Success
Stopper # 3: Responding vs. Planning
by Rosemary Davies-Janes |
When we run our own business, so much
can "come at us" in a day it can be overwhelming! Most of us react
or respond by either;
a) taking on multiple roles; such as coach, salesperson,
administrator, book- keeper, courier, etc., and over committing our
time. (There soon learn that there simply aren't enough hours in
the day to be "all things".) We can also be;
b) pushed to respond to questions on costs or timelines by pulling
dates and figures "out of the air", (as we know it will be 3 weeks
before we've cleared out plate enough to generate a realistic
proposal).
The problems of responding thus are two-fold:
In situation a) we tend to spend far too much time engaged in “low
profit” or “no profit” activities that we really don’t like and are
not very good at; entering contact information into our databases,
logging accounting receipts, shopping for new technology, etc.
Another less obvious but time consuming problem arises from
over-responding e-mails and phone calls. While it may seem like a
good business practices to respond immediately, or pick up the phone
whenever it rings, it is not. By continually interrupting and
distracting your focus, these communication tools can reduce your
billing rate by as much as 50%, if they’re not properly managed or
"batched": into time slots allocated for "administration". Take a
2-week period and log how you spend your time – notice how, when and
where your profitability is being zapped and then seek out either a
software program or a support service/person/firm that can take care
of the task far more economically. Want to know why? The following
example will clarify...
After learning that the website you want will cost $5,000 to
develop professionally, you decide to build it yourself. After
investing 80 hours of your time to shopping for a host, authoring
software, figuring out how it works you build a very basic low-tech
site. If your billing rate is more than $62.50 an hour, you would
have done far better to have the pros were develop a functional,
well-positioned, professional looking site, as if you had billed out
your 80 hours at $100 to $150/hour you’d have earned $8,000 to
$12,000 – enough to pay your developers, and yourself!
Other time saving software programs are; on-line and telephone
banking services; electronic money transfer services; auto
responders that supply standard information to prospective clients;
server based mailing programs that automatically distribute your
newsletters or e-zines; web-based forms that automatically sign up
subscribers while logging them into your database and automated
scheduling programs that allow your clients access your schedule
on-line and book their sessions, instantly!
Focus your time on billable tasks and your cash flow will be
assured!
In situation b) Having provided a time or cost estimate "off the top
of your head", you learn that when you finally do delve into the
complexities of the quoted task, that you have backed yourself into
an ethical dilemma. You have quoted half the price and one third
the time the project truly requires. Do you:
a) 'Fess up" and let the client know that upon further
consideration, your costing needs to be doubled and your timeline
tripled? (And probably lose the project AND the client AND your
reputation, in one fell swoop!)
b) Drop everything else and "just do it" for the price and time
provided, without a word to the client but with many words to
yourself, and a resolve to change your ways in the future.
c) Contact the client and discuss how to meet halfway, contrasting
your original perception vs the reality you have since uncovered.
Obviously, any or all of these options are not an optimal way to do
business.
It is important to stay "on top"
requests for proposals, prices and quotes. If you do not price your
services fairly, you may bring your business down by running your
profit margins either too tight or too excessive. As well, you may
be knocked out of contention by the client for being "out of the
ballpark". After all, the "unreasonable" client who is pushing you
for an immediate price or timeline may be the sort of "driving"
person or organization that will continue to push you throughout the
project, and may in fact be a client you'd rather not take on.
Having the courage to insist on taking a reasonable amount of time
to generate a realistic proposal will enable you to win both fair
clients and an appropriate fee.
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