Five key tips to encourage new growth in your HR business

Thanks to https://unsplash.com/@artic_studios for this image

By David Leahy, Director, Great People Inside Australia

In my recent conversations with HR consultants, encouraging new revenue growth, scaling their business and managing business downturn between Melbourne Cup and Australia Day are the challenges that loom large for 2021. However, especially in this uncertain world we live in, there are some unique challenges and barriers for consultants which can stop growth in its tracks.

As an Irish migrant in the 90’s, I was always fascinated when business owners and salespeople told me that “not much” happens business-wise in Australia between Melbourne Cup and Australia Day. When I socialised this generalisation at BBQs, contributing factors such as school holidays, time with family, and great weather were mentioned, nevertheless many heads nodded in agreement.

Forewarned is forearmed, they say, and each year I paid close attention to this period in my planning and introduced various strategies to overcome this decline in “normal” business activity.

A genuine business or a consultancy?

When you take a step back and look at your HR business, is it a consultancy or a genuine business?

In a consultancy, you are paid for your expertise and your time. You may work alone, or you may employ one or two people. Even when you have a constant stream of clients, profitability is a constant struggle. Why? Because there are only so many hours in a day that you and your team can work. There will always be a cap on what you can earn.

There are also diminishing returns. As your workload expands and you employ people, you earn less per hour than just doing the work yourself. It’s a catch 22. You’re either doing too much work yourself to remain profitable or earning a lower margin on your team’s work.

A genuine and sustainable business, on the other hand, is different. Your revenue isn’t limited by your time. There may be multiple income streams that cushion the business from the ups and downs of winning and losing business. It’s possible to grow without chipping away at profitability. Best of all, as a business owner, you can work less while earning more.

If your business is still a consultancy, you’re not alone. Many HR businesses will never evolve beyond that. But if your aspirations are to own a genuine business, it is possible to evolve.

So how can you evolve your consultancy into a sustainable and thriving business in 2021?

Scrutinise your costs

Managing your costs effectively will help you claw back profitability. That may include negotiating a reduction in your rent, sourcing more competitive suppliers, or outsourcing lower-level work to a more junior rather than a senior staff member.

Become more time-efficient

Consultants need to understand how their time is spent and reduce that time where possible. If you or your team are spending too much time on a job, it can blow out costs and make that job unprofitable. Consider ways to bring the time down: improving your systems, processes, and technology are good places to start. Look at whether there are any tasks you can automate or outsource at a lower cost to help you focus more on your clients improving their customer experience with your business.

Price strategically

I’ve written before about how trading time for money is a trap. Consultants often find their earning potential is limited because they are paid for their time, and there are only so many hours in a day.

The answer is to price based on value or outcome instead of time. Create service packages at a fixed cost, which you know will be profitable. This also makes it easier to raise your prices. Don’t get stuck in a race to the bottom on price. By charging what you’re worth, you can earn more while working less and attract a better client.

Target the right clients

Do you know which clients are your most profitable clients and a good fit for your business? By better understanding this, you can focus your energy on those clients, upsell or cross-sell to them, and seek other potential clients with similar profiles. Having fewer more profitable clients is worth more to your business than having more clients who are less profitable.

Diversify your offering

Diversifying what you offer is an excellent way to grow both your top and bottom line. Are there additional revenue streams that fit well with your existing offering? A great option is to offer a product in addition to your usual services, such as an assessment, survey, or report. These offerings require less of your time, can be sold at a higher volume and with a more reliable profit margin.

There are many online tools out there. You may even have a product already in your portfolio but is it a “me too”? Does it differentiate you from your competitors? Is it the latest technology? How does it support your ability to earn revenue without constant active involvement by you?

Are you looking for ways to differentiate your business?

Great People Inside services are offered in over 20 countries globally. We recently launched in Australia, and we’re in the process of growing and extending our channel and referral partner network.

The Cloud-based GPI People Intelligence Platform is a next-generation platform that provides you with the ability to provide key strategic HR insights and analytics to your clients. Its flexibility is unique as it’s the only fully-customisable psychometric profiling and 360° feedback platform in the world.

For example, are you interested in helping your clients:

Identify people who will be productive in a work from home environment?
Analyse employees’ alignment with organisational values?
Develop a robust selection, onboarding, and development process?
Understand the business impacts their top performers contribute?
Manage all the generations effectively?

Tick, Tick, Tick, Tick and Tick the GPI platform can do this and more.

These days everyone wants choice, and that is precisely what we deliver with GPI. The unique ability to easily customise assessments means you are not restricted to offering assessment tools that measure or analyse what the test provider wants you to measure….you can help your clients measure precisely what’s important to them.

With GPI, you’re not restricted by the status of the role either. Our assessment dimension range is so vast. Our unique pricing models mean you can develop client-focused valid customised assessments regardless of the role position or status in the business. At GPI, we believe everyone in the organisation should be happy in their job and have the same opportunities to ensure they “fit,” and they love their work.

In fact, our mission is “To develop and offer the future’s talent and assessment solution – the Cloud-based GPI People Intelligence Platform – to anyone working with people: Ready-to-use, customisable to meet every need, and affordable to everyone.”

If you’re interested in implementing a strategy that will drive revenue to your business – regardless of the Melbourne Cup or Australia Day – please click here to contact us or email [email protected]