Today we’re announcing the most radical changes to NixonMcInnes in our 14 year history. It doesn’t affect any engagements with existing clients, but it’s a pretty big deal for us. This is a long post so if you’re short of time you can skip down to the headlines of how the new NM will work.
Why we are changing
It comes down to two things:
Purpose: being set up in the best possible way to scale up our positive impact in the world.
Resilience: for a world which is more volatile, uncertain, complex and ambiguous.
The operating model we’ve had since we began in 2000 is typical for a professional services firm. We have quite a fixed set-up with nice offices and lots of smart people on the payroll. There’s a flat structure with a management team at the ‘top’, a high degree of transparency, and empowered employees working autonomously. There are targets, budgets and plans. It’s a proven model – award winning in fact – and has kept many people in interesting work for almost a decade and a half. So why change?
Feeding the machine
There are some side-effects of the standard professional services model. The first is the month-in month-out pressure to ‘hit the numbers’. If your purpose is to make money and sell the company in a few years, that’s okay, but if you’re in the long-term impact business like us, it’s not. It can be a big distraction from finding and delivering the most purposeful work, which often isn’t the most profitable in the short-term.
Recurring revenues are vital to the professional services firm, but it’s rarely these monthly contracts that create real positive impact in the world – they’re usually based on simple tasks that a client can’t or doesn’t want to do themselves. It’s often chasing money to keep the system running. But without recurring revenues, the business is subject to boom and bust cycles. NM has been an absolute engine of profit in good times and we’ve also peered into the abyss a few times too. I’ll never forget the great cash crunch of 2009 when our three largest clients all let us down on big invoice payments at the same time. We’ve always pulled through and the company is run in the black without external investment. But in an increasingly volatile world, the model isn’t resilient.
Mobilising the best team to do the work they love
Having a fixed, in-house team is another limiting factor even when the people are as brilliant as ours. When work is secured, you have to ‘utilise your resources’. Every consultancy out there loves to track their chargeable utilisation metrics. The business model can demand that utilisation be prioritised regardless of whether it’s the most fulfilling work for the employee, or if they’re the absolute best person to do the work relative to all possible associates. It gets in the way of putting the very best, world class team together for projects and allowing people complete autonomy to choose the work they love.
From digital to purposeful
Finally, this change is the last step in NM fully moving on from ‘digital consultancy’. It will allow employees who love digital to continue their work outside NM, whilst allowing the company to fully emerge into a new phase dedicated to developing purposeful organisations.
So we are addressing all of these issues, and realising the potential to create a far more purposeful, resilient company by transitioning to a radically different model. I wrote an internal proposal called ‘Operation Supernova’ which set out this transformation over a year ago, and now the conditions are right for it to happen.
I believe the future of work is not building fixed, monolithic companies which chase revenue. We can do much better than that and we’re going to have a lot more fun creating a lot more impact.
How the new NixonMcInnes will work
The business model is changing from a centralised company with employees, to a decentralised associate and partner-based model.
NM founder Tom Nixon will run the company and continue to build a network of trusted associates, including many former employees, to help him with his initiative of developing purposeful organisations.
Consultants will be working as independent spin-out businesses, owned by them and in partnership with NM. Many will continue delivering digital consulting work. We’ll be announcing these spin-outs over the coming weeks.
Our new, flexible model will allow us to work with smaller, purposeful, disruptive clients as well as the very large organisations we currently serve.
Clients will be able to work with any of our people by contracting through NM or directly with our spin-out businesses and associates. It’s an ecosystem approach to business based on our core value of abundance. There’s plenty of work out there for everyone so we don’t need to lock things down.
The NM Meaning Conference will continue and grow (get your 2015 ticket now).
All contracts and services to existing NM clients are completely unaffected by the changes.
We are mid-way through this transition right now, and it will complete on 28 Feb 2015.
The dark and murky side of change
This process is much more than an evolutionary development. It’s a real act of creative destruction. It’s an exciting and necessary transition, but change is never easy. In fact it’s bloody hard! We’ve had some incredibly difficult moments and tough conversations as this has unfolded. There have been moments of absolute black comedy (Max and I, diligently following employment law, had to read each other a formally worded letter, which included ad-libbing light hearted insults.) There has been a real spirit of opportunity and optimism too. The full melting pot of human emotions and needs have been felt absolutely viscerally. It’s felt chaotic at times. I’ve just tried to hang on to the intent towards purpose and resilience and the integrity that everyone expects from this company. That’s been the anchor.
Some words of thanks
I am acutely aware this transition could not happen without the extraordinary courage and collaborative attitude of every NM team member. I owe them all a huge thanks.
I’ve personally felt out of my depth on more than one occasion. The leadership of Max St John through the last year and the transition process so far has been incredible, as has the support from fellow board member Jenni Lloyd, and advisors Nick Shepheard, Charlie Davies, Matt Weston and Lasy Lawless. And finally thanks in particular to NM shareholders Will McInnes and Pete Burden who have been extremely supportive. Thank you all.
Onwards to a bright, purposeful and resilient future.