There was an interesting article in The Times last week (17th March). Sir Michael Snyder (Senior partner at accountants Kingston Smith and a former policy Chairman of the City of London Corporation) made the following observations regarding the Professional Services Global Competitiveness Group report:
• The professional services industry employs more people than any other in the UK
• It is also the largest sector by output, contributing 8% of GDP and providing a trade surplus of £2.46billion in 2007
• The UK will see a 12% drop in 18 to 21 year olds between 2010 and 2020 affecting recruitment by professional service firms
• By 2020 the professional services industry will be global and border free
The report advocates a solution to the complex and critical issue of “joint and several liability” affecting UK partnerships and called for changes to the taxation system for reinvested profits of partnerships and to eliminate double taxation.
But the article focused on the views of Laura Empsom – a banker/strategy consultant/academic who is a professor in the management of professional service firms at Cass Business School. She fears that professional service firms may be following the same path as bankers.
She argues that the collective ownership, professional ethics and long term loyalty have taken a hit as firms have cut loose partners and staff in response to the recession and this will impact motivation and retention in the future. Then firms may be tempted to address this by paying more. This, she argues, makes everyone much more individualistic – focusing on personal financial gain rather than the good of the firm. (Funny, but I thought that they were already pretty individualistic!)
She uses a matrix plotting individual commitment against management control and argues that professional service firms aspire to the top right hand box of “Band of Brothers, Henry V” style of management with high commitment and high control. And argues that if commitment is lost they end up at the bottom of the grid with the pirates and gladiators. Gladiators – as long as they are a brilliant fighter – are controlled by management but become celebrities, make shed loads of money but had a rather short life span. Wondered why so many partners I deal with are calling themselves Maximus!