"What I find generally so praiseworthy is the balance of theory and practical application that runs throughout the book. Clearly, Mark Scott is someone well versed in the whole range of management sciences, yet able to ground this perspective in the world of real experience. This book accomplishes this in a natural, coherent and very readable way." John Zweig, CEO Specialist Communications Businesses, WPP Group USA Inc.
Spanning a diverse range of activities from accountancy to marketing communications, the professional services industry now accounts for up to 17% of employment in the Western economies and had worldwide revenues in 1999 of around $800 billion. It is continuing to experience one of the most spectacular growth rates of any Western–dominated industry and is progressively cornering an ever larger share of industrial value added.
Yet, it remains one of the most unanalysed and undocumented areas of business acitivity. It has been subjected to little scrutiny and received minimal attention from the capital markets. This book aims to change all that!
The Professional Services Firm is intended for three key audiences:
∗ managers and owners of professional services firms who want to understand the strategic options they face and how to improve their financial performance.
∗ investors who want to understand how they can exploit the largely untapped and misunderstood opportunity the industry holds.
∗ managers in industrial and service sectors who want to understand how to emulate the two critical skills mastered by PSFs – hiring, developing and retaining the best intellectual talent available and exploiting collective knowledge to achieve differentiation and to–die–for margins.
This seminal book provides not only the first real insight into the structure, strategy and economics of this huge and prosperous industry but also an excellent guide to understanding the challenges and opportunities it faces. Mark C. Scott′s analysis of the professional services industry is an indispensible guide for anyone involved in these types of companies wishing to maximize performance and profitability.
About the Author.
1. The Inexorable Rise of the Professional Service Firm.
The sceptical invester.
Learning from PSFs.
2. Segmenting the Professional Services Industry.
Consolidation versus specialization.
3. Determining the Relative Attractiveness of Segments of the Professional Services Industry.
Nature and level of competition.
Growth and cyclicality.
Entry and exit barriers.
Recruitment and retention patterns.
Threat of service substitution.
Impact of government activity.
Pulling it all together.
4. Generic Strategies for Professional Service Firms.
Global service integration or bundling.
Global versus local specialization.
Sector versus product specialization.
Executing a strategy.
5. How Do You Tell How a PSF is Doing?
The balance sheet.
It′s not just the financials...
6. Understanding the Underlying Economics of a PSF.
Fee capacity and resource allocation.
7. Identifying Whether a PSF is Positioned to Maximize Returns to Shareholders.
Process efficiency and internal structures.
Recruitment, incentives and career management.
Financial and process control.
8. Corporate Finance and Valuation of PSFs.
What keeps potential investors awake at night?
Investment strategies and pricing.
9. The Future for Professional Service Firms.
Mark C. Scott is Executive Vice President of Lake Capital Management, a principal investment group specialising in investing in professional service firms. He formerly held the same position at Lighthouse Global Network, a global marketing services group. He was previously an Operations Director at WPP Group plc and prior to this has worked for a number of years as a management consultant in Europe and the USA. He received his MBA from Harvard Business School and was educated at Oxford and Cambridge Universities. He is the author of Value Drivers and Reinspiring the Corporation.