Maintaining Solid Client Relationships More Important Now Than Ever

Maintaining a good relationship with your clients just seems like common sense. The funny thing is, many consultants (and other business owners) regularly fall into the trap of creating an adversarial relationship with a specific client from time to time. This can ruin an otherwise fruitful relationship for no good reason. Often, the reason boils down to simple pride. Now more than ever, maintaining or fixing damaged client relationships is critical. Here are a few tips:

The client is always right.

This is one of the more annoying truisms out there. Nonetheless, it should be a core part of your client relationship strategy. In the end, you are in business to serve the client. Even if the client is wrong about a specific point, if you really listen, what you will hear is what they really want now. In the end, isn’t our job to serve the client? Sometimes people change their minds and often they don’t like to admit it (especially if they believe it will increase billable hours). Find a way to accept the client’s position and be constructive about any differences. No matter how right you are, in the end it just doesn’t matter. So why worry about it?

Provide value beyond what was agreed to.

Most of us (unless you own a monopoly) have to compete at some level. Competition can be stiff, especially in service industries where the differentiating factors that separate one vendor from the others are so hard to see. One of the ways to make sure that your firm excels is to exceed expectations as a matter of policy. Now, sometimes you’re going to fall down. In the end, the client is much less concerned with you making a mistake as they are with how you handle it. If you make a mistake be honest about it and do your level best to make the client whole (and then some). The client will trust you even more and that is a good thing for everyone. If you don’t make a mistake, make sure that you provide services beyond what is called for in the contract. This can be as simple as advice or not billing for something that you could have. From time to time I get asked to deliver something that was not called for in the agreement. Sometimes we won’t bill for this to help keep the client on budget. Your client will be appreciative at your helping keep costs down and will be more likely to hire you again or recommend you to others.

Reach out to clients as often as you can.

Clients want to know that their vendors are thinking about their business. Besides, there is no better way to build a relationship with your clients than to talk to them frequently. In order to add value you should be truly engaged in your clients industry. That might include reading trade publications, researching what their competitors are doing, etc. This will provide you with opportunities to reach out and open non-project oriented discussions with your clients where you can not only add value, but will most likely learn what your client thinks about key issues. This may present an opportunity to up-sell other services as well. At the very least it presents an occasion to support your client and provide extra value.

These tips might seem obvious and easy to do. But the fact remains that most service providers fall down here as they are too busy chasing new revenue. Your existing client base is your core. Every day you should try to think of a way to add value for them. It will make your business more stable and your clients happy. These happy clients are the ones that will ultimately support your own company’s growth through recommendations and referrals.

Making things Happen: The Price of Being Idle

One of the most interesting comments that I get from people is that I must somehow “be different” from other people in order to be able to get as much done as I do. My partner and I always seem to have several new ventures in the hopper and we still need to serve our clients from our previous ventures in order to fund the new projects and pay our respective mortgages.
The fact of the matter is that my business partner and I are no different than anyone else. We do however have a couple of traits that make it seem like we are considerably different. I for one, try to live by these maxims in order to keep sane while getting more things done. They are:

Be fearless.

This one is important. If you stop reading after this, then I’ve made my key point. Most people who wish they could start their own business (but don’t) are all saddled with themselves as their biggest obstacle. Many very smart people have great ideas and can’t follow through because they are totally afraid of failing. In my experience these people spend way too much time worrying about what other people will think of them if they fail or have an over-inflated opinion of themselves and just can’t bear to shatter the image. Fact is that all entrepreneurs fail and fail often. It is those failures that often help us come up with the winning ideas.

Try first, research later.

From the time when we are little, people tell us that “you can only learn by trying.” Then we become adults and somewhat professional and we are totally paralyzed unless we analyze everything half a dozen times. In business, learning form experience is just as true now as it was when you were a toddler. I am not suggesting that you go off all half-cocked and spend your hard earned dollars on a venture that was not well thought out. I am suggesting however, that once you have a reasonable strategy and a good idea of what you are going to do that you develop a simple plan for a proof-of-concept. In most cases, a smaller product with more limited functionality can be built for less money. Getting this into the hands of key customers or friendly prospects will help you fine tune your idea based on real market feedback instead of an academic exercise. This is still directionally correct and will significantly reduce your overall business risk.

Always have something new in the works.

Markets change. New competitors come online. New opportunities arise when you least expect it. Even if your venture is already successful you should be looking for the next one. This can mean a new product under the same flag serving a different market, not necessarily a totally new venture. Having more than one idea in the hopper keeps you fresh and stimulates you intellectually. Even if you don’t execute on any of them, working on new ideas will always make you smarter at running your existing venture. Either way you can’t lose. My partner and I try to launch one new product or venture each year. Sometimes it is simply a new service line. We weigh our ideas based on the amount of capital required to get it off the ground, the reasonableness of the concept and the time to market. Sometimes this works and sometimes it doesn’t. But in the end, we all become smarter for the effort and that helps our consulting practice.

Abandon what doesn’t work.

This one goes hand-in-hand with the first maxim. If you try a bunch of stuff, some won’t work. Unless you are King Midas and everything you touch turns to gold, you will come up with some ideas that fail. Even if they seem like a good idea but are just ahead of their time, or market conditions just aren’t quite right, you can’t hold onto a business that will not eventually self-fund. Let the bad ideas go. You may resurrect some later, but more than likely they will just fade away and become overshadowed by newer better ideas in the future.

Only worry about what you can control.

Once you decide to execute on an idea, you now have created a monster with more moving parts than you can reasonable control at once. Generally, the big things are obvious. Smart managers delegate or otherwise outsource non-core operations and focus their energies on what is most important to growing the business. When something is beyond your control, don’t worry about it. It is a waste of calories and always results in lost opportunities. Focus your energies on what you can control and do the best you can. When things go wrong, adjust. If you always focus on what is important and do your best, everything will generally fall into place.

In the end, nothing is more expensive than being idle. If you are not moving forward then you are moving backwards. There is no such thing as standing still because the world will move without you. My partner and I are not different from any other entrepreneur. We just don’t make excuses and if you don't eaither, you will find that it is never quite as hard as it looks.

The Outsourcing Advantage: Saving Money in a Down Economy

Tough economic times make many businesses think twice about spending money. Usually, the first people to get cut out of the budget when cash gets tight are the consultants. The interesting thing is that in many cases, a good outsourcing program can help companies spend less money while getting more done. This is especially true with application development projects. So the snap reaction of cutting outsourcing spending may actually cost the company more money in the long run (in lost opportunity) as well as in the short run (in project dollars).

There are several main advantages of outsourcing software development efforts. They are:

1. The development team is dedicated to the effort resulting in a shorter development timeline.
2. The project team members can be much cheaper than the more expensive in-house staff.
3. The development costs can be capitalized if the developers go away at the end of the project.
4. Key staff can focus on growing the business while the project moves forward.

The fact of the matter is that even with all the productivity gains in recent years employees can still only be counted on to be productive for around 50% of their day. The remaining half of the average worker’s day is filled with answering emails, sitting in meetings, eating lunch, talking in the hallway or on the phone, surfing the internet, etc. That combined with the competing priorities associated with having multiple projects on their plate (not to mention keeping things moving for existing clients) means that they can simply not compete with a standalone, dedicated project team.

A blended project team that uses a combination of U.S. and offshore resources give businesses the advantage of a locally based senior consultant to help them with their project while also allowing them to enjoy cost savings associated with an offshore team (without the headaches). This approach can save companies up to 120% on a well executed project. These savings are based on the average costs for a 90-day application development project for my company (see http://www.ifconnect.com/) as compared to the wages over the same period for workers in similar positions in the Boston, MA market as reported by the U.S. Department of Labor’s Bureau of Labor Statistics.

One effect of outsourcing that is often overlooked by managers is the impact of the opportunity costs associated with not outsourcing. Because a project can be completed more quickly and internal staff can remain focused on key initiatives and running the business, companies can get more done quicker. The net effect can be higher revenues in the period and the ability to bring a product to market more quickly. Both of these conditions can serve to reduce business risk and help prop up revenues under certain conditions.

In addition, as long as the software being developed provides the company with some future benefit then the development costs can be capitalized. The main advantage of capitalizing your software development effort (as opposed to expensing it) is that it aligns your investment dollars more appropriately with the future revenue you expect to reap from making the investment. This allows you to protect the profitability image of your company in the current period, which can help with debt financing, etc. If you do not expect to realize a financial benefit from the development effort (as reflected in new or increased revenues or real dollar savings) then you should not capitalize. Your accounting professional can help you determine the eligibility of your project.

If you already outsource then you should think twice before cutting back. If you don’t outsource already, then you should consider how outsourcing might help you reduce your business risk and get more done for your budget dollars. After all, getting things done is more critical now than ever.

Online Collaboration: Why You Should Consider It If You Haven’t Already

The sharp increase in the number of companies offering “cloud computing” or “software as a service” solutions has increased dramatically in recent years. This, naturally, has resulted in a sharp increase in the number of companies that have discovered online collaboration as a new way to do business. Interestingly, there are still many companies that continue to operate business as usual without taking advantage of some of the cost effective products that are now readily available.

There are a myriad of good reasons to collaborate online with your employees and customers. If done properly, this can create a closed “community” where ideas are exchanged in a secure manner in order to move a business idea or product forward. Here are a few other good basic reasons to collaborate:

Transparency – By moving operations into a virtual environment management has better visibility into internal processes and client interactions. Searching across project documents can improve efficiency and ensure that expensive resources are being used wisely.

Security – Many businesses ignore the fallibility of email by using it as a rudimentary workflow platform. Using your inbox as a work queue is an inefficient workflow method at best. Transferring sensitive financial data via email opens your business up to considerable risk from unsavory characters (accountants take note!).

Business Continuity – By ensuring that critical data and documents are centrally located on an off-site server (via a third party solution) companies will ensure that their business information is well protected from catastrophic system failures and employee shenanigans.

Relationship Management – Using a collaboration platform wisely can help companies get closer to their clients. Clients can access the information they need when the need it through various search and data visualization tools. Key product managers can create virtual focus groups to ensure that product features are being fully utilized. User manuals and other useful information can be easily accessed by customers. This can all result in fewer client services calls, reduced support costs and happier clients.

Communication – Many applications available in the market today also include the ability to assign tasks and proactively push important messages to members of your network. This type of dynamic communication around projects can ensure that project risk is mitigated to the greatest degree possible and that stakeholders’ expectations are being appropriately managed.

Cost – In many cases, a cloud computing model will save you money. In the end, you are sharing the cost of sophisticated software with other subscribers. If you had to purchase software with the same functionality it would be cost prohibitive both from a licensing perspective and from a maintenance perspective.

Infrastructure – If you are a start up, a few well placed subscriptions can have the effect of quickly building out all the infrastructure you will need to support your new venture. This is not only cost effective, but also an expedient way to move forward while freeing you up to focus on growing your business.

Despite the benefits of this type of solution, managers should make sure that they still maintain some sort of platform independence. For example, make sure that any solution you choose allows you to export data into an easily digestible format in case you want to switch to another provider at some point. Otherwise you might find yourself married to a third party simply because they own your data. Try to look for one that will allow you to integrate with other standard applications, like MS Outlook or QuickBooks. These providers realize that they can’t be all things to all people and expect that their users will want to streamline their activities further by blending functionality from multiple platforms. The best solutions are not threatened by this type of third party integration (they encourage it).

Many of you reading this are already using some sort of collaboration tool. But if you’re not, then you should seriously look into it before you get left behind.

Expanding Capabilities and Reducing Operating Costs in a Tough Market

It is impossible for all companies to be all things for all clients all the time. Many companies try, but these are usually businesses whose leadership tends to be a little controlling or fearful of the competition. In the end, this can result in resources being stretched too thin or costs being carried that are simply not necessary. In a tough economy this kind of business stance can be a death knell for a small business.

One way to maintain or expand your company’s capabilities while controlling costs is to outsource certain non-core functions. Another effective means is to identify “delivery partners” who have business lines or service offerings that are complimentary to your own.

When the number of companies out there spending money starts to get thin the companies with the most capabilities will often win the most contracts, so long as their price structure is under control. Adding a delivery partner will help your consulting or IT shop by giving it broader reach and set it up to penetrate deeper into your existing client base. In addition, you might find that it can have a significant impact on your overall “deal flow.”

In my company we look for delivery partners whose businesses not only provide complimentary services but whose target market looks a lot like our own. Everyone knows it is easier to approach a warm lead than a cold one. If you and your delivery partner can share client lists or at least collaborate on how to approach each other’s clients then you can increase your respective deal flows while shortening your respective sales cycles. This is a big deal in any market, but it can be crucial to survival during tough economic times.

One thing to be wary of is partnering with firms that feel they must have a piece of the profits from any deal that you do with their clients. My rule of thumb is that although I might be willing to pay a finder’s fee in some cases, the fact is that unless my partner is adding specific value to the deal they should step aside, as should I in the opposite case. Not stepping aside runs the risk of pricing the deal too aggressively and losing an opportunity for both you and your partner (not to mention leaving a bad taste in the mouth of an otherwise good client). The best approach is to bring your partner to your clients with the idea of helping your clients, not making additional money for you. A good partner will try to reciprocate if possible. It’s simply good corporate karma.

If you can’t find a delivery partner that you can trust, you should seriously consider outsourcing certain non-core functions. At the very least this will cost you less than having an FTE perform certain non-core functions. But it also might result in an improvement in your overall employee and customer services. For example, even if you have the utmost respect for your office manager and she is a wiz at QuickBooks, chances are she is just not as current on employment laws and practices or possess the same skills as an HR professional or CPA.

In addition, you might be able to outsource non-core client facing functions as well. There are ample opportunities to do this in the technology arena (from software development and hosting to SEO and email archival).Depending on the nature of your business you might find that you can employ a call center (onshore or offshore) to perform some of your basis phone based services. This way you can ramp up and down with the ebb and flow of your business without carrying extra headcount.

In the end, we all need to be more creative in a down market. Finding a way to outsource non-core functions or developing relationships that will help you grow or preserve your market share is simply good corporate practice. Why try to do everything yourself?

Don’t Worry About the State of the Stock Markets; Just Be ready For the New Economy When it Emerges

Consultants and other professional services firms are wholly dependent on their clients’ ability to spend money for their own growth. With the market behaving like a bad dream this can be quite disconcerting. So what should we do to survive, never mind grow? That is the real question.

Unfortunately, most people are “looking down” right now. This is a problem. I’m not suggesting that consulting firms and other professionals shouldn’t be doing their best to cut costs and manage risk. Any business owner should take responsibility for managing his/her business intelligently. What I am suggesting is that the market gyrations that we are currently experiencing right now (including the credit crunch) should not be what companies focus on.

At some point in the not so distant future, maybe six months maybe two years, things will loosen up. The thing is that when the dust settles the economy may not be something we recognize easily. The rules may have changed a bit (literally in the case of highly regulated markets like banks). So consulting firms should spend a little time getting their houses in order so they may prepare for the inevitable downturn, but then they should aggressively remake their businesses to be well positioned for the “new” economy. So what does the new economy look like?
Here are a few trends that we are focusing on:

• Workforce Mobility – We believe that when the economy emerges from the current malaise most traditional companies, even those that were reluctant to outsource in the past, will begin to view outsourcing as a required means of doing business. This will reflect both the maturity of today’s technology and a general reluctance to operate with a significant cost base (see my posting from October 8th titled “Creating Collaborative Products for a Troubled Market”). A much larger percentage of the pool of eligible workers will be contractors not FTE’s going forward.


• Workplace Automation – Although this trend has been ongoing for years, we believe that the trend will continue and will reach into markets that have traditionally been reluctant to pursue technology solutions in the past. A few notable markets that we are looking at are the legal and recruiting markets. More on that later.


• Information Aggregation – In the 1990’s the financial services industry in particular enjoyed centralized data resources provided by data and content aggregators. In the new economy even companies whose information has existed in a silo will begin to demand integration between internal content and outside sources. This might include the medical profession, for example. As more and more patient data becomes available in medical systems there is a market opportunity for those firms that find a way to blend patient metadata with outside data (keeping HIPAA compliance requirements in mind, of course). This will not only help the medical and insurance industries reduce costs and risk but could result in the development of improved therapeutic methods for the population at large as well.


• Outsourcing – Yes, outsourcing. At some point protectionists are going to realize that the power is where the growth is. That is going to be Asia in the next decade. Europe has simply regulated itself into a stagnate state We can look inward as a society and hold off the inevitable for a while, but in the end western companies need to be more global in order to be well positioned for the next boom-time. That means that even small companies need to begin to develop relationships with offshore partners or else they risk being left behind. All the old arguments for not outsourcing simply do not hold water anymore and if managed properly, a blended solution that uses onshore and offshore resources can actually create high paying jobs at home (see http://www.jlroy.com/Documents/jr_Outsourcing_IBJ07_rev.pdf for more information on this subject).
  

Despite the state of the economy I am optimistic that there is still plenty of opportunity, if not in the short-term then certainly in the medium to long-term. The trick is to make decent predictions and try to position yourself for the inevitable changes.

Practical Business Continuity: What Does it Mean for Your Business?

What is “business continuity” and what does it mean to your business? A quick search on Wikipedia says that business continuity “is an interdisciplinary concept used to create and validate a practiced logistical plan for how an organization will recover and restore partially or completely interrupted critical (urgent) function(s) within a predetermined time after a disaster or extended disruption”. That’s a good technical definition but it is not particularly helpful in telling the average business owner what to do to protect his or her business.

Most large businesses have some sort of plan in place for hurricanes, earthquakes, catastrophic power failures, cyber attacks, viruses, etc. In the end they tend to lose more data from disgruntled employees anyway. For small businesses, planning is much less complex but is often ignored. Chances are your hard drive will simply fail and you will lose data. No hurricane, no virus, no disgruntled employees. But in the end the effect is the same. You have lost mission critical data and now you have to scramble to maintain momentum in your business and serve your clients.

All businesses, even the small ones, need some way to safeguard their companies in case things go south. Business owners should think about continuity planning as a “self-insurance” policy. We buy business insurance to protect our firms from things that are beyond our control. Why not write your own policy for things that are within your control?

If you own a software or records management company then you probably already have pretty sophisticated disaster recovery plans in place. But what if you own a small consulting practice or work in a professional field such as the accounting or legal profession? These individuals are extremely susceptible to data and document loss but rarely do more than back up files from time to time on a flash drive or central server. These companies also have data and documents spread out over a widely distributed workforce on laptops and tend to outsource many basic functions. Outsourcing alone means that a business’ command and control over critical business information is further compromised. This can also be a risk for any company with a geographically based sales force. So how do you protect your business?

First, decide what is important to your business. In most cases the business information on your hard drive is all you need to rebuild your business and maintain momentum. Your financials, sales data, customer lists, client documents, etc. tend to be resident on a single PC for each employee.

Once you’ve identified the “gotta have” data a documents make sure that you organize it. Put all your key data into a single directly on your hard drive. In my business, each venture I own with my business partner has its own directory. In this way I can have an extremely complex sub-directory structure that logically organizes my information, but from a continuity perspective all I have to do is make sure that just one directory is backed up to protect the whole venture.

Find a solution that works for you. The problem with burning CD’s or backing things up on external hard drives or flash drives is that external drives fail and you can lose a flash drive. Additionally, we can be our own worst enemy. By depending on ourselves, we have to remember to save data and documents not just periodically, but each time we create a new document or make a significant change to our data. I don’t know about you, but when I am in the middle of my busy day I am not thinking about business continuity – I am thinking about serving my clients.

What does this mean? It means that once you have organized your data you need to find a solution that solves the problem in the following ways:

1. Copies critical data to a remote location.
2. Ensures that data is backed up without your proactive intervention but without preventing you from being proactive.
3. The solution must account for the hierarchy in your business. Each employee, contractor, vendor and even clients can have data automatically backed up into a centralized location.
4. Make sure that you can easily recover and access backed up data. Simply zipping data files up and shipping them offsite does protect the data, but leaves you dead in the water for a time as you try to recover. Make sure you can rebuild your data structure with a few clicks.
5. Ensure that you can find what you need quickly. A solution that bundles all your data into one bucket without offering a sophisticated search function may leave you in a lurch as you try to respond to clients during your recovery process.

There are a variety of tools that could work for your business. My firm (http://www.ifconnect.com/) and its parent company have determined that although there a many good solutions out there, most fall short in some way. So in November 2008 we are introducing Praura (see http://www.praura.com/). The first iteration of Praura will blend some basic collaboration and document management functionality with simple to use fully automated disaster recovery features. This fully integrates your business continuity solution with you core business operations, resulting in cost savings and superior protection for your business.

Whatever works for your business, it is important that you find a way to protect against the unforseeen. A little self insurance never hurt anyone and the responsibility for protecting your data is yours, after all.

Consulting Sales: The Expertise Conundrum

One of the most daunting challenges facing any service provider, especially consultants, is sales. In order to build a successful consulting practice you must have credibility and experience, in short you must be a domain expert in the areas where you are consulting. So how come it is so difficult for domain experts to sell their expertise? They are proven experts after all.

It is difficult because “expertise” is an inherently intangible item. And the more expertise you have, the more difficult it can be to sell, as backwards as that may sound.

Selling the intangible is difficult because it is not readily apparent where the value is. Even if you clearly articulate your value proposition, not everyone will understand exactly how your expertise will benefit their business even if they recognize you as a subject matter expert. But that is only part of the problem. Even if you are successful at adequately explaining the value of your services, the act of selling your expertise can actually turn off many potential clients regardless of whether or not you could in fact help them.

For example, an expert in systems integration hears that the Universal Widget Company was just acquired by Widgets International. Everyone knows there is considerable overlap between these two companies and integration challenges abound. Since this is such a hot prospect, the integration expert contacts the CEO of Widgets International and offers her services, explaining how much experience and expertise she has with just this kind of project. The CEO politely listens to the pitch because he does in fact need help. However, our expert is surprised when she reads an announcement that Widgets International has just engaged a competitor with less experience to help with the integration.

Why did our expert lose the opportunity? The reason is that like many consultants her pitch was exclusively focused on her expertise and experience. The consultant was explaining why her background and experience would benefit Widgets International. At best, this approach did not focus enough on the value that could be reaped by Widgets International through an engagement and at worst turned the CEO off by indirectly implying that he and his team were not skilled or experienced enough to handle the integration on their own. Even if it is true, nobody likes to be made to feel inadequate.

Selling expertise is a delicate process. The best way to sell expertise is to not sell it at all. Instead of discussing past successes and track records the consultant should sell bundled service offerings that deliver specific values to clients. In short the consultant should sell a “product.”

If that product makes sense to the client and seems like it will deliver enough value, they will investigate the experience of the consultant and be pleasantly surprised to learn that he or she does in fact have a great track record and solid client list. If you cannot generate interest for your product at the beginning of the sales process then your background does not matter and you’ve quickly ruled out a prospect with minimal expenditure of time and effort.

One of the most important lessons to be learned here is that the process of productizing your services will ultimately convert an intangible offering (i.e. “expertise”) into a tangible product (i.e. “bundled integration services”).

Another advantage of productization is that is creates opportunities to up-sell other packaged services once you’ve established a relationship. The same consultant that is an expert in integration in the previous example probably has other skills, such as process improvement, change management and organizational development. Once a client has purchased one product from you they will be more likely to purchase others as their needs change because you already have established credibility.

For more information on productizing services please visit http://www.jlroy.com/JLROY_LearningCenter.htm.

Selling Expertise to a Suspicious Market

Starting a business carries risk. During the early stages of developing any business concept an entrepreneur is essentially a business person operating without the safety net provided by an employer. Even after their product or service concept has been defined and has matured somewhat, the entrepreneur must still work to overcome considerable business challenges unique to start ups while also shouldering the burden of running a business. For those entrepreneurs who are starting a professional services firm there are also some special challenges.

One of your first challenges as a new consultant or service provider is creating a market for your services. In order to do this, you must make your expertise clearly understood by the marketplace. Traditionally, all new consultants make the same mistake at this point.

Consultants tend to believe that their past history and track record is what sells their services. So the first thing they do is build a website. This is a requirement, of course, for any new business today. But the content that you include on your website matters. The typical consultant’s website reads like a resume that was simply divided up into separate web pages. Fact of the matter is that prospective clients care very little about what you have done for others. They want to know what you can do for them specifically.

My experience has been that very few prospects even ask for references. They know you will load your reference list with only people who like you. The prospects that we are able to convert to clients we convert simply because we were able to present them with a viable solution to their specific business challenge at the right time. More importantly, we go out of our way to show them that we understand their business and take time to explain the benefits of our proposal to their company. I am fond of telling our sales director (and anyone who will listen) that clients never buy expertise from a consultant despite consultants’ often lofty opinions of themselves. Clients are buying a benefit to their business. So if you cannot explain exactly how your service will save money, make money or mitigate risk for your clients then you will not close a sale.

So what can you do to successfully sell your services to a suspicious market? The steps below may help you get started:

1. Productize your expertise and experience. Everything you have ever done professionally can be boiled down to areas of expertise, each with a specific benefit to your past employer. Instead of listing past accomplishments, look hard for what expertise you leveraged to accomplish corporate objectives in the past and link that directly to a realized benefit. Describe this in general terms linking the benefit to one of the three purchasing drivers mentioned above. A road map on how to do this can be found at http://www.jlroy.com/Documents/Creating%20A%20Framework%20For%20Growth.pdf.

2. Put something useful on your website. One of the best ways to demonstrate expertise is by providing something for free. This thing should be useable and provide a specific benefit to the user. It might be educational “how to” kind of information. It could be templates or case studies that teach a lesson. It could be links to other useful sites or online resources. The point is that at some point during your sales process you will direct someone to your website (or they will go out and find it independently). The site should not only be informative but should be useful too. If you can build a useful online destination then you have successfully demonstrated that you understand how to help your clients.

3. Sell efficiently. Many consultants will go out and try to sell their service to everyone and anyone by casting a wide net. They spend an inordinate amount of time selling. Although sales are important to any consulting firm, the hours spent on sales are not billable. Another way to think about this is that you have roughly 2,000 billable hours per year. Your income is directly affected by how efficiently you sell. Locate companies that you understand. Make sure that you completely grasp how you can specifically help each company. Make company specific proposals. This will dramatically improve your success rate and as a result will require you to spend fewer hours on sales. We will generally target entire industries. If we can help one company in an industry then we can pattern most participants. This will make your research easier too.

There are lots of ways to sell your services. My belief is that you must spend a little time up front learning how you can impact clients. Make sure you completely understand the benefits of your services and remember that if you can’t describe your benefits in one sentence then prospects will likely miss the point as well.

The Future of Social Networking for Business

The social networking phenomenon has clearly changed the way people meet, interact and exchange ideas. I don’t think anyone will argue that this is not true. Even the most old fashioned of people now seem to have a presence on FaceBook, LinkedIn, Ryze or some similar site (if not all of the above).

More recently, special interest groups have benefitted from dedicated networks and communities such as BlackPlanet for African Americans, Geni.com for those interested in genealogy, CafeMom for mothers and many more. There are now also a myriad of social networks based on your country of origin; for example, Cyworld for South Koreans, Biip for Norwegians and Grono from Poland to name but a few. Your options for joining a social network are now officially endless.

What does this tell you? It tells me that people want to link with each other to share ideas and information and to just generally communicate. It tells me that people constantly seek like-minded individuals with similar backgrounds, interests, experiences or origins. If this were not true then there would not be so many options available.

So what about social networking for the business community? Interestingly, the business community is way behind. First of all, most social networks that are frequented by business people are so because the business community believes that they can sell their product or service, find a job, hire a good employee, etc. In other words, the business community uses social networking to supplement the same functions that it was doing before. This means that most people do not get to realize the greatest value from the networks that they have joined. It may also mean that the traditional social network simply does not add that much value to the business community.

Businesses today should view the social networking phenomenon as an opportunity to create networks within their own client or employee communities. This will ensure that their products’ evolution is in line with their clients’ expectations. It would also mean that employees in large conglomerates could learn best practices from peers in far flung offices around the world. This exchange of ideas and information within a corporate environment may increase morale, productivity and efficiency. It will also ensure that limited spending dollars are focused on only the highest value initiatives for the business. In the end, even if these communities simply created a more transparent operating environment it would be good for the business.

Some business leaders may worry that this will empower their employees causing them to lose control of their message to staff. Simply put, that type of thought process is the digital equivalent of sticking your head in the sand. Employees only value employers that also value them and their opinion. Creating an environment where ideas, thoughts and complaints can be freely shared openly exposes management to the scary reality of what their business is and how it is perceived. It will also empower employees to think creatively and find new ways to solve old problems. In the end we all need to know what is good and what is bad in order to make the best decisions.

Social networks that include real targeted functionality could also be used to create new market opportunities for businesses. A great example of this is Parlerai (http://www.parlerai.com/). Parlerai is a client of my project outsourcing firm IFConnect (http://www.ifconnect.com/). Parlerai uses social networking technology to enable families to establish secure (i.e. closed) networks of family, friends, caregivers and educators around children with special needs. This is a great example of targeted social networking. What Parlerai calls “augmentative collaboration.”

Up to this point, the expansion of social networking sites has been limited to people with common interests or backgrounds. The new world order in social networking will be leveraging this same technology to build functional networks that simplify a person’s life. This goes way beyond the simple sharing of ideas and information and represents the future of online communities.

Increasing the Value of Your Knowledge and Experience

If you are a consultant then you already know that one of your biggest challenges is letting the market know what you know. There is no quicker way to generate sales than being perceived by the marketplace as an expert. There are many ways to do this, a good number of which are outlined by my good friend Ken Lizotte in his book “The Expert’s Edge” (McGraw Hill, 2008).

In his book, Ken describes how to become a thought leader through speaking engagements, public appearances and various traditional publishing vehicles. Ken and I have had numerous conversations about the best way to do this in the new technical age. Ken has a solid reputation for getting people published (in addition to himself) and this clearly works wonders for the reputation of many consultants. Our conversations however, have centered more on what happens after you’ve already been published.

My belief is that although nobody can dispute the value of being published in print media or via online publications there are better ways to generate value from your knowledge in the long term. The problem with magazine articles and books is twofold: first, they have an extremely limited shelf life (pun intended); and second, no matter how well placed or how well written an article or book is the fact remains that the information in the book or magazine is not useable.

Information increases in value exponentially as it becomes more useable to its audience.

So how do you make your knowledge more useable? The answer lies in leveraging technology. When you read a book you increase your knowledge. This is clearly a good thing. But this rarely helps you during your business day, even if you are blessed with complete recall. Executives (a.k.a. “your clients”) have little time to read all the books that they should in order to stay current and move themselves and their companies forward. This is why information aggregators have been so successful in the past decade. They simply blend a variety of news sources (for example) into one digestible packet by putting everything into one online location. Subscribers need only go to one site to find out what is going on. From there they can peruse headlines or run specific searches. Newer versions of this type of product include “push” features that allow subscribers to receive SMS or email alerts based on their own filtering criteria.

Information becomes useable when subscribers can find what they are looking for quickly and easily. This means that your product should be well organized and needs to include some basic knowledge management functionality. Topical and full text searches, data visualization, sentiment calculations and links to similar content can help subscribers not only find what they need at a specific point in time but can help them locate knowledge they didn’t even know they needed. If your product can deliver value in quick easy to find doses your audience will learn to not make a move without checking in. That is valuable for them and good for your consulting practice.

If you have written a book (or two), have a long running newsletter, a blog, a library of magazine articles, whitepapers or other content generated over the years then chances are that much of this content still holds some residual value. But I would wager that almost none of it is generating value for you today.

By developing an information product you can resurrect your expertise and deliver value to the marketplace on an ongoing basis. By continually updating this knowledge base and supplementing it with content from others or with filtered news, etc. you can quickly and inexpensively create an online destination for your constituents. In additional to generating subscription or ad revenue this can do wonders for your consulting sales process and will help you net new clients.

There are a variety of tools available to support this model that can be implemented with limited or even no costs. There are a few steps that you should follow before considering what technology to employ however. They are:

1. Compile your content into logical categories that will support topical searches. Ultimately, any school child knows that a good library is organized somehow. One of your first challenges is to determine the best way to segment your knowledge base to make it easier for readers to quickly find what they are looking for.

2. Determine what information needs updating. Without a doubt some percentage of what you’ve written in the past will be hopelessly out of date. Some of this can be brought current and some might simply need to be discarded. Figure that out early. Be ruthless. All your content should deliver specific value.

3. Find the holes in your library and fill them. Even the most thoughtful subject matter experts will not cover every angle. The fact is that we tend to specialize where the majority of our expertise lies. If there are gaping holes in your content set then you should find a way to fill them. This can be done through new independent research or by seeking contributions from other professionals that you might know.

4. Outline your value proposition. As a consultant you already know how you deliver value to your clients. But this needs to be tailored for a new audience – namely subscribers. Subscribers purchase their subscriptions for decidedly different reasons than people who might buy your services. Always remember that someone will subscribe not because they like you or feel that you are particularly interesting, but because they feel that their subscription will help them make money, mitigate risk or reduce their operating costs somehow. Make sure you have a sound strategy before you go to market with your new information product.

5. Find the right technology. If you have only limited content a simple blog might be enough if you don’t have one already. This is a good way to push information out to alert your clients to new trends and may also help you get found by prospective new clients. This kind of passive sales is always welcome. For people with large volumes of content to publish (or re-publish as the case may be) a broader search may be required. If you are not technically savvy, you may want to seek assistance from an outside expert.

A good example of an information product built by a larger company is Fortent’s Inform product (full disclosure, my project outsourcing firm IFConnect built this product for Fortent). This is a good model for consultants because it blends information from many sources and leverages relatively basic technology. Fortent Inform includes regulatory data, original content, filtered news, calendars and more to assemble an online destination for bank compliance officers. On a smaller scale, this model could work for almost any thought leader or experienced consultant.

Hopefully, after you think about your business a little bit and determine that you do in fact have adequate content to support an information product (no matter how basic) you will begin to realize how much value you have that has gone untapped. This can be the very first step in converting your expertise into a tangible product.

Maintaining Cash Flow to Survive the Downturn

Let’s face it; money is tight right now. All sectors of the economy are looking for ways to reduce spending. In many cases, this includes cutting costs in their core operations and not just on the “nice to haves”. If you are a professional services firm you’ve probably noticed that this trend is exacerbated by a new behavior; companies stretching out their payment of invoices.

Professional services firms have become accustomed to operating on a net-30 day basis. Most conscientious businesses pay their bills on time, or not more than a week or so late. This reflects a general discomfort with having invoices stack up. That has all started to change.

In my own business and those of people I know, I have started to see a trend where otherwise good companies are starting to delay payments to the point of being troublesome. With the tight credit market it is difficult if not downright stupid to hit your line of credit to float your customers’ projects, something we might have been willing to do even as late as this spring. So like everyone else, we have to find a way to strike a balance between dropping clients that are not paying and trying to preserve these valuable relationships for the future. We recognize that as vendors we are the first to get cut and it is rarely a smooth and equitable process. So how do you protect yourself?

We have two kinds of clients: large clients that have been good customers for years and everyone else. Here’s what we are doing to mitigate our risk during this period:

1. For large clients with a good solid history of paying their bills, we are trying to be as flexible as is reasonable. So long as they are making some payments each month we are staying in close contact with company leadership and trying to work within their means. We’ve made it very clear that we rely on them for cash flow and that we will continue to move their projects forward so long as we feel we are being treated fairly. My philosophy is that we will get through this downturn just fine so long as we are willing to compromise with our customers and they are with us.
2. For clients that are more than a quarter in arrears, we are calling the CEO or decision maker and having one more frank conversation. If they do not put a check in the mail then we will be dropping them as clients. At the end of the day, it is not reasonable for us to continue to prop up any business whose leadership can’t bring themselves to open a dialogue with us about their cash flow problems. These are companies that will most likely default on payments, but are selfish enough to get as much as they can from us until that becomes obvious. I don’t need clients like that. We will cut our losses early so we can reduce our operating costs related to their projects.
3. For companies that are somewhere in between, they’ve paid their bills in the past but are behind now, we will work with these customers for one more month. If no payment comes in then we will start to hold back source code and other deliverables. While this will not stop them from operating, it does increase their business risk and prevents them from totally ignoring our pleas for payment. The longer this goes forward the stronger our negotiating position becomes.
4. For chronic deadbeats and companies that simply will not even answer my calls anymore, we just write off the revenues and send them to a collection agency. Ultimately we do not like to do this as the collection agencies’ relentless approach virtually guarantees that you will not maintain a good relationship with that client in the future. But you have to ask yourself, if they are not paying their bills then do you really want them as a client anyway? So we cut our losses.

In the end, all businesses are different. Smaller vendors must be aware that they cannot mortgage their future for companies that will most likely not pay their bills anyway. They need to be honest with themselves about their cash flow and begin discounting receivables. It does not matter how much revenue you have accrued, until your customers pay you these assets are worth little. We all have to be careful about allowing our expenses to remain high or even grow when our cash flow is taking a hit.

Larger vendors will have to be just as careful as their clients about reducing costs, but they can be more creative. In this market , a large vendor may quickly find that they are suddenly bigger than some of their clients. They can use unpaid receivables to buy into their clients’ businesses and position themselves well for the economic upturn (whenever that happens).

The only way to manage your risk is to open an honest dialogue with customers and unwind from those that will just not pay their bills. This might mean working with your good clients to help keep them in business, something which is good for your business too. If you want to survive this downturn, you must manage your own business tightly and start to think defensively.

Creating Collaborative Products for a Troubled Market

The current selling environment stinks. There really is no other way to put it. That being said, I still find it difficult to be pessimistic. Fact of the matter is that both up and down markets can breed opportunity. The challenge is determining what that opportunity is and how to capitalize on it.

At my company, I’ll admit that we are having a difficult time finding that one bright spot in the market. So we have changed gears. Instead of looking for market segments that are bucking the downward trend we are now seeking future trends in workplace development. The companies that can remain at the forefront of how businesses work will ultimately be successful regardless of the short term market conditions.

Currently, there is at least one trend that presents a number of opportunities. This is in the area of "workforce mobility". The past ten years have seen huge gains in productivity through the use of technology. This includes software offered in different ways (the SaaS trend comes to mind) and new workflow solutions that help automate specific task-oriented business functions. These past trends when combined with the current dismal economic outlook means that companies that intend to survive will have to change the way that they operate. This will include finding ways to reduce operating costs and keep those knowledge workers that they can’t afford to shed.

Workforce mobility can be defined as a blended offering of functionality and enabling technologies that support a widely distributed workforce while controlling output in a transparent environment.

Companies that find a way to maintain a truly mobile workforce will find that their people’s individual productivity improves significantly. The average worker is at least 50% inactive while in the corporate environment. Without getting into the specifics of how workers waste time while at work, if you remove the corporate environment you will find a significant positive bump in productivity for many workers.

The beautiful thing about where we are as a technological society is that technology has finally matured on a wholesale basis. Fiber optic networks, cheaper laptops and other hardware, inexpensive collaboration tools, portable wireless devices, etc. mean that it is relatively easy for even small businesses to assemble market specific solutions that can reduce costs, improve productivity and actually increase controls for a workforce that go to work each day in their home offices. Any company that found a way to combine collaborative solutions with basic corporate needs such as document management, data acquisition, disaster recovery, etc. would find an eager market even when dollars are tight.

So how should companies capitalize on this trend? Simply focus on what you already know. My project outsourcing firm understands intimately how consulting firms operate. We know where we as providers fall down and where we shine. We also understand what kind of solutions could make us operate more efficiently. Now, full disclosure: my company already manages a global workforce under a virtual business model. So we are already accustomed to a widely distributed workforce. We have several offices in India and several in the U.S. (Boston and Washington D.C.) that must work closely in order to be successful. Even our employees in a single market, such as Boston, only rarely come together; and even then, it is often at a client site in a different city.

We are currently working on a product that really represents subscription based infrastructure for professional services firms. So, by developing a solution that will help us operate in this dynamic market, we are also creating new revenue opportunities by offering our homegrown solution to other participants in the marketplace. This strengthens our competitive position, ensures that we remain thought leaders in our market and helps us diversify our revenue base.

So what should you be doing for your firm? Ask yourself what you do well and what you don’t. Try to visualize an environment where you simplify your world by intelligently leveraging technology. There is no blanket solution that will work everywhere. But there are enough tools available that you should be able to at least lower your own costs right now. And if you can do that for your own firm, then you can do it for others. That is how new products are born.

How Consultants Can Make Money in a Down Economy

Just because the market is in the toilet doesn’t mean that there aren’t opportunities for consultants to grow their businesses. In a strong economy many of us consultants make money despite ourselves. The consultants that are worth their salt are the ones that can weather a slowdown in economic conditions or even thrive.

There are two ways for consultants to make money in a down economy: First, they can identify a specific market segment that is bucking the trend. Second, they can alter their sales methods and value proposition to match what the market needs.

In the first case, it can be difficult to find that needle in the haystack and many of us simply stumble upon opportunity if we are lucky. An example from the last recession was companies operating in the mortgage industry. They were the only companies that were spending any money at all as they benefitted from the refinancing boom. As a result, mortgage lenders and credit reporting companies were flush with cash and were just about the only game in town. This time around that segment is obviously not throwing a lifeline.

Fact is that we should always make sure that our sales pitch matches what the market needs. It’s amazing just how many consultants only know how to sell on their background, track record or experience (i.e. their resume). This leaves most employers wondering what the consultant can do for them today. As consultants, we all need to sell to what is motivating purchasers of our services. Nobody cares what you did last year. Everyone is interested in what you can do for them now. This is especially important when dollars get tight.

So what is motivating businesses to purchase services now? It seems obvious to anyone whose head is not in the sand; the market is tanking, the government is becoming a major shareholder in some of our premier financial institutions, investment banks are now chasing deposits, oil prices are raging and the dollar just doesn’t buy what it did six months ago. What does this mean? It means that companies are digging in. On the surface it might seem like nobody is spending any money. Fact is that some companies can be highly motivated to spend dollars if it will mitigate risk or help them preserve their hard-earned market position as they try to weather the storm.

Almost any consultant can alter their current sales pitch and package their services to fit neatly into the motivating factors of the market today. For example, if you sell IT services you probably spend a lot of time extolling the benefits of your expertise or how companies can expand the bandwidth of their IT departments by hiring your firm. These are pitches for a growth market. You should start to think about how your services can be used to reduce risk for clients. Offer code reviews to improve software performance and help preserve market share. Sell on the reduced cost of doing business by helping clients keep their overhead lower. Help clients expand their reach with less expensive non-development projects such as implementing discussion boards to get closer to their customers so they can head off revenue leakage.

If you don’t think your expertise can be positioned as a risk reducer for clients then you should ask yourself if you can use your experience to help clients find a way to generate new revenue with the assets they already have. Most companies own tons of intellectual property but don’t know what to do with it. Can you get their content into a useful format on the web? This will help generate interest in their core products and depending on the nature of the content it might actually enable them to solicit subscription revenue.

Another approach would be to find a way to expand your current offerings to your existing client base. These are the companies that know and like you (assuming they pay their bills). Consultants should be looking for ways to gain deeper penetration into these firms. Is there some service you offered some clients that you have not sold into other clients yet? You know your clients’ businesses as well as they do. You should think about how you can improve operations, reduce costs or expand their reach and suggest these things as new proposals. At the very least this kind of proactive selling might let them know that you are thinking about them. Bringing value added ideas to the table for existing clients will keep you on their radar.

In the end, this is the time to get creative and think outside the box not a time for panic. Chances are all you have to do is repackage how you sell your services in order to thrive. Many companies find a way to thrive in tough economic conditions, why not yours?

Get Clients Before You Even Start Your Business

If you are a freelancer thinking about striking out on your own, having a few clients in the bag before you make that leap is a pretty smart step. This can be a particular challenge of course, as you most likely don’t have the time it takes to market yourself successfully while still gainfully employed. Not to worry, there are plenty of ways to do this nowadays. One of my favorite ways is to find an online marketplace where you can both market yourself and find suitable projects to bid on.

One site that I would like to suggest that you check out is Guru.com. In a nutshell, Guru.com is a site that brings freelancers and prospective employers together. Guru.com has been around in one form or another since 1998 and they definitely have the marketplace model down pat. In 2007, over 93,000 projects were awarded to freelancers on Guru.com, mostly in the U.S. At any given time there can be more than 5,000 projects posted on the site for freelancers to bid on.

Freelancers can scan thousands of projects posted by companies and then select those that they are most qualified for to bid on. Projects can be filtered using Guru.com’s search engine. The bidding process is all done on the site and notifications are sent to you via email. Freelancers and hiring companies generally communicate with each other via Guru’s “private DB” feature at the outset of an engagement. This is essentially a bulletin board where companies can post a message and the freelancers can respond in kind. This allows the selection and Q&A process to move forward in relative anonymity.

Once a project is awarded and work is underway Guru offers a number of ways for funds to exchange hands. The site includes functionality that helps freelancers create invoices and set up an escrow account. Companies then pay the invoice by transferring money into the escrow account (or paying by credit card) and freelancers simply request payment which then comes to them directly from Guru via check.

Additional features on the site include: a project tracker so freelancers can see the status of projects they have bid on; a watch list so they can track projects they are interested in; and a proposal template manager for bidding assistance, etc. The user dashboard is well organized and easy to use.

Freelancers can see all projects, but can only bid on projects that match their posted profile. This helps ensure that folks are only bidding on projects they are qualified for. In addition, you might be prevented from bidding on projects based on your subscription level. Although you do not have to pay to play on Guru.com, those freelancers that become “Guru Vendors” pay a small annual subscription fee and have access to more projects (companies can limit those who can bid on their projects to “serious” consultants only in this way).

The downside of Guru.com is that although there are some large projects available for bidding, for the most part companies are either small (it’s a good resource for startups too!) or the project budgets are limited. IT consultants in particular also have to compete with a large population of offshore freelancers and smaller companies (mostly in India) that use Guru.com to find projects from U.S. based companies.

It is difficult if not impossible to make a living on Guru.com projects and they are certainly not the only marketplace out there for freelancers, but it does represent a nice sales channel for freelancers and a good safe starting place for the newly self-employed so you can see what is out there in the market while getting some valuable experience selling yourself.

Flushing Out Your New Business Concept

Building a company can be a daunting challenge. There can be this lull at the beginning after you finally decide that you are going to do it. You start planning; thinking really. You start thinking about all of the things that need to be done and then you suddenly realize that you are woefully under-equipped. You’ve haven’t sold anything since those Girl Scout cookies in the 5th grade. You don’t know a P&L from the S&P and you may not have ever been the boss before. Now you have to find a way to get everything that needs doing done while simultaneously learning how to do all the things you’ve never had to do before. And let’s not forget that you just inherited all the trouble that you used to give your employer!

To say the least, first time entrepreneurs can get crushed under the weight of their own task list, if not physically then emotionally. The early part of the start up phase is challenging for sure. There are still so many loose ends and so many things that remain undecided simply because you have not gotten to them yet. The list of things to get done can seem endless.

One approach would be to ignore the problem and simply get started. Throw caution to the wind and account for business challenges as they arise. Another approach might be to sit down and methodically write a thorough business plan. The first approach is simply foolish and creates risks and obstacles that are just not necessary. The second approach may not be the best thing to do either even though it seems more reasonable. While I would certainly recommend that you create a business plan at some point; most business plans are written for an external audience, such as potential funders. So although the process of gathering the required information for the plan can certainly be educational and is certainly helpful, it can be premature. Even so, many people are in such a hurry to get their venture off the ground that they neglect to fully flush out their business concept.

Even if you have a clear understanding of what you are selling, you might find it useful to create a concept document to help you flush out the execution part of your business. This might include: describing how and to whom you will market your product; how you will handle customer service; what tools you will use for order management and managing customer relationships; how you will generate leads, etc.

A good concept document touches on all aspects of business operations but does not necessarily drill down too deeply. The intent is to make sure that you have thought about all facets of your business venture. It might also be useful to think of this as the rough draft of your business plan for when the time comes.

Your concept document should include at least the following items in its table of contents:

1. A summary of your business concept written in a way that someone with no understanding of you or your business would still be able to understand what you are offering.
2. Objectives of the business and an outline of your success criteria. Be specific. Saying that you want to make “a lot of money” does not give you a realistic target to work towards and will cause your business to lack focus.
3. A description of your market and why they would buy your product/service (i.e. your value proposition). If you do not have a clear understanding of why someone would buy your product or hire you then how can you expect to sell your product or service successfully? Again, be specific.
4. Outline your pricing model. Make sure that you understand what your product or your expertise is worth to your potential customers.
5. A list of action items (things you will be working on next). This is just practical.
6. A development calendar. You have a ton to get done. If you do not find a way to organize your workload and get it on a calendar then you will most likely feel like you are always struggling to get things done. Set reasonable expectations for yourself. Only assume that you will be 50% effective on any given work day. The rest of your time will be filled up making calls, taking calls, answering emails and running errands. It’s all productive time.
7. A description of your future opportunities. This might include an exit strategy or partnerships you will be seeking. It could be an outline of how you will expand your product or service offering over time, etc. This forms the basis of your company’s roadmap and sets direction.
8. Outline your risks. Make sure that you are honest with yourself about all the things that could go wrong. Write them down to make them real. If you do not pay attention to these things then you are not adequately managing your risk and the likelihood that you fail at some level increases dramatically.

And don’t forget to have fun. If you make yourself miserable in your own business then you might as well just get a job. This way you can still be miserable but at least you don’t have to take on the financial and emotional risk personally.

Taking That First Step In A New Business

Deciding to start a business is a big step. It can be life altering.

Some of us start a new venture because we are tired of working for others and want to create our own destiny. Some of us start our businesses out of pure necessity. Either way, one of the biggest challenges to starting a new business is taking that first step.

What should that first step be anyway? Should we run off and incorporate? Write a business plan? Or should we jump in and just start selling? Well, depending on your circumstances and the nature of your business, technically there is no wrong answer. Nonetheless, if we can take just a little time and produce a brainstorm map we might find that the work surrounding the business’ launch is easier – well at least more under control. The absence of some sort of tool for organizing your thoughts (and your work) can make the start-up process seem overwhelming.

A brainstorm map is nothing more than a chart that links the various “units of work” (or things that we have to get done) to logical topics or categories. They are not particularly fancy or difficult to produce, but they can go a long way towards helping the new entrepreneur organize his or her thoughts.

So how do we take this first step? Since we are starting a business it makes sense that we organize our thoughts along the lines of how the business will ultimately be structured. Even if you will be the only employee in the venture, you can break categories of work down into traditional functional verticals, such as: sales, operations, technology, product management, administration, legal, etc.

Once all of your functional verticals have been listed, you simply begin to think about all the things you want to accomplish in your business. These things are then organized along the categorical lines that you have already created.

In this way the brainstorm map can be described as a graphical depiction of all of the things that must be accomplished for your business to get off the ground. If you are really ambitious you can even drill down deeper and create a map for each functional vertical as well.

Once the brainstorm map is complete it can guide your activities until you get organized. I like to let the map serve as an inventory of sorts, kind of like a “to do” list. Ultimately, the map gets converted into a development calendar that can be linked directly to specific corporate objectives, such as the launch date for a new product.

A brainstorm map is a useful tool for getting organized and can go a long way towards helping the new entrepreneur take that first step.