Insight for Independent Consultants
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I think the episode of The Freelancer’s Show where Jonathan, Kai, and I talked through the question of “What is positioning, and how does it relate to specialization?” won’t be live for another week or two, but in the meantime….After that episode I took some notes to expand on the discussion we had about the difference between positioning and specialization.I think you’ll find these notes interesting:Positioning is not something you do, it’s something you achieve. Positioning is how the market sees you, remembers you, measures you, and compares you to alternatives. Your position usually includes elements like reputation, specificity, price, and intangibles like brand.In the world of professional services, you achieve a desirable market position by specializing and developing exceptionally valuable expertise, and then (simultaneously or after the fact) becoming well-known among your ideal clients for that expertise.Specialization is how you create the ability to deliver economically valuable outcomes to clients, which over time, feeds into and enhances how the market sees you.Specialization is the lever/engine you use to cultivate a desirable market position.When you combine these ideas about positioning and specialization, a complete picture emerges of how you might improve your business over time:
- First, you aspire to a desirable market position.
- Then, you make a decision about how you want to be known, and then you specialize (narrow your focus in 1 of 5 possible ways), and execute on that narrow focus for long enough to move into your desired market position.
- As you or the market change, you make course corrections along the way.
Do you have substantial experience selling software development services to clients in the manufacturing vertical? (Substantial = sold enough projects that you’ve seen any patterns of behavior that might be relevant to someone new to selling to manufacturing clients.)If so, I’d love to hear from you. Hit me up here.Thanks,-P
One of the most fundamental, persistent, difficult challenges of bootstrapping a services business is that you are constantly tempted to say yes to work that has positive short-term cash value but neutral or negative long-term strategic value.This paradox of what’s in your business’s long-term best interest is very difficult to resolve.What has long-term strategic value? Developing exceptionally valuable expertise, and producing economically valuable outcomes for clients in a way that reinforces your expertise or your desired position.It’s very often tempting to take on work that does not further those two goals.Why would you take on work that does not have long-term strategic value? Or even work that works against that long-term strategic value?Cause you need the money, like now, or very soon.The problem is, the way most of us do the “getting money now/soon” thing takes 80% or more of our time and energy, leaving little time and energy for promoting the long-term strategic vision.I wish I had a magic bullet for this paradox, but I don’t. It takes courage, discipline, and a little bit of faith to resolve.If you have those ingredients, the missing one might be a bit of advice about strategy : http://thepositioningmanual.com-P
Does this sound familiar?You seek a worthy adversary.You always have sought it, and you always will. It brings out the best in you.At first, software development is that adversary. You struggle to master it, and its apparent strength and wiliness make it seem like a worthy opponent.But… you gain strength and cunning faster than it does.Under the combined onslaught from you and your fellow programmers, your adversary weakens. Eventually, trained by best practices and caged by a fortress of solid documentation, useful libraries, templates, sample code, and frameworks, it is finally tamed.As life with your formerly unruly and unpredictable adversary becomes domestic and predictable, you grow bored while those who paid you to fight this adversary on their behalf are willing to pay you less and less.You, their former Fearless Champion, have become a zookeeper. They’re considering hiring a zookeeper from over yonder because they work for less.And so you seek another worthy adversary; one worthy of your increased strength and skill.Is a seemingly fearsome adversary that takes only 3 to 5 years to tame into a zoo animal really a worthy one? Is the next programming language, framework, or platform really worthy of your full intelligence and strength?Would applying that intelligence and strength to a different opponent be a better use of your limited life force?Other opponents await. They are worthy of your gifts: http://thepositioningmanual.com-PP.S. Know a self-employed software developer who might benefit from specialization? Send ’em this free gift! Details here –> https://philipmorganconsulting.com/referrals/
Part of the problem with early stage tech startups as clients is that tech practitioners (or former practitioners) run the business. This undermines your power/control/value.Additionally, you have startup luminaries like Peter Thiel saying no less than 3 times in his book “Zero to One” that a startup should avoid outside consultants because they aren’t equity motivated and they don’t buy into the startup’s mission as deeply as employees will.Also…. startups are invisible until almost too late unless you’re geographically embedded in a startup scene or have a unique rainmaking relationship (with a PE company, etc) that brings you work.But hey, they sure are fun to work with, aren’t they? :)I’m not at all sure that fun is worth it, though, in view of the bizdev challenges this type of client presents. And that’s without even considering the challenges of pricing your work for startups, who often lack a proven business model that you can help improve (see https://expensiveproblem.com/list for more on this pricing stuff).What do you think?
Any time a stranger reaches out to you, you have to make a decision: ignore them, connect, or decide not to connect.What if that stranger made it easy for you to decide?This guy did.Here’s his first contact with me:Breathtaking clarity about who he helps and what he helps them with.I’m not a leadership speaker, but I accept the connection request because I’m so impressed by his clarity of focus.Then I sniff out his website: https://grouplabs.com/It’s also a platinum-level example of clarity and focus.I talk a fair bit about the theory around specialization, positioning, and effective lead generation. I try also to share examples of those who have put these ideas into action.Asher’s LinkedIn outreach and web site are two great examples.Go and do likewise.If you’re struggling with how to decide on your focus, check out: http://thepositioningmanual.com-PP.S. Know a self-employed software developer who might benefit from specialization? Send ’em this free gift! Details here –> https://philipmorganconsulting.com/referrals/
List member Michael Borthwick shared a really insightful perspective in response to an email I sent last week about the problems working with startups:——I work with startups. Biggest issue isn’t so much their lack of money, but the lengthy sales cycle.I often joke that Startups only have money for about 30 minutes, but it’s true. That’s how long it takes them to spend it once they get it. Everything and everyone they want to work with is already lined up before they get their money. When they finally get it, BAM it’s spent. You can’t ride in late in the startup world.They can’t afford reinforcements – they can’t afford being told they need to redo anything, they can’t afford to be told they were wrong. I think that’s what Peter Thiel is actually worried about. Consultants like to point out what you did wrong, what you should change and what you need to redo. Unless something is completely FUBAR’d they won’t call and if they do chances are high they don’t have the money or the time to make it right.If you do go down that road you need to be 100% sure they’ll do what you say when you say it. You can know exactly how to help, give them the best plan the world has ever seen, but if they fail to execute you’ll be the first to get thrown under the bus when the Peter Thiel’s of the world come around asking why shit is still broken. Think about that and think about his perspective. I totally understand why he doesn’t like consultants.So you have to be nice to founders when they’re broke and realize that it’s a very long sales cycle if you want to land them.You have to meet them and hand them your business card 3-5 times before you become a name they recognize. You have to get in front of them, with your brand, repeatedly before they get their money. Yes, you want to be on that list when the time comes. That’s not too hard to do, but it does take time and patience.——Thanks for sharing your insight, Michael!I work with people one-on-one. One of the available slots could be yours if you need help with deciding how to specialize, developing a compelling, focused value proposition, or designing a lead generation program.Hit HERE to inquire.-P
I thought this was a fascinating story of niche expertise: https://www.thebroadcastbridge.com/content/entry/2399/when-it-comes-to-parabolic-mics-larger-is-not-always-betterAre there any lessons in there for your custom software development business?Of course I think there are 🙂 Here’s a sort of mini “study guide” to help you pick out the parts that might be relevant to your business:
- How did the opportunity to build a better parabolic microphone find its way to Patrick Santini and Paul Terpstra?
- How did the client (the Fox network) think of these people? (positioning is the fancy word for how your clients, prospects, and the larger market you serve think of you)
- What role did expertise play in this story?
- What role did disruption and iteration play in this story?
- What role did industry events play in this story?
- How long did it take for Santini and Terpstra to become “successful”?
- What came first? The product, or the use case for the product?
That’s probably enough questions for now.
Earlier this morning I was finishing up my first cup of coffee for the day.I make my coffee with an Aeropress and 50% more beans cause I want ’em reeeeeal thick and juicy. Oh, sorry, just started channeling Sir Mixalot for a second there…Anyway, I like my coffee thick and dark.I drank the last sip of today’s coffee and saw a dead spider at the bottom of the cup. I hadn’t noticed it before because of the aforementioned thick and darkness of my coffee, and also because I often get up at the butt crack of dawn and make my first cup of coffee while I’m still half asleep.This makes me think of risk, particularly the risk of specializing.Some types of risk make themselves known going in. You know you’re getting into something risky, you feel it right away, and you can start worrying (or better yet, doing something about it) early.I suspect that many of you fear that the risk of specializing is a different type of risk.A “dead spider at the bottom of the cup you only discover at the end of the process” risk.A sucker punch type of risk, like you’ll do everything right and still get a bummer result or, worse, damage your business even though you didn’t do anything “wrong” per se.How do you mitigate against this risk?One of the best ways is by talking to your target market–people who would know whether your intended way of specializing has strong economic value to them. By asking good questions and by listening a lot, listening deeply, and listening very carefully.If you’d like assistance with this process, check out http://positioningacceleratorprogram.com-P
Jake Jorgovan’s presentation on LinkedIn lead generation was great: https://philipmorganconsulting.com/dev-shop-marketing-briefings/dsmb-jake-jorgovan-on-linkedin-lead-generation-for-specialized-dev-shops/Highlights:
- A method for generating leads for sales, or for market research/validation
- Pays for itself in terms of the time or money you spend on it if your client LTV is $10k or greater
- Produces results FAST, like in a few weeks (this makes it approximately infinity times faster than content marketing 😉 )
- Jake covers the entire system from end to end in about 15 minutes. It’s really simple!