Leading with product results in price being your differentiator; leading with managed services requires that there be a trust relationship already established, making new client acquisition nearly impossible. True value differentiation comes through consultative offerings, generally in the form of analysis or strategy.
Fluctuations in staffing utilization and consultant availability eat at profits as operational costs rise and fall, on the other hand, product gross profit (while admittedly low) and managed services revenues offer stability.
Building a profitable business model is complicated. Having the right mix of consultative offerings, followed by products and services, and finally managed services has the potential to create a very strong business model; both for the company as well as the individual sales person. Tomorrow’s Podcast explores this in greater detail as I deliver Part III of Building the Profit ProgramTM – Make sure you have the worksheet located at http://www.stelzl.us/training/003-Podcast-Talc.pdf