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I don't think I've ever posted a blog entry this long, but if you read it like I did, you'll forget about time and be so engaged that you read it all. It's from a friend (Schuyler Brown) who consults out of NYC. She graciously allowed me to publish this. More about her work at the end. Broadly, the subject of this is money and life, and based on the questions I've been getting recently, many of you are thinking about just that.
Like many Americans post-recession, I've been taking a close look at my relationship to money. To my surprise, what started simply as a responsible exercise turned into a deeply instructive philosophical journey.
I'd been ignoring the task of addressing my ideas about money for years, hiding behind an image of myself as Bohemian, an artist, a spiritual aspirant. Money seemed something too concrete to factor into my flights of fancy. Even as an entrepreneur I never stopped to think much about money. I worried when I wasn't making it and was jubilant when I was...it was a roller coaster.
It was my daughter's birth two years ago that unexpectedly initiated a shift in my approach to money, because she shifted my entire perspective on the future. Her presence forced me to imagine a future I'd been happy to leave to chance. One day, exiting the subway on my way home, I caught myself with a furrowed brow worrying once again about the numbers in our bank accounts...this time with no regard for my own needs, but for hers alone. I heard a steely voice of resolve somewhere deep inside say, "I never want her to suffer the burden of financial strain." At that moment, I felt my actual walk change. I became more directed.
But it wasn't until an incident this summer....Read More >
A "client concentration" problem refers to having a single related source of work representing more than 25% of your gross profit (fees + markup income). That's usually the point at which the yellow light should blink on your financial dashboard. That same light should blink red if it moves to 35%, because my research shows that to be the median at which one-half of firms fail. In other words, one-half survive the loss of a client that represents ca. 35% and the other one-half fail. Maybe not immediately, but they can usually trace it back to that point if they were not prepared for it. This is meant to prepare you for it.
You either had, have, or will have a gorilla client. Don't be afraid of it, and don't say "no" to the work. A problem like this almost always comes from something great you've done and you deserve the accolades in the form of even more work. Don't get a huge head, though, because unusually high spikes in your top line revenue typically stem from a client concentration issue and not unusual and sudden strong new business skills.
First Step: Honesty
When I talk about this to clients, the first thing they always say is this: "Yes, but all this related work is coming from different departments, and even different contacts in the same department. In fact, they hate each other and we'd probably get more work if we lost one department!"
That's bullshit, if you'll pardon me, because it assumes....Read More >
There are thousands of tools for social media, and only a few dozen that strike me as useful. One of those is Tweriod, which analyzes your Twitter account, including when followers are most likely to interact with you, and thus when you should post. Best of all, it will auto-populate your account at Buffer, building the schedule for each of your accounts accordingly.
Click to download a 9-page PDF of the data from my account to illustrate what you'll see.Read More >
I had trouble getting to sleep last night, and for some reason I started thinking about how managing client relationships has changed over the years. I'm not talking about my clients, but your clients. Do you know the really important things about how to do it right? I'm not sure i would have figured all these out, but I have paid attention to the hundreds of firms I've worked with and tried to cull out the best practices that have been proven in the field.
Just for fun, I started writing these down as they came to mind in a stream of consciousness style. Here are a few of them:
- The only power you have in a client relationship is to withhold your expertise.
- The degree to which you have power in a relationship is directly related to how long it takes to replace you.
- There are only two ways to have more opportunity than capacity, which represents your ability to say "no" to prospects and clients: create more opportunity or reduce your capacity.
- The most important criteria in evaluating a prospective client is whether or not they've used a firm like yours before. Never be the first.
- Your cheap ass clients are the ones spending their own money. You want to work for clients with budget authority over someone else's money.
- The clients who trust you say: "I have $140,000 for this project. What's the most we could do with that money?" The ones who don't trust you say, "Here's what I need. What will it cost?"....
A great client recently asked me to outline my definition of success for their firm. I really enjoyed doing that, and below is a version that you can adapt to your own situation, putting your own stamp on it:
- Partner compensation equals or exceeds industry benchmarks.
- After that is achieved, you still 20% net profit.
- The more entrepreneurial employees are satisfied that their contribution to your gain is recognized and accounted for.
- Partners and employees in key roles will have already tasted competence in the area of your focus, or they will experience it within nine months of joining the firm.
- There will be few or no young employees who value variety over expertise.
- When employees talk about your firm, while still employed, their private comments will be complimentary.
- When partners and employees head out the door to work for the day, they look forward to the challenges, the companionship, and their participation in the overall culture.
- As a firm you will not require extraordinary people....
I was recently working with a firm under our new "Come to Nashville" program for a day and we were doing long-term planning, mainly, but with an eye on how that might impact the short term. I came up with some questions that turned out to be very helpful as they took a break from the continuous crazy days we all have, and then answered them honestly and seriously.
- How do you feel about the current positioning of your firm? If you could waive a magic wand and change it (without regard to current employees or clients), what would your positioning be?
- What are your biggest fears in just pursuing that positioning, even if it means doing so alongside your current firm and maybe even doing it all alone without employees?
- If I watched you on a typical day, would it look like you are taking care of clients or would it look like you were taking care of employees (who would then take care of clients if you did your job well)?
- Who are the two weakest employee links who probably should be dismissed in the near future?
- Who is the most talented person at your firm who is disruptive to the culture? Are they on the list, above, of people to dismiss?
- You likely started this firm to create an environment for yourself that allowed for more freedom, control, and money. Now that you have built it, to what degree are these three things true?...
I seldom give up my 17,000-person blog platform to guests. Keeping your attention is important and my primary marketing tool. But, I read a blog last week that Mark Busse wrote, and I thought it was brilliant. I'm sharing it here with his permission:
Rushing into starting your own design business can turn a dream into a nightmare.
Recently I heard from two former students of mine. As they entered the industry a few years ago we had some honest talks about their options, and against my advice they decided to skip internships or junior positions--which they felt were both beneath them--and went into partnership together with another classmate to form their own design studio. After some early success working for friends and family, their studio quickly fell into chaos, the partnership dissolved, and the company folded, leaving their clients in rough shape.
I'll spare you my story of how running my design business has still not brought the freedom, flexibility or financial reward I'd hoped for after 15 years--and I have a business degree--and how I often miss the days of just working for someone else. Instead, let's talk about how lazy, short-sighted and dangerous starting your own business can be.
You heard me: lazy, short-sighted and....Read More >
This is a question that has long intrigued me. It comes up more frequently, too, as individual workers find it harder to find work at all, much less work that they enjoy. But even in a difficult economy, employees regularly switch jobs to work in a more satisfying environment.
They are told repeatedly to "follow your heart…and the money will come." Even aspiring entrepreneurs are encouraged to take that path to fulfill a dream, chase their hopes, and attempt to "build it," hoping they will come.
But that's different than having a right to enjoy it. Not only do I strongly disagree with the sentiment, I think believing it has twisted our expectations and those of our employees. It's not all that different, in fact, from commenting on someone's gruesome death that "at least she died doing what she loved."
First, a lot of people who are "following their heart" are starving. It's just true. Even pseudo-entrepreneurs who follow a system via a franchise are failing in droves--in some, there's a 60% failure rate.
Second, just...Read More >
Forgive me for the ominous subject line of this email, but there are times when it's best to be objective and forthright. I've been talking with the executives of large associations and educational institutions in this field, hoping they'll drop the status quo and beginning offering real help to their members and graduates. So far I've made very little progress, so I'm just going to use my own platform (16,000+ of you).
Look around, think back through the last decade, and make a mental list of the firms you knew that are no longer around. Did any of them fail for lack of creativity? Even if you don't think they were that creative, the answer is a resounding "NO". Here is why those firms--and possibly yours, if you don't listen--will cease to exist, in descending order. I'm going to list seven reasons firms fail, and then seven things to keep a very close eye on.
What to Keep An Eye On
What kind of information are you giving people in a business setting, and how are you delivering it? I have a reputation for complete candor (deserved), deep and thought-provoking content (deserved), and a less-than-engaging conversation style of delivery (deserved). I speak 30-35x/year, and if the event happens to give audience members feedback forms to complete, on a scale of 1 to 5, I typically get a 4.9 on content and somewhere around 4.0 on delivery.
I only use PowerPoint or Keynote when the audience is too large logistically to provide handouts (200?). I much prefer handouts, because I hate last minute technical problems, I'd rather look people in the eyes the entire time, I want them to write, and I want them to take something home. For larger audience (200-3,000 typically), I just include a URL on the last slide so that a PDF can be downloaded for their later use. I tell them that in advance so that they can relax, listen, and not bother with too many notes.
I'm an intense introvert. I'm so far off the scale in that direction that I jokingly call it "unabomber land." That just means I like to be by myself to recharge. I can be with crowds, large and small, in little doses and no one would know I'm "acting the part." Oddly enough, speaking totally invigorates me, too, which may not fit in your mind with the idea of a deep introvert.
Do you know when I began to love speaking?...
I've had a hand in shaping four of the software products out there, including the two with the largest installed base. And for ten years I've been clamoring for more transparency, enabled primarily by allowing a client to log into your project management software (that's not BaseCamp, by the way) and seeing the status of things. For one thing, why make the AE do that? Every client is different, and this would let them interact with the data on their own terms, with selectable update options to boot.
Why hasn't this caught on? Two reasons:
- Firms say something will take three weeks of work but they don't even start it until four days before the deadline, and this way the client would know that.
- Firms are afraid of interferance in the creative process, where I think it should be more collaborative and with no "big reveals" as we call them.
Anyway, I was chatting about this with a client of mine, Greg Daake, who has a firm in Omaha. He has been thinking the same thing, and so I asked him to write some thoughts on this. Here's Greg...Read More >
I was sitting down last week, thinking about how much difference it makes when you have a good boss. I realized, though, that much of good management is counter-intuitive. So I thought I'd take a few minutes to record a few observations while they were top of mind.
Before I do, though, remember the survey on the last email? It asked whether you were better or worse than average as a manager. A full 68% of you said better! You can interpret that one.
Here are the things I've learned interviewing nearly 14,000 people for the book I reference at the end:
- Any non-evil person can be a manager.
- Management does not make you special.
- Managers shouldn't always make more money than those they manage.
- There should be two career paths so that we don't saddle technicians (craft people) w/ management.
- Nearly all important information should come from an employee's direct manager.
- Why you were promoted, or why you promoted a certain person, tells a huge story.
- The biggest danger to your company is a very skilled employee who doesn't fit the culture.
You'll have to look long and hard before you find a marketing firm that publishes much, if anything at all, on their pricing. That's been true for years, and only recently are firms experimenting with a little more transparency around the financial aspect of what qualifies a prospect as an appropriate fit. And if they are feeling particularly bold, they might even publish some pricing for a few services that they've packaged up so that they have fairly similar deliverables from project to project.
Reasons You Don't Publish Pricing
I'd like to think outloud with you about why that is. I think there are five primary reasons why this is the case. See if any of them resonate with you.
First, most principals don't really believe that the main purpose of their corporation is to make money. They know that it's probably the right reason the company exists, but underneath it all is the truth: the business is an extension of what they want to do personally. The money is nice, but the work is more important.Read More >
Have you ever had a huge corporate client and delved deep inside the organization only to find incompetence around you? I have, and it makes me wonder how we've become the richest nation in the world. It's also encouraging, because the bar is set very low and therefore it's pretty darn easy to be an expert!
One thing I get asked a lot is this: "What is an expert?" There are many ways to define that, but here's how I think about it. I picture myself keynoting a conference. In the auditorium are 3,000 people. After my presentation, I open it up to questions from the audience. There's a microphone on a stand in the center aisle, and soon a line forms with people who want me to elaborate or they want to disagree with me.
Picture yourself in that place. How do you feel? Prepared? Nervous? Naked? Eager? Being an expert is flat knowing that you can answer any question about the narrow field you serve. By the way, you don't need to be some amazing speaker or a strong extrovert to captivate an audience. Essentially, it boils down to two things: do you know what the hell you're talking about, and are you presenting it with a personal authenticity.
So the next question is how you get to that place where you think of yourself as an expert, and where markeplace acceptance confirms that belief. Here are my seven specific, practical suggestions:Read More >
Bill Baker (no relation) is nicer than I am, so don't pin any of my introduction on him. I recently spoke to an auditorium of C-level executives, and the title of my presentation was long but revealing: "The Happy Death of Branding, the Next Fad of Storytelling, and the Hopeful Rise of Alignment."
I guess that expresses my view of branding: there are a few firms really doing it, and the rest (and majority) aren't doing anything differently than they did before, but now they are calling it branding because it sounds upstream. There was no training in marketing, no classes, books, or even real processes. The typical four circles with the ubiquitous use of alliteration doesn't count and should be taken off your website.
Regardless of whether or not you agree with my view of branding, it clearly is yesterday's news, and storytelling comes up frequently. Rather than being marginalized even more, I think we ought to jump on this one early so that we don't relieve the word of even more meaning.
Bill (disclosure: a client) is one of the very few people really doing story telling. While the concept has been around since people wrote on cave walls, modern storytelling was really maximized by E+S (Envisioning and Storytelling) in Vancouver roughly three decades ago, a place where Bill was Chief Strategic Officer. Now, under BillBaker&Co he continues that great work with clients like GE, Relais & Chateaux, Johnson & Johnson, The Canadian Centre for Ethics in Sport, etc. Here are some of his thoughts on the difference between faux storytelling and real storytelling. Real storytelling is a very complex skill, and I can sit for days listening to Bill point out the subtleties involved. This is just the outer layer.
Here's Bill:Read More >