Talent & Leadership

From Chaos to Control: Why Smart Year-End Planning Starts Now for Delivery & Ops Leaders

July 2, 2025 by Lisa Burton Leave a Comment

The July – December window can make or break the year for professional services firms. Client budgets tighten, new projects race to signature, and your own consultants begin mapping out well-earned holiday PTO. Waiting until Q4 to reconcile those moving parts is a recipe for margin erosion, last-minute firefighting, and overworked teams. This can be even more acute in smaller firms, which have fewer people to shuffle when things shift.

Investing in a little structured planning will pay off when it matters most. We’ve worked with organizations that have used the checklist below to get ahead of the chaos and the results speak for themselves. With forecast variances consistently under 3% on both a monthly and quarterly basis, these firms were able to predictably manage utilization and revenue forecasting.

The impact went beyond the numbers: consultants were staffed more strategically, client relationships strengthened, and the internal pressure to “find a home” for bench resources eased significantly. It created a more confident, less reactive culture.

By starting year-end planning six months out, delivery and operations leaders have the runway to fine-tune capacity and set clear expectations with clients before peak demand collides with holiday downtime. The checklist below turns foresight into clear, time-boxed actions so Q4 shifts from seasonal scramble to a more predictable, profitable close.

1. Forecast Resource Needs Early

What to do now:

Review Q4 project pipeline and anticipated start dates
Build week-by-week supply-vs-demand heat map
Identify high-risk projects that could overlap with year-end holidays
Flag accounts or deliverables likely to require holiday coverage
Assess historical year-end utilization trends for capacity planning
Confirm or establish contractor agency relationships in case you need to scale quickly or backfill last-minute gaps

Why it matters:

No one likes scrambling for coverage in December. And sure, looking three to six months ahead can feel early, but even one step forward now saves time, stress, and last-minute headaches later. Thinking through potential gaps now gives you time to fix them calmly, not in a panic. Plus, you’ll catch things like skill mismatches or client patterns that could quietly derail delivery. Getting ahead of this protects revenue and can avoid costly last-minute staffing fixes.

2. Plan Time Off Now

What to do now:

Ensure understanding of regional holiday calendars
Ask team members to begin thinking about year-end PTO
Set a timeline for submitting PTO requests (e.g., by end of Q3)
Identify critical roles where staggered leave will be essential

Why it matters:

If you wait too long, everyone wants the same two weeks off, and no one is happy. Getting out ahead of PTO helps you keep projects on track, avoid burnout, and make sure people actually get the break they need. It also helps you avoid needing to pay for contractors or miss revenue targets because you couldn’t deliver what was booked.

3. Develop Preliminary Capacity Plan

What to do now:

Estimate Q4 demand based on current backlog and sales pipeline
Begin modeling delivery capacity across key teams and geographies
Identify potential resourcing gaps based on early PTO signals
Explore pulling forward early Q1 work to smooth out resourcing across the holiday period, working with Sales to identify deals that could realistically start sooner
Engage in early bench planning and cross-training discussions

Why it matters:

It’s way easier to shift workloads or train backups now than when you’re in the thick of it. You also get a shot at using any idle time more intentionally—before folks get restless or frustrated sitting on the bench. Done right, this improves employee engagement and margin, and helps avoid end-of-year surprises that mess with your financial goals.

4. Engage Clients Early

What to do now:

Begin setting expectations around team’s availability
Start conversations with larger, strategic clients about their holiday plans
Ensure mutual understanding of Q4 project requirements and resource implications
Adjust project plans and milestones based on a realistic view of availability

Why it matters:

Your customers will appreciate the heads-up. If you talk now, you can make smart calls together instead of rushing through decisions when everyone’s out of office and stressed. Focus especially on the larger, more complex projects. These are the ones most likely to slip if planning lags. Doing this sooner rather than later helps you lock in realistic delivery timelines, protect Q4 revenue, and avoid hard-to-recover trust issues when deadlines slip.

5. Align Cross-Functionally

What to do now:

Ensure broader delivery team understands the importance of strong planning around Q4 and business impacts
Partner with finance to ensure revenue/margin forecasts fully consider holiday impact
Partner with sales to align on realistic staffing for late-year deals
Sync with HR on leave policy communications, expectations and early consideration around incentivizing teams or individuals who may have high burn projects in Q4
Partner with recruiting to get ahead of Q4 hiring needs, especially for roles that are specialized or take longer to fill

Why it matters:

Delivery plans don’t live in a vacuum. If sales is closing late-year deals, finance is forecasting Q4 revenue, and HR is managing PTO and burnout, everyone needs the same view of what’s possible and the potential risks. Getting aligned now helps avoid conflicting priorities, unrealistic asks, and late-stage surprises that can hit margin or delay delivery.

The best Q4s are the ones where you’re not surprised. By planning now, before things get noisy, you can give yourself options: time to shift workloads, loop in clients early, and head off the crunch that usually hits just when everyone’s about to disappear. It’s not just about being prepared; it’s about being in control of how the year ends.

About the co-author

Luke Slevin is the Vice President of Operations at Black Diamond Advisory, a global consultancy in the CPM space and a Tercera portfolio company. Luke has more than 15 years of experience leading delivery and revenue operations, and supporting complex enterprise finance transformations.

Rethinking global delivery in the age of AI and tariffs

May 1, 2025 by Lisa Burton Leave a Comment

Over the last two decades, we’ve seen global delivery evolve from a cost-focused initiative to a strategic lever. IT services firms have built centers of excellence offshore, experimented with nearshore models, and found the right mix of skills, price points, and time zones to meet customer demand.

But the playbook is changing. Fast.

Between the rapid advancements in AI and the shifting ground of global trade policies, we’re now navigating a new era — one where IT services firms have to be more agile, thoughtful, and forward-looking about where and how talent is built.

AI Is Changing the Talent Equation

Let’s talk about AI first—because it’s the elephant in every boardroom.

What we’re witnessing isn’t just automation at the edges — it’s a fundamental reshaping of how work gets done across the entire delivery spectrum. AI isn’t just taking on routine back-office tasks anymore, it’s writing code, generating test scripts, drafting documentation and even proposing solution architectures. This is the kind of work that many firms used to assign to junior engineers in offshore teams. Now, AI is doing it in seconds.

All of which is prompting companies to rethink the role of junior talent, the locations they invest in, and the kinds of skills needed to build for the future.

Does this mean companies should shift away from offshore and near shore teams? Not exactly.

What it means is that the profile of the ideal delivery team is changing. Companies are looking for engineers who can co-pilot with AI, not be replaced by it. People who bring contextual understanding, domain knowledge, creativity AND strong technical chops.

Darshan Deshmukh, a Tercera advisor and president of ProcureAbility (a provider of procurement services including advisory, managed services, digital solutions, staffing, and recruiting) said it best: “As organizations focus on the work design aspects of AI, talent with strong critical thinking skills and a high comfort level with change will be essential.”

It’s no longer just about cost arbitrage — it’s about value creation.

This is where nearshore and offshore strategies take on a new importance. What were once hubs tuned for scale and efficiency must now tune for capability and innovation. It’s no longer just about cost arbitrage — it’s about value creation. Nearshore and offshore teams have always been force multipliers, but with AI enablement, they become even more so. Compared to today, tomorrow’s global delivery centers may look leaner, but they will be far more strategic, more productive, and laser-focused on delivering real business impact.

When Politics Meet the Playbook

The overall political dynamic is also forcing businesses to rethink playbooks for global delivery centers (GDCs). Tariffs and barriers to cross-border services, including visa restrictions and digital and data localization laws, have the potential to increase costs over time. If the entire objective for a GDC was purely for lower labor rates and higher margins, just know the math might change.

At the same time, a rise in economic nationalism and isolationist policies across some major markets are prompting companies to reconsider just how “global” their delivery strategies should be. From rising political pressure to repatriate jobs, to new legislation that favors domestic hiring or penalizes offshore spend, companies are navigating not only economic trade-offs but reputational ones.

This doesn’t mean abandoning global teams — but it may shift the calculus on where and how they grow. Countries seen as more politically aligned or economically stable are gaining favor for nearshore and offshore expansion, and delivery leaders are being asked to justify how those teams map not just to cost and skills, but to risk resilience. GDC strategy is no longer just an operational decision. It’s becoming a geopolitical one.

That doesn’t mean the value around having global delivery teams gone. Far from it.

Offshore and nearshore teams continue to be a critical part of the delivery strategy — because of the talent, not just the cost. These regions are home to highly motivated, tech-forward professionals who are hungry to grow and quick to adopt new tools, including AI. Regions like Latin America, Africa, Eastern Europe and India have massive pools of talent that are not only delivery-ready but eager to lead and bring in fresh ideas.

The key is investing in the infrastructure around that talent. Savvy companies are doubling down on training platforms, AI enablement, onboarding programs, and leadership development in these regions — because that’s what turns a capable workforce into a competitive advantage. It’s not just about who you hire or who you partner with in these regions. It’s about how you support them, onboard them into your own processes and (hopefully AI-enabled) systems. It’s about how connected they feel to the customer’s mission.

Savvy companies are doubling down on training platforms, AI enablement, onboarding programs, and leadership development in these regions — because that’s what turns a capable workforce into a competitive advantage.

For example, Zennify – a Tercera portfolio company specializing in data and CX for regulated industries – is finding ways to tap into emerging talent ecosystems like Africa through partnerships. According to CEO Chris Conant, “by prioritizing training, contextual understanding, and collaborative intelligence with AI, we’re not just preparing for the future — we’re actively creating it.”

Advice for Navigating Shifting Terrain

Tariffs and other geopolitical trends may be introducing volatility and change to existing playbooks, but near-term policy shifts shouldn’t fully dictate long-term talent strategy. The firms that win will be the ones who stay committed to nurturing global talent ecosystems — even when it’s not the easiest path.

As delivery leaders, we have to look past the noise and focus on building resilient, future-ready teams. That means balancing risk today while investing in the talent we’ll need tomorrow. Here are a few areas to consider this year:

Re-evaluate your delivery footprint with today’s lens
The assumptions that guided your offshore or nearshore strategy even two years ago may no longer hold. Tariffs, rising service costs, and policy shifts are impacting regions differently — and fast. It’s time to take a fresh look, with an eye on agility, not just rates.

Turn global teams into learning engines
One of the biggest bright spots in all of this? Nearshore and offshore regions are packed with ambitious, capable talent—and they’re often the most enthusiastic adopters of AI tools and new delivery models. In fact, 52% of enrollments in Coursera’s Gen AI classes are from emerging markets. The most successful IT services firms are not just leveraging that—they’re building training frameworks around it. By investing in structured AI enablement and skill acceleration in these regions, you create a flywheel of growth: eager talent, smarter delivery, happier clients.

Plan for uncertainty—because it’s here to stay
Whether it’s a policy shift, a trade rule change or a platform breakthrough, surprises are the new normal. Design flexibility into your resourcing model so you can pivot quickly when the world throws something new at us. Some actions we suggest include developing a multi-region strategy, leaning into a digital workforce culture and reviewing contracts for risk and optionality.

The old model isn’t broken, but it is being rewritten. And as delivery leaders, we have a responsibility to reimagine what great delivery looks like in a world shaped by AI and tariffs.

The world is shifting fast. Make sure you’re moving with it.

Getting WiSe and closing the gender gap in IT services

March 31, 2025 by Chris Barbin Leave a Comment

Introducing Tercera’s Women in Services (WiSe) Initiative and High Potential Sponsorship Program

As we wind down Women’s History Month, let’s take a moment to reflect on how far we’ve come when it comes to women in business, but also on how far we need to go. Especially when it comes to female representation at the most senior levels of IT services.

According to McKinsey’s annual Women in the Workplace study, the percentage of women in the C-suite has risen from 17% in 2015 to nearly 30% today. That’s a pretty significant increase over 10 years. However, when you consider that women make up about half of the world’s population, are earning degrees at a higher rate than men, and account for 52% of workers in management and professional occupations (at least in the US), those numbers still look pretty anemic.

This situation is even worse for women of color, within the technology sector, and more specifically, within IT services. A few years ago, Tercera analyzed 60 investor presentations we had received from IT services firms between $8M and $100M in revenue. Of these, 28% had not a single woman on their leadership team and only one had a woman as the CEO. Anecdotally, we have not seen those numbers improve.

A few years ago, Tercera analyzed 60 investor presentations we had received from IT services firms between $8M and $100M in revenue. Of these, 28% had not a single woman on their leadership team and only one had a woman as the CEO.

Earlier this year Tercera kicked off a Women in Services (WiSe) initiative to do something about this imbalance. The initiative is a series of events and programs focused on elevating and empowering women leaders in IT services. And today, I’m very excited to announce a new Sponsorship and Coaching Program for high potential female services leaders that I’ll go into more detail on below.

More details on Tercera’s sponsorship program can be found here.

But first, let’s first cover why addressing the gender gap in IT services is so important to us.

Diversity should be table stakes

Building a workforce that reflects the broader population isn’t just ethically right — it also drives stronger business performance. Research has shown that diverse businesses are 39% more likely to outperform than non-diverse businesses.

People with different backgrounds, life experiences, and yes, genders, have different perspectives. This not only leads to better problem solving, but opens up different networks and access to a wider set of resources, customers and potential employees. Having a diverse and inclusive workforce can also lead to better employee engagement. This is especially critical for people-based businesses where attrition has a quantifiable and significant cost.

We realize that diversity is far broader than just gender. It’s about bringing people across different genders, races, ethnicities, age, religion, sexual orientation, abilities, and socio-economic backgrounds into the mix, and creating an environment where they all can contribute and thrive.

We realize that diversity is far broader than just gender. It’s about bringing people across different genders, races, ethnicities, age, religion, sexual orientation, abilities, and socio-economic backgrounds into the mix, and creating an environment where they all can contribute and thrive.

However, we routinely preach the power of focus to our portfolio companies and have embraced this advice internally as we consider how to maximize our impact. By narrowing our focus to gender representation and equality in services, we believe we can make a more significant impact.

We are also in a unique position here. While there are many areas of diversity we are working to do better on as a firm, Tercera is more gender-balanced than most private equity and venture firms. Half of our partners are women, as is 60% of our overall firm.

Why now?

While we’ve been a vocal advocate in this arena for many years, we believe a formal program to sponsor and support women in services in our portfolio and beyond can make both a concrete impact and draw attention to the issue. Which seems especially important given some of the factors at play that could flatline progress or even push us backward.

DEI has suddenly become a four letter word. Some of the most vocal advocates for DEI (Morgan Stanley, Target, Citigroup, Target, Facebook and Accenture to name a few) have been rolling back or shuttering their DEI initiatives for fear of litigation or losing federal contracts under the Trump administration.

The shift back to full-time, in-office policies could also disproportionately impact women. Women often take on more caregiving responsibilities, and if flexible work arrangements are withdrawn, it could potentially hinder career advancements.

The rise in AI could entrench existing biases. Women are not only significantly underrepresented in the field of AI, but AI algorithms are trained on data that likely reflects historical biases. This could potentially limit women’s opportunities in hiring, promotions, and evaluations.

We talked about a number of these issues at a recent International Women’s Day panel with women leaders from across our portfolio, and over 150 participants. You can listen to the recording here or clicking on the screenshot below.

Introducing the WiSe Sponsorship Program

One of the topics that has resonated the most across our dinners and discussions is the importance of sponsorship, not just mentorship.

As Leigh Bryant from Orium, one of the participants in our International Women’s Day session, put it in her blog: “While having a mentor can be invaluable, sponsorship is what truly changes careers…It’s one thing to support women when they ask for advice. It’s another to proactively champion them and create opportunities for them to lead.”

The impact that sponsorship can have on careers is what led to the creation of a formal sponsorship and coaching program within our WiSe initiative. Each year, Tercera will select a small group of women leaders to participate in a year-long program preparing them for the highest level roles in IT services. The program includes 1:1 executive coaching, cohort group coaching, mentorship from Tercera and its community of Advisors, and participation in select in-person executive events.

Each year Tercera will select a small group of women leaders to participate in a year-long program preparing them for the highest level roles in IT services.

We are taking nominations for the 2025 cohort through April 25, 2025. Open to VPs and above in IT services firms, these candidates must be nominated or approved by their CEOs, and commit to a one-year program. If there is someone in your organization that you think could be an ideal candidate, please visit this site for more information.

Let’s keep focus on women’s progress in the workplace well past Women’s History Month. Because if there was ever a year that we needed to be intentional about this issue, it’s this one.

The power of a CEO dashboard

September 1, 2024 by Mike Epner Leave a Comment

I once met a top official in the US space shuttle program who was responsible for signing off on the quality/efficacy of the shuttle’s millions of lines of code. He did this before every mission, in the presence of the astronauts who would be piloting the vehicle. Such an awesome responsibility. I asked him “how do you know that you can assure those pilots that they are safe?”

His response (paraphrased) stuck with me: “I have a dashboard of all the key metrics and I know our processes, so signing off is easy!”

Running an IT service company may not be as mission-critical, but it’s still a great lesson for leaders. If you want a high level of confidence in decision-making, you need a dashboard — a control panel that looks at metrics for how well your team (and processes) are performing.

If you want a high level of confidence in decision-making, you need a dashboard — a control panel that looks at metrics for how well your team (and processes) are performing.

Growth spikes and pipeline divots will happen. A dashboard helps to foresee what’s coming and respond to the inevitable challenges and opportunities that could change a company’s trajectory.

When I was President at Traction on Demand, a Salesforce consultancy that was ultimately acquired by Salesforce in 2022, we grew the company from 200 to 1500 people in five years. That kind of growth is impossible to manage gracefully without the right metrics and dashboards in place. Especially when something like COVID happens.

When the COVID lockdowns hit in 2020, we immediately saw the business impact in our dashboard – a significant number of projects were canceled or put on hold, and 25%+ of our pipeline dissolved nearly overnight. Our revenue forecasts showed within a few weeks that we’d start to lose significant amounts of money. We also knew we couldn’t cut our way to make up for the lost business, so we immediately shifted gears into offense mode.

We created project pipeline by scrambling to help organizations do everything from track available hospital beds and PPE equipment, to make the transition to virtual work. We saw results within a few months and created so much impact that we started growing at an unprecedented rate. Again, all reflected in our dashboards, which proved invaluable at navigating a very uncertain time.

So, what should be on a service executive’s dashboard?

The components of a CEO dashboard

The needs of each CEO and company vary depending on their target market, the size and stage of the business, and the challenges they’re facing in growing profitably. In short, there’s no one-size-fits-all dashboard. However, the most effective dashboard I’ve seen represent a combination of:

1) operational metrics that monitor day-to-day business performance

2) improvement-oriented metrics that track the progress of high priority initiatives

Operational-based metrics

For a CEO, operational-focused dashboard elements should look across core business functions, including sales, marketing, delivery, operations, finance and HR. Together, these metrics can give a day-to-day view of business health.

For a CEO, operational-focused dashboard elements should look across core business functions, including sales, marketing, delivery, operations, finance and HR.

Figure 1 below provides an example of a dashboard incorporating the core operational metrics I would track.

For sales and marketing, a CEO needs to see how well the company is doing at hitting its quarterly targets, but also how the weeks/months are trending for future performance. This data should help answer questions such as:

What are our best case and worst case forecasts?
How are close rates trending?
How much pipeline have we added this week?
Will we have enough pipeline, based on our close rates, to hit next quarter’s targets?
How are we doing across new logos vs. expanding existing business?

These are the high level metrics, but you can also get more granular to help guide where to focus attention. For example, which SOWs are set to close in the next month.

Similarly, delivery and operational insights keep the CEO grounded on “today’s” performance and allow them to pull the right levers to address immediate issues. For example:

Problem (red) customers may prompt executive outreach to a counterpart.
A downward trend in CSAT or employee attrition may require a more detailed analysis into why.
A dip in forecasted utilization may drive slower hiring and perhaps steps to manage cash.

The key is to have the right information as quickly as possible in order to take advantage of opportunities or take action to mitigate risks. Having it all on one control panel helps.

For example, historical and forecasted utilization (broken down by geo, group or job level) can indicate if there’s enough work for the consultants. Or if that work is being efficiently delivered in a 40 hour work week. Understanding utilization trends is critical in a services business because utilization ultimately affects profitability.

Supporting metrics such as backlog trends (how much booked work has yet to be delivered), goodwill (non-chargeable labor), and sold/realized bill rates should prompt action when they aren’t where they’re expected to be. The Figure 1 dashboard contains real examples that can guide this sort of decision-making.

For a people-based services business, talent and HR metrics should also be on a CEO’s dashboard, especially if they can immediately impact corporate performance.

For a people-based services business, talent and HR metrics should also be on a CEO’s dashboard, especially if they can immediately impact corporate performance. Attrition rates are a great example – which can spawn next-level down dashboard components around resignations, hiring results, candidate pipelines, forecasted talent vs needs, or diversity metrics if that’s a focus area.

Lastly, although perhaps most importantly, is the company’s real-time financial performance. Data and reports might include revenue billed in the last week, last month and in the current quarter – as well as accurate forecasts for the next week/month/quarter. Having a ready view into cash flow – especially when times are tight – is also important.

Initiative-based metrics

In addition to the day-to-day operational elements, initiative-based metrics may warrant a proactive place on the CEO’s dashboard. Here are three good examples:

1. Resolving causes of high attrition

One company struggled with attrition and customer satisfaction. After digging into the root cause, they found consultants were consistently being assigned to more than six customer projects, and as a result, were simply unable to deliver on expectations. They created a goal to assign no more than two clients per consultant, and created a dashboard component to track this – evaluating weekly progress.

2. Gauging M&A integration effectiveness

There are many metrics to gauge whether an acquisition has been successfully integrated, however, employee engagement is a big one. It’s also a leading indicator for attrition. One company had brought in a tool, CultureAmp, to do a monthly pulse check on how things were trending across groups and regions. They added these results to a dashboard.

3. Planning for rapid growth and hiring

One company was growing incredibly fast into a new segment, bringing on, training up and certifying large cohorts of new employees. Their business and staffing plans were built on assumptions for how fast they could get these employees billable, while maintaining high customer sat. They developed a set of reports to track things like business days to certify, business days to billable to ensure these assumptions held.

Initiative-based elements might up a much smaller portion of the CEO dashboard, but they may drive results on par with the operational ones if they are well selected.

Initiative-based elements might up a much smaller portion of the CEO dashboard, but they may drive results on par with the operational ones if they are well selected. The key is making sure they are meaningful – and retiring them when they are no longer pertinent so that the dashboard stays relevant and effective.

Making a Daily Habit

Having the right dashboard and data is only half the battle. How you use it, and how often you use it, is just as important. If you have a dashboard and aren’t using it every day, then you probably need to take a look at why. If it’s because you don’t trust the data, fix that. If it’s because the data isn’t real-time, fix that. If it’s because there’s too much on the dashboard and it’s overwhelming, fix that.

Having the right dashboard and data is only half the battle. How you use it, and how often you use it, is just as important.

Like that space shuttle director I mentioned earlier, I would start my day, coffee in hand, with a dashboard review. I would use it in discussions with other leaders within the business to talk about what’s performing and what’s not. It helped me push on certain areas in a quantifiable way and show the kind of data-driven decision making I expected from my team.

It helped ensure that we were keeping the business not just safe, but ready to take off like a rocketship if we saw an opportunity. Pun intended.

Stuck in a growth plateau?

April 16, 2024 by Chris Barbin Leave a Comment

Advice for technology services firms climbing the hard road from $10M to $50M

Scaling a professional services firm is a challenge. Unlike product companies, most services firms – even tech-enabled ones – receive the bulk of their revenue through people and customizable projects, rather than a tangible piece of technology that’s easy to package and can easily scale. People and projects are unpredictable and can be difficult to manage. Software subscriptions less so.

People and projects are unpredictable and can be difficult to manage. Software subscriptions less so.

There are things that leaders can do to make their businesses more predictable and scalable. Things like managed services, investing in packaged IP or AI to deliver work more efficiently, or using data and tooling to predict and smooth out the ups and downs inherent to customized services – just to name a few.

As a former founder and investor who talk to hundreds of services firms every year, I can tell you that there is no one-size-fits-all playbook that works for every company. However, you do notice some patterns. Common points in a firm’s life cycle where leadership teams struggle to get to that next level.

We call these the plateaus of growth. We use the word plateau because these are the inflection points where firms get stuck, and growth slows or flatlines. This happens because what got them to that size simply doesn’t work at the next phase.

The plateaus of growth

Each growth plateau has its own challenges, and all are hard in their own way. However, we witness companies struggle the most in the jump from $10 to $25 million in revenue, and from $25 to $50 million. Think about how many “lifestyle” services companies you know in that $10 million range. Now think how many you know at the $200 million range.

Each growth plateau has its own challenges, and all are hard in their own way. However, we witness companies struggle the most in the jump from $10 to $25 million in revenue, and from $25 to $50 million.

Before we get to why that is, and what to do about it, let’s talk about the different plateaus of growth and the challenges inherent to each one.

Plateau 1
Plateau 1 is the build phase – the climb from zero to $10 million in revenue and approximately 100 employees. This phase is all about setting the foundational elements: putting together the founding team, crafting the vision, curating the culture, determining what kind of customer and market you’ll go after, hiring the right people to service them, and driving awareness among the partners and influencers that will help you reach those customers.

During this phase, founders tend to tap their existing networks for both customers and the people they hire. This can help create a level of trust in early teams, although it’s not always the best for diversity or customer concentration. This is something to be conscious of during this phase, as it can ultimately impact your ability to scale.

Plateau 2
Plateau 2 is the transition to approximately $25 million in revenue, or about 250 people. This is when founding teams start expanding beyond their known universe, when team structure and processes become far more important. Companies start to look more like companies, with different levels of leadership, at this phase. They have plans and plays, and operate less like a pee wee soccer game where everyone swarms the ball and more like a team with specific positions.

Priorities during this phase include building out go-to-market (GTM) teams (sales, marketing and alliances), managing cash flow as the timing of payroll and collections starts to matter more, and usually fundraising and building out a more formal board of directors.

Plateau 3
Plateau 3 is the push to $50 million in revenue or about 500 employees. This is when refining and scaling a company’s GTM team, strategy and processes becomes even more imperative – especially for growth-oriented services firms looking for an eventual exit. Growing 30-40% YoY on a $30 million revenue base requires more support than growing that much on $10 million in revenue.

In this phase, building out the delivery pyramid with entry-level or offshore/near-shore consultants becomes more important, especially if you want to improve margins and be cost competitive for larger projects where global firms are in the mix. Recruiting, onboarding and learning and development (L&D) programs also become much more vital.

Plateau 4
Plateau 4 takes you to $100 million and 1000 people strong. This is when global expansion, partner diversification, and mergers and acquisitions (M&A) start to play a bigger role in corporate strategy. Revenue predictability, and the capabilities of your systems and process governance rise in importance as well.

The makeup of your workforce and how you incentivize them also evolves in this phase. Larger companies don’t compete on the same things as smaller ones. Employees that gravitate toward larger companies might be more specialized and expect certain benefits, like training, formal career tracks, and larger spans of control. Services firms in this phase also tend to lean into larger customers with bigger programs, and may begin to specialize in specific verticals (if they haven’t already). This too will shape the types of employees you hire and skills they require.

Plateau 5
Plateau 5 stretches beyond $200 million and 1,500+ employees. Whether it’s taken a few years or a few decades to reach this point, the company and leadership team at this phase typically looks very different here than it did in Plateau 1. It’s no longer about defining the culture, it’s about scaling and orchestrating progress across different regions, customers and industries. There are likely hundreds of projects and multi-year programs happening concurrently. As the business grows, and layers inside a business expand, it becomes harder, but also more important, for leaders to stay connected with customers and employees.

We stop at Plateau 5 because so few companies make it to this level before they are acquired, but there are plenty of different inflection points beyond this. All of which have different challenges and opportunities.

Leadership and mindset are key to navigating growth plateaus

A number of factors influence whether firms successfully make the journey from Plateau 1 to Plateau 5, and how gracefully they do so. However the two biggest factors we’ve seen come down to leadership and mindset.

As Jim Collins highlights in his seminal book Good to Great, the best performing companies focus on getting the right people on the bus, then figuring out the strategy. We couldn’t agree more and it’s why we spend so much time with company leadership when we’re evaluating investment opportunities, and supporting and coaching after we make an investment.

A number of factors influence whether firms successfully make the journey from Plateau 1 to Plateau 5, and how gracefully they do so. However the two biggest factors we’ve seen come down to leadership and mindset.

The leaders you have in place during each phase make all the difference. The CEO is the most critical role during each plateau as they’re the ultimate decision maker, and often the biggest influence of culture. However, the leadership team below her or him is almost as important (more on the Starting 5 leaders below).

The company may retain the same CEO throughout the different plateaus of growth, but many do not — and that’s okay. When we analyzed the CEO profiles of more than 100 services firms, spanning $1 million to $200 million in revenue, we found that 80% of companies in plateaus 1 and 2 were led by the original founding CEO. That number dropped to 70% for companies bringing in over $25 million in revenue, and it continued to drop as the companies got larger.

The company may retain the same CEO throughout the different plateaus of growth, but many do not — and that’s okay.

This is because, as a company grows in size and complexity, the job requires different skills AND a different mindset. In the early days, a founding CEO does it all: hiring, payroll, marketing, sales, the list goes on. But as the company increases in size, scope and complexity, vision setting, delegation and communication become more important. At a certain size, the CEO has to decentralize decision making and give autonomy to others so that they can run their parts of the business. They need to find people who make them better, and be less “player coaches” and more of a head coach. Otherwise, they can’t get out of the weeds and see the future. That’s when the business stalls and…you guessed it…plateaus.

Data, controls, governance and shareholder management also become more important at scale. For many entrepreneurs who love the build phase, this isn’t their passion or natural skill set. When this happens, some choose to hire people around them to manage these areas. Some step into new roles to shepard the company to that next plateau. And some cash out and build their next business (or go on a silent meditation retreat to decompress from thinking about their business and people every waking moment).

The starting 5

No matter how great a CEO is, without a trusted, aligned and well functioning team behind them, they simply won’t be successful. At Tercera we often refer to this second level leadership team as the “Starting 5”, which typically includes the company’s:

Head of finance and/or operations
Head of sales
Head of marketing
Head of HR/people
Head of delivery

These are your playmakers. In larger, global companies this team may be larger and more regionally aligned, but for simplicity we like to put it in basketball terms because having the right people on the court, working together as a team on offense and defense, is what wins championships. Assembling the team is the first step thing, but if you want to keep winning, it’s equally important that they remain the right players, running the right offense.

No matter how great a CEO is, without a trusted, aligned and well functioning team behind them, they simply won’t be successful.

The experience level and profile of these individuals will shift throughout the different plateaus, and how well capitalized you are to fund future growth. If you are only $5M in revenue and boot-strapping the business, you probably don’t need (nor could you afford) a big name CRO. Instead you’d likely want to invest in account executives on the ground driving revenue directly.

Our advisor, Jeff Smith, wrote a blog recently on how sales in professional services evolves at scale. Sales is just one role that changes as you scale. Being the head of a global sales process across dozens of people is very different from being an amazing salesperson at a start-up. Tasks like sales forecasting and having a handle on how the quarter is shaping up matter a lot more than they used to.

There are plenty of other things that evolve and grow in importance as a company scales – things like legal, systems and infrastructure, and internal communications. However, if you have the right people in the right seats, those things tend to get prioritized at the right time.

Looking for help?

If you’re an IT services leader stuck in a growth plateau, and are looking for inspiration on how others have made the leap, we encourage you to subscribe to our monthly newsletter with content, case studies and advice from our extended team. Or if you’re thinking it might be time to bring on a capital partner, please reach out to the team at Tercera directly.

Gender equality is a journey: 6 lessons learned from Accenture

March 8, 2024 by Michelle Swan Leave a Comment

It’s 2024, and we’d like to believe that, by now, most organizations are doing more to acknowledge the significance of International Women’s Day than ordering in some cupcakes with pink frosting. Yet few organizations stand out the way Accenture does when it comes to real commitment to gender equality in the workplace.

Given Tercera’s focus on empowering and investing in the people who make technology work — all people — diversity, equity, and inclusion (DEI) is a topic that is near and dear to us. So, it was a privilege to sit down with Zoe Kibbey, Associate Director of Accenture’s DEI efforts, to learn more about the company’s DEI journey.

Accenture is regularly ranked as one of the World’s Best Workplaces, and ranks number one on Refinitiv’s Global Diversity and Inclusion Index (for the fourth time in six years). These achievements don’t happen by accident. Accenture has been focused on DEI since the mid 1990s, and when it comes to gender equality in IT consulting and professional services, they are often held up as the gold standard.

The following takeaways offer insight and advice to any people-centric service organization looking to differentiate itself based on the quality of its talent and human capital.

1. Set goals, not quotas.

While Accenture is a leader in gender equality, it is also a meritocracy. Accenture makes decisions about its people, including hiring and advancement decisions, based on an individual’s merit, and not the person’s identity. The company’s equality goals are based on real metrics and numbers, but they are advanced and achieved by removing systemic barriers that hurt diversity and harm inclusion. The organization intervenes where needed to ensure the right people with the right skill and the right levels of performance have every opportunity to gain access to and then move up in the organization.

2. Go public with your goals and disclose your progress.

Accenture formally put itself out there in 2017 when it announced its goal to reach gender parity across the global talent base. The company is looking to achieve 50/50 gender balance across all roles globally by 2025, with 30% of managing directors being women within the same timeframe. It is well on its way to these goals, and already exceeding them in some cases.

Broadcasting such goals, and being fully transparent about disclosing progress, keeps the goal front and center and ensures accountability. Nothing supercharges an internal effort more than knowing the world is watching.

There are a number of external organizations and indices, such as the Bloomberg Gender Equality Index (GEI), that can serve as guideposts and benchmarks for diversity goals. They can also provide insights into where DEI gaps may exist to help focus efforts. Below is an excerpt from Bloomberg’s DEI Reporting Framework highlighting areas where they measure performance.

3. Be aggressive, but realistic with goals.

While we hold Accenture up as a beacon of what’s possible with the right commitment, it’s important for companies to think through what will be required to achieve their specific goals and not just pull numbers that sound good out of the air. Leaders should understand where they are starting and what is possible in a given period of time. Accenture completed robust modeling to determine their goals, looking carefully at the investments in recruiting, retention, and internal advancement strategies that would be required to achieve different levels of gender equality before making the commitment.

In our discussion, Zoe reiterated that companies need to remember the organization will grow, the economy will fluctuate, and technology will evolve during the timeframe the company sets for its goals. You won’t be making DEI progress in a vacuum, so keep these forces in mind when considering what can be achieved.

4. Embed DEI goals into the business’ broader purpose.

It’s important that any DEI goal be more than a side gig. For it to be a priority, it should tie back to a company’s business goals and advance the organization’s larger agenda. In Accenture’s case, the company understands that it needs the best talent in the world to achieve its mission, which is delivering on the promise of technology and human ingenuity. People with different backgrounds, different perspectives, and different lived experiences are key to innovation and delivering value for all stakeholders around the world.

The company – like so many others – also knows that having diverse teams can have a positive impact on financial performance. Asset Management firm BlackRock recently released a study that shows companies with the most diverse workforces outperform those with the least diverse workforces by an average of 29% a year.

5. Take a holistic approach.

Zoe says she’s always asked about the one thing that is most important to DEI success and it’s a question she can’t answer. It’s never just one program that drives progress but rather it’s the collective impact of all that a company is doing to create a workplace culture that brings a diverse group of people in and helps them grow and thrive once they are there.

Accenture’s diversity programs are broad reaching – from how it handles recruiting and interviews, to a new Allies in Action program the company put in place last year to help people learn what it means to practice inclusive behaviors and be a role model. It’s not just employee programs either. Accenture is well known for its Supplier Inclusion & Diversity Program to incorporate diverse businesses into its supply chain.

According to Zoe, it comes down to a cultural commitment, leadership, and ownership of issues that make the workplace better for everyone, not just women. Simple but powerful things like respecting people for who they are, fostering a culture that values psychological safety, and supporting family commitments.

6. Play the long game and don’t stop when you get there.

Gender equality, or progress on any DEI initiative for that matter, won’t happen overnight. Accenture developed its first gender equality strategy back in 1995 and made its goals public seven years ago, several years before Julie Sweet became the company’s CEO and lent her own passion to the initiative. And they are still on a journey.

Below is an excerpt from Accenture’s 2023 360 degree value report, showing their progress over the last three years of reporting. While a two percent increase in women in the workplace from 2021 to 2023 might not seem impressive, it is when you consider that in 2023 Accenture employed more than 733,000 people and brought in $64 billion in revenue.

Accenture has months left to achieve its long-term gender equality goals and is on track to hit its targets. That in no way means the company will be winding down its DEI programs once these numbers are achieved. The 50/50 gender parity goal is an overall global objective. Some regions will outperform others. There will be key areas where additional effort and focus is needed to get closer to the 50/50 mark.

My take

The IT services sector still has a long way to go when it comes to equal representation for women (and other underrepresented groups) – especially at the most senior levels of an organization. But firms like Accenture offer both inspiration and a solid blueprint for how services leaders can start making progress in their own organizations.

At the very least start measuring where you’re at today. If that’s not where you want to be – which, let’s be honest, few companies are – then set a goal and make it public. That’s what you can do to celebrate International Women’s Day. Save the pink cupcakes for when you hit that goal.