Consulting Practice Economics & Profitability Management Playbook
- Executive
- Intermediate
- Template Included
A framework for managing consulting practice profitability by understanding and deliberately managing its specific component levers — utilization, realization, margin, and revenue mix — rather than treating profitability as a single number to react to after the fact.
What's the difference between utilization and realization?
Utilization measures how much of a consultant's available time is billed to client work. Realization measures how much of the billed rate is actually collected (versus written off or discounted) — a practice can have high utilization but poor realization, and both matter independently for profitability.
Which lever matters most for improving practice profitability?
It depends on which is currently weakest — this playbook's core discipline is diagnosing which specific lever is actually constraining profitability in your practice, rather than assuming a generic priority order.
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