Building Capabilities in Professional Service Firms
One of the most distinctive aspects of professional service firms is that the vast majority of the people who work in them are directly involved in serving clients. Long-term success in a professional service firm requires obtaining and developing the right professionals (managing the talent market), obtaining and developing the right clients (managing the client market), and matching clients' needs with the professionals in the firm who have the appropriate capabilities. Another distinctive aspect of professional service firms is the extent to which working for clients is the basis upon which both its individual professionals and the firm itself builds capabilities in order to satisfy new needs of existing clients and the needs of new clients. This can occur in relatively modest and incremental ways, such as when a young associate is put on a project in an industry she hasn't worked in before. It can also occur in very major ways, such as when a client has a problem that has never been solved before and in helping the client solve this problem, the firm develops a major innovation that leads to a new service offering, not only for the firm but for the entire profession in which it operates. In collaboration with Professor Das Narayandas in the Marketing Unit, Dr. Eccles is using the insights gained from a number of new cases developed for the MBA elective course on "Leading Professional Service Firms" and the Executive Education program "Building Client Management Capabilities in Professional Service Firms, along with supplementary research, to develop the concept of "building capabilities" as a core principle for ensuring long-term success in a professional services firm.