Hope you are having a good holiday and perhaps even relaxing a bit. I myself am attempting to catch up on some reading. Though “catch up” is more of a convenient phrase to use than actual fact. There’s always more to read (and do for that matter)…not that I’m complaining.
On with today’s topic…
Independent consultants may be in an enviable position within the world of business. Our services, by their very nature of not being tangible, allow us to be more agile. We can adopt to changing market demands.
This is especially true for us IT consultants. After all, regardless of how many folks are laid off, how badly capital budgets are cut in the near-term, etc. – nearly every organization has investments in IT infrastructure. And it’s nearly a given that a good part of it is necessary to supporting the mission of the organization — through good times and bad.
In fact, with layoffs and hiring freezes, some organizations may increase their use of consultants and contractors because it doesn’t require the same approvals that hiring a new employee would and it doesn’t commit them to keeping another body around. You’re also probably going to be “cheaper” than keeping someone around with your expertise full-time.
That’s all well and good but what should you actually DO to increase your chances of being hired for a gig (or kept on) in more uncertain times?
Aaron “Crooky” Cruikshank, the Founder of Friuch Consulting, sums it up quite nicely:
“Find new pain points, serve them.”
That may sound disingenuously simplistic to some but it’s really the essence of serving your clients – in good times and bad.
Elsewhere he makes an observation and argument that knowledge workers, which includes us, have always done better even in economic downturns:
And in a prior post where he advocates against “undercharging”, he hits on it also from the angle of the tendencies a few of us may have during an economic downturn:
“People starting out in consulting today might think that they need to go down market to succeed in a shrinking economy. I respectfully submit that such thinking is bunk. What you need to do is find a niche that is not something everyone else is doing and sell it at a premium. For example, when the economy is tight – offer a service that makes people think they’re saving money. You’re a webmaster? People still need websites, even when the economy is in the toilet. Make your niche designing websites in the most affordable way possible or link your design techniques to a measurable return on investment (ROI) so that the client can be sure they got their money’s worth.”
I’ve often heard Dan Kennedy, a highly successful consultant as well as marketer, state that we consultants are selling “dollars at a discount”. That is, we are (often) hired to save our clients money, increase the money they receive (improve ROI), or (indirectly) help them avoid some other pain that would cost them money at some future date.
We can talk about cool software features and faster IP networks but everything we do must be translated into its benefit to the business. We’re in the “dollars at a discount” business. Ponder that and consider how you fit into that arrangement with your clients. Then consider whether you are effectively _communicating_ your worth in terms of business benefits.
Now some of us will certainly suffer during economic downturns….just as we would if we relied too much on a single client (such as our ex-employer turned first client). Anytime something impacts our client relationships our weaknesses are exposed.
Warren Buffett used the phrase “After all, you only find out who is swimming naked when the tide goes out” shortly after September 11, 2001. He was referring to insurers who weren’t prepared for the worst and thus were suffering mightily – some fatally. It’s an appropriate metaphor for many recurring situations in history – and thus in business and in life.
If one of your weaknesses is your new client pipeline and thus far you’ve been getting by because you’ve had one major client that accounts for most (or all) of your income, this may be the time to evaluate what you should be doing to mitigate that risk a bit. Purchase a bathing suit, if you will.
On the upside, when business does slow down a bit for us, there is more time to spend on some of those put off activities such as building up a marketing funnel (generating leads, encouraging referrals, increasing repeat business, list grooming, relationship building). If you aren’t familiar with these topics, spending time may include educating yourself more, finding some mentors, and seeking out other (farther along, more successful) consultants, etc.
As a side note, there may be some promotions you can tie into the current economic concern mindset that you can offer specifically to your current (and past) clients. How can you be their dollars for a discount in this time of their greater need for capital?
(Within all problems lie opportunities).
(adapted from the very post I made, which was e-mailed out to the first few subscribers to join ITConsultingLessons.com, on 11/29/2008).