Consultants, this one’s for you. But it’s also for MSPs. And, oh yeah, you IT Admins working for SME’s? I’ll share some tidbits for you on contracting outside consultants/MSP’s!
Business is not for the faint of heart, friends. Folks will start up businesses for all kinds of reasons: they want freedom, they want to make a gajillion dollars, it seems easier than a job, they don’t like having bosses…lots of reasons. What they don’t realize, though, is that all those reasons are idealized dreams. Starting up a business is not gaining freedom, it’s rare to make a gajillion dollars, it’s super hard work, and instead of one boss you have all the bosses. Still, for many of us, the dream of owning our own business is/was well worth the difficulties.
One of the things that make owning a business difficult is the feeling of being constantly in flux. “Change is the only constant in life.” (Heraclitus) I feel you, friends, it can be exhausting. But it can also be a vehicle for growth and success.
Today we’ll discuss how to deal with business changes, how to plan for other options, and how the operational business decisions you make affect IT Admins’ hiring decisions at their SMEs.
How Business Looks Today
Streamlining your business operations can only really happen if you have a solid plan for:
- How you want to operationally structure your business (is it an LLC, a sole proprietorship, a corporation); and,
- The offerings you have available for your clientele (consultancy, MSP, VAR)
In other words…to be successful you really need to take stock of where you are today.
Knowing how your business performed this year (and previous years, frankly) is crucial to being able to project how things will go next year. Realistically, you can’t set goals for the next phase until you know how you got to where you are today. Our IT Toolkit for Admins and our IT Toolkit for MSP’s have some tools to help you gather vital information to help you make informed decisions.
You should look at your financial trends over the past couple of years. Which months seem to be your most active months? Which ones are leaner? Which months or years were heavy for labor and which were heavy for software or hardware purchases? All of these trends should help you plan for the upcoming year.
Your Next Iteration
Every business has cycles. Some months are slower than others. Sometimes the cycle is predictable based on vendor cycles. For instance, you probably see an upswing in hardware installation projects just after Apple ships new equipment. Other increases in business occur for reasons we can’t figure out. My business had an upswing every February. I was never able to figure out what made that such a good month, but it was consistently profitable every year.
Once you know your cycles, you might want to consider some kind of paid advertising in the two months ahead of your typical slow month(s) to encourage project work. Maybe you want to come up with some kind of BOGO offer (for you non-shoppers, that’s Buy One Get One) or a discount for paying up front for services. Maybe you want to spiff your current clients for word-of-mouth recommendations. Maybe you want to hire an outside sales team or buy some lead generation. Or maybe you want to change your offerings completely.
Your previous years’ worth of information should guide your business decisions in the upcoming year. And you’ll need to have that information, along with any market studies or financials, in a single location where you can easily put your hands on it.
The (Ugh) Business Plan
You’re (probably) going to hate me for saying this. Heck, I kind of hate me for saying this. You really really need a Business Plan. Not an “I know what I’m doing, Mom” kind of plan, but an actual written Business Plan with a capital B and P.
It used to be that writing a plan was like writing a novel. Then things got streamlined and now there are one-page business plans – Lean Plans.
I feel like a Lean Plan is great for using in a presentation to, say, investors or banks where you’re looking for a loan or investment. They’re great for working with and networking in your BNI Group and are terrific for ideating new ideas as well.
But to plan your business’s success, you really need to be able to dig into the details. You have to look at the past accomplishments, review past marketing efforts, and review past financial performance… you should also have your marketing study handy. There is a LOT to consider and all that just won’t fit on one neat little page.
We’ll have more on how to assemble and write up this information in an upcoming article but, for now, let’s keep moving while you ruminate on how to collect the data you need to make great decisions.
Defining The Strategy
Once you know where you’ve been and figured out the patterns, it’s time to break out the crayons and start coloring outside the lines.
A one-page Lean Canvas is a terrific tool for quickly outlining what your objectives and directions will look like for the upcoming year.
Download the canvas. Fill this in on your computer or (as is always my preference) grab your favorite pen and fill it in by hand. This is an exercise that can be performed many times throughout the year as you make new discoveries about the way business is performing for you.
Your data may show that it’s time to move into MSP mode instead of just Consulting. It may be that your market research shows a need for VAR services in addition to your MSP. You may want your business to look and feel like a commoditized operation (streamlined to get to the point faster) or maybe you’ll become a white glove service operation (lots of energy focused on communication and education)?
I can’t tell you how to change your business…only your marketing research and financial data can do that. Part of your research should include polling SMEs in your area to find out what their IT Admins will be learning about you from the information in your Business Plan (whether the full version or the Lean Canvas version).
What Should IT Admins Look For?
The IT Admin who is responsible for hiring contractors and consultants needs to ask a lot of questions in order to decide who is and isn’t trustworthy enough to receive the keys to your IT Kingdom.
Things to consider about your candidates (pay attention MSPs and consultants – these are things you should have no hesitation answering):
- Is this a real business or someone’s hobby:
- Do they have a business license?
- Do you pay a person or a company?
- Important: it is fine to hire a sole proprietorship, you need to know what kind of business you’re about to start a relationship with so you know what to expect.
- Who is going to be your specific contact person?
- What is the contractor’s SLA?
- What happens to your account when the owner takes a vacation (because everyone needs time away from work)?
- What (if anything) is included in the candidate’s contract?
- Are there other tasks you can offload to the contractor to make your job more manageable?
- Does the candidate pass a background check?
- Is the candidate bonded (not applicable in all cases)?
- Is there a contract, how long is it for, and how do the parties negate it?
- How do you request service?
- What are their service hours?
Do your research. Do a background check. Call their references. And be kind…don’t leave the candidate hanging. Let them know an expected decision date…their time is valuable too. And don’t ghost them; let them know if you’ve chosen someone else.
Consultants, make sure you have all your information and handouts ready for your presentation. Know your audience and know your business. You don’t get a second chance to make a great first impression.
Do you have great tips on planning for next year? Do you have some questions you always ask a contractor candidate? What does your MSP do that’s amazing (or what do you wish they did)? Share your successes, questions, and not so great moments with us in the Community.