , and I suppose I had some personal interests and skills that led me much more towards the sort of sales side of it than , say , the delivery leadership side of it . I was never going to be the best program manager in kpmg . That wasn't going to happen . They were far , far better able colleagues than myself . I think what I'm saying in all of that in terms of sort of personal attribute is actually a kind of really starting to work out in that kpmg and understand actually what I was good at and what I wasn't good at and actually start a little bit of kind of almost emotional intelligence in terms of you know just really , you know personally , analyzing , you know what I was good at , what I got personal kind of reward out of . You know actually , therefore , how I wanted to kind of start to steer my career and I definitely want to start to steer my career much more into sales is not the right word because I wouldn't ever describe myself as a salesman and I don't think any of my colleagues would either but actually , in terms of that kind of client management piece , take an organization from being a single engagement to having potentially multiple engagements over a longer period of time and how you kind of create an account that did really interest me and that was something I really learned and crafted at KPMG . When I then left KPMG , sort of via Atos , but set up my own business with , as I said , one other ex-KPMG partner , it brought all of that learning into that business so early on . That's something I said half an hour or so ago in this conversation .
Speaker 2First off , really strong focus around what we were going to do , so setting out clarity around our value propositions and our accounts . So we defined , literally in the first few months of having the business , very little work . We were doing a couple of pieces of work . We've still not recruited anybody , but we had secured our first couple of pieces of work . Ironically , I sold a piece which my business partner went and delivered and he sold a piece that I went and delivered . It worked perfectly , kind of thing .
Speaker 2But we hadn't really done much more than that by way of , I suppose , market delivery . But we hadn't really done much more than that by way of , I suppose , market delivery . What we did was we set out a framework of a four-by-four matrix which said these are the four services , these are our four value propositions and these are the four markets that we want to work in . Here's our four-by-four matrix , here are our 16 problems . Our challenge over the next 10 years is to turn every one of those green Green in terms of sales , revenue , staff utilization , all of those sorts of things . And , of course , year one . Hardly any of them are green . They were nearly all red . But actually , year on year , really , our business model was about how did we turn that matrix from red to green ?
Speaker 1And I presume there was coherence , logical coherence , between the different boxes . There was Exactly that .
Speaker 2So we set out a business that had four solution areas . We had a strategy in business planning , a supply chain optimization , a performance improvement and an IT advisory , and we set out four markets home affairs , foreign affairs and education . So we were absolutely deeply in the public sector and we were very clear about what we were taking to the public sector , and it was then about which of these gained most traction early on and how could we build out from those initial gains .
Speaker 1Yeah , and that logical , structured way of thinking and planning which you bring to your clients now as well as your own business . I'm guessing that's carried through to Garwood .
Speaker 2It has . Yes , interestingly , we had a Garwood partners meeting only a week ago and we've always had a good clarity around our service propositions . So we will talk internally about having
Leadership Skills and Strategic Focus
Speaker 2five or six service lines , but we'll really talk to clients about having three kind of solutions . It's about growth , it's about operational improvement and it's about mergers and acquisitions . There are kind of solutions We'll talk about if you want to accelerate growth , improve operational efficiency , realize value . They're the things we're interested in talking about Behind the scenes . There are a few other things that we can do , but they're all in support of those three things .
Speaker 2Yep , what we've only ever done today is to say we work in professional services . But actually professional services is a very broad market in its own right and what we're just starting the process of doing , literally through the kind of next quarter , is being a little bit more definitive about what do we mean by professional services and actually where are strengths within it and therefore , where can we quite frankly offer better value ? And I think that's both in terms of subsectors to professional services . So , yes , of course , management consulting , but do you class ? And I I would . But do you class , kind of you know , the tech side in there ? Yes , absolutely , where do we get to with kind of I don't know lawyers and accountants ? Where do we get to ? And keep going , because there are looking hundreds of them .
Speaker 2Yes but we need to understand where we play really strongly and you know where we've got good track record . So we're starting to build out that kind of framework for ourselves in gar , where we've got good track record . So we're starting to build out that kind of framework for ourselves in Garwood . To date and we've only been training for three years but to date we've focused very much on the value proposition side of it , the solution definition side of it . Now we're starting to think a little bit more about the market definition side of it .
Speaker 1Yeah , okay , that makes sense . It's interesting that you managed to combine the entrepreneurial skills with also the skills that you need with a larger organization , and your CV shows that . But it's something I see quite a lot with my clients and my clients are obviously further down the you know . They're a lot smaller than yours , but very often you have the entrepreneur Now being , you know might be . Take yourself , for example . You know they've got this proposition around . You know consulting firm growth , professional service , firm growth . But then it would be quite easy and tempting to start thinking well , you know the recruitment side of it . You know executive team recruitment we could do a bit of that . And you know internationalization we could do a bit of that . And how do you decide what not to do ? I kind of get what you decide . It's difficult because you're talking about known unknowns . You don't know how big the market is for these things .
Speaker 2No , you don't . And whilst I portray that sort of journey at Avail of being very much focused around that kind of four by four matrix and actually it was pretty constant throughout the whole five , six years of the growth of that business , there were times , and every year we would certainly look at the market side of it and say , yeah , actually , are one or two of these markets reaching kind of maturity ? Can we do more in them ? Do we need to therefore supplement them and bring a new market ? And I remember spending quite a lot of time and , quite frankly , quite a lot of money working out whether we were going to kind of enter defense or not and then concluding that we weren't In fact , actually that was the right thing for us to do . So we did look at that .
Speaker 2Markets can be a little bit cyclical from that point of view in terms of the level of work that's available within them , particularly in that instance where you're being pretty narrow . So that tends to be the part that certainly I would think of . You know on our annual basis . Certainly you know the value proposition piece . I think that's something that's probably on more like a five-year cycle or something like that .
Speaker 2Yes , it's constant , but actually you look at your refresh over a much longer cycle than perhaps you look at your client refresh over . There's different timescales , but you've got to look at them . But the focus down on them is the part that you know , I find really key in terms of actually , you know , driving us forward and using that framework to set the metrics for the business . So , if I use avail again as the example , you know we set all of our targets in that 16 buckle , those 16 boxes , that four by four . So revenue targets , we set sales targets , we set utilization targets , we defined effectively almost the kind of solution market strategy for every solution , market intercept , and that's how we got the focus and that's how we drove the business .
Speaker 1It's a fair bit of work , isn't it ? I mean , it's something that certainly smaller firms struggle with . You know this better than anyone , in that you know you're desperate to get the money through the door , and that also means selling and delivering , and then you've got the business absolutely , but I think , one or two organizations .
Speaker 2So I have an expression and it's not my expression , sorry there is an expression which is about you know , are you working on or are you working in ? And actually you know for good reasons that I understand , but actually too many smaller organizations spend too much time working in and not enough time working on . Yeah , sure , yeah , and you have to find the time to work on the business and I think you know that's something that we did . Well . If I'm honest , in terms of my kind of setting my fire example , in terms of Avail Martin and I were the two founders After the first six months , you know we were setting our utilization targets in reverse , you know , as in . You know we shall not exceed yeah , okay , yeah , because it's about preserving the time to work on the business here . Because it's about preserving the time to work on the business , and if you're not working on the business , then actually is it doesn't matter how good your delivery is and doesn't matter how good your sales are . Actually you're spending all of your time delivering , then you're not going to grow the business . You have to create the time and you have to create the capacity for others to grow . In that circumstance , you , I think , user-avail .
Speaker 2Again , we did literally set maximum utilization targets . So our maximum utilization targets were basically 40% . As the two founders , we will never exceed 40% in the market and that was clear . We need to preserve the time for us to run the business . Aside from that , we recruited well and I think that's a challenge that many organizations struggle with and I think when I say recruited well , I mean recruited future leaders . Store . Our responsibility is creating space for them to lead the business , not for us to lead it . Myself and my business partner , you know , avail always as a company , came first , but for smaller organizations , uh , failed to get past one or two of the early inflection points because the organization is too much about the leaders and not about the organization in its own right yes , definitely , it's something I see a lot , certainly at my end of the market .
Speaker 1Yeah , and sometimes you know you get a very strong leader who doesn't want any competition .
Speaker 2We absolutely see them as well and I would absolutely agree , and you can see that those organizations where that founder leader for reasons that are perfectly valid . I'm not criticizing them , but , yeah , they do want the business to be about them . It is a platform for them as much as , yes , you see them oscillate often between sort of the numbers will be specific to the organization , but I don't know , I can think of organizations that oscillate in size between sort of 15 and 25 staff and they never get above 25 staff and that's actually partly
Working ON vs. IN Your Business
Speaker 2almost . The founder's preference is yeah , I don't want to get past 25 staff and it sounds slightly perverse , but that's a perfectly valid way of running it and perfectly valid business model , if that's what you want to do .
Speaker 1That's not what I ever want . Yeah , yes , I think the trouble is is when it's not what you want to do , but you can't overcome that thing in your head . I've worked with a couple of companies that get to a certain size and think , actually , we want to keep it small and that's great . What's really tricky is when you find a founder who wants to grow to 100 , 200 , but they don't want to delegate and they want to tell people what to do .
Speaker 2Right , there aren't the hours in the day to do that . When you start to get to that time and you can't develop a framework to manage that , I go back to my pre-partner days in KPMG . So we're now talking late 90s , and the partner that I then worked for in one of my performance reviews said it's okay to take risks . It's not okay to take uncontrolled risks . Your responsibility as a leader is to put the control mechanism in place . I like that . That's sensible . It stuck with me and that's been part of my philosophy , which is , you know , we don't let people run loose , as it were . That's irresponsible . But actually what you have got to do is you've got to give people room and then you've got to create the frameworks that help them to succeed in that room . And some of that is about the control mechanisms that you put in place . And you know , you know control basically for everything from . We're going to have a half an hour a day , you know where . We'll just chat through what's happening to . I need to spend an hour with you once a fortnight or whatever . You know , it doesn't , doesn't really matter . But the point is that you've got visibility of the data , you've got sight of the client , but actually you're giving people space to execute it Brilliant .
Speaker 2Certainly a common challenge , I agree , and I do think that there are people that want to grow beyond a certain size , and one of the interesting conversations I have with people is that we'll destroy our culture and values . Our culture and values are very special , and I would fully support that . I'm knocking that conceptually . What I do often knock , though , is , if we get above pick a number 10 , 20 , 30 , 40 , 50 , whatever the number is it'll all change , and my experience is no , it doesn't all change .
Speaker 2My experience is you can manage a strong culture and a strong set of values and grow an organization not aggressively , but certainly you can grow it . What's the word I'm looking for ? You can grow it strongly , you can grow it . You don't have to be shy in that respect , and you know those things don't ? They're not in conflict with each other . I think so often people , when they're looking at growth , particularly from smaller business structures , think that conflict , or think that , basically , growth and kind of culture are almost going to go in opposite directions , and if I feed on one , I'll destroy the other , and actually I don't believe that , and not only do I not believe it , I've never done it .
Speaker 1Once you float , it seems to me to make a difference because of the amount of reporting and the ownership structures and things . That seems to be a major inflection point when it comes to culture sometimes .
Speaker 2I wouldn't disagree with you at all . I think I would just characterize it slightly differently . I think it's when you take external investment yeah , sure , it doesn't have to be afloat , it's at any point in that growth . If you've got a third party , that's now in this kind of journey . You've got your founders , you've got the kind of family culture , whatever it is , that's making it special , you've got more staff , as it were . If you now add effectively an investor that can change things , I agree with that and that itself needs kind of executing , navigating quite carefully . But I think , yes , your point I would agree with , but characterized slightly differently yeah sure , brilliant , bob .
Speaker 1Listen , I have taken up a lot of your time this morning and so your insights are are really appreciated and you're an inspiration , not just for you know , some of my clients in terms of consultancy , but also in terms of my students who want to . You know my students at the university who want to go on and you know maybe they don't want to start up themselves . They want to go into KPMG or whatever .
Speaker 2Well , I would genuinely say I have enjoyed equally my time in kind of KPMG as an example of the big four , starting and then growing my own company and then subsequently running a listed company . They've all had different challenges , but they've all had different challenges but they've all had , you know , huge enjoyment factors to them , you know and personal reward . I think probably this sort of satisfaction about the kind of reasonably rapid growth of your own organization is hard , but nevertheless the other two have been immensely enjoyable it's a bit like children , isn't it ?
Speaker 1you've got this satisfaction in seeing them get bigger , but you just worry a little bit more because it's further to fall . Well , yes , there is a bit of that .
Speaker 2Bob , thank you very much . Real pleasure , good to talk to you , joe .
