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Enter the world of architectural wizardry, where a seasoned maestro has been orchestrating growth since 2018. On the surface, revenue sings a sweet melody, the team flourishes, but lurking beneath, a dissonance disrupts the harmony. Profits, in absolute terms, ascend, yet as a percentage of revenue, they dwindle annually.
The Architect, content with the traditional notion that expanding businesses sacrifice margins to overheads, sees no cause for concern. But for us, that didn’t ring true. We dived deep, suspecting a Gross Margin hiccup. In the realm of Professional Services, people costs reign supreme, forming the bedrock of Gross Margin.
Our journey led to a pivotal moment: a 3-month odyssey where the entire team, initially reluctant, diligently logged client-wise timesheets. The Architect reassured them, emphasizing this wasn’t a trust issue but a quest for financial enlightenment.
The revelation surfaced after 92 days – a tale of two margins. In some cases, ideal margins or better; in others, a bleak panorama. The culprits? Some teams indulged in an excess time fiesta, beyond the project’s scope, dragging margins down. In the majority, the pricing was a mismatch, insufficient to cover costs, unveiling a symphony of incorrect pricing.
This classic saga showcases how silent issues with seismic repercussions can elude notice. The Founder, armed with newfound clarity, marched forward, adjusting pricing strategies, heralding a renaissance in profitability. An architectural masterpiece crafted not just in blueprints but in the fine details of financial acumen.
