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Exhibit 9.3
L5
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LEVEL
214
Organization Structure
215
• Consultants, senior consultants (entry level to between one and four years postadvanced degree)
• Associates, senior associates (four to seven years postadvanced degree)
• Principals (7 to 12 years)
• Partners, senior partners, and managing partners with ownership stakes (greater than 12 years)
Some models also have a nonpartner track and provide long-term career options for individuals with specialized knowledge or training.
Because only a select few progress to partnership, hiring and promotion model plans for natural attrition. If the workf low demand varies or changes occur in the business environment, lateral hiring is used to replace associates lost to attrition, or “up or out” policies are increased to diminish supply.
Under this career progression model, formal and informal training and mentoring on every level are perceived as “investment” in the assets of the firm and are expected to be core competencies of senior level staff.
In professional services firms, the management of complex interactions among client staff and support staff is critical to ensuring overall quality of work. Because under this model partners are the leaders and leading administrators of the firm, the ability to manage these complex interactions well is another core competency expected of senior client staff.
Summary
A firm’s reputation and success depend exclusively on the talent and intelligence of the people delivering it. The optimal organization model for professional services firms is the one that allows the firm to best leverage its resources and intellectual capital for optimal competitiveness. Regardless of which model the firm chooses, it must allow people the freedom to operate effectively while supplying needed structure as well as checks and balances to keep the firm on track. It must incorporate transparency throughout the organization, clearly define roles and responsibilities, and make knowledge sharing a part of the corporate fabric.
RESOURCES
FIDIC (International Federation of Consulting Engineers): The Professional Services Firm: A Training Manual and Guide to Practice—see http://www1.fidic.org
/resources/capacity/wb_f lier_final.pdf for details on this publication.
Maister, David H., Managing the Professional Services Firm (New York: Free Press, January 1993).
Maister, David H., True Professionalism (New York: Free Press, January 1997).
216
Attracting and Retaining the Best Professionals
NOTE
1. Philip Crosby, Philip Crosby’s Ref lections on Quality: 295 Inspirations from the World’s Foremost Quality Guru (New York: McGraw-Hill, 1995).
2. Harold R. McAlindon and Michael Michalko, The Little Book of Big Ideas: Inspiration, Encouragement & Tips to Stimulate Creativity and Improve Your Life (Nashville, TN: Cumberland House Publishing, 1999).
3. Kennedy Information, Inc., Benchmarks in Management Consulting: Operational Metrics for Sound Firm Management (Peterborough, NH: Kennedy Information, 2002).
10
Career Tracks,
Compensation, and
Professional Development
JOHN BASCHAB AND JON PIOT
I haven’t the strength of mind not to need a career.
—Ruth Benedict (1887–1948), U.S. anthropologist1
Show me the money!
—Cuba Gooding Jr. as Rod Tidwell in Jerry Maguire 2
Of the internal operations issues affecting the performance and delivery of services to clients, staff satisfaction and performance has an enormous impact. The biggest predictor of that satisfaction and performance is happiness with firm career path, compensation, training, and professional development.
However, the rewards of a well-articulated and deliberate career track, compensation, and professional development plan to the firm are indirect and often neglected.
Why This Topic Is Important
Professional services firms must have a systematic way to promote, train, and compensate those who are best at executing and selling the business of the firm. Effective measures will attract and retain the best professionals, as well as ensure the future of the firm itself.
217
218
Attracting and Retaining the Best Professionals
Top professionals in any field generally have their pick of which opportunities they pursue and are attracted to positions with well-defined paths that will reward them consistently and objectively. They want to perform and to be recognized for their achievement by their firm. They also know that firms that have taken the trouble to provide clear career tracks to their professionals will attract other “A” players and are likely to be well managed in other critical areas, such as sales and operations.
Because planning in these areas is of indirect (and often delayed) benefit to the firm, it is an often-neglected area of focus for professional services providers. As firms grow from small and mid-size to encompass dozens or hundreds of professionals, the management of the staff becomes exponentially more difficult. Defined career tracks, compensation, and development plans can reduce the overall human resources effort required to be effective. Instead of every case being handled as a “one-off ” proposition, with the attendant spaghetti-tangle of disparate compensation, bonus, and promotion decisions, decisions can be made according to predetermined policies and practices within the firm. These policies and practices remove the immense burden of case-by-case decision making from firm management
and send a reassuring message of consistency, predictability, and reliability to the staff.
Additionally, properly constructed training programs can enhance
the productivity, expertise, and capability of the professional staff. Well-executed professional development programs can reduce costs for services firms by allowing lower cost staff to perform higher level functions sooner in their career.
A company that has thoroughly thought through its compensation, career track, and professional development approach will attract and retain the best professionals and find itself executing most efficiently in a difficult-to-manage internal area.
Determinants of Staff Satisfaction
A variety of studies has highlighted key drivers of staff satisfaction. Based on our analysis of these studies, as well as first-hand experience, we list the following key drivers of staff job satisfaction, in priority order:
• Satisfaction with immediate manager: Because of day-to-day contact, professional staff identify with the company through their immediate manager. If an employee does not have a good relationship with his or her manager, that employee is at risk of leaving. Conversely, if that employee has a productive working relationship with the supervisor, risk of the employee’s departure decreases significantly. To reduce the likelihood of uncontrolled attrition, firm executives must ensure that their
Career Tracks, Compensation, and Professional Development 219
managers are top performers and are respected and liked by the staff.
The human resources group can help the firm track attrition by man-
ager to determine whether there are any problems with a particular
manager, principal, or partner.
• Opportunities for training: Investment in training is a major driver of employee satisfaction.
• Satisfaction with team and coworkers: Dysfunctional teams and coworkers drive out employees quickly. High-performing, cohesive teams can be a source of immense job satisfaction and are an important source of employee and client satisfaction.
• Opportunities for career growth: The firm must provide the professional staff members with challenges to satisfy their demand for learning.