Our Enterprise Value Optimization (“EVO”) program helps technology consulting clients improve relative performance visibility, increase profit margins and reduce business risk. With our extensive experience from evaluating hundreds of consultancies while running acquisition programs, we bring unique insight into key performance indicator benchmarks and best practices of highly profitable firms.
Improved Relative Performance Visibility:
Many consultancy leaders do not have a clear line of sight into their firms’ performance relative to their peer group. We help answer these questions for our clients:
- What are the key performance metrics to track?
- How are those metrics measured?
- How do our metrics compare to those of our peer group?
For example, services gross profit margin is one of the most important metrics in evaluating a consultancy. However, there is significant confusion around how it should be calculated and wide disparity in performance throughout the industry. Our experience evaluating hundreds of consultancies provides unique insight into this and other key performance metrics.
Increased Profit Margins:
By calculating key performance metrics, identifying negative variances to peer group performance and focusing on the operating drivers behind the metrics, we help our clients identify areas of potential improvement to drive higher profit margins.
Reduced Business Risk:
We help clients evaluate their degree of business risk and deploy mitigation strategies. We see wide variance in consulting firm practices in areas such as employee non-compete and intellectual property protection provisions, client revenue concentration, internal client relationship ownership concentration and degree of reliance on partner-driven sales lead flow. Implementing changes to decrease risk in these areas improves business performance sustainability.
Our EVO program typically involves an upfront assessment and recommendations phase to improve business performance followed by quarterly reviews to assess performance against goals, discuss market changes and adjust forward-looking objectives. Successful EVO program clients build better businesses, resulting in higher profitability and lower operating risk while building higher enterprise value should an eventual sale of the company be desired.