The reality is that everyone in professional services has the same AI and automation tools available now. And everyone is prioritizing them, us included at Nichols Cauley, to do work more efficiently and systematically.
So the question I keep coming back to is: when the work itself stops being what separates companies, what does?
Technology may turn out to be the great equalizer of professional services companies, or it may just make all of us less distinct, so you've got to find ways to make yourself even more distinct.
From where I sit, that comes down to relationships and capabilities. Not the WHAT we do, but the HOW we do it.
What gets you considered vs. chosen.
Professional services companies and the technicians in them have historically been defined by the things they deliver… the tax returns, the audits, the deliverables… the "stuff" they can do.
But are those the things clients really want? Well, in some cases, maybe. But if that's all they're interested in, it's a commodity relationship, and those types of relationships are being challenged by technology.
Everybody says they can audit better. Or do taxes better. But now that technology does more of the work, nobody wins by claiming they do a better audit or better tax work, because that's table stakes.
Technical excellence isn't going anywhere and it isn't being devalued, since it's the price of entry and what gets you considered. It's just no longer what gets you chosen.
What you can't buy off a shelf.
I don't know how AI is going to deal with the relational side of client service, and I'm not sure anyone does. What I do know is that production can be solved through technology, automation, and better processes.
What we can't buy off a shelf is a professional who knows how to steward a relationship, and if we can build that, we can solve for all the other stuff.
That's why we're doubling down on relationships and the connections we have with our clients.
How curious are we about our clients?
How well do we understand them?
How well do we predict what they need next?
Building relationships isn't just about talking sports or fly fishing, it's about asking, listening, and solving problems for people.
And the thing is, this isn't some job you can post and hire for. There's no relationship tree to pick somebody off of, and nobody comes out of school ready-made to be relational in a client service seat.
Heck, early in my career I sure wasn't…
You've got to look for the person who has that "it," and then you've got to water the flower. Take them into the client meetings, prospect meetings, and the challenging client calls, because this skill set doesn't get developed in a classroom.
So focus on giving young people experiences, letting them screw up so you can teach them, and not doing the work for them. I'm advising all young people in our company to be curious, come alongside the more senior people, look for patterns, and apply what they learn to the next situation.
When technology allows everyone to do the same work in a similar way, relationships become a differentiator.
Capabilities, not services.
At a rudimentary level, people confuse capabilities and services, but in my mind, there's a big distinction.
Services are what you deliver: the audit, the tax return, the insurance policy.
Capabilities are the unique strengths that define how you create value. They include things like your talent, experience, processes, intellectual property, industry knowledge, and ways of working.
They can be technical, operational, or strategic, from deep subject matter expertise to the ability to move quickly, adapt to change, or execute complex transactions. The capability is delivered through the services.
Plenty of companies offer similar services, but capabilities are difficult to replicate. And clients know the difference.
They don't care how a company is organized, or whether the person serving them sits in a separate practice built around their industry. They want to know you've got the industry knowledge and can apply it to their situation.
Clients wake up every day thinking about how to better manage their business, protect what they've built, and grow what's possible, and they want the comfort that somebody's looking after their best interests, as opposed to just delivering a commodity. That's what professionals in professional services are here to provide.
We're seeing it at Nichols Cauley with manage, protect, grow (MPG), which is how we bring the full scope of our capabilities together around what the client is actually trying to get.
One of our senior partners told me he's batting a thousand with new prospects, because every time he's brought our MPG framework to one, he's won.
Well, right there, there's a wonderful endorsement of how operating through capabilities is a winning formula.
You win on the fringes.
Every professional services company is going to have the technology, and most of them will get work out the door faster than they do today.
That will stop being remarkable very quickly, and good enough isn't good enough to really win.
You win on the fringes, in the connections you make, how you put things together, how detailed you are in articulating your strategy, and how consistent you are in the way you do things.
In a world where technology commoditizes the work, relationships and capabilities are where professional services companies will win. That's the bet we're making at Nichols Cauley.
With intention,
Alan Whitman
CEO at Nichols Cauley
ps… when a client picks you over a competitor with the same tools, what do you think actually tipped it? Would enjoy hearing from you, and we can all get better by discussing things with other leaders.