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Love Thy Competitor

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If you are the type of Freelancer/business owner who believes that a primary business goal is to annihilate and destroy your competition,  then you’re likely destined to become a less successful entrepreneur.  Research can now demonstrate the wisdom of the adage,  “keep your friends close and your enemies closer.”

A 2004 study conducted by James Westphal,  professor of management at University of Texas/Austin,  examined CEO friendships in 293 U.S. companies and found that regardless of the intensity of competition within a given industry,  rival CEOs who formed friendships enjoyed distinct business-related advantages over those who shunned competitors.

According to Westphal,  not only is it possible to make friends with competitors,  it’s advisable.  He explained the advantages of friendships among rivals this way:  when business owners get together,  what do we do?  Talk shop.  We compare notes,  discuss what’s new in the industry,  talk about the economy and how it’s impacting customer behavior.

In other words,  by going to trade industry conferences and meeting,  greeting and getting to know rival Freelancers,  you’ll obtain information and get exposure to perspectives that can help make you more successful.  So think about following a bit of counter-intuitive advice and realize that business is not always a zero-sum game.  A competitor’s win does not automatically mean your loss.

If getting chummy with the competition makes you feel a little queasy,  then get friendly with a competitor based in another locale.  The distance will create a boundary that could make it comfortable for the two of you to trade ideas about cheap and savvy advertising options,  how to make your clients happy,  or how to take advantage of,  or protect yourself from,  market trends.

In some instances,  you may decide to collaborate with a competitor.  It’s potentially risky,  but forging a strategic  collaboration with one of your competitors can benefit the bottom line and help both entities to thrive.  It can be a smart expansion or survival strategy for Freelancers and other small business owners who are trying to remain viable.  Maybe there is a partnership you can set up with the right semi-rival?   It’s called coopetition.

Get to know a fellow Freelancer who works in your own,  or a related,  field.  It’s preferable if each of you has discrete strengths,  with limited potential for overlap.  Meet for coffee and broach the subject of joining forces to make money.  How can you combine your strengths and approach clients with an innovative and more desirable package?  There’s nothing better than giving clients more reasons to do business with you.

Collaborations can work in a number of ways.  Just a couple of months ago,  a lady named Julie presented me with an idea where we can add-on or up-sell certain of each others’ services.  There is potentially a complementary need in a market segment that we share and Julie wondered if some selective cross-promotion would be beneficial.  Together,  we’re hoping to gain entry to clients where separately neither could get in the door.

Another form of coopetition is establishing a referral relationship with a near-rival.  Accountants and bookkeepers have done this forever,  with much success.  Their functions have similarities,  but each party knows and respects the boundaries and knows how to work together.

Nevertheless,  do not be naive.  Take precautions and clearly define boundaries and expectations.  Watch your back and work only with someone you know to be trustworthy.  Also,  do not underestimate the potential for difficulties in establishing and sustaining a coopetition arrangement.  Assumptions about appropriate customer service or corporate culture can derail your best intentions.  Careful planning and execution are crucial if coopetition is to work smoothly.  In close collaborations,  a written non-disclosure, non-compete agreement will be essential.

Finally,  remember where friendship ends and business begins.  There will be sensitive issues that are best kept to yourself,  like new business initiatives or the  “secret sauce”  of how you deliver your unique services.  Keep your antennae raised as you and a worthy competitor mull over ways to share resources or expertise and boost profits in the process.

Thanks for reading,

Kim

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What’s Your Influencer Score?

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If you have a Facebook,  LinkedIn or Twitter account, get ready to have rating points assigned to your online presence.  There’s yet another way to keep score in this world and the newest yardstick is your social media reach. The rating system resembles a credit score or Google page ranking and it assesses your social media power and influence.  Three companies, Klout, Peer Index and Twitter Grader, will analyze and determine who the heavy hitters are.

Who are the movers and shakers,  experts and taste makers,  across a range of topics and specialties within a certain geolocation? Marketing departments want to know.  While authors, celebrities, politicians and athletes have traditionally been capable of influencing opinions on a large scale, social media have given a powerful voice to ordinary citizens and a new league of authorities has emerged.

The rating companies measure your Facebook (Klout),  LinkedIn  (Klout, coming soon)  and Twitter  (all three)  friends,  connections and tweets on their respective algorithms.  According to analysts at Hewlett Packard who tried to crack the codes,  a large network of contacts and friends is not the primary value of the influencer score.

Peer Index focuses on topic resonance  (how much interest you generate within your area of expertise),  subject authority  (perceived credibility and trust)  and activity  (how much content you generate within your topic)  in its ranking recipe.  If you’re looking to game the system  (you wouldn’t try that, would you?),  it is beneficial to become well known for a particular topic and avoid being a generalist.

In other words,  go narrow and deep.  Boost your influencer score  (and online brand)  by demonstrating knowledge and expertise,  trustworthiness and credibility and enthusiasm and passion for your preferred subject.

Furthermore,  demonstrate your ability to influence those in your network with calls to action and recommendations that engage and inspire followers and friends and cause them to spread the word about your choices and opinions.  Did you get out the vote for Obama or persuade people to join the revolution in Cairo? If so, then you are an influential social media darling.

Surprisingly,  blogs,  newsletters and YouTube are not in the ratings mix at this time,  but tweets and online profiles most definitely are.  The rankings of your connections and friends also factor impact your score,  as do the rankings of those who retweet you.

It’s possible to sign yourself up for free and learn your Twitter rating on Peer Index http://peerindex.net or Twitter Grader http://twitter.grader.com and your Facebook score on Klout http://klout.com.  The latter recently announced a deal to rank LinkedIn profiles  (I wonder if activity on the Answers Forum will be in the algorithm?).

So what’s in it for high scorers? Thousands of companies have already signed on to buy data and big influencers are positioned to receive all manner of promotional goodies.  As reported in The New York Times on June 26, 2011,  Audi will begin to offer special promotions to Facebook users based on their Klout scores.

Last year, Virgin America selected highly rated Facebook influencers in Toronto and rewarded them with free round-trip flights to Los Angeles or San Francisco.  The Palms Hotel and Casino in Las Vegas used Klout scores to choose Facebook influencers and give them either free room upgrades or free admission to Cirque du Soleil.

Nevertheless,  a corrective is in order.  While it is apparent that social media influencers exist and in certain circumstances they are able to impact the actions and opinions of others,  they do not necessarily live up to the hype.  Duncan Watts,  author of  “Everything is Obvious Once You Know the Answer” (2011),  asserts that the  “influencers”  do not always obtain impact through their expertise,  persuasiveness,  popularity or reputation.

Watts used computer simulations to model how information is likely to disperse through social media and found that the spread of an idea or story depends upon  “a critical mass of easily influenced people,  who in turn influence other easy-to-influence people.”  When this critical mass exists,  “even an average individual is capable of triggering a large cascade.”

Well,  so much for algorithms.  However,  it may be fun to sign up and get your influencer score anyway. You might somehow manage to get a high rating,  perhaps because you’re connected to other high influencers,  and get some promotional comps as a result.  But then again,  being connected to the right people has always  been how to get the goodies,  with or without social media influence!

Thanks for reading,
Kim

Professional Development , Leave a comment

The Ideal Network

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We’ve all encountered people whose primary goal is to create a vast network of  “contacts”.  These folks supersize.  They have an enormous collection of Facebook friends and they exchange business cards with everyone they meet,   inviting one and all into their LinkedIn network.

But what do their  “contacts”  actually mean to them?  Do such collectors of contacts follow networking best practices and act as a resource? Would they actually even recognize many of their  “contacts”  if they ran into them at the grocery store?  Too often,  the answer is no.

I’ve had the experience of being sucked into the clutches of a few super-networkers and found that when I emailed an easy and uncomplicated question,  my inquiry went unanswered.  Needless to say I severed the association but I’m sure my absence is neither missed nor even noticed.  Who can keep track of or maintain contact with 500 connections?

Well I’m happy to report that at last there is data that supports what has long been my gut feeling about networking.  Apparently,  when it comes to our network of relationships,  size matters and smaller is better.

Robert Cross,  Associate Professor at the University of Virginia’s McIntire School of Commerce and Robert Thomas,  Executive Director of the global consulting firm Accenture’s Institute for High Performance,  contend that the most effective networks focus on high-quality relationships,  ideally with people who come from diverse levels of the corporate and/or socioeconomic hierarchy.  Cross and Thomas found that a properly functioning network consists of about 12-18 people.  The ideal network provides guidance,  exposes us to fresh approaches to decision-making and problem-solving,  challenges us and also gives us validation and encouragement.

A diversity of professional and personal interactions pays numerous dividends,  socially and professionally.  We get to meet and rub shoulders with those who’ve lived different lives and therefore have different values,  perspectives and experiences.  We learn how to become more flexible and resilient.  Our decision-making capabilities improve because we incorporate additional information and we become better leaders and better business people.

Take a look at who you know and who you consider to be a member of  your network.  Who looks out for you and who do you look out for?  Cross and Thomas recommend that we cultivate relationships in these categories:

  • People who share or expose you to new information or expertise,  e.g.,  giving the heads-up on happenings in your business environment.  This could be a client or someone from the chamber of commerce or other business group.
  • Peers in other industries,  who can open your eyes to what other organizations consider to be best practices or smart business strategies.
  • Powerful people,  who can open doors,  make introductions,  cut through red tape,  provide useful inside information and mentoring.
  • Those who know and validate validate your work and can provide feedback and challenge you to get better (maybe a client,  peer  or boss).
  • Peers in a business similar to your own,  but who are based in another geography and therefore allow you to discuss business strategy and not worry about competition.
  • People who provide personal support,  good friends and family you can call on when things go wrong and you need to talk.
  • Outlets for spiritual and physical well being:  fitness,  meditation,  religion,  volunteering,  sports and hobbies.

As you review and perhaps revamp your network,  look to include people who bring good energy,  people who bring out the best in you.  Build relationships with people who see opportunities and know how to reach for them.  If you’ve been gestating an important goal you’d like to achieve,  think about who in your network can help you get there?  Is there someone you should reconnect with?

Most of all,   remember that networking is about building and maintaining relationships,  whether or not there is an immediate need to call in a favor.  Reciprocity rules,  so maintain contacts,  reach out and reconnect to good friends and colleagues and be generous when they are in need.

Thanks for reading,

Kim

Business Strategy , , , Leave a comment

Face Your Financials

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Although you may have both an accountant and a bookkeeper on your payroll you, the business owner,  still bear the ultimate responsibility for maintaining the financial health of your enterprise.  Every business owner should be able to understand and make good use of business financial data.  Each financial statement has a story to tell and you the business owner must be able to decode the language and comprehend the information that the numbers relay.

There are three financial documents that are generated monthly  (and also compiled quarterly and annually): the Balance Sheet, the Cash Flow Statement and the Profit & Loss  (or Income)  Statement.

  • The Balance Sheet resembles your checking account monthly statement.  This document details business assets and liabilities,  showing the monetary value of all the business owns and what it owes.
  • The Cash Flow Statement is the business budget and shows what sales revenue will flow into the business and what expenses will flow out.  This document helps you stay on top of how much money is available to cover expenses,  like payroll and rent.  Accounts payable  (the bills)  and accounts receivable  (sales revenues)  are listed on this statement.  If you’ve ever managed a household budget,  then you can master the Cash Flow Statement.
  • The Profit & Loss  (or Income)  Statement is similar to the Cash Flow Statement.  It contains many items that are also found on the IRS tax form Schedule C,  Profit or Loss From a Business.  Sales revenues and expenses are listed on this statement,  including labor,  taxes,  inventory  and the wholesale costs of products sold.  Net Profit (also known as the bottom line)  is  the last line of this statement and this figure represents the ultimate story of business financial health.

One does not need a degree in accounting or an MBA in finance to identify which numbers on financial statements are most critical to your business and understand the story that each one tells.  Keeping track of five or six key values,  including values called ratios,  will do wonders for your comfort level with financial analysis and in the process,  guide your business decisions in many ways.

  • Gross Profit  in the P & L tells how much money remains after selling and product production costs,  or the wholesale cost of products sold,  have been tallied.  Freelancers calculate this figure as time: how many hours were spent on your contract project,  networking to create new business,  developing a new workshop? Make a reasonable estimate of the wholesale cost of your labor.  This figure gives insight into how much money/time  it takes to make a sale.  Can you work smarter and faster,  or buy materials for products manufactured more cheaply? That’s how to increase gross profit.
  • Net Profit,  or the bottom line of the P & L,  tells the ultimate story.  Every line item that precedes it impacts it.  If you want that number to be larger (and don’t we all?),  look at all expenses to see what can be trimmed and also consider ways to generate new business through strategic partnerships,  referral relationships,  networking for client development,  PR,  etc.
  • Gross sales revenues  in the P & L may be tracked in two ways,  looking back over what occurred in previous months or years  (historical comparison)  and going forward  (projections, or forecasting)  to what you reasonably expect and want to sell in a given period,  guided by sales history and current demand for your product/service.  Are you achieving,  exceeding or failing your personal sales goals?

Finally,  see your Balance Sheet and calculate these ratios,  to expand your grasp of the financial data:

  • Quick Ratio = Accounts Receivable + Cash – Inventory divided by Accounts Payable    This figure indicates how much money is available to pay bills.  A 2:1 ratio represents a business in good shape.  However,  a big receivables number can mask clients who take longer than 30 days to pay,  thus signaling the owner to step up collection efforts.
  • Current Ratio = Assets divided by Liabilities   This figure measures resources available to pay debts over the next 12 months.  A value > 1.0 shows a business in good shape,  > 2.0 is a business in excellent shape.
  • Working Capital = Current Assets – Current Liabilities   This figure also demonstrates the ability to pay off short-term debts.  Obviously,  a positive number is what you want.
  • Debt to Equity Ratio = Total Assets divided by Total Liabilities   This figure indicates how much debt the business carries relative to its assets.  A value <0.5 is excellent and values > 0.5 mean the business is carrying rather heavy debt and is considered highly leveraged.

Thanks for reading,

Kim

Technology / Office , , , , 2 Comments

In the Cloud

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Cloud computing hooks you up to numerous computer based business functions,  including email,  website hosting and data storage,  directly through the internet.  Access to those computer functions,  which you select based on your needs,  is available from any computer that has an internet connection.  When your computer functions are in the cloud,  your business is truly mobile.  You can tap into your data and work from anywhere in the world.

Needless to say,  cloud computing offers big advantages to businesses and individuals.  A big plus is the tremendous flexibility available.  It’s possible to access numerous computer applications and software functions and operate your business entirely in the cloud.  Users of cloud computing essentially rent space on a virtual server and order a la carte the applications and functions that are desired,  be it Linux or Windows.

From the cloud,  you can request functions specific to your business,  without buying an entire software package that may cause you to pay for and install what is not useful to you.  One can order online accounting and payroll management functions,  for example,  rather than buying Intuit’s QuickBooks software.

Cloud based website hosting can be customized to provide the appropriate bandwidth to support video,  audio,  e-commerce, survey, etc.  Furthermore,  cloud computing is significantly less expensive to operate as compared to buying separate software components like the latest Windows,  traditional website hosting,  plus whatever else your business must run to operate efficiently.

There will be less money tied up in technology and more money available for marketing,  customer outreach and otherwise carrying out the business mission.  Prices start at about $4.95 US per month.  Amazon,  Google,  IBM,  Microsoft and Yahoo are among the companies that offer cloud computing services.

Many familiar online functions already live in the cloud: gmail and Hotmail; VoIP telephone services like Google and Skype;  social media sites,  including Facebook,  LinkedIn and Twitter;  media services like Flickr and YouTube;  and Microsoft WebApps,  which offers internet-based access to Excel,  Outlook, Power Point, Word,  etc.

So should you migrate your online operations to the cloud?  Maybe,  maybe not.  Cloud computing may be pervasive,  but it’s not yet perfect.  Reliability,  security and privacy are real concerns.  The major cloud service providers claim they deliver 99.95% availability with 5 hours/year downtime on average.

Nevertheless, during the week of April 21-24 of this year,  the data center that houses Amazon’s Elastic Compute Cloud servers (EC2) went down and internet access for thousands of businesses was lost as a result.  Although this exciting new technology is being promoted as safe,  comprehensive,  user-friendly and inexpensive,  the underlying infrastructure may not be there yet.

Moreover,  can some pimple-faced brat hack his/her way into your data and wreak havoc on your business?  Let’s pray that never happens,  but to provide the maximum available protection to the integrity and security of your cloud computing,  be sure to use secure sockets layer (SSL) encryption to keep your user name and password safe.

Issues of capability and capacity have also been raised.  Can the present technology support the fast expanding weight of VoIP,  website hosting,  video streams and data storage demands?  What happens as developing nations in Africa,  Asia and Latin America ramp up their internet access and 3 billion more global citizens elect to join the cloud?

All that remains to be seen,  but my guess is that the necessary upgrades will be made to accommodate new cloud users,  because money is the mother of invention.  Data security is probably the larger issue.

On Friday June 10,  the International Monetary Fund learned it was the victim of a major cyber attack.  The data breach occurred over several months and has the potential to expose highly confidential information about the fiscal condition of many nations.  In an article that appeared in the June 12, 2011 New York Times,  the incident was called  “political dynamite”.  There was no mention as to whether the IMF computer system operated in the cloud.

Thanks for reading,

Kim

Survival Strategies , Leave a comment

Launch Your Part-time Business

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Here’s a sampling of part-time business suggestions that will jump start your brainstorming and get ideas flowing for a business you can run while also keeping your nine to five.  Oh,  and do be sure to keep your business activities separate from your job,  meaning,  don’t tell your boss and co-workers what you’re up to.

Baker

First,  decide if you’re a bread baker or a pastry chef: will it be baguettes and croissants,  or cupcakes and pies?  You can sell your wares at neighborhood street fairs and farmer’s markets.  Do some market research and take a tour of local venues,  to see what sells in which marketplace,  at what prices and to which customers.  Check the licensing requirements of your state and city health departments and also find a commercial kitchen to give yourself the capacity for high-volume baking.

Bookkeeper

Those with experience in corporate finance departments,  payroll departments or accounts payable/receivable are the best candidates to set themselves up in a tidy little part-time bookkeeping business.  Brush up on your QuickBooks skills and promote yourself to Freelancers,  churches and small businesses.  Join your neighborhood business association to meet potential clients.

Caterer

Are you a fabulous cook who knows how to serve and present food elegantly and efficiently?  Does the prospect of preparing Christmas dinner for 12 or a buffet Easter brunch for 50 fill you with excitement and make your organizational skills shine?  If that is the case,  then catering on the side may be an ideal money-making and creative outlet for you.  Hone your chops by taking over the preparations for a few large family events.  Graduate to getting hired for dinner or cocktail parties held by friends of friends.  Consider renting commercial kitchen space to make cooking for large events easier.

Floral designer

If you’ve always known how to compose a pretty bouquet,  upgrade and refine your natural abilities by taking a flower arranging course at an adult learning center or community college.  Next,  identify good flower market and floral supply wholesalers,  so you can provide a wide selection of fresh and exotic blooms arranged in the loveliest vases and still earn a good profit margin.  Promote your services to those celebrating anniversaries,  births,  christenings,  graduations or other special occasions.  Form a strategic partnership with a (part-time) caterer who needs to decorate a party.

Gardener

Do you have a green thumb?  Do you know people who have no time for yard work?  There is money in mowing lawns,  trimming hedges,  tending window boxes, weeding and coaxing roses to bloom.   My mother’s uncle started a part-time gardening business which he ran for at least 20 years.  My father worked with him on many spring and summer evenings throughout my childhood.  The more artistically inclined can create a niche in landscape design for residential clients and neighborhood merchants.  Remember to include Christmas decorating in your list of services.

Hair stylist

So maybe you were a hairdressing school dropout? Pick up those scissors again and revive your skills,  so you can offer wash,  cut,  blow-out and maybe even color and straightening services at your kitchen sink or the client’s.  Friends and friends of friends who need makeovers,  or maybe just maintenance,  will appreciate both your talent and at-home discount prices.

Photographer

If you’re a clever shutterbug,  invest in a good digital camera,  become a Photoshop expert and  pull together a portfolio of your work to show to prospective clients.  You may even want to specialize in a niche,  like weddings  or family reunions.  Form a strategic partnership with a web designer who creates sites for Freelancers  and make money taking the all-important website photo.

Tutor/coach

Are you a good teacher?  What is your area of expertise—golf, tennis, algebra or languages? Open an account at Craig’s List,  to advertise your services.  Those who teach an academic subject should also contact local parent’s groups, neighborhood blogs and local schools.  My brother’s wife has taught piano for several years and she’s quite busy.  She is a full-time wife and mother of four.

Thanks for reading,

Kim

Survival Strategies , Leave a comment

Having it Both Ways with a Job and a Business

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To my readers in the weekly paycheck world: do you sometimes wonder what it would be like to chuck your day job,  become the captain of your destiny and start a business of your own?  Maybe you have a special creative talent,  something you do that makes you feel proud and fulfilled,  something that friends and colleagues always compliment you on?

Maybe you already daydream about starting a business,  but fear that you don’t have the resources or temperament to grow it into your primary source of income?  Perhaps you need a few extra dollars each month,  because your paycheck is no longer big enough as prices at the gas pump and grocery store continue to rise?

You can have it both ways and start a part-time,  on the side business while you continue to work full-time and enjoy the security of a regular paycheck and health benefits.  People have done it for years and for all sorts of reasons,  mostly as a cash flow safety net,  but also to provide an outlet for a creative talent.

Former full-time employee and part-time business owner Felicia Joy has coined the term  “hybrid entrepreneurship”  and she defines the process as  “the act of working a full-time job while building a business part-time.”  Joy explains it all for you in her new book  “Hybrid Entrepreneurship: How the Middle Class Can Beat the Slow Economy” (2011).

Joy advises that although your part-time business venture will not be your main source of income to still treat its launch seriously.  She recommends that you write a business plan to ensure that you cover all bases,  such as devising a good marketing strategy,  identifying your target customers,  perfecting the business model and assessing start-up costs.

Furthermore,  Joy says it’s important to create a professional image for your business: print business cards,  build a website,  have appropriate print collaterals,  open a separate business email account and maybe also have a separate business telephone line.

Network for your business venture,  so you will meet peers with whom you can form strategic partnerships and referral relationships that will help you to grow your business more quickly.  Join a professional association related to your business,  to receive access to information and other resources that will help you grow as an entrepreneur.

At work,  volunteer to take on assignments and lead projects that will help you acquire skills that you’ll need in your business,  such as sales,  operations,  bookkeeping or marketing.  As Joy says  “Learn to leverage your day job in a way that helps you in your business and also helps you at your job.”

Next week,  I’ll give a few examples of part-time businesses that you may want to start.

Thanks for reading,

Kim

Marketing , 2 Comments

The Remix: How to Win the Consulting Game

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The greatest truth about Freelance consulting is that it is a marketing business.  If we expect to be successful,  then we must  artfully package ourselves and our services and promote to those with the money and motive to award us high-paying projects.  The ability to view yourself as your ultimate product,  creating and executing self-marketing strategies,  requires a good amount of self-esteem and a dollop of fearlessness.  Not everyone has what it takes.  To be successful in this business,  it is necessary to model yourself as a consulting company of one and learn to swim like the big fish do.

Let’s first get our self-esteem on track.  Learn to fully own and value your skill set and communicate your self-worth to one and all  (in a healthy way).  You’ve acquired an impressive array of competencies over the years.  That knowledge base is your calling card,  your brand,  your intellectual property.  Never position yourself as subordinate to the client.   The Freelance consultant is a peer.  We have a particular expertise that the client does not possess.   That is why we’re needed.

Second,  let your business practices reflect your self-worth and stop billing hourly for your work.  Alan Weiss,  author of  “The Consulting Bible” (2011),  recommends that Freelance consultants bill on a project basis only and avoid billing hourly.  In fact,  Weiss advises that you not work with a prospective client who insists upon an hourly rate,  because the amount of time it takes to produce the deliverable is not the issue.  The impact of that deliverable on the organization is the issue and the two must not be confused.

So when you’re in your next prospective client meeting and you’re talking turkey,  reach a mutual understanding with the client regarding the project’s objectives and clarify how your success will be measured.  Ask your prospect to explain the impact that meeting those objectives will have on the organization.  Let the answer determine your project fee.

Weiss also says that if your intellectual property,  i.e. your work,  will help an organization save a significant amount of money or measurably improve its marketing position and/or sales,  then the Freelance consultant should receive 10%  of the value of the gain.  In other words,  billing on value = billing on outcomes + impact,  hours be damned.  If your client is too obsessed with hourly rates,  nickling and diming on costs,  then find another client.

Third,  let’s take a look at marketing and promotional strategies.  Revisit my May 10 post and get inspired to write a book,  whether you create your own book deal and self-publish,  or manage to finagle a traditional publishing agreement  (Weiss did the latter).  Weiss insists that a book deal does wonders for your credibility and gives your consulting career a major boost.

He also claims that it doesn’t matter how many copies you sell,  just get your book into print.  I’m afraid that I must respectfully disagree on that last point,  however.  Being on The New York Times best-seller list has got to make a huge difference in more ways than one!

Additionally,  Weiss points out that speaking at a trade association meeting is yet another consulting career-booster,  as are teaching,  blogging and writing a newsletter (as I’ve mentioned countless times).  All of those strategies give a competitive advantage,  leading clients to view the published Freelancer as a thought leader and a cut above.  Clients will consider you an expert and they’ll be more likely to seek you out to discuss upcoming projects.  The axiom  “publish or perish”  is no longer limited to academia.

Finally,  do not be shy about approaching friends,  family and former co-workers to discuss new business opportunities.  Spell out to folks what it is you do,  the clients you usually work with and the projects you like to take on.  Always keep in touch with your network and remember to help them out,  too,  because it’s good karma.

Thanks for reading,

Kim

Marketing , , , , Leave a comment

What Consulting Companies Know

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There are certain similarities between consulting companies and Freelancers.  The firms work on a project basis, as we do. They submit proposals and compete for clients, as we do.  Like us, the firm’s consultant comes to the client’s organization as a hired gun, takes on the assignment, produces the deliverables and gets paid.  The similarities seem to end there, however.

The fact is,  consulting companies get a lot more respect and a lot more money than Freelancers.  The consulting company’s value-added is perceived as more valuable than the Freelancer’s value-added.  Most clients have a great deal of trust and confidence in consulting companies (well, at least the person who hired them does).  As a result,  consulting companies are awarded the most lucrative projects.  Their calls and emails are always returned.

Likewise,  Freelancers who have worked for consulting companies are held in higher regard by clients and prospects.  Anecdotal evidence leads me to believe that they receive more lucrative contracts,  billing more hours and commanding a higher rate. Freelancers with a consulting company background appear to know a secret code,  know all the right moves.  I came to realize my knowledge gap through a series of casual meetings with an acquaintance of mine named Erika.

Erika once worked for a mid-size consulting company,  first in their LA office,  then in NYC.  Like me,  she facilitates strategy meetings in the for-profit and nonprofit sectors,  but we cannot call each other competitors.  Erika stands head and shoulders above me in terms of consulting savoir-faire and client list.  Next to her,  I am the country cousin!  Erika is a very cool girl and over time she took pity on my poor, untutored self and shared a few consulting company secrets.

Primarily,  the advantage gained from consulting company experience is that one learns how to build value into all client interactions.  The perception of adding value starts with the very first client meeting.  A consultant’s job is to deliver comprehensive,  data driven analysis,  insights and answers that produce the desired results. Those analyses,  answers and insights form the basis of the strategies that the client will be advised to implement,  so that key goals and objectives will be reached.

Erika lets it be known that she will deliver the goods.  In the client meeting,  she asks questions that reveal what the client wants and help her discover what the client needs–that information forms the essence of Erika’s value-added.  Next,  she confirms with the client that she’s accurately grasped the project scope and understands all priorities and timetables.  She follows up in writing and in fact boasts that she does not so much submit proposals as send confirmation letters.

Erika isn’t awarded every assignment she’s invited to discuss,  but her track record is very good.  Before she starts work on a project,  she also takes a few important actions to keep her value-added rolling:

I.  Recognize,  and if possible meet,  the organization’s senior management team: the CEO, ED and other key staff.  Their names and sometimes also photos are probably listed on the company website.

II.  Learn the thought process that led to the project’s initiation and approval.  If possible,  read the project proposal and review any preliminary work that may have been done.  Find out who supports the project and who opposes it if you are able, to learn who your friends and detractors will be.

III. Know the organizations’ basic financial data.  Read the most recent annual report and examine the P & L to learn the annual operating budget,  total annual revenue,  gross profits,  profit margin and operating margin.

IV.  Know your client’s top five competitors: key products and services,  annual operating budget,  total annual revenue and gross profits.  Know what differentiates each main competitor from your client and know each main competitor’s strengths and weaknesses.

V.   For nonprofit organization clients, know which agencies within a 10-20 mile radius deliver similar services or compete for a similar constituency.  Know where and how those agencies offer services that complement or compete with your client’s mission.

VI.   Cultivate good relationships with your project sponsor and other key project supporters.  Identify a couple of good restaurants near your client’s geography and invite your sponsor and/or those with whom you work most closely out for coffee or lunch,  as applicable.

VII.  Become a resource for useful information to your client.  Sign up for Google Alerts and stay current with industry news and competitor’s activities.  If an item looks particularly intriguing or urgent,  send the link to the right people.  This practice can continue after project completion,  as can the above strategy, to extend relationship building and value-added.  Your objective is to entice the client to engage you for repeat business and to refer you to others.

Thanks for reading,
Kim

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Give Yourself a Book Deal

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I’ll probably not do this for myself anytime soon, but since I’ve mentioned the topic several times in this column,  I decided to finally do some research and figure out how one goes about getting a book in print.  Note that I did not say “how to write a book”. You’ll have to figure that one out for yourself!  Hint: first,  have something relevant and compelling to say and second, money and sex are two very popular topics.

However in this post,  I will dare to assume that readers will produce a business-themed book on a subject in which they’ve acquired considerable expertise. Writing a book is a marketing tool that can carry a Freelancer for years.  A book gives its author gravitas. The author will definitely be  positioned as an expert,  considered a more attractive conference speaker or panelist,  a more credible source to quote by journalists.  You are an author,  an authority.

The original method of getting a book into print was to write up a book proposal and shop it around to publishing houses that specialize in books in your subject.  If the proposal looked strong enough to generate sales that would justify the time and money involved in editing,  printing  and distributing the book,  then the author would receive a letter inviting him/her to discuss the proposal.

That is still done,  but not nearly as often.  There are far fewer publishing houses now and competition by aspiring authors looking to get in the door is intense.  It would be almost impossible for the average Freelancer to publish a book conceived to be used for self-and business promotion to succeed in the traditional manner.

Self-publishing houses and similar operators have stepped into the breach and opened the doors wide for those who have a business to promote,  a story to tell,  or a family history they’d like to document in print and pass on to future generations.  Self-publishing is most suitable for authors who are unlikely to attract a traditional publisher and who will sell directly to  readers from the author’s website,  at seminars or at other gatherings.

So let’s get started on your book deal.  Begin by visiting the websites of self-publishers to compare services and prices.  Createspace and Lulu are two outfits to consider.  When evaluating services,  pay attention to exactly what it is you will pay for and watch out for hidden fees.  Look for non-template, customized cover design charges;  editing and copy editing (i.e., typos) charges;  and distribution and renewal fees.  Expect to pay $1500.00 – $4500.00 to edit, design and print your book.

Examine with great care (and perhaps with the assistance of an attorney who specializes in the field) the subject of author rights.  True self-publishing means that all rights to the book lie exclusively with its author.  Furthermore,  clarify whether you are able to terminate your publishing agreement at will and without penalty.

You’ll need to decide if you’d like your book to appear in print or as an e-book.  Maybe you can do both eventually?  In 2010,  e-book sales accounted for 9%  of the overall book market,  according to the Association of America Publishers.  The e-book trend is upward,  spurred on by Nook and Kindle.

How your book will look (print style, lay-out, etc.) and the design of the front and back covers are another big concern.  You may want to hire a graphic artist with experience in book production to do art and design work.  Chances are that your money will be well spent. Your book must look professional and represent your brand well.  Also,  be sure to use the appropriate paper stock.

Do yourself another favor and hire a copy editor and a proofreader.  In fact,  this will be among the most important investments in your book’s production.  It is absolutely crucial to ensure that your book has no errors.  Your professional reputation depends upon it.  Your publishing service may offer copy editing,  but they may not be especially diligent.

Becoming a published author is a much more attainable achievement today than ever before.  Your book will be a useful marketing tool,  a door opener and a confidence builder for both you and prospective clients.  A significant amount of work must be done to bring the book to life and it will be necessary to carefully research available options—just like any other major goal you plan to reach.  Additionally,  it will no doubt be useful to seek out the blogs of self-published authors for more information and the real inside scoop.

Good luck and thanks for reading,

Kim