Usually, the team will be sent away from the first such meeting to revise its thinking, and return for a second presentation. In most cases, this process will result in a clear plan of action and a request for some form of investment. When the management has listened to (and challenged) the plans of each of the groups, it will now be in a position to develop a strategy for the firm. It has heard the “best shot” of each group in describing the opportunities available, and can now decide on the aggregate level of investment it thinks prudent to make, which opportunities seem the best investment and which will make the firm strongest. Management can then negotiate with each practice head any modifications for action plans not fully approved or funded.

In some firms the formal management group might choose to involve other senior people in either the “friendly skeptic” critique process or the final resource allocation decisions, rather than doing it alone. In part this choice will be based on considerations of whether firm harmony will be promoted or compromised by doing this

The results of this strategy process at the firm level should be a set of “contracts” between the firm management and the leaders of the various practice groups. The contract should spell out the measurable goals the group is aiming for, the action steps they plan to take, the investments they require, and the support they need. It is also a good idea to ask for some “milestone” points: “When will we review progress and how will we measure whether it’s working!?”

Excerpted from ‘Managing the Professional Service Firm’ by David Maister, page 229