Recently faced with a consulting job that we couldn’t do in time at Fontenergy, I called Nick Devlin. Nick and I had done a lot of this particular type of work together at XCO2 and I knew he would do a great job.
Nick took on most of the burden. We collaborated online and by phone and within a week I delivered a superb report to the client. In fact it went so well that we’re now discussing formalising the arrangement and jointly developing some tools to allow us to carry out this type of work more efficiently, sharing the work and the profits.
So could small business networks be the future of low carbon consultancy?
If you go back seven or eight years, there were only a handful of low carbon consultancies: most either standing on their own or forming part of boutique M&E practices.
Then, buoyed by the construction boom, increasing awareness of climate change, and more stringent regulation, the sustainability sector really took off. Engineering practices and some architects, keen to get a piece of the action, brought consultants in house even if people didn’t understand exactly what they were meant to be doing. Teams just couldn’t expand fast enough to keep up with demand.
And then last autumn, the downturn pulled the plug on private development. Developers put the brakes on anything that wasn’t already committed and associated businesses began to scale back. Talking to colleagues at events or in the pub, there are lots of examples of sustainability teams in large practices being decimated or in a couple of cases disappearing altogether.
Here and there, projects are reviving. But it seems that clients, still obliged to meet regulations but determined to get better value for money, have begun to use smaller practices with lower overheads. The disadvantage to small practices is they probably don’t have the capacity to handle sudden gluts of work. They may also lack the ability to draw on in house specialists when dealing with work outside their areas of expertise.
In the past, the solution would have been to hire more people. But not anymore. There has been one unavoidable lesson from this downturn: watch the pennies, stay lightweight, and keep overheads low. Having found a survival strategy that works, we’re reluctant to take on new people on the consulting side unless they’re essential or there is already a stream of work to cover their costs.
But my recent experience with Nick has suggested a potential way of handling this. By having a network of businesses to draw on, you can increase your capacity (and widen your base of expertise while you’re at it). When there’s a glut, collaborate and share the profit. If someone wants something for which you don’t have expertise, call a colleague. And then if things go quiet again, there are no panicked resourcing meetings. There’s no one to sack. Better yet, you might even find you get work off someone else in your network.
There are also some big upsides for the client as well. When organisations are shallow everyone does everything. As a result you get extremely well qualified people doing jobs that in a large practice would be dumped onto a graduate trainee. And with lower overheads come lower fees.
But there are some sticking points too. How do you deal with IP for example? How do you allocate liability and does this need to be formalised? How do you handle the interface to the client? There are certainly issues to address.
But sticking points aside, I think we might be onto something here.
carbon limited 
Kindle is a case in point. Formed from 35 consultancies, builders, designers, architects and so on, we are currently looking at such issues as PI- it seems our best bet is to become a CIC and dip in and out as individuals so Kindle has the PI. As we do work, we put 5% into Kindle admin to cover PI and accountancy costs etc. This way, our own small firms still continue independently as well, but we have the ability to take on much bigger work.
I think its the way forward, but isnt for everyone and there are loads of different ways to do it, as Casey says.
Of the member companies, most are doing well in the recession, some better than others, and with a few tightening their belts. Colleagues in bigger practices, however, are clinging on by their fingernails those that still have jobs
Jason, I really like the Kindle idea. How are you guys addressing branding? One of the nice things about the recent collaboration with Nick was that he was wearing a Fontenergy hat.
Is Kindle a black box with anonymous members providing the services or do the members provide services directly from their own companies with work branded accordingly?
At the moment, it can go either way. We are having an AGM in June to make big decisions but we have a Kindle logo, flyers and impersonal business cards and the website is slowly getting there. We did a stand a Ecobuild and it went OK. I dont know if it generated any business but it was good to make the collaborative effort and get people together. As we have professional Marketing and graphic designers as members, we come up with a fairly good concept that people were happy with.
It is, however, a ball-ache trying to get 35 people together to make a decision on pretty much anything
I’d like to add that trust is a major requirement in this type of collaborative work. One of the reasons that this particular cooperation works is that I think we trust and respect each other implicitly. Perhaps even more important is that we have similar opinions on process and professionalism.
this means you dont have to worry about the quality of the work / input from the other party, because you know they can deliver.
Issues of IP are naturally important, but a jointly developed approach and solution should be owned by both parties. In our case, as we have complimentary skill sets and a divergent knowledge base since we left XCO2 that means the sum is greater than the parts. We are developing similar relationships with other small consultancies, but I am not so clear on what they bring to the party in terms of IP and complimentary skills. That will, I expect be more difficult to make fly.
Finally, the only downside from a branding perspective, is the need for continuity in terms of client contact. So there can be times when it is quicker for the one doing the work to call the client directly, but this can be seen to compromise branding. We need to determine a collaborative approach that retains the right branding needs and yet makes those direct contacts acceptable. I dont necessarily think this is to do with company protocols, more of industry perceptions and inertia.