×

What this CEO learned by taking her company virtual

Just over a year ago, my company was headquartered in one of the most exclusive office buildings in Calgary, with neighbors including big banks, hedge funds, big law firms and multinational oil companies.

It isn't any longer.

We had achieved modest success in a highly crowded consulting space, but the business was difficult to scale without significant investment. The consulting market is also increasingly fragmented, with market share decreases for even the largest firms—now at 20 percent on average versus 60 percent to 70 percent some 30 years ago, according to Kennedy Consulting Research & Advisory.

Our executive team recognized it was time to enter the 21st-century way of doing business. In short, we were ready for an extreme organizational makeover.

Source: Office Space | Facebook

Since 2007, we have been helping clients improve their workplaces by implementing flexible work arrangements, reducing overhead and making the workplace more efficient through technology. The irony is that we maintained a traditional work model.

Our first step toward evolution was research. Our findings reinforced our hypothesis: Clients today are no longer willing to pay for fancy offices, overeducated and underexperienced MBAs, or large teams to solve relatively simple issues. They want authentic, long-term relationships; lean teams to work with them, not directing them; and, most importantly, they want value, not flash.

Read MoreHow to make a living off Amazon

We realized it was time to ditch our office space.

We gave up our downtown offices and moved into home offices and onsite client offices.

We embraced cloud technology, telecommuting, flex work and client-based schedules to meet 24/7 client needs, and we engaged a contingent workforce for specialized projects. We have occasional in-person team meetings, and we videoconference with team members in other cities as required. At the end of the day, we focused on process, communication and service delivery, not infrastructure.

The 3 big implications

The implications for the organization and clients are significant:

1. Client service

Employees now work when they, and their clients, want them, and the new model has improved their work-life balance through flexible hours and a lenient telework policy.

2. Retention

Client and employee retention are both at 100 percent for the past year, largely due to the improved client-value proposition, availability outside the traditional 9-to-5 workweek hours and specialized workers.

3. Business growth

Revenue has doubled in one year, and margins have remained stable, while our billing rates were lowered to as much as 70 percent below a traditional firm and team compensation increased.

The parts of the traditional model that we eliminated are costly overhead fees, antiquated consultant-pay systems and unnecessary staff. Furthermore, lowering overhead costs and office-capacity constraints has enabled the company to take on smaller clients that would not have been profitable in the past.

Wavebreakmedia Ltd | Wavebreak Media / 360 | Getty Images

The 5 key takeaways

1. Look beyond your competitors for a new business model.

We did a lot of research and focused on broader trends, like the shared economy (Uber, Lyft and Airbnb). We looked at who was creating new and unique office spaces (WeWork, Facebook and Google). We went outside of our industry.

2. Don't wait until after a final decision to talk to clients.

Recognize that your clients are the reason you exist today, and ensure them that they are part of the process. Talk to them about your new direction and get buy-in. But don't approach them with a broad statement like, "What do you think we should be doing?" Instead, present the new direction to garner input and consideration. If you are looking to broaden your client base, talk to prospects as well. Often the best and most candid information comes from clients who passed on your services the first time around. They can help pinpoint the changes that would get them to engage your services.

3. If you lose the office, you need to find the right people.

When business models evolve, so do the key attributes of successful employees. Our new model offered excellent perks for our team, like flexible work hours and working from home, but it requires self-motivation and a hypervigilant focus on client service. This skill set is unique, but when you find the right people, they are really engaged.

Read MoreThe new banks for small business

The Society for Human Resource Management reported in a recent study that 77 percent of workers achieve greater productivity working off site and 23 percent are willing to work longer hours than they would working on site. This has been our experience as well. As an added benefit, a nontraditional workforce can offer your organization the ability to tap into extensive networks of technical experts, innovators, non-local talent and seasoned professionals you may not otherwise attract.

4. Make the new model part of your story.

Changing your brand is risky, and in the absence of information, people often assume the worst. Clarity on who you are is critical. We wanted to be a sophisticated consulting group with a nontraditional model trailblazing the 21st-century work model. This is the "Who we are" statement we developed to share with all of our existing clients:

Our business has joined the 21st century. We no longer have a wood paneled boardroom, a team of assistants or brass statues in our halls. What we do have is a team of caring, highly experienced and skilled human resource professionals offering top-notch advice either on site or off site, on a flexible, as-needed basis. We will never charge you by the minute for calls, for photocopies, unnecessary team members and travel costs. We don't charge extra for working at your place or ours. By eliminating the overhead costs, inefficiencies and stress, we save businesses a lot of money. And by giving our team control over their schedules, we also enable weekend and evening availability and more midday workouts and children's soccer game attendance.

5. It's always going to come down to execution.

The most critical aspect of any business model is execution, and in a nontraditional business model, the only way you are measured is on client delivery and value. In our case, we hammer home client response as one of our key differentiators, so we can't afford not to deliver consistently. Measure it, manage it, and never sway from this.

By Debby Carreau, CEO of Inspired HR and a member of the CNBC-YPO Chief Executive Network

About YPO

CNBC and YPO (Young Presidents' Organization) have formed an exclusive editorial partnership consisting of regional Chief Executive Networks in the Americas, EMEA and Asia-Pacific. These Chief Executive Networks are made up of a sample of YPO's unrivaled global network of 20,000 top executives from 120 countries who are on the front lines of the economy. The opinions of Chief Executive Network members are solely their own and do not reflect the opinions of YPO as a whole or CNBC.