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MILLION DOLLAR CONSULTING
effort and confuses perceptions. (And $50,000 from one client is far more profitable than $10,000 from each of five clients. It’s not what you make in this business; it’s what you keep.) 3. Effort applies to tasks, whereas payoff applies to results. While managing a national field force for a training company, I discovered that it requires as much time to sell a $10,000 project as to sell a $100,000 project. The number of calls, the nature of the proposals, the types of competitive threats, and the overall time required are amazingly consistent. Thus, if each of my salespeople had x hours in a day, and both sales required the same amount of time investment, which kind did I want them pursuing? This was real rocket science, right? The only difference is in the attitude of the salesperson, and a similar attitude is necessary for the consultant. The efforts required to attract, administer, and deliver small assignments are virtually the same as those for larger assignments, so you are not making up in volume what you lose in size. By accepting any business that comes along, the consultant is doomed to poor investments of time, and she will find it increasingly difficult to break out of the box. Every time you raise your fees and/or refuse to make concessions to gain business, you will lose the bottom 15 percent of your market. Million dollar consultants regularly abandon the bottom 15 percent of their market as a growth strategy because it frees them to expand the upper reaches of their market. Every two years or so, you should be able to look back and identify assignments that you would not bid on or accept today. If you are accepting the same types of assignments at the same fees today as you were two years ago, you have not abandoned the bottom 15 percent of your market, and therefore you probably haven’t expanded the top 5 percent of your market (which is far, far more profitable). You cannot retain all types of business and expect to grow. Continuing to take on everything means that your growth in expertise and repute aren’t advancing.
Digression I’m writing this in 2009, a record year for me, while traveling less than 15 percent of the time and working perhaps 20 hours a week. And 75 percent of my income originates with services and clients that were not in existence for me five years ago. That is the continual reinvention that is possible if you choose not to waste time and energy holding onto poor business.