A new $100,000 engagement can be very profitable, or be one that loses the firm a lot of money. Yet many firms reward partners for the volume of fees {top-line} that they bring in, not whether or not they bring in profitable work.
David H. Maister Managing The Professional...
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The quote highlights a significant issue in professional service firms related to how partners are rewarded. Firms often focus on the total fees generated by partners, without considering the profitability of the work they bring in. This can lead to situations where a large engagement might appear beneficial on the surface, but in reality, it could cause financial losses for the firm.

This approach can create misaligned incentives, where partners prioritize securing high-volume work instead of ensuring the engagements are lucrative. As a result, the financial health of the firm could suffer, demonstrating the need for better performance metrics that account for both revenue and profitability.

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Managing The Professional...
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David H. Maister
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