My name is Jonathan Stark and I’m on a mission to rid the earth of hourly billing. I hope that Ditching Hourly will help achieve this, one listener at a time 🙂
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Talking Points How to maximize your impact as a consultant How to "fish where the fish are" How to identify ugent problems that your clients are dying to pay you to fix for them How to win business even when you're up against giant competitors How to build trust in a five minute conversation Quotable Quotes "It's about the finding the right people, right problem, right solution, right time."—DAF "Winning business is easy when you're fishing where the fish are."—DAF "If you don't hear back from clients, you're operating where there's a lack of urgency."—DAF "If you're not winning as many clients as you'd like to, you have to make some changes."—DAF "You have to make your practice about the client, not about you."—DAF "Every time I have a conversation with someone who looks like my prospective clients, I learn something."—DAF "If you're smart and your willing to pick up something new, the sky's the limit."—DAF "Asking your client about hypotheticals will give you bad data. 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David is the co-founder of Ascendant Consulting, is a true consultants' consultant who works with selling boutique consulting firms worldwide, a best selling author, speaker, consultant and mentor. David also heads the Ascendant Consortium whose clients are who's who of the business world. David, welcome to the show. David F: 00:22 Thank you so much, Jonathan. It is fabulous to be here. Jonathan S: 00:25 It's really my pleasure. So for folks who maybe haven't come across you before, could you just give people a crash course and who you are and what you do? David F: 00:33 Sure, and imagine that, there are people who are not aware of me. It happens every day. 95% of my business right now, Jonathan, is actually working with other consulting firms. So whether they are solo practitioners, or small boutiques up to, call it $25 million, I work with a few folks that are larger, but mostly 25 million and under, down to the folks that maybe have just started a practice and are just sort of cracking six figures. And so while I have corporate clients, most of my work now is with the consulting firms that are trying to win those corporate clients. And that's what I spend my days doing, is helping them accomplish that goal. Jonathan S: 01:12 Excellent. So I've got your new book, it's called the Irresistible Consultant's Guide to Winning Clients. Thank you very much for that. And in it, it's broken into six sections, six steps to unlimited clients and financial freedom. And there's a section that I'm particularly interested in, so I think it would be a great place to start, and that is this section on, I think it's maximizing your impact. Am I- David F: 01:37 Sure. Jonathan S: 01:38 Okay. Cool. So can you sort of give ... There's a bunch of sort of sub-sections here. Could you give us a kind of overview and then we'll drill into individual questions? David F: 01:48 Sure. The one thing I would ... Let me preface this with, because this section, which on maximizing impact which is sort of step two, but it's important to understand that this comes before you start building visibility. A lot of consultants, a lot of freelancers want to get out there and just get known by everyone they can. David F: 02:09 And before you run out and try to spread the word about yourself, you need to make sure that the word will be listened to, that you're not just out there talking, you're saying words that people want to hear. And that's impact, that's maximizing your impact. So that's where this fits in. It's very early in the process, making sure your message is going to resonate. David F: 02:29 And basically, maximizing impact just comes down to a few pieces. You need to talk with the right people, about the right problem, offer the right solution in a way that's compellingly articulated at the right time. So right people, right problem, right solution and right time. Of those four, time is darn hard to figure out. David F: 02:50 And so I tend to say you know what, put that one aside because if you talk to enough of the right people, about the right problem, and offer the right solution, then you don't need to worry about the timing. Some of them will be ready to move and want your services. So that's it. That's really the core of maximizing impact. Jonathan S: 03:10 Excellent. So you have a great graph, it got six quadrants in it where you talk about the awareness of ... your sort of the clients' awareness, or the prospects' awareness of a problem- David F: 03:25 Sure. Jonathan S: 03:26 ... or opportunity, and their urgency around that. And this is a different way to describe something that I talked about here a lot. So I wonder if ... It is kind of visual, but I wonder if you can break it down. David F: 03:40 Yeah, sure. I can describe it. As a matter of fact, all your listeners can sort of build it for themselves very quickly and easily if they want. This is useful, so it's interesting you pulled this out. This is one piece I didn't mention inside maximizing impact, which is this idea that I call fishing where the fish are, and business is so much easier if you're fishing where the fish are. David F: 03:59 So here's how you figure out where the fish are. I would say regular consultants, they do two by two charts, but we're super sexy here, so we do a sextant chart. You're going to draw a horizontal line, and then instead of bisecting it with one line, you're going to trisect it with two vertical lines. David F: 04:18 So now what you have is sort of six boxes, three on the top, three on the bottom. So that vertical axis is really is the client aware of the problem that you solve? So at the top, you might say yes, all those three boxes at the top are yes. And the three boxes at the bottom are no, they're not aware of the problem that you ... they have the problem. David F: 04:38 They may have the problem, but they're not aware that they have the problem. So yes or no. And then across the top is the urgency that they have, how urgent is their desire to solve the problem that you can solve for them. So all the way on the left might be no urgency. They have no urgency at all to solve it. In the middle is some or maybe tomorrow, or maybe in the future, and then all the way to the right is now, they want to solve that problem right away. David F: 05:09 So now what you have, if you've drawn this out, is you've got a box in the top right where your prospects are aware of the problem that they have that you solve, and they urgently want to solve that problem. That spot, that box is what I call fishing where the fish are. And when you play in that box, this business is actually very easy. David F: 05:31 Winning business is easy because you're not trying to convince someone to work with you, you're not trying to tell them to work on the problem, you're not trying to say, “Hey, you really need me even though you don't realize it,” both of which are quite difficult. You work with people who know they've got the problem and they're saying, “Yeah, I need help.” And boy, isn't it easy to sell a consulting gig when someone's saying, “Hey, I got a problem and I need help.” So were you able to sketch that out? Did that work for you, Jonathan? Jonathan S: 05:58 Yes, that does, mentally. That's a perfect picture. Can you describe for a second what it might feel like to someone who is not fishing where the fish are? So let's say someone has a ... Let's say someone is aware of a problem that's just epidemic proportions. So, for me, just to instantiate it a little bit, for me, I was doing consulting in the mobile web space for a long time. Jonathan S: 06:23 And you could just go ... almost any site you went to on iPhone was just garbage for the first couple of years, so I could see this as a problem like there is no way this is good for the conversion, this has to be hurting their traffic. This has to be causing a really bad bounce rate on mobile so on and so forth. Jonathan S: 06:41 But it was surprising to me at the time this going to about like 2010 that so many people, prospective clients with these terrible experiences didn't really see it as a problem or they want aware there was a problem, because unlike their audience, or their customer, or their users, they weren't on their own website on their phone all the time trying to get things done. Jonathan S: 07:05 So it's just wasn't ... it just didn't raise the level of consciousness. So I could run around beating the drum all day long saying, "If your business isn't mobile friendly, you're going out of business," sort of Chicken Little Approach. David F: 07:16 Yeah, how'd that work for you? Jonathan S: 07:17 Not that great. Early on, I magically got clients because there were early adopters who saw the problem. And my estimation of the situation is that over time, all of the early adopters, and then the sort of cutting edge people, and then the late adopters solved ... they got someone to fix it for them. And we started to get down to the late adopters, and then laggards. And it became a really hard sell, because they just didn't see it as a problem and still don't. Jonathan S: 07:48 So it's really hard. And there's a line in the book that made me laugh out loud, because I've heard it so many times where a student of mine, or someone on my mailing list, we'll be inside of a client organization, and maybe have done one project. And while they were in there, they were just appalled by the inefficiency of a laundry list of other things that they could easily automate, or at least, you know, not that it wouldn't be a lot of work, but they knew exactly how to automate it. Jonathan S: 08:16 Like, “Hey, I could automate this whole system, and you wouldn't need this entire department,” And still find themselves extremely frustrated, sort of ... it is kind of this Chicken Little thing, where you're almost saying ... it's kind of like walking up to someone in a Starbucks and saying ... as a personal trainer, walking up to someone in Starbucks and being like, "Hey, you're super fat, you want me to help you with that?" It's the wrong timing. It's just terrible. Obviously, it's terrible. David F: 08:45 It is. But now, I have got to ask, what was the line that made you laugh, if you remember it? Jonathan S: 08:50 It was not verbatim, but it was basically like, all these clients have the same problem, but no one sees it. But really to me that's not what's actually happening, to me it's that maybe they see it, maybe they don't, but they just don't ... they might be aware of the situation that you're pointing out. But to them, it's not a problem. David F: 09:10 Right, so that would shift them from the bottom right, which is, they're not aware of the problem. But if they were aware of it, boy, they'd want to solve it. Right? The hidden cancer if you will, right? Jonathan S: 09:21 Exactly. David F: 09:22 Or the hidden pot of gold, even if they're aware of it, they don't have an urgent desire to solve the problem. And that's different. Now, you're in that middle box at the top. And those folks are, you have to deal with them differently. There's a lack of urgency. It's not a lack of awareness. It's a lack of urgency. So you need to create desire, and frankly, that's hard to do. David F: 09:49 And so if you had been working in an environment where you're chasing folks. You're trying to create this desire, you go, look, there's a huge problem. I'm looking at how you people at Starbucks, who I can help because I'm a personal trainer, and you're not as fit as you could be, I could help you, right? And you're trying to create demand, and you're submitting proposals and nobody assigning, you might not even hear from anyone. Right? David F: 10:11 That problem, if you have a lot of proposals that are languishing, if you don't hear back from prospects, it's because you're operating where there's a lack of urgency, and it's extremely frustrating. And the answer actually, isn't later in the process. It's not that you're doing something wrong in the selling process, is you're doing something wrong in the prospects' selection process. Jonathan S: 10:35 Right. Right. So to use your metaphor, and to use myself as an example, because I know examples help people, when I ... you talk in the book about you can move your boat ... you can sort of paddle around in your boat and find where the fish are or you can just randomly moor yourself somewhere and assume that just by throwing the line in the water, you're going to be pulling fishing. Jonathan S: 10:59 And you're like, I can't believe, this industry is dead, there's no fish coming out of the water. This pond is dead. Well, maybe you're just in the wrong spot in the pond. And with me, it was a similar sort of feeling where it wasn't that I was in ... To use the fishing metaphor, when it first started the whole industry was basically invented by the iPhone in 2007, 2008. Jonathan S: 11:21 So there was no pond and I was the first boat in it, or one of the very first boats in it. So we were pulling ... fish were jumping into the boat, because the pond was incredibly small. So there was some competition, but not enough to support the demand. But then the pond got bigger and bigger and bigger and bigger. And if you didn't move your boat, you're still sitting in that same spot and the fish went somewhere else. David F: 11:45 Right. Right. So we weren't totally butcher the metaphor. Then we say, even where you are, if you're somewhere in your pond, or whatever and you're not catching any fish, you could move your boat, right? So that's one way at it. There's another way at it, which is to basically talk to the fish, become the Dr. Doolittle of fish, or whatever it is and- Jonathan S: 12:05 The Incredible Mr. Limpet. David F: 12:06 ... Or SpongeBob or something like that and find out what it is, because you're not solving the right problem for them. You don't have the right bait in some ways. So you don't always have to move your boat, though in all likelihood, you're going to have to make some changes. The one thing you know is if you're not winning as many clients as you'd like to, you have to make some changes. David F: 12:29 And you have to make your practice not about you. You have to make it about the clients. You have to make it about the fish, so that you're going after fish with what they're looking for. Jonathan S: 12:39 Yeah, what's the line, don't fish using strawberries and cream as bait. Use worms as bait, just because you like strawberries and cream. So- David F: 12:50 I have not heard that, but it's an interesting image. Jonathan S: 12:54 I completely destroyed it. It's a great quote that I destroyed and it's a classic. I think it's a Jeez, it's a classic. I think it's How to Make Friends and Influence People. David F: 13:07 Dale Carnegie. Jonathan S: 13:07 Yeah, I think it's a Carnegie quote. David F: 13:07 Yeah. Oh, that's great. Jonathan S: 13:11 Yeah. Anyway, I'll link to in the show notes, with Google under my fingertips to actually get it right. So there's something I want to point out here that we're not making explicit. I mean, we're saying it, but we haven't made it explicit. We're not talking about solutions. We're talking about problems, the problems that the clients have that you solve, and you just talked about, it's about the fish, It's not about the fisherman. Jonathan S: 13:35 So let's talk a little bit about ... this all sounds logical and straightforward. But how do you talk to the fish? How do you find those problems? How do you find your way to that top right square? David F: 13:49 Wow, what a great question. Not enough people ask that question. The answer to that is, it's actually extremely simple, not easy, like most of this stuff, it's not easy, but it's simple. And the answer you ask, you flat out ask. So I'm heading up to Toronto tomorrow as we record this, and please, I have an all day session with a consulting firm up there on Thursday. So what do I do tomorrow before I get there? David F: 14:18 Well, what I do is I reach out to other boutique firms, the leaders of boutique firms, some of whom I know, some of whom I don't know. And basically say, "look could I meet, not for any kind of sales call just to learn from you, just to hear what's going on in your world." Now, this isn't easy, especially if you're introverted, and I'm actually introverted. David F: 14:41 But it's critical, because every time I have a conversation with someone who looks like my prospective clients, I learned something, I learn about what's going on, what their problems are, what their problems aren't, which is just as important, because I don't want to waste my time talking about things that they don't need to solve. David F: 14:58 So the way you learn about this, the way you figure this out is actually by talking to people and asking them. And you might ask them, what problems have you had in the past year, two years that were so pressing, so urgent, so expensive to leave unsolved, that you actually hired someone to help you solve them? That's the right question. David F: 15:20 The wrong question is, "Hey, here's my fishing line. Or here's what I want to do. This is what I'm thinking about building my consulting practice on what do you think? Or would you maybe buy this, those are the wrong questions, anything hypothetical, like that will give you bad data, it would just give you very bad information. David F: 15:37 You need to find out what they are actually experiencing right now, or what they paid for in the past. That's what's going to tell you what the problems are in the marketplace. Jonathan S: 15:47 Absolutely. And you already said it. But I'm going to say it again, the answers to these questions might not be solvable with your current solutions or your current activities. But could be well within your skill set, your broader skill set, or that could be some skill that you could easily acquire. David F: 16:07 Sure. Jonathan S: 16:08 So- David F: 16:09 You can learn things. As matter of fact, the firm I'm working with tomorrow is a great example of it. Now, they're a small boutique. They're under $10 million. And the two owners, I want to be careful, because some people know who I work with. They're working in an industry and they're now extremely well regarded in the industry. Yet, neither one of them has a background in that industry. David F: 16:33 They have a background in a completely different world. And that's true of a number of my clients, quite a few of them that are very successful. They didn't define themselves by what they had done in the past. They define themselves by what their clients want. And as long as you're willing to do that, and you're smart, which I'm sure your listeners are smart and you're willing to pick up something new, sky's the limit. David F: 16:56 It's easy. I mean, that's one of the great things about consulting, there's no iron in the ground that you're paying for. There's no capital or equipment you've invested in. David F: 17:00 In the ground that you're paying for. There's no capital equipment you've invested in, in a massive assembly line. You can pick up just about anything. So find it and pick it up. Jonathan S: 17:10 Exactly. A lot of people might have heard you say the question, "What if you've hired someone from the outside to come in and help you with the past year or two?" You did not say, "What copywriters have you hired in the past year?" Or, "What software developers have you hired in the past year." Or, "What kind of software have you had outside [inaudible 00:17:31]?" You didn't say that at all. Jonathan S: 17:34 It's much broader than that. I tell people to do this exact same thing, optimize for conversations. If you aren't getting enough leads, you're not talking to enough people. Go out and have this exact conversation. Jonathan S: 17:47 This is sort of aspirational, if you could wave a magic wand, even if it was impossible, what would you change about your business, or your industry? Or, what keeps you up at night? The classic one is what's keeping you up nights. What's been on your to-do list forever that you haven't done? Jonathan S: 18:03 Yours is even more practical. Yours is actually a question that I use when I'm thinking about helping people choose which software features to develop. You say, "Don't ask people what features they wish something had because they're not software developers, they're probably not optimized to think of the answers to those questions. Ask them where they're having a hard time with their existing software solution." If you've got some competitor, go talk to their clients and say, "Hey, the last time you had to do X, last time you had to do a mail merge", or, "Last time you had to do some sort of marketing automation, what are your pet peeves about that? What blew up in your face? What was the biggest problem you had?" Jonathan S: 18:49 Because they can tell you and they're right. It's their history that they're telling to you. It's not this, "Oh well maybe I would like that feature." It's like no, find the pain, or the opportunity. But we usually just like pain. Go back and say, "Huh, I wonder if there's something I can do about that." Jonathan S: 19:10 To reiterate, this could very well mean, shock of shocks, you might have to change what you do. A little bit or a lot, I don't know. But it's really, if your goal is to go out and go where the fish are, as you put it, you need to be open to solving the problems the fish have, and not just having this hammer and going around looking for nails. David F: 19:32 Absolutely right, and it's a great mix of metaphors. There's just all sorts of awful images there. I love that, you're absolutely right. David F: 19:43 Jonathan, you and I and all the listeners, everybody who's listening to your podcast, are future focused. We're all entrepreneurs. We're all looking with optimism toward tomorrow and next month and next year and five years from now. But our clients are not entrepreneurs for the most part. Our clients are not as future focused. David F: 20:05 Asking them about the hypothetical, asking them about tomorrow and what do they need, not only is it not a good use of time, it will steer you in the wrong direction. You will literally get bad answers that will cost you time and money. Our clients, we need to focus them in the past. It can be difficult for us because we're future focused. It's an absolutely critical step. David F: 20:30 Keep those conversations past focused. And focused on symptoms. Like you said, problems or sometimes symptoms is a good way to think about it. What is that pain that they're experiencing? Jonathan S: 20:42 Yeah, that's a good segue into, I read something, I'm not sure if I misinterpreted it. It's a phony question but there's a ... Before I jump into that, can you give people a background on what you mean when you say, "Fishing line"? David F: 20:57 Fishing line is a very short encapsulation of your target and the problem you solve. I work with small consulting firms that are not achieving the revenue they think they could. Someone here, they either work with a consulting firm, or they run a consulting firm or they don't. If they don't, they say, "That's not me", and that's perfect. David F: 21:18 They either have the problem that I help solve, or they don't. If they don't, that's fine also because now I don't waste my time with them. What it does is your fishing line very quickly selects people, allows them to self select, to ask more. They say, "Oh, that is interesting. I run a consulting firm. Tell me a little bit more." David F: 21:36 That's all you're looking for. It's a conversation starter. You throw that line out and you see if someone nibbles and tries to get into conversation with you. From there on, you're good. You move into relationship building and nurturing and conversation. David F: 21:50 That's all a fishing line is, a very succinct encapsulation of your target, which is extremely narrow, and the problem you solve, which is very precise. And it's meant to start conversation. David F: 22:03 That's it. Does that make sense? Jonathan S: 22:05 Not only does it make sense, but it's like brother from another mother because listeners have heard me beating this drum endlessly. I have a different name for it, that doesn't matter, it's the same concept. Jonathan S: 22:16 Notice, dear listener, what is not in it. What's not in it is how you solve that problem. There's no "how" in there. There's no explanation, because you want them to ask how. It's exactly what you said, it's a conversation starter. Jonathan S: 22:33 Very focused, target market our audience or demographic or psychographic, this is very clear. I help people who believe this", or, "I help people who have this job title", or "I help people you work in this industry with this problem they have." Which is different than saying, "Oh I build software for businesses." David F: 22:51 Right. Or even, "I support a software platform." If it's a narrow platform. I work with a number of firms that do that. They're working with clients that use a certain platform and then they'll code within that in order to make it fit a particular client. David F: 23:12 But it has to be beyond just the platform. It's supposed to challenge the platform. Ideally, it's industry focused and on a certain platform, because the number one things clients look for is industry experience. Jonathan S: 23:24 Yeah, that's good. I have a lot of people who do platform specializations too. Things like Sales Force or File Maker, Shopify, that kind of thing. Jonathan S: 23:32 I do agree with you that it would be more powerful instead of saying, "I'm a Shopify plus expert", to say, "I help people who use Shopify", or "I help store owners who use Shopify, with this particular problem that is common to the platform." Jonathan S: 23:47 Or maybe it's not widespread, maybe it's very specific, but expensive problem for a small, small segment of Shopify users. David F: 23:54 Right. Actually if you say, "I'm a Shopify expert", you start devaluing yourself. Jonathan S: 24:00 Interesting. David F: 24:00 I'm not smart enough to know what a Shopify problem is, but if I could say, "I solved the problem with Shopify duplicate" or "basket abandonment", that adds value. And therefore you're able to charge a higher fee, because you're adding value. David F: 24:25 Focusing on the problem, especially a high value problem, is how you create the opportunity to win a high margin, high fee project. Whereas, if all you do is you say you're an expert, you're setting yourself up like a commodity, as someone who will unfortunately end up in a fee structure that's commoditized. Jonathan S: 24:43 Oh that's really interesting. That's funny that the notion of saying if you call yourself a Shopify expert now, you're in competition with every other Shopify expert. I wouldn't actually recommend someone call themselves a Shopify expert, but Shopify consultant, or advisor, I could see that on a business card. Jonathan S: 25:06 I do believe that you're right. I agree with that, that it would be even more powerful as a conversation starter. I don't know if you like the word "differentiator", but certainly you're differentiating yourself when you are decommoditizing yourself. I see that synonymously, but tell me if you disagree. David F: 25:29 I don't see them quite the same, but that's okay. In part because one of the lines you may not have seen in the book is that, I don't think consultants should differentiate. I don't think they should worry about differentiation. Jonathan S: 25:42 That's why I'm stammering, because I did read it. I feel like it's a distinction without a difference because in the book you say something along the lines of, if the client says why shouldn't we go with cheap-o ink and you say, "Well because I'm more reliable." That's a differentiator though. David F: 26:02 It is. Ultimately you do differentiate. What you differentiate on is reliability and credibility. Can you credibly solve the problem and are you gonna solve it without screwing up, without making your client look back. David F: 26:14 That's very different from how most people perceive differentiation. Most folks who approach their website for instance, or they approach their conversation with clients and they're thinking, "How do I make myself different? How do I make myself look different from everyone else?" That's the wrong question. David F: 26:34 There is a difference because our clients are choosing us for a reason, not just because they flipped a coin or threw a dart and hit our name. So there is a difference, it's just that difference is not what people typically associate with differentiation, which in marketing often means finding the subtle or unique points of difference. That's not what we're after. Jonathan S: 26:57 Like product or solution focused differences. Like different features. David F: 27:02 Right. And that's just not what we're after. It's not about your whiz bang, super unique process. As a matter of fact, your whiz bang, super unique process is more likely to scare off a prospective client than it is to attract them, because it doesn't look as reliable. David F: 27:19 If you're the only person in the world who's done this, if you say, "I've got something so new and so innovative", they're actually less likely to use you. Most clients aren't looking for innovation, they're simply looking for a solution to their problem. They want their pain to go away, no fuss, no muss, no issues, cause no harm. Jonathan S: 27:39 Yeah, and they've been burned so many times. David F: 27:41 Absolutely. Jonathan S: 27:41 Yeah exactly. They want something reliable, something that they can trust. They want risk mitigation, they want to feel like it's not risky. David F: 27:49 Absolutely right. Hiring any kind of freelancer or consultant, whether it's a programmer or a coder, someone helping with marketing strategy, you name it, it is fraught with anxiety for the purchaser. Because they've all been burned before, because there's very little that's concrete. David F: 28:07 We're selling what's inside our head, we're selling what's between our ears. That's difficult for them to get their hands around. And there's a big purchase they have to be able to justify to other people why it is not being done internally, or why they're not doing it themselves, and why they're spending so much money. There's a lot of head wind that you need to calm down. This whole idea of liability or credibility is lessening or dampening those winds to make it easy for our prospect to say, "Yeah, come on in. Come on board." Jonathan S: 28:42 I completely agree. You mentioned fees a little bit there, a little while back. Is there a big picture you can draw for me around pricing? David F: 28:52 First of all, fees are the trickiest part of consulting. The figuring out fee structures is without a doubt the most complex. There is as much art to it as there is science. David F: 29:04 There are a couple aspects to this. The one is fee structures. There are different fee structures. Some will create more value and create more margin for you. David F: 29:16 But there are other pieces. To the extent that you are working on a higher value problem, you can charge more. There's more value to be tapped. To the extent you are creating more value, you can charge more because there's more value to be tapped. Which means if you can solve the problem faster, if you can solve it with less interference, with less risk of failure, any of these kinds of things, those all allow you to increase your fees, to charge more. David F: 29:45 If you have more credibility, if you have renown, if you have a reputation in the marketplace, that allows you to charge more because it implies a certain level of reliability and credibility. Jonathan S: 29:57 You appear less risky. David F: 29:59 Yeah, you appear less risky. Exactly right. Contracts and pricing is actually all about risk, it's all about risk allocation. I don't talk a ton about that because that goes off into the really nerdy world of risk allocation pretty quickly. But ultimately that's what it's about. That's what they're paying you for. David F: 30:19 The more confident you can make your prospect, that you can solve their problem, that you are thinking about them, that you will not in any circumstances make them look bad, if you can hit those three, and the better you hit those three, the higher fees you can charge. Straight out. David F: 30:36 Now of course, there's a cap. The cap is set by the value of the problem you're solving. Solving a problem for one individual is likely to have less value than solving a problem for General Motors, or Microsoft. There's more money to be had if you're solving a problem for a bigger company. David F: 30:54 But you don't have to work for global giants to bring in very good consulting gigs, or contracts. This is a new learning for me. This is something I've learned over the past five years or so, is that I can work with firms, or companies, that only bring in seven figures, or maybe low eight figures, and win six figure contracts. David F: 31:19 I used to think because my corporate business was all with big companies. But you don't have to work with big companies to win big business. What you need to do is solve valuable problems and that will push your pricing up. David F: 31:30 That's all a little bit vague, so do you want to drive it to a level that's more concrete? Or what would work best do you think for your listeners, Jonathan? Jonathan S: 31:39 There's a specific thing I'd like to drill into, which is this. You referred to increasing your authority in the space, becoming a recognized expert if you will, or if you want to use another term, but basically looking like the low risk option. What are the strategies and tactics that someone can use to go from what looks like a risky option to what looks like a safe bet? David F: 32:07 Yeah, and again, really insightful question. Because how do you compete with Accenture? How do you compete with Deloitte? They've got big brand names. The consultant who walk in with a card that's stamped with Deloitte, or Accenture, or PWC or E&Y, they have the brand behind them, and that brand's worth a lot. David F: 32:29 What do you do if you don't have that brand? One thing of course is, over time you establish the brand. That's a long term, multiple years, if not decades, endeavor. But you can establish a brand. David F: 32:45 What could you do in the short term? There are quite a few things you can do in the short term. I'll give you just a handful of them. One of course is, you do good work. You can bring in case studies, you can bring in testimonials, you can bring in references from other people. David F: 32:59 I'm gonna tell you something that you can do. I'll give you and your listeners a tactical tip. I don't know if it's in the book or not. It's something I call Loop Backs. Basically, when you are in conversation with a prospect they might ask you something. Rather than answering it right away ... Maybe they ask you, "Do you know how to solve this certain type of problem in JavaScript?" And excuse me, because I'm not a coder, even though both my sons are, I have no idea what they're talking about either. Jonathan S: 33:27 That was good. Yeah, you nailed it. You had me convinced and then you blew it. I was like, "Whoa, he knows what JavaScript is." David F: 33:33 Yeah, there you go. Try selling something to JavaScript. Rather than saying, "Yeah, I can do that", what you might say is, "You know what, that's a good question. If you don't mind, let's put that one to the side for just a moment and I'll get back to it in about five minutes." Because you were also talking about this other thing, and you continue the conversation. David F: 33:50 Then five minutes later you go back and you say, "You asked about this question, about JavaScript. Let me address that, let me give you the answer to that now." David F: 33:58 Or, they say, "Can you send me some materials?" And you say. David F: 34:00 "... and can you send me some materials?" You say, "Absolutely. I will get those to you tomorrow," and then, you get the material to them tomorrow. David F: 34:09 What you are doing in this case is you are fulfilling a small promise. Because your prospects don't have any experience with you fulfilling large promises, no direct experience, unless they've been a client of yours before- Jonathan S: 34:22 Yeah, [crosstalk 00:34:23]. David F: 34:22 ... they have to rely on your ability and willingness and consistency in fulfilling small promises, and then, they extrapolate from that. So you can build trust fairly quickly by living up to small promises, and you can create the opportunity to live up to those promises with these loopbacks by saying, "Hey, you know what, let me go back to that," and then, getting back to it." Jonathan S: 34:45 That is great. I often talk about the small promises thing and do things just even on follow-ups. You've got a long sales cycle happening, you say, "Hey, if I don't hear from you by blah, I'll email you on date." Then on date, you say, "Hey, as promised, following up about this thing you wanted me to check back and see the status of the project," so on and so forth. Jonathan S: 35:10 This is sort of in the nurture phase, so you got one of these long sales cycles where the problem is not urgent, but the client knows you're a good fit for something like when they do pull the trigger, you're definitely going to be in the running, but you just want to keep in touch with them. Jonathan S: 35:26 I do with email all the time, and I tell people to do it. Put a follow-up date in the email, and then, when you follow up say, "As promised, following up," and- David F: 35:37 You're absolutely right. And, of course, well, I know you do and I do and hopefully many listeners do, is if you are in conversation with a prospect, you do not hang up the phone, if you've been on a phone conversation, without actually setting that date in the calendar so that the email is more of a confirmation. David F: 35:54 They receive many calendar invite anyway because you agreed ... "We'll talk in six months. It's July right now. What do you say we talk ... Oh, no, how about December? Should we start to talk at the beginning of the year? Great. Pull out your calendar. How does the second week in January look?" Jonathan S: 36:09 Exactly. Yup. But, no, see the new tip, though, the tip that I love that you gave, was their opportunities create these, what did you call them, loopbacks? David F: 36:19 Right, loopbacks. These small promises. So you're going to create something, then you're going to loopback to it later and fulfill that promise. Jonathan S: 36:27 I never thought about looking for them. I definitely, like when they show up, jump on them, but you proactively doing it is a really good idea. Because you'll see quickly that most people don't do this, so you suddenly, in a really short amount of time, you look way more professional than your clients do because they're busy, and I know we're all busy, too. But if you do this one thing, you will come across like you're significantly more put together than most of the people than you're in contact with. Jonathan S: 36:59 And it shifts the power frame a little bit, if you're familiar with- David F: 37:02 Sure. Jonathan S: 37:03 ... what's his name, Oren Klaff, and his ... Geez, I can't remember the name of the book. But he's got this concept about power frames and he's kind of an aggressive alpha dog type of guy. It's not my favorite approach, but I do- David F: 37:17 I've got to say that's not really my approach. Jonathan S: 37:18 It's not my favorite, but I don't think he's wrong, where the sort of social weight or the social ball quickly comes into your court in a good way. They're starting to feel scattered, you're just doing what you said you were going to do and you do it when you say you're going to do it, and it becomes an attractive force. David F: 37:45 You bet. Jonathan S: 37:46 On top of the trust-building aspect, I think there's another kind of attraction that happens there. It's almost like a- David F: 37:53 Oh, I think you're absolutely right. Setting dates in particular which some people feel like, " Oh, but isn't that being pushy?" or "I'm not imposing on them?" No, actually the exact opposite. What you're doing is you are offering your prospects some clarity on their calendar and their calendar their future is as murky, messy, ugly, scary thing hanging out there. So when you offer clarity, you say, "Let's talk the second week of January. Let's talk that Tuesday at 10 AM." It's locked in. It's clarity for them. They feel relief by having it on their calendar. The worst thing is not knowing when you're going to talk again. That's anxiety. People don't deal very well with ambiguity. Ambiguity causes stress, it causes anxiety. So putting something on the calendar, you're absolutely right. It actually creates a lessening of the anxiety, it creates some clarity, and then, makes you more attractive. Jonathan S: 38:47 Absolutely. I wanted to drill into something that I know a lot of listeners to sort of rationally understand and perhaps even recognize in the brands or vendors or products and services that they use, but they have the worst time ever identifying when they're doing it wrong. It's just so hard to see the forest for the trees, can't read the label from inside the bottle. Jonathan S: 39:17 It was in the section about common mistakes with your fishing line, or whatever you normally call your positioning statement. There was one where you said, "We get rid of bugs" is a solution versus "We help homeowners whose kitchens are infested with roaches." Do you mean in that sentence or that phrase, do you mean that like the entire fishing line would be "We get rid of bugs," and that's- David F: 39:45 No, and I don't recall that way exactly. Jonathan S: 39:49 Fair enough. David F: 39:50 That's right. But often what happens is, and I may be heading in the wrong direction here, but it's more common to say, to talk about the bugs as opposed to the homeowner and their situation. So the issue actually isn't ... No one says "I want an exterminator," or they'll say it eventually, but how they get there is, "Oh, my God. This is so disgusting. I have roaches all over my kitchen," right? [crosstalk 00:40:23] feel- Jonathan S: 40:23 Yes. Well, that's the fishing where the fish are. That's the urgent. David F: 40:26 Right. And it's the emotional challenge also, so you want to deal with that emotional challenge also. Jonathan S: 40:36 The thing that I'm getting at is the difference between using the desired future state versus the current state in the fishing line. It sounds like you prefer to say it's not that ... "We help homeowners have a bug-free house." That's very different than ... I mean to your listener I'm sure that when you heard "Kitchen infested with roaches," you might have even recoiled. It's a powerful visual versus "We help homeowners live a bug-free life," or whatever. David F: 41:18 See, you're talking a little bit about aspirations versus problems and should we target aspirations or should be target problems? The answer is you can do either one. You can do either one and succeed. The aspirational version is "We give you a clean house. We give you a bug-free house." That's the aspiration. The problem version is "We kill those disgusting roaches in your house." We solve the problem versus we give you an aspiration. They're very close, they're subtly different. David F: 41:50 There's some interesting connections between that frame, whether it's a positive or a negative frame and pricing. There's an interesting research I wrote about a couple of years ago, I think. There's an article on my website about that. But you can go either way. Consultants tend to want to be aspirational because it sounds better, it sounds nicer. What they didn't tell you is it's a longer sale to target aspirations. Targeting a problem is a faster sale because people want to solve their problems usually fairly desperately, fairly urgently. Whereas, aspirations have less urgency and they're more discretionary. David F: 42:34 Now, on the other hand, aspirations, when you win them, can sometimes be the larger projects. So from the coding world, if there's a bug in the software, well, let's go back to Y2K for any of you who were alive back then. Jonathan S: 42:47 Probably not. Probably not as many as I wish. David F: 42:49 Yeah, I know. I'm dating myself here. But Y2K was a clue that there was a problem. We have to fix the problem or a software will break. That was not aspirational. It was a problem and there was huge urgency on that. There was desperation in some cases, and so, back in those days, there was business galore for folks to solve those problems and you were familiar with legacy systems. David F: 43:13 The aspiration at the time may have been, you know what I'd love is a ... I don't know. We're talking about the early '90s. I would love a graphical interface. I know [inaudible 00:43:26] thing for back then with the aspiration [inaudible 00:43:28] but getting that graphical interface, if that was an aspiration, was not nearly as important and urgent as getting the problem solved. So the graphical interface might ultimately be a bigger win, but it's the Y2K problem at that time that got the money more immediately. Jonathan S: 43:55 That's funny because that just happened with GDPR and- David F: 43:58 Right. That would be a better example. Jonathan S: 44:02 But the thing about that is, those two specific examples and there are other ones, and it is also similar to the Gartner Hype Curve and blockchain and augmented reality kind of churning at the very peak of inflated expectations. They are all this sort of globally ebbs and flows. I mean like in 2001, if your whole business was around solving Y2K bugs, see you later, that's, I don't know. David F: 44:02 Exactly. Jonathan S: 44:34 That's a very different kind of problem than, say, we help people who manage apartment complexes get rid of roach infestations. That's the kind of problem that's, unfortunately, almost fairly recurrent. Or it's not globally happens once, and then, it's done. David F: 44:54 Yeah, but I'll tell you what. Some of the most successful firms jump on those one-and-done problems, and then, pivot off of them. Jonathan S: 45:02 Interesting. David F: 45:02 They create momentum and they pivot off of them. It is important, especially for your listeners because your listeners aren't focused on certain software platforms or software in general. It is very important to keep your finger on the pulse of what's going on in the area you specialize, and then, don't hang on too long because it evolves. Jonathan S: 45:26 Yeah, [crosstalk 00:45:26] David F: 45:26 One of my clients is actually a nice size firm. They are around $20 million, but almost all of their business was built on a certain call center software platform and doing implementation and that type of stuff. David F: 45:43 Unfortunately, the market has moved on from that particular platform to another platform and they've been hanging on desperately. Now what I've been doing is just beating them into submission to let go and move on to someplace else, so we're finding what their someplace else is. So your listeners do need to be very careful of hanging on to one spot. David F: 46:04 But if there's an urgent problem, there's nothing wrong with jumping on that, creating the connections, creating the relationships, and then, nurturing those relationships and letting those people know that you got broader capabilities. So narrow is your way in, narrow gets you in the door. But once you're in there, you can spread out. Jonathan S: 46:22 That is a really important point to emphasize because I know a lot of people miss it. I see it all the time, too. These sorts of things, this is the sign outside your Irish pub. You don't have a list of all 200 beers on tap out on the sidewalk. You say "Cold Corona inside" because it's 150 degrees. It's how hot it feels in Providence right now, and you want to get them in the door. Jonathan S: 46:48 Once you get them in the door, aka they become a customer, they become a client, then you don't need to carefully adhere to your positioning statement, this extremely narrow focus because you're having conversations, you've built trust, you've delivered wins, people think you're smart, they know you, they like you. It's a completely different ballgame. Well, not completely different, but it's a very different ballgame. Once you're inside and you have contacts and you know the politics, you know, all of the intricacies of working inside of a company, it's just completely different. David F: 47:23 Absolutely right. But plus- Jonathan S: 47:24 So this is ... Yup? David F: 47:25 Plus you know they must be really accepting because they went into an Irish pub looking for a Corona. Now, I get it. Jonathan S: 47:32 Wow. Nice. [inaudible 00:47:34] David F: 47:34 So would you [inaudible 00:47:36] to a client. They will come to you and be open to you doing more once you've proven you can deliver the basic goods. Jonathan S: 47:45 Yes. Excellent. Excellent point. Okay. We could probably go all day and I would love to, but I know we've both got other things coming up. Where can people find out more about what you're doing and connect with you online? David F: 48:02 The easiest place is just jump on my website, which is davidafields.com, so just [inaudible 00:48:09] middle initial, davidafields.com. Or you can always go on to Amazon or wherever you buy books and look up Guide to Winning Clients. It's often in the airport bookstores, too. I've been very fortunate the book has done well, and so Google that and grab it, or jump onto my website. I'm also pretty easy to grab. Jonathan S: 48:30 Yes, I second that motion. The guide, it's really good. It's a fun writing style, the illustrations are very engaging, and it's not dry at all. Very practical and I highly recommend it. David F: 48:44 Well, thank you. Jonathan S: 48:46 All right. Well, thanks very much, David. Maybe we could do this again sometime? David F: 48:51 That would be awesome. It really has been a delight. Jonathan S: 48:53 All right. That's it for this week. I'm Jonathan Stark and I hope to see you again on Ditching Hourly. Bye. If you'd like to learn more about how to ditch hourly billing, please go to valuepricingbootcamp.com to sign up for my free email course. Again, that URL is valuepricingbootcamp.com. Thanks.
All Late Projects Are The Same with guest Tom DeMarco
Tom DeMarco - a former software litigation consultant - explains what all late software projects have in common. Guest Bio Tom DeMarco is a Principal of The Atlantic Systems Guild, a technology think tank with offices in the United States, Great Britain and Germany. He is the author of ten books on organizational dynamics and the role of technology, plus five novels. His most recent work —just published this month — is a romance, entitled The One-Way Time Traveler. Talking Points Why clients get angry when a project is late Who is to blame when a project is late The real reason for tight deadlines How to respond when a project has an unrealistic deadline How the value of a project affects deadline expectations Why clients initiate projects that offer marginal returns How managers use bad estimates to manipulate employees Why software is so inexpensive these days What distinguishes prosperous software developers from those who are struggling What buyers are actually concerned about other than price Quotable Quotes "I thought all late projects were the same in that they were really estimation failures, not performance failures. I still believe that all late projects are the same, but for an entirely different reason. All projects that finish late have this one thing in common: they started late."—TD "By the 1990s, a significant part of my practice was litigation support, which was a natural consequence of raising my rates to the level that only legal departments could afford."—TD "Being blindsided by the competition—is not software developer failure but that of some marketing arm that got one upped by superior marketers in another company."—TD "If a project offered a value of 10 times its estimated cost, no one would care if the actual cost to get it done were double the estimate."—TD Related Links Tom's Late Projects article Tom's Personal Site The Atlantic Systems Guild Procreate App
You Can’t Buy An Hour
You know you can't literally buy an hour from someone... so why do you think you can sell an hour to someone? Here's the tweet that inspired this episode: Matt's Tweet Thanks to Matt Olpinski for asking! —J
Serving vs Selling with guest Liston Witherill
If you hate selling, you're probably doing it wrong. Guest Liston Witherill joins me to change your mind forever about what it means to sell as a consultant. Talking Points Where did the negative feelings about marketing and sales come from? How can you sell without selling? What you can do to relax in the sales process Why persuasion has no place in the sales process The importance of listening in the sales process How to have your products and services sell themselves What activities are okay to give away for free and which aren't? What to do if you find yourself in a terrible client relationship Liston's Bio Liston Witherill helps consultants sell their expertise with confidence by creating sales programs that produce predictable results. He's a coach and trainer who works with consultants, business owners, and their teams to take proactive control over their revenue. You can read his writing and watch his videos at liston.io. Links Liston's website Liston's LinkedIn Value Pricing Bootcamp
Lessons Learned Building My First Online Software Course with guest Chris Buecheler
Thinking of monetizing your expertise by creating an online software training course? Don't make these three classic blunders. Lessons Learned Building My First Online Software Course with guest Chris Buecheler Today I'm joined by guest Chris Buecheler to talk about a few of the hard lessons he learned creating his first online software course, Five Minute React. Chris' Bio Christopher Buecheler is a self-taught web developer with over 20 years of professional experience. He's worked as a developer for a variety of internet companies. He founded CloseBrace because he loves tech and wanted to share his knowledge with other developers. "I believe you can learn Node, Express, React, or anything else you'd like, and I want to help you do it!" —Chris Buecheler Talking Points Using version locking to future-proof your course Building the example app before writing the education materials Knowing how much to material to cover in a single course Links closebrace.com fiveminutereact.com expressjscheatsheet.com jsquickhits.com
Can Value Pricing Work for Firms? with guest Adam Aronson
Guest Adam Aronson joins me to discuss the feasibility of value pricing for firms. Adam's Bio Adam is the founder and principle of FileMaker development firm FullCity Consulting. Since 2000, FullCity has serviced clients like ESPN, the NY Rangers, and the WWE. Earlier in his career, he managed FileMaker database systems for advertising and television production at Martha Stewart Living Omnimedia and provided 24/7 personal technology support for Ms. Stewart and her executive team. Adam managed the IT side of the advertising department at Toys ‘R Us and was database manager for Bloomingdale’s wedding registry website. Without further ado, here's my interview with Adam Aronson. Enjoy! Links FullCity Consulting Find Your Moose Conference Talking Points Hourly billing is like taxes and fossil fuels; there's just not a better answer out there. There are two very different reasons why clients might ask you how long the project is going to take: They have some actual hard deadline They see time as a proxy for cost Developers are like artists. Would jazz musicians do their best work if you were paying them by the hour? Why do you eat hours on things you think took you too long, but you don't add hours for things you think you finished extra fast? If you're asking the client questions about their business logic or entity relationships in a sales meeting, you're doing it wrong.
Bells & Whistles
What if a client doesn't understand what they're getting themselves into? Talking points: The sales meeting is not over until you're reasonably confident that you can help improve the client's condition. Don't quote work that you believe will most likely hurt the client (even if they insist that they know what their doing). If you are skeptical of the client's vision, tell the client so and ask them to help you "connect the dots" to understand their business case. You need to understand the client's desired business outcomes in order to write a value based proposal (a feature list is not sufficient). Separating fools from their money is bad way to build a long-term business. When offering options, the lowest price option should be the thing that you agreed to in the sales meeting. Higher tier options may or may not have been discussed in the sales meeting. The lowest price option should be the most risky to the client and the highest tier should be the least risky to the client. Questions? Leave me a voicemail at (401) 952-8899 and I'll include your recording in an upcoming show. Cheers! —J
The Business of Expertise with special guest David C. Baker
Guest David C. Baker joins me to talk about expertise, positioning, the pros and cons of vertical vs horizontal focus, addressing client concerns about conflicts of interest, the risk of hitching your cart to a third party, and tons more. David's Bio David grew up with a tribe of Mayan Indians in a remote village in the highlands of Guatemala. He’s an author, speaker, and advisor to entrepreneurial experts. This is his fifth book. He’s a helicopter and airplane pilot, an avid photographer, and taught high performance motorcycle riding/racing. Based in Nashville, he has visited and worked all over the world. He is married, has two boys, two daughters-in-law, and multiple grandchildren. His work has been featured in the WSJ, Fast Company, USA Today, Inc. Magazine, and Forbes. He speaks regularly at various TEDx events, Harvard, Adobe, and major international conferences to audiences looking for accessibly refreshing insight into how experts shape their world. Links The Business of Expertise ReCourses: Business Insight for Expert Marketing Firms 2Bobs: Conversations on the art of creative entrepreneurship with David C. Baker and Blair Enns
Value-Based Design with guest Nick Disabato
Guest Nick Disabato (aka nickd) talks about measuring the economic value of design. Links Nick's personal site Nick's consultancy Nick's new book Nick's A/B testing course
Price Sickness with guest Janet Kafadar
Does the idea of doubling your prices make you physically ill? Janet Kafadar shares a very personal, inspirational, and funny story about how pricing herself too low wrecked her health... and yet raising her prices literally made her puke. Definitely check this one out. Links Janet's site Janet's YouTube