Life in a Professional Firm vs. Life in a Commercial Firm – Episode II

In the 1st Episode, I shared about some lightweight differences between life in a Professional Firm (“PF”) and Commercial Firm (“CF”). PF and CF have also been defined there.

For the second installation, let’s look at some more pertinent differences…

Profit centre vs. Cost centre

This is by far the most significant difference should you decide to switch over to CF.

In a PF, you render your professional service to client thus generating revenue for the firm. The reports that you produce and the hours that you slave are all translated into $$$ for the firm. You are known as the profit centre (“PC”).

Being in the finance or legal function in CF would mean you will be looking after the welfare of the firm, not the clients. It means you do not generate any revenue for the firm. You will move from being a revenue generator to being a cost burden. You are now a cost centre (“CC”).

Naturally, PC is given more privileges in CF. They are the breadwinner of the firm and hence, they tend to be well taken care of. Their “voice” tends to be louder, their gatherings will be more lavish, their departmental trips will be more luxurious; and you will have to live with it.

Don’t fret though. Though PC will be getting higher pay and bonus, the general pay structure in a CF would still be better compared to PF.

You may want to check out other perspectives on being profit centres vs. cost centres.

Advisor vs. implementer

In a PF, you are a consultant. You are the expert who tells your client what to do and how to do it. It does not matter whether your expert advice is workable or otherwise, your job is to tell your client what is in the rule and what the available options are.

In a CF though, your focus will change. The management do not expect you to tell them what to do; they expect you to do it. You are there to make things happen. If you need resources, you have to voice out. You are the expert who has been employed to deploy.

This is when you suddenly realised that you are not that expert as you think. You will suddenly realise all the so called technical knowledge you gained while in PF may not work. And so, you might end up being a “client” to PF and boss the partners that you once report to. Sounds fun, isn’t it?

Learning vs. contributing

It’s funny that people join PF to learn. They are supposed to be the expert and top consultants, providing top notch advice and yet, people join them to learn. While in PF, I was once told that I am to act like an expert in front of a client even if I am not. I was supposed to be the expert consultant, but I was actually just learning. Ironic isn’t it?

Quite similar to the preceding point of advisor vs. implementer, the learning takes a dive when you move to CF. Instead of learning, you should be contributing. After all, you are the expert in the CF that you work in. Of course, there will still be things to learn but it will not the skills that you have been hired to perform.

It can be quite a daunting expectation. One should be mentally prepared.

Technicality vs. Commerciality

Last but not least (for this episode); discernment between technicality and commerciality is crucial when you work in a CF.

In a PF, it’s all about technical knowledge. During performance evaluation, you will always be asked to improve on your technical knowledge. Which section, which rule, which paragraph, while law, which regulation, they should all be in your fingertips. In your mind, everything is written in the book, you just follow.

Things take a whole new perspective when you enter CF. When in PF and you tell your clients to do this and that and they reply saying they can’t do it and can’t provide this and can’t implement that and you will be wondering why they can’t do it. When you are in a CF, you will know why.

Sometimes, doing the right thing may not be commercially justifiable. Sometimes, the right thing just can’t be done. Maybe it will cost a lot of money, or result in loss of revenue. Your role in a CF is to strike a balance. You are the expert who is there not to advise, but to implement measures to look right even when it’s wrong.

Just like how you found out that things learned in university are mostly futile when you work, things learned in PF may not be that useful either when you are in CF.