Your client would want to thrive in the economy. As a consultant, we should help them cross the borders towards their success with the help of our expertise. In this episode, Mike Rowlands, the CEO of Junxion Strategy, lends his expertise to consulting clients’ to deliver their wants and needs. The two things that Junxion focuses on that are critical to the overall business: are quality control and Culture. As a social impact consultancy, they are tuned to the human experience. Scale your consulting business by considering your client’s wants and needs. Learn how by tuning in to this episode today!
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I’m very excited to have Mike Rowlands joining me on this episode. Mike, welcome.
It’s great to be here. I’ve been looking forward to our conversation. We’ve had to reschedule a couple of times. I’m glad that we’re now sitting here and able to have a juicy conversation together.
We are literally in the same city-ish, probably about a 30-minute or so drive from each other. It’s funny to do these virtually when we’re so close. Most of the people that I tend to have on the show are somewhere else in the world, not necessarily in the same city. It’s always nice to have someone local. Your business Junxion Strategy goes beyond the local Vancouver area. You are the President and CEO of Junxion Strategy, which is a social impact and social purpose consultancy. Your clients include some very well-known organizations like Adidas, Doctors Without Borders, the UN, and a whole bunch of others. If I’m not mistaken, Mike, you have offices in Vancouver, Toronto, and London. You also serve clients all around the world.
That’s right. We’ve had the opportunity to work on five continents. We have spanned around the world. We even had an office for a few years in New Delhi in India. We served a lot of health and health NGOs and companies in Southeast Asia. At one point, we literally were open 24 hours a day across all our offices. Now, we’re about twenty people and we’re in Vancouver, Toronto, and London, UK.
What were you doing before you assumed the role of President and CEO of Junxion?
It goes back to the dot-com bust way back in 2001 to 2002. Out of university, I worked for an advertising agency and had a fantastic experience. The owner of that agency was the first real mentor that I’d had, other than my father. His name was Bruce and I still see him from time to time. I started at this advertising agency and quickly got interested in how organizations communicate externally, but also internally, and how the connection between culture and marketing worked.
During the dot-com boom time, that little advertising agency was acquired by a web development firm. The whole dot-com thing was everybody needed to have a website. They were calling it a land rush. There are lots of comparisons to the gold rush. There were all sorts of venture capital flying for all sorts of business models. Some of them were brilliant and some of them were not. It was a fascinating time to be in business because we were all so convinced that this internet thing was going to change the way the world works.
In many ways, it has but we built an interactive agency about 5 or 10 years before anybody used the phrase interactive agency. It was interesting because we were doing online and offline communications, thinking about internal engagement for staff as well as external engagement for customers. We did very well. We worked with some amazing clients. We built that company up to about 110 to 120 people or something like that, and then the dot-com bust happened.
It was so dramatic. In 2001, the owners and management of that company couldn’t keep up with the downsizing. They did a heavy layoff in the spring. Maybe it was the April of 2020 or 2001. Three or four weeks later, they realized they hadn’t cut deep enough. They did another round of layoffs. That’s four rounds of layoffs through 2001. I was finally let go on November 16th, 2001. Why do I remember the date? Because I was laid off on my wife’s birthday. “Happy birthday sweetheart. I don’t have a job.”
What a gift indeed, but it was the push that I needed because I don’t know that I would’ve had the courage to go out on my own if it weren’t for the circumstance that I found myself in. It’s November 16th or mid-November. We’re in a recessionary time. The 9/11 attack had just happened. The world is in turmoil and it’s nearly the Christmas holidays, so there are not many people paying attention to hiring and there are not many jobs anyway.
The 2 or 3 opportunities that I did have fell through. By March of 2002, I had to hang out my shingle. I had to go out on my own. I had a great founding business partner for the first consulting firm that I had. He and I are still friends, though I don’t see him as often as I’d like. We created a company at that time called Octopus, and the company was focused on values-based branding.
I’d come out of communications. I was interested in this thing that was being called branding at the time. It wasn’t about logos, colors, and fonts. It was about the ethos of the organization. At least, that’s the way we saw it. The thesis was we’ve spent a few years experimenting with building a brand based on a domain name. It worked for some but not for many. We’ve thought about building brands based on technologies or technology platforms. That’s worked for some, but not for many.
The environmental crisis is a crucial consideration for many leaders today in business. Click To TweetOne thing that we saw that was consistent across those organizations is all of them wanted to articulate their values because that was useful to help them make decisions. The companies that did that well seem to be the ones that were successful. We built, at the time, a pretty rudimentary IP based on how you help a group of leaders articulate shared values, and then make decisions based on those values.
In the echoes of the dot-com period, that was golden. People loved that. It was a refreshing shift. We started to build a consultancy. That’s 2002. We’ve been through a couple of expansions and a couple of contractions. We’ve been through a couple of mergers and now, we’re a social impact firm. We’ve extended into thinking about social purpose in business and about businesses’ responsibility to the communities from where they draw their labor and to where they sell their goods and service. Also, the environmental crisis is a key consideration for a lot of leaders now in business. We’ve expanded beyond that fundamental brand thinking to broader shared values across communities and across humanity.
I want to ask. I had Whitney Johnson on the show. She shared with me that a big launching point for her consulting business, Disruption Advisors, also came on the back of IP and developing some intellectual property in a specific area. When you say that you also launched or had a real initial momentum on the backend of this IP, elaborate a little bit more. Take us back. What was that IP? Was it white paper? What did it look like, and once you had it, what did you do with it to be able to get it out there and create the impact that you’re talking about?
There are a couple of things that I think are important on this for the people that are aspiring to be consultants. One is that you got to have something distinctive. We needed to have a point of difference. Why work with us instead of the next guy? We built that point of difference around the story of using values to drive the brand. Values-based branding is what we called it. That was the story we were telling. That was the point of difference that we took to the market
The second thing that is valuable, and this goes straight to your IP question was you have to have a distinctive experience that customers and clients can enjoy. The IP that we built was a series of workshops that we took a group through to help them together articulate the values that they shared. It’s nice to put a name up and have a nice word. Courage is a beautiful value and it’s one of our core values at Junxion.
It’s just as important to carefully define that value, and lots of companies do that. You and I may have different definitions of courage. It’s important if we’re going to work together and that we get on the same page. The next piece that’s interesting is, “If our organizational culture is going to demonstrate that value, what are the behaviors that I’m going to be able to see in the organization?” I can hire for those behaviors. I can train people against those behaviors. I can coach people against those behaviors.
Now, I’m taking the values and turning them into the culture. For us, it was about taking people through, “Let’s ideate what is valuable to us. What are the values that we hold together? Let’s make sure that we’re all clear and on the same page about what we mean by those words. Also, let’s talk about how wonderful it would be in our organization if we as leaders and in all of the staff that we’re going to hire over time live up to those values through particular shared behaviors that we could identify and see every day. That was where we.
How many people went through that initial series of workshops you put together around that IP and around that concept?
I’m going to say in the first couple of years in 2002 and 2003, it was probably 10 to 20 organizations. That model has evolved, but we’re still using something similar now.
How did you get those 10 or 20 organizations to take part in this? To add a little bit more, what I’m trying to get at is you’ve created this new concept or a different perspective and a different way of seeing things. I would imagine for some, it might be very exciting. They want to learn more. For others, is it worth their time? If these are busy executives, is it worth their time to show up and be part of these workshops? Was the workshop free and/or paid? How did you get people to say yes to something new?
The workshop was paid. It was part of our consulting engagements. We embedded the workshop in the process to develop what the client thought they were buying, and that was the visual brand.
It was part of the bigger engagement. It wasn’t a sole purchase of a workshop.
Rarely. The clients came to us wanting to rebrand or wanting to develop a brand for their new company. What they thought they were buying was the visuals and the nice turn of phrase and the tagline. What we convinced them that they ought to buy was something a little bit deeper. Rather than having a subjective experience of graphic design and font choices, let’s have an objective understanding of the culture that we want to create and the values that we want to share, and then develop the visuals based on that story. That was pretty compelling. It was sensible for a lot of people. It took it out of being this fluffy creative exercise as many people perceived it, and turned it into something that could be a little bit more enduring and had more meaning in the day-to-day.
That was how you took your initial IP to market. It sounds like from there, people started to latch on, “This is different.” Did that create word of mouth for you in terms of starting to be known? I’m wondering, how did you go from rolling out this business where people are coming to you for branding work? Now, you get them involved in this bigger process and you’re doing deeper values-based work around that. How does that lead to growing the business and getting more clients and growing engagement size? Walk me through what happened after you took people through this process.
It’s been an interesting evolution for us. It’s got a couple of feedback loops in it. One was we certainly got referral on referral. The founding business partner that I had is a tremendously good graphic designer. I brought the account management and the values-based piece. Together, we were a pretty great team. We delivered fantastic work and referrals started to come. That was wonderful. Fast forward a few years though, we started asking clients the same question and repeatedly getting the same answer, “Yes, we’re going to bring the values, but what’s your strategy as a business? Where are you aiming to go as a business?”
Oftentimes, they didn’t know or they were going into a round of strategic planning. We felt that we needed to have the strategy in place to articulate the brand effectively because our definition of a brand is the public face of strategy. It is the tool through which you engage stakeholders in the strategic intent of the organization, but lots of clients didn’t have the strategy. We felt like we were flying with one hand tied behind our backs.
We extended the business and started to develop an approach to strategic planning that was similarly values-driven. Sometimes, we would start with the brand. We start with values and develop a brand. Sometimes we would start with values and develop a strategic plan, but it was the values that were the connective tissue of the brand and strategy. Now, I would guess that certainly out of our Canadian office, the majority of the work that we do is strategic planning.
It’s interesting to mention that because it sounds like the breakthrough or the opportunity for this whole new line of service and product that you’re bringing to the market came from asking your clients questions. From pushing a little bit and exploring and trying to identify what’s missing, and then identifying what’s missing and saying, “We should probably work on it together. Let’s explore this.” That then turns into the majority of your business or a big piece of your business.
One of the loops that have come around us is we’re developing these great strategic plans. Now, the question is how do we help our clients to operationalize them successfully? That comes back to the question of culture. Do we have a culture that’s capable of implementing this strategic plan? There are a couple of sides to that.
On the one hand, I think as a consultant, if you’ve delivered to your client a plan that they’re not capable of implementing, then that’s a failure on the consultant’s part. You have to understand the capacity of the client organization. On the other hand, capacity changes and flexes over time. Companies learn new capabilities. They develop new capacities. They bring in more people. They’re able to do more. A plan needs to be responsive to the capacity and the culture of the organization.
What do you think about capacity in your own firm? You could see that as your clients have greater needs or there are opportunities or potential problems identified. As you mentioned, you could say and make an argument for let’s start implementing for our clients or supporting them to operationalize the actual strategy that we’re developing with them. That requires people, more resources, and more infrastructure on your side.
How do you personally think about the balance between greater revenue opportunities to provide more services and more value to your clients, but at the same time, the opposing force of, “Are we getting pulled away from our core area of expertise and/or are we potentially getting pulled into work that is less profitable?” What do you think about that whole piece of the business?
I’ve always thought there are a couple of models in consulting. People hire consultants because they need more capacity, so they need more people to do the work, or they hire consultants for expertise. We have always been expert consultants, not capacity consultants. We’re not intent on building a 100, 200 or 300-person firm that can deliver this operational capacity support. That’s not the business that we want to be in. We want to be in the business of these high-leverage moments of engagement with clients.
Our mission statement is to help leaders build the success stories of the purpose economy. Fundamentally, the first verb there is to help leaders. We’re here to help you as a leader of your company or your organization and make it more successful. If we’re going to do that, then it doesn’t make any sense for you to then be dependent on us for ongoing support. We want to be there at those high-leverage moments when change happens, but we don’t want to be there as a crutch for our clients. They need to build the capacity internally if they’re going to be successful in the long haul.
Courage is a beautiful value and one of our core values at Junction. It's just as important to define that value carefully. Click To TweetYou’re teaching them how to fish. You’re working with them so they feel confident that they can provide for themselves, but you’re not the one going out and fishing for them and delivering them the fish because when you’re gone, everything falls apart. I’m interested to transition our conversation and to know a little bit more. Now, you have about twenty people.
As you said, the firm at times has been bigger. It’s been smaller. Here it is now, a global business with twenty people. Where do you spend your time? What does your typical day-to-day look like as CEO or President of the company? Are you focusing more on business development? Are you working with team members? Walk us through what your typical day/week looks like in your role.
I’m having an atypical day now. I came back from vacation and jumped into a couple of major client deliverables that I wanted to be involved with, but a more typical pattern is about 10% or 15% of my time is still billable to clients. I am still client-facing. It’s important to me because I love the clients and the work that they’re doing. It’s super inspiring to be with them, but also it helps me keep a clear understanding of what the market wants, what the market’s looking for, and where we may need to adapt or extend or change our services.
Most of the rest of the time is split pretty evenly between running our business, leading the operations, leading the team, managing the finances, and those sorts of pieces, and business development and sales. I’m out in the world meeting potential new clients and pitching new businesses all the time. That’s probably 40% of my time, and 40% of the time is running our business. The balance is directly billable.
What’s one thing that you’ve delegated or deleted from the day-to-day activities that you felt was maybe holding you back or wasn’t your highest value?
There are two things that have been total game-changers for us. I can’t remember the timeframe. I’m going to say three years or so ago, we elevated a longtime consultant into a project director role. Her name is Chantal. She has built a project management office for us. We have a centralized framework to understand all the capacities across the whole team when we can take new projects on or when we can schedule them if we need additional contract support to deliver on them when the client needs them. That project management office has been a total game changer.
The second piece and one of the more recent hires we made were for the first time to hire in operations. Melissa came to us from a much bigger company. She’s brilliant. She’s absolutely amazing. She’s taken off my plate a lot of the day-to-day decision-making within our business. We’re nearly complete in delegating the finance function of the business.
Designing the systems and the processes to make sure that it works well. That’s only another massive shift because she’s capable of thinking about that work in ways that I’m not. The finance function has never been my expertise. I know enough to run a business. I don’t think I know enough to scale a business beyond where we are now. That is going to prove to be a game-changing addition.
What would you say is one activity or behavior that for you as a leader, you try and recall or it’s bringing into your consciousness on a regular basis to remind yourself? Is there anything you tend to focus on or feel is critical to the success of the overall business, but specifically in your role as a leader?
There are two things that crossed my mind quickly. One is quality control.
What does that mean?
We have a written and unwritten rule that’s a standard and norm at Junxion that nothing goes out without two sets of eyes. No document gets to a client unless two people have had a look at it, and I’m often the second person but not always. There are lots of people that can cross-check a doc, but we always ask critical questions to make sure that we’re delivering the best quality product. The second thing that I’m paying more and more attention to over time particularly as the team grows is our culture. How comfortable are people? Where are the stress points? Who is experiencing more difficulty than others?
That’s been pointed out in the last couple of years during the pandemic when we all shifted to the home office. Some of us are super lucky and we’ve got single-family homes and space. Others are married couples living in one-bedroom apartments in an urban setting and there was no respite from being locked in difficult times. There are no surprises in mental health crises following the pandemic. It’s paying close attention or to a degree that I can to all of the stresses and strains on each of the individual team members, and then doing what we can to make sure that everybody’s able to operate at their best.
What does that look like to you? If we could break it down into a little bit more detail. Is there a structure or a system that you use to have those touchpoints with your team members? How do you bring that to life in terms of checking in and making sure that the team is good, and the culture, vision, and values, that people are living them?
I have a business partner, Adam, and he lives in London. He largely runs the UK operation. I largely run the North American operation, but we try to behave like we’re one team. It’s an accident of geography, but we behave like we’re one team regardless of where people are seated. Adam and I have regular one-on-one conversations with everybody. It’s bi-weekly for some. It’s monthly for others but they’re on a regular rhythm. We’re always checking in and we’ll talk about the ongoing project and whether they’re finding success or not. We’re way more focused on, “How are you? How are things going personally for you? What can we do to make sure that life is good?
As a social impact consultancy, we’re particularly attuned to paying attention to the people’s experience and the human experience inside the organization. It’s important to us. By doing that, we’ve done a leadership-by-example piece where now everybody in the team seems to be checking in with one another. “How are you? Can I help?” We have Slack like lots of companies do, and one of our channels on Slack is Asks and Offers.
We’ve created this cultural habit of asking for support where you need it. People tend to get pretty open about where they’re getting stuck and where they’re struggling. We’ve got this accepting culture of honesty inside the organization that feels healthy, but people are also comfortable saying, “I’ve got a little quiet spot. I’ve got a little bit more capacity. I can offer it up to anybody who needs it.” It’s both the asks and the offers that are important. We seem to be creating this norm in the culture of using that, which is awesome.
A lot of companies don’t necessarily have that level of transparency or alignment where people care about their team members as much as maybe the leader does. Is there anything that you’ve done very intentionally and proactively to create that kind of environment? Are there any exercises or direct conversations?
There are a couple of things. I always hesitate to use the word vulnerability because there are some problems with it, but Brené Brown has made vulnerability quite famous. What I mean by vulnerability is appropriate professional vulnerability. When I use the word vulnerability when I’m in a room of people of color, vulnerability takes on a very different meaning. Appropriate professional emotional openness and accessibility don’t happen by accident. That has to be demonstrated and led by the CEO from the front of the room or from whoever is calling the shots. Adam and I have very purposefully tried to be as open and embrace that appropriate vulnerability and set the tone in that way.
Is there anything that you could offer? Whatever you’re comfortable sharing, but I’m wondering, “What does an example of that look like where both you or Adam were vulnerable and that maybe made team members feel, ‘It’s okay for us to also be more vulnerable or more open or more honest about certain things.’”
There are some things that we’ve written about. There are a few people on the team, myself included, that had difficult times with mental health, both during and prior to the crisis. Depression is a sneaky thing. You find yourself unable to work, sitting and staring at the computer for long periods of time, and not getting anything done. One of the things that help is to talk about it. In our society, it is still quite closeted.
We don’t talk about those things. Mental health is only now becoming something that we talk about and is getting normalized. That’s taken a lot of advocates, a lot of campaigning, and a lot of time to get to a place where it’s more normal in society. We’ve tried to be ahead of that. If we’ve been struggling ourselves, we said so. We name it. Those are important moments for people because they see that you can show up as a leader in a different way.
You mentioned that one of your team members, the Director of Operations came from a much larger firm. As you start building and scaling a consulting business, your people become and the people that you bring in are not so much about the quantity, but the quality of those people. One amazing person can create the outcome or results of 3 or 4 people that don’t have those skills.
A belief that many consultants have is as a small consulting firm, I can’t get that kind of talent. It’s somebody from a larger firm. Yet, we’ve had that experience ourselves where we’re able to attract team members who come from much larger companies. What’s been your experience and any recommendations or suggestions? The question is, why would somebody want to leave a larger organization with a more recognized name to come and work at a much smaller organization?
Appropriate professional emotional openness and accessibility that doesn't happen by accident have to be demonstrated and led by the CEO. Click To TweetIt’s a fascinating question. In Melissa’s particular case, she was interested in her next career step to being with an organization that leaned into social purpose. She’s taken a much lower salary than I’m sure she was making previously in a much smaller firm, but it seems like she’s absolutely loving it because of the purposeful work that we do. That’s a big trend in our society. People are interested in aligning their sense of purpose in life with their work.
I mentioned a couple of minutes ago that finance was never my strong suit, but I’ve had a couple of staff members over the years that are MBAs that have done work in finance, and that understand the financial model of consulting firms. I am now at a place where I reject the assertion that you can’t afford to hire better people. The business model allows for pretty expensive people.
Why is that? Can you explain a little bit why that’s now clear to you, where maybe before it wasn’t?
It’s a question of leverage. There’s a fantastic book by David Meister about how to run a consulting business. One of the things that he talks about as an important metric in consulting firms is the profit per partner hour. It’s a leverage piece. How much profit are you generating for each hour of effort that a partner puts into the business? It’s extremely high leverage. The biggest cost in our business is certainly salaries, but we can increase salaries at a pretty significant rate and still generate sufficient margin to keep the business healthy and able to finance its growth.
I’ll speak for myself. Years ago, as an early consultant trying to build a business, I’m looking at cashflow and trying to figure out if I can afford the next hire. If you’re at a place where it’s not so much the cashflow, but you’re looking at the income. You’re not worried about if you’re going to be able to clear every check, you’re worried about the ratios. It’s pretty clear that you can hire better people and you’ll get better results and better work.
You can’t snap your fingers and make a massive change overnight, but the model allows for pretty healthy salaries for people. To put it in the current context, we are at 8.1% inflation expected for the year. We’re matching that for our salary staff raises. We’re not going to try and get to that over two years like a lot of companies do. We’re doing it. It’s an 8% minimum raise for everybody across the board. We don’t charge super-premium rates. We’re fair value.
We’re a niche boutique consultancy with particular focus areas, so clients will pay a little bit more because we’re in that niche, but we don’t charge PwC rates. We’re not hundreds and hundreds of dollars an hour. We charge a healthy fee. We think we’re pretty accessible and we deliver good quality work. We do it as efficiently as we can and we’re able to pay decent salaries, and give people lots of time.
You mentioned that one thing that you pay attention to or are focusing less on is the cashflow. Once you know the business is in a good place and you’re not worried about making payroll, you’re shifting more to focusing on the margin of the business and making sure that’s healthy. In your experience, what’s a margin or percentage term that people should be thinking about or aiming for? Maybe right now somebody is running at a place they are let’s say at a 50% or 60% margin or maybe even higher if they are a solo consultant.
For them, it’s like, “I feel like I’m taking a lot. My margin is going to decrease significantly,” but in order to scale, that’s something that in most cases you need to do. In your experience of building up to more people and you are now at twenty people, what have you seen as a margin that you feel is a healthy and acceptable percentage?
We operate at a pretty high gross margin. It’s probably 60% to 75%, I would think. The number I’m interested in is the bottom line number which is the EBITDA throughout. I think 10% to 15% is probably a reasonable target for a consulting firm. A lot of firms are aiming for 20%, but in my experience, you’re probably under-investing in professional development and you’re probably under-investing in marketing if you’re stretching to the 20% to 25% EBITDA. We’ve found that 10% to 15% is a good goal.
Mike, just to explain for those that may not be as familiar with finance, the main difference between the gross margin and then your actual EBITDA or net margin, how would you describe the difference between those two?
The revenue line at the top is what we charge the clients and what comes in. It costs us a certain amount to deliver that. We call that cost of goods sold. At Junxion, a portion of our salary is against that. If you were to come to work with us and you’re working 40 hours a week, twenty hours perhaps got billed to a client. Half of your salary goes into the cost of goods sold, but the other half still has to be paid. That’s out of the other part of the income statement. It’s the operating overhead.
We might be able to operate the top piece revenue minus the costs to deliver that revenue. It might deliver 60% to 75%. Out of that 60% to 75%, we still have to pay for an office. If we’re leasing one, we have to pay for the leases on our computers. We have to pay for the other part of the salary that’s not paid for by clients. That pulls the earnings before interest, taxes, depreciation, and amortization down to that 10% or 15% number.
It’s essentially everything else in the business that cost-wise that comes up, and then you have after paying salaries. I appreciate you explaining that to everyone out there. The other question I have for you is you mentioned an office. Yet, I know that we’re talking right now and you’re not in the office. What percentage of your team is remote?
One hundred percent. We all have home offices. That happened during the pandemic. We were scattered out to our homes, but we do have shared workspaces that we use to get the team together or for meetings. We have a membership in a space in Vancouver and London. We also use a variety of spaces in Toronto, and that’s working well for us.
I know a lot of people are concerned or one of the concerns people have as more and more people are shifting to remote or are stuck there is around accountability. If you’re in the office with team members, you tend to feel like you have a better sense of what’s going on. You can help to support people to be more accountable.
What have you found in terms of any best practices or things that you do at Junxion that you feel give you a great handle on making sure that even if you can’t see somebody physically, you don’t have to worry as a leader because you know that things are getting done? What do you think about that? How do you track that? What’s worked?
We had an unfair advantage before the pandemic because we’d had the office in London for ten years. The team was already split in half. We had offices in Vancouver and London. Those subsets of the team were together, but we knew how to over-communicate. We knew how to make sure the communication channels were open and fruitful. We had those rhythms in place already, which made it relatively easy for us to go totally remote during the pandemic.
In terms of making sure people are getting their work done, I have a couple of views on that. One is we plan our resources carefully. We use an ERP system. A great American piece of software called Mavenlink, a Software as a Service. It is particularly built for small to medium consultancies and agencies. It’s tailor-made for companies like ours. We forecast all our resources there. It is our project management platform. All of the communications about projects happen on that platform. We can see everything related to any project across the whole portfolio there.
I know what Dallas has to be working on six weeks from now. I know what Chris has to be working on six weeks from now. It’s all forecast out. We can adjust and load balance as we need to, but the other more simple answer to the question is, do you trust your people? Do you not trust your people? Do you have a generous mindset where you believe people want to do good and meaningful work? Do you have a scarce mindset where you believe people will take every advantage that they can? We have a more generous mindset. We do interesting work and people come and work at Junxion because they’re interested in that work, and they roll up their sleeves and they get stuff done.
In fact, more often, we’re coaching people to work less. “Slow down on the overtime. You’re going to burn yourself out. Take it easy. You don’t need to be pulling all those projects through at once.” We’re having that conversation more often than we’re having the conversation about, “You look like you put a ton of time in this week. Is everything okay?”
Shifting for a moment to marketing. I know we started off the conversation with you were out of the workshops and the IP got things jump-started. Here we are now nearing the end of 2022. What’s working for you from a marketing perspective? What are you seeing that’s bringing in the best quality leads or the most opportunities?
The best opportunities come to us through referrals. The best marketing that any consultant or agency can do is great work. That’s what’s going to generate the most of it. The overwhelming majority of the work is coming to us through referral. The second thing is anytime we can get out in the world as thought leaders, to coin a phrase. Everybody wants to be a thought leader these days, but what that means, practically speaking is, do we have something distinctive to say that they want on a stage at a conference?
If we can get on a stage at a conference, chances are good that we’re going to have the right kinds of conversations with the people in the room and that’s probably going to lead to business. That’s big for us, and then we’ve been experimenting a bit with online advertising. We’ve never done it before but we’re finding that LinkedIn is a good platform for us to advertise on.
You can hire better people and get better results and work. Click To TweetWe’ve got a new Marketing Manager, Charlie, and he wrote some great ads. They show up for the recipient as a message in their LinkedIn inbox. We’ve found that we get some good attention from what appear to be C-Suite kinds of personalities, mid-career, senior roles, and we’ve driven quite a lot of inquiries through that early experimentation. We’re going to double down on that in our next year.
If you could share a little bit more about that strategy. We’re also very active on LinkedIn. We found it tends to be a much better platform for us as opposed to some of the other social channels. Every business is different. You always want to think about where your actual ideal clients are and where they spend time. You mentioned the strategy, which on LinkedIn, you can essentially have an email delivered to a specific type of person. What’s the content of that email? Is it for them to book a call? Is it to check out a resource? What’s the actual message?
It’s to book a call or reach out to learn more or to start with an inspiring conversation. There are three cues to that call. A lot of clients come to us because we’re experts in the B Corp certification, the Benefit Corporation certification. We had dozens of companies we’ve helped to achieve the certification. That’s something a lot of companies are interested in. One of the cues is to say, “Are you thinking about B Corp? Are you thinking about the benefits of being a stakeholder-driven organization? We’ve got lots of expertise in that. Call us if you want to learn more.”
It’s way better written because Charlie has done a great job, but that’s pretty much the message. The second one is as you probably know, there are many companies and executives who are interested in this whole question of social purpose. Why does your company exist and what’s the redeeming value that’s left in the community? We have a message crafted around that. Are you thinking about social purpose? Have you been able to articulate it yet? Are you operationalizing it? How’s that going for you? Reach out if you’d like to learn more and have an inspiring conversation. I can’t off the top of my head remember what the third one is, but they all delivered pretty good returns.
That’s fantastic. You talk about referrals as being the bedrock and the majority of where your business comes from. When you say referrals, are these mainly people reaching out to you and you’ve had no involvement directly in that? Is there anything intentional, any strategy or any activity that your company is taking to generate more referrals?
At the end of each project, we’re in a pretty good habit of doing a project debrief with our clients. It’s modeled on the after-action review that’s pretty popular, but it’s an opportunity for us to sit with the client and say, “How did that go? What were you expecting when you came into the project? How did it go? Was there anything that you would like to have done differently in retrospect? Is there anything where we could do differently or do better?”
Towards the end of that conversation, we ask, “Would you be willing to write a testimonial for us about this project?” More often than not, they’re happy to do it and then, “Would you be interested in referring us to somebody?” It’s a pretty soft ask. We don’t ask them to give us names. We don’t ask them immediately to make email intros. We simply ask, “Would you be comfortable referring some colleagues or associates to us?”
They do it quite often, which is lovely because it’s a good measure for us that we’ve done a good job on the client. What better reward than having people sing your praises? We’ve found that politely asking and without overdoing it, because overdoing it can feel pretty uncomfortable for both parties, does seem to cultivate some connections.
Is that something that you track? Do you look at which specific lines are sending referrals and how many they send each year or do you make that soft ask?
We are starting to track that. For a long time, I could do it in my head. I can track a series of clients that came from a particular conference in a particular year. We’ll see the daisy chain of connections, but the company is getting too big for me to be able to do that now. We’re starting to track it.
I want to shift to talk about sustainability or even more around this idea of social impact and purpose. These are things that for many people they connect them to larger organizations. They don’t necessarily promote social impact or purpose as being as relevant for the solo independent consultant or the consulting firm with 10 or 20 people.
What’s been your experience with that? What I’d love to hear from you is what’s the opportunity for the people that are joining us right now. They’re wondering, “I have a consulting firm with 5 people or 15 people or 30 people, or it’s just me.” Is there any benefit to them to start thinking more about social impact? If so, how would they bring that to life? What would be some tangible steps they might want to take and explore?
It’s interesting because if we were having this conversation twenty years ago, we probably would be talking about sustainability. It was about environmental sustainability and what’s your carbon output and how much energy you’re using. They are all important questions. Maybe 10 or 15 years ago, if we were having this, we’d be talking about social enterprise and community benefit. How supportive are you being of the communities from where you draw your labor into which you sell your goods and services?
Those things started to blend maybe 5 or 10 years ago, and sustainability took on this overarching mantle that included social impact, community impact, and employee satisfaction. All of these things fell under this umbrella of sustainability. We think that’s evolved a little bit and it’s been interesting watching this conversation about social purpose in business over the last maybe 3 or 4 years. It’s been some very high-profile people that have talked about social purpose. Fundamentally, it’s asking the question, “Why does your business exist?”
Every business has a purpose. Entrepreneurs start their businesses because they want to earn a living or they want to create something or they want to get rich. We’re interested in companies that want to have a social purpose, where the purpose leaves a valuable legacy in the community. More and more companies are interested in that. We think it’s a megatrend. Maybe because of the environmental crisis, maybe because of the health crises. Maybe because of all of the changes that are happening in the world at this moment in history. More and more companies are interested in not only balancing but making up for the externalized costs of the current industrial capitalist system.
For a long time, lots of companies were allowed to use the atmosphere as a garbage dump for byproducts of their services or products. We’re not tolerating that anymore because we’re in an existential crisis in a climate that could collapse. It’s terrifying. The more I read, the more terrified I am. We’re in an urgent moment. More and more people are counting on that fact. We’re seeing that shift in behavior emerged from grassroots organizations the world over.
One of the things that give me hope in the face of the climate crisis is that there are millions of social entrepreneurs that might not describe themselves as social entrepreneurs. That might not be their language, but they’re thinkers. They’re in grassroots communities. They’re developing enterprises, for profit or not, that is sustainable and healthy for the communities and staff.
Mike, let’s take the example of a manufacturing consultant or a pharmaceutical consulting firm or a designer branding consultant, or a food and beverage consulting firm. What does all that mean to them? How might they incorporate some of this into their practice? Maybe they don’t want to incorporate it into their practice. Is there something they should be thinking about? What kind of advice might you offer to somebody that this is not their focus? They don’t want to make their business about social impact because they’re focused on manufacturing. What else could they potentially do with this?
There are lots and lots of data that show social purpose companies are more successful companies. They’re more successful to thrive through a downturn. They’re going to be more durable and stable clients. You should be bringing us thinking into whatever niche in an enterprise you’re working on. Second, it is a phenomenal talent retention opportunity. As I said before, more and more people are thinking about social purpose and aligning their sense of meaning in life with their work in the world.
If you’re thinking in this way, you’re adopting these kinds of practices, and you’re interested in doing a little bit more and a little bit more, it helps you attract better staff and it helps you keep them. Retention goes way through the roof, so there’s a significant HR benefit. Fundamentally, it’s important not to ignore it because it is a megatrend. It’s giving shape to manufacturing businesses. They’re thinking about supply chains. They’re thinking about toxins in their supply chains. They’re thinking about labor in their supply chains. If you’re in operational consulting, you need to be thinking about that.
You also mentioned that one of the big breakthroughs for you in terms of new opportunities or new service lines around strategy came from asking questions and identifying a void. It seems to me like there might be a big opportunity for many consultants regardless of what area you specialize in or what industry you work with to start exploring or asking questions, picking up the rocks and looking at what’s underneath them as it relates more to social impact or social purpose or the environment or other things like that.
It doesn’t mean that your services necessarily are going to work specifically on that, but as a way to provide more value or unique perspectives or insights to your clients. It seems like there will be some opportunity there for many people. Let’s say somebody wants to dive deeper because some of the advantages that you outlined can come from bringing this mindset or behavior or practice into a business are pretty significant in terms of retention and the types of clients that want to be with you and HR benefits. Is there a book or resource that you would maybe point to that you think would be a good primer for people to learn more about this topic?
This might seem like an odd one but the B Corp Impact Assessment is a beautiful primer. The B Lab is the nonprofit behind that assessment, and the B Corp certification is a quantified measure of the health of a company in five key areas. How well is it looking after the environment? How well is it performing for customers and workers on governance and then in the community?
It’s a very complex rubric. It’s a scoring tool and there’s an available 200 points. You can certify as a B Corp if you can achieve 80 points, but the average company only scores about 53. There’s a big delta between the average company and somebody that’s able to achieve the B Corp certification, but simply reading that assessment and all of the things that you could do, not necessarily should do. Not every company has to do all of those things. Eighty is a fantastic achievement. I think the best B Corp is 160. Nobody has achieved 200.
Plan your resources carefully. Click To TweetIs that a Patagonia or something like that?
It’s like a Patagonia or it’s a bank. It’s a cooperative credit union or something. They are amazing companies. They’re upheld as the gold standards and even if they get only 160, but 80 is a phenomenal achievement. My point is that as a reference, as a tool to read all of the things that you could be thinking about.
Under workers, all of these different labor standards and practices. Under community, all of these different engagements and stakeholder engagement, transparency standards, supply chain standards, and so on. It’s a lovely catalog of all of the things that you could be doing to be a healthier and sustainable business, and it changes all the time. It’s constantly being refined and improved. It’s more difficult each time we re-certify, which you’re required to do every three years than it was the time before. The bar keeps getting a little higher because it’s current to what expectations are in the community.
Mike, I want to thank you for coming on and having this conversation with me. I know we explored a lot of different areas in terms of building and consulting businesses, scaling and consulting businesses, social impact, purpose, and a whole bunch of other stuff in between. I also want to make sure that people can learn more about you and everything that you have going on at Junxion. What’s the best place or website they should maybe check out if they want to explore that?
It’s Junxion.com, and we have a great blog on there. We also publish a lot of content in the insights section there. There are bios of all of our team. We think it’s a pretty valuable site. Folks are welcome there and they can reach out to me. No problem at all, [email protected]. I am always happy.
Mike, thank you again so much for coming on.
Thank you. It’s been a treat. I enjoyed chatting.
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