Wednesday, December 28, 2011

End of Year report

I'm supposed to be doing some report writing today, so picking up the blog after a few months of inactivity probably isn't a bad way to get back into the swing after a few days' break. I realise I haven't written anything on here since September - not through lack of interest, but through having been too busy both on the comms side and on the academic side to have the time to put the thought into making any sense on here. Now though, we're just a few days from the end of 2011 and it's not a bad time to reflect on a curious year.

Business-wise, I'm finishing the year strongly. Unilever has been a fantastic new client this year, the Adecco Group has kept me busy across several of their brands and agencies such as ArtHaus and Gatehouse have both put interesting work my way. I've picked the odd one-off piece up too - with a small piece for World Vision sticking in the mind. On the flipside, Diageo has been very quiet and some of my regulars from the past few years either are no longer in existence or have reduced their comms work significantly. While there are some signs of growth and recovery in some industries, it's patchy and inconsistent.

My year has definitely been one of two halves. The first was pretty poor, with a lot of scratching around for new work and a rather linear flow to what I was involved in. The second half has been much stronger with a mix of facilitation, training delivery, writing and editing for a range of electronic media and even a few smallish pieces of consultancy work. For the first time in about two years I even had to turn some work down as I didn't have the capacity to deliver it. That's always bittersweet, but at least this time I was able to pass it on to a connection.

I have been courted for a number of interim projects and came close mid-year to taking on a year's contract that looked as though it would have a foot both in comms and in academia. However, the actuality didn't really live up to the billing and the prospect of working with the most unctuous person I've yet to come across in the industry convinced me to stay clear.

I've built on my teaching at Brunel University and am convening a module on US History this academic year. This is tremendously rewarding (other than financially!) but probably has held back my PhD work as I strive to keep at least a week ahead of the students. That said, I've just had my first full academic paper published, and the reaction so far though minimal, is positive.

Looking ahead to 2012, I have one retained, client which is always good, though we're still negotiating what that retainer should be! There's the prospect of both a White Paper and a corporate magazine to keep me busy through January and February, but after that, who knows?

I feel that business-wise I'm in a slightly better position than a year ago, but still feel a month or two behind where I should be to feel comfortable. It has been a tough 12 months with the prospect of another toughie to come. But, in March, I'll celebrate a dozen years outside corporate life - and I'm not about to give up yet!

Tuesday, September 20, 2011

The Freelance Rules #12 - Be of strong constitution

You'll get plenty of knock-backs as a freelancer and to make a real go of it, it helps to have the constitution of an ox.

I've been at my desk since about 7.30am today. My elder daughter, off school with an Autumn bug, has kept me company for some of the time, though she has headed back to bed now. To be honest, I'm not feeling great at the moment - the kids go back to school each Autumn and bring home every virus and infection going. And they're very 'sharing', my kids. For the last couple of days I've had a dull headache and have a lovely scratchy throat to accompany it. But as a freelancer, you simply have to rise above such man flu.

Back in the day when I was a magazine journalist, I thought nothing of missing the odd mid-week day after a big night out. When I moved over to corporate life, my work ethic improved, but if I didn't feel 100%, I would call in sick knowing full well that I'd still get paid. Once, when I picked up horrendous food poisoning in Paris and was off for a fortnight (and lost a stone and a half in the process), I was particularly glad for that payment security blanket. Though, as the symptoms recurred over the next year while I struggled to finally get the bug our of my system, my boss was less impressed by the additional half dozen days I racked up in sick leave.

When I started working for myself, everything changed. I have insurance that covers me if I can't work, but it's very restrictive and kicks in only after six weeks. So, the equation for me is simple. If I don't work, I don't get paid. It's amazing the change that understanding prompts. In 11 years, I've only had to cancel work appointments twice. I've never been ill for more than a couple of days (and try and save those for weekends) and regularly work through the minor illnesses that would have sent me in search of my duvet in 'employed' days. Okay, I have coughed and spluttered through a few meetings; attended one where I couldn't sit down having been bitten on the backside by a big bug who didn't wipe his feet; and pitched for a new account in a mis-matched suit jacket and trousers put on in a migraine haze. But the upshot is, the fear of not earning is a fantastic medicine.

There's nothing unusual in my situation - just about every freelance I know operates in the same way. We all know that if we're not around to take on the work, someone else will.

So, if you're thinking about taking the freelance plunge, think about your health and your ability to work through the sniffles. If you're a bit of a fragile flower, you probably won't last long working for yourself.  

Sunday, September 11, 2011

The Freelance Rules #11 - Trust your gut

I'm in the very nice position at the moment of having a number of projects to juggle - that's great after a tough couple of years but throws up its own challenges of prioritising, keeping clients happy and generally having enough hours in the day to take part in the meetings and deliver the work.

I recently had the chance to cut the stress by focusing on one project for one client for a year. Okay, the pay wasn't going to be fantastic, but the project sounded great. The spec was to support the internal and external comms needs of a new CEO in an industry I enjoy for one of its biggest organisations - and one that was both new to me and would be a very good name to have on the CV. Stakeholders would be in the UK and International and would cut across the private and public sectors and include considerable government liaison. The call was to create a new strategy and then be a key player in implementing it.

There was a pretty time-consuming procurement process - which saw me spend the day I went on holiday writing a speech among other activities - but it looked like a project worth getting on board.

At the first selection meeting, I didn't meet the guy I'd be supporting. That rang an alarm bell, Instead, I was asked to do some more pre-work (which was never mentioned again!) and then grilled by a panel of four. One actually said nothing; two I took to, but the other managed to come across in turn as unctuous, officious, pompous and overly alpha-maleish. My answers didn't seem to be ringing his bells, and I left the room really not expecting to be asked back to sell-in my services - and not sure I wanted to return anyway.

Within 24 hours, as other client worked buzzed about me, I was asked back - and they wanted to see me pretty much immediately. My gut said let it go - but their obvious (though slightly surprising)interest in me probably flattered my ego a little too much. The lack of chemistry in the first meeting; their forensic interest in what seemed to me not so important issues; and a certain friction when I outlined my preferred way of working should have alerted me that this was not going to end happily. But, it's nice to be flattered and I shifted a couple of appointments and headed for this potential new client.

Again, I didn't get to see the person I'd actually be working for and was faced instead with the gang of four. They drilled into my preference for effective over efficient communication (they seemed to want things the other way round) and pointed to their CEO as being the 'expert' whom I should take my cue from without challenge.

At that point, I was seriously thinking: 'why have a dog and bark yourself?' My gut was telling me to get out of there - but that's not what we do in pitch meetings. Too often we sit there giving the answers we think the other side wants rather than what we actually believe to be true.

By now, Mr. Unctuous had turned particularly pompous. He was virtually going line by line through some other client work I'd been asked to provide to demonstrate the breadth of my work. I didn't take to his school master tones and finally woke up to what my gut was telling me.

These people didn't want a creative, challenging communication partner - they simply wanted a speechwriting powerpoint jockey who wouldn't rock the boat. The package they were selling bore little resemblance to the pretty picture on the box.

Politely but firmly I piped up: "You know what, I don't think I want to take this any further. I obviously don't fit what you're looking for and don't think I need to take up any more of your time."

It would be an understatement to say they were shocked. I think I shocked myself. But I honestly could not see any point in going through the polite rituals for another hour when I knew that there really was no meeting of minds. A few coughs, splutters and uncomfortable minutes later I was walking back to the car.

I should never have gone to the second meeting. It merely confirmed my concerns and wasted the time of five people - and I never did get to see the head honcho......probably a sign in itself.

I feel I dodged a bullet. Myself and Mr. Unctuous would never have got on. But I also feel that potential clients should be more honest in their project specs. If you advertise for a creative challenger and set a process that plays to those strengths, that's what you'll get. If you really want a skilled packager, make that clear on your tender.

Anyway, my gut has stopped rumbling. Since that slightly painful hour in the Midlands, two clients have come by with new work and the pipeline's looking particularly perky.

I'm very far from perfect, but on this occasion I felt vindicated in walking away from a poor, over-engineered process. Chemistry matters, honesty matters and respect matters in project negotiations. When any of those factors is out of kilter, it can leave a particularly painful - and long-term - gut ache.

Monday, July 11, 2011

Be a partner, not a packager: know when it's right to say 'no'

My working world has been organisational communication for more than 20 years now. Throughout that time, IC professionals in particular have been fighting to establish their role: first in delivering comms, then in gaining employee buy-in and communicating through change and most recently, establishing the position of IC in engagement. The constant has been that IC has never been confident in its role  - and the upshot is that communicators and the rest of the business see the IC role as two different things.

Wherever I go, I tend to find well-qualified, talented and ambitious IC people working as packagers: responding to the needs of the business by picking up decisions made elsewhere and processing them for publication - be that on a portal, through a tweet, in a team meeting or even in a glossy magazine. Most are doing a great job, but I'd question whether they're doing the right job in building a culture that will truly drive their organisation forward.

Far less frequently, I find IC people in on the decision making process before the key business decisions are finalised. This is where IC should be and should earn its spurs.

With the democratisation of communication, through the near-ubiquitous SharePoint world of team sites, yammer and the rest, overlaid with the bloom of external social media, comms pros can no longer sit their with a finger in the dyke expecting to control the media flow throughout their organisations. Give people the tools to get on with communication, but then get out of the way. The real value that IC can bring is in expert advice - not in trying to craft every message and manage every mechanism.

If IC wants to be taken seriously, it should be looking at the models being set in other functions - Finance, HR and IT for instance.  More and more, those other functions are outsourcing and automating transactional business. Of course, in the last few years, much of this has been driven by the economic climate. Teams have got smaller and in order to make their workload manageable, it has been essential to find new ways of doing the time-consuming but less high-value areas of the job. What has emerged in these functions are a two-speed operation: a few people still looking after the bread and butter process work, but more senior, more able or just more business-focused team members taking on a business partner/expert adviser role further up the business chain. Where such advice works best is before decisions are made. It's a model IC should be fighting for.

I'm ambivalent to the term 'business partner': when a service department is helping a business unit director, it's no more a partnership than when I'm supplying my expertise to an internal client. We'll meet at a point of mutual interest, but I'll always know who's boss. I prefer the concept of expert adviser - and that expertise will become valued and trusted the first time you say 'no' to something.....and are proved right.

We've all had the situation when the CEO or someone equally influential comes along and says: "I need to get this message out now." Sometimes it's a no-brainer: it has to go and everything else gets shoved to the side to make it happen. But on other occasions, your expertise tells you it's the wrong thing to do. Is the message that important? Is the timing right? How does it fit in the context of other communication happening at the same time? What will be the reaction of the organisation? If you have a good case for saying no - and have the evidence to back that case, you prove your worth by challenging the authority figure. But how often does IC do that in reality? How much more likely is it that we stop being an expert and revert to the comfort zone of packaging again?

If IC wants to finally nail a valued role in the organisation, it has to stop being the packager, get into the decision making loop and be far more prepared to challenge far more often.

Thursday, July 07, 2011

Are we getting hung up in the Emperor's new clothes?

The wealth of words spilt in pursuit of organisational engagement is staggering. From ning groups of thousands to a plethora of LinkedIn communities, engagement is the buzz of the decade that's supposed to be delivering organisational success.

But what is it? Can we ascribe measurable benefits to it and can we turn those metrics into something that conclusively delivers results?

Working for a couple of large corporates this year, together with my involvement in Adecco's fascinating research project: Unlocking Britain's Potential and even my own research on organisational communicators' role within engagement, what strikes me is that what's being talked about now isn't a million miles away from the emotional intelligence of a decade and more ago or even the corporate dialogues I was involved while working at Nationwide Building Society 20 years ago.

Back then, before the Internet; when communication was face to face and backed by print, we were taking faltering steps from top-down communication into a world where employees were 'empowered'; they had a voice in decision making and all our focus was on breaking down silos and getting cross-functional teams to collaborate within a culture of success to deliver on a range of defined and beneficial corporate goals. We worked with the eager young tyros who wanted to rule the world by e-mail, and with their elders brought up on paper-based systems to find common ground and a way forward that made the most of their blended skills.

It felt good but didn't seem particularly revolutionary then. Now it seems to be happening all over again - this time with social media advancing the collaboration quicker than email and the first clunky iterations of Lotus Notes ever could.

20 years ago, I learned two allied lessons that seem to have been lost, forgotten and rediscovered. First, no organisation was ever going to prosper without great leadership; and second, business organisations are not democracies.

And that's where the Emperor's New Clothes come in. In the consultancy world, there are any number of people out there telling me that social media is engineering a revolution in engagement, bring people together as never before to create cultures that will reshape business as we know it. They've been telling me this for the last three or four years. Yet the reality is, aside from one or two organisations where the leadership already comes from Gen Y and the structures have been built from the ground up, most organisations are operating as they have since the 80s (in some cases, the 1880s).

The pyramid hasn't been inverted and even those organisations exploring the benefits of of wider, more social engagement are doing so through traditional HR/Marketing/Comms structures. The vision of a joined-up organisation with organic engagement remains largely a vision while good businesses built on meritocracy bolt on teams and departments tasked with delivering an engaged organisation. Somehow engagement becomes a process and the essence of it is lost.

Indeed, other than changing the toolkit, is what our engagement experts are doing actually any different from my days at Nationwide in the early 90s?

While organisations are undoubtedly leaner; have flatter structures and are slightly less driven by command and control, the nature of capitalist practice means that the need to drive the bottom line remains the default setting in the Board Room. Some are seeing that this demands a culture very different from traditional business - look at google for instance. But most aren't. And until a very different generation of leaders break into that Board Room, engagement will remain elusive in meaning, benefit and measurement - and those of us pursuing it from a number of different business avenues may well simply be evolving business practice further, as generations have done before us, under another fancy name.

I'm genuinely interested in what's really different this time round?

Monday, July 04, 2011

The Freelance Rules #10 - Manage Expectations

Every client assumes you are sitting at your PC (or Mac!) poised, just waiting for their job to come along. They assume you can do it in half the time quoted, and miraculously, it will be completed at a fraction of the cost you originally agreed. Every client knows they're far more important than every other, and every client is convinced you want nothing more than to dump what you're currently doing to meet their needs.

They are, of course, all completely.....right.

One of the first things you'll find out running a microbusiness is that work never arrives to fit in with your circumstances. When you need a new project, no-one will have anything for you. When you're full to the gunnels with projects, another will come along....and then another.....and then, probably, another.

There's no science to managing the workload (as the great Senator John Glenn, he of the Mercury 7 and the Space Shuttle once told me: "just pray for 48 hour days and 10 day weeks" (how's that for a name-drop)), but there is an art. It's all about managing expectations to ensure all your clients are aware of the art of the possible. To repeat an earlier tip: never over-promise. Let your clients know when you're busy but never put them off. Find out what their real priorities are - it'll enable you to prioritise your workload. And don't be afraid to push back on unreasonable deadlines or pressures to do more for less.

Think about what would happen internally: would a manager going to an internal contact expect an immediate response? Probably not. So why should they expect the world to be different dealing with an external supplier? Let them know what you can do - and then do it better than they could have expected. Then get on with juggling heaven and earth.


Thursday, June 30, 2011

The Freelance Rules #9 - Find your niche

When I first started freelancing in the early '90s, my specialism was death. Well, I say death, I mean dead people. And when I say dead people, I mean their money. I'd worked, briefly, as a Probate Commissioner in the '80s and had built on the experience while at Which? Magazine, co-authoring a wills and probate kit and writing both reports and book chapters on how to deal with someone's estate.

So, when I was setting out for the first time as as an independent, I had a niche: a specialism where I really was an authority on my subject. It got me more work on titles for accountants, for the Government and even a couple of BBC radio appearances. That niche led me to new building new relationships with editors and commissioners who used me not just to write about wills and estates, but other aspects of legal issues and, making a sideways leap, investments for the elderly. It all helped me get up and running and gave me a regular income stream in those three years of running my own show.

I've long-since left those initial specialisms behind as organisational communication has filled my plate over the last decade and a half, but have never been afraid to use specific experiences: companies and industries worked for, and areas within those organisations, as my entry card when looking for work.

As a microbusiness, the worst thing you can possibly be is the 'jack of all trades and master of none'. If that's the case, you're always going to be competing for work with others who are just a little bit more specialist in the area where you're trying to pick up work. That will make your business development harder- and you'll have to compromise on other factors (price!) to improve your chance of landing the work.

I pick up a lot of work for finance teams, IT and facilities management - I'd love to get some of the sexy marketing stuff, but have built my best relationships around the back office. It goes back to the days when I was running comms for Barclays' Group Planning, Operations and Technology. It may not be the sexiest of areas - but I've found a good niche where I can operate effectively.

Tuesday, June 21, 2011

The Freelance Rules #8 - keep on top of your business

It's important to start out as you mean to go on in your microbusiness life. If you're just passing through, on the look-out for another in-house role, there's probably little point in operating as anything other than a sole trader. It's the simplest way to administer your business - but still needs the discipline to keep control over your financial affairs and to set up the necessary insurances and protections to ensure you're covered for the work you - and should anything go wrong.

If you're set up to remain a microbusiness, it's worth considering whether you need to establish limited company status or, if you're working with someone else, a partnership agreement. It's essential to have a formal arrangement if you're more than one person - you may think your working relationship with your partner(s) will always be terrific. But what if it's not? What if something goes wrong or things turn sour? What if another person in the business wants to move on? You need to know your legal standing and have a plan in place if you suddenly have a stack of projects to deliver, but no-one else to make it happen.

Of course, many businesses start from one or two people and suddenly have three, then four, then eight then 10.....and in the last few years may have been trimmed back to a few or a couple. Clearly if you intend to grow the business, set it on a proper legal footing as early as possible. Being a limited company can be a hassle in terms of keeping accounts - you need a properly qualified/registered accountant to audit the business each year (even if you're turning over tuppence), but it gives more options for growth - and also still seems to hold sway both with banks, if you're looking for finance, and with clients. With most services procured through purchasing teams these days, it's actually much easier to pick up business if you are a legally registered entity. If you're just Jessica Bloggs sole-trading, you may well find it far harder to get on a preferred supplier list, no matter how excellent the service you provide.

Equally, if your clients are big and expect to pay VAT on invoices, it's probably worth registering - even if you fall short of the threshold where you have to. If you're an anomaly in a purchasing process, things are far more likely to go wrong. VAT is more bureaucracy - but it's worth being registered if it helps you get paid the right amount when you expect it.

Most microbusinesses hate business administration - we'd rather be out there doing the work. But it's vital to keep on top of your financial affairs. If you miss that VAT deadline; don't pay HMRC or slip beyond the overdraft (even though it may not be your fault and down to the vagaries of cashflow), your credit rating will soon start slipping and black marks will start appearing on your credit rating. Business health is something procurement teams love to check - so when pitching for that project you'd love to do, the last thing you want to explain is why your business might be flashing up amber or red on a procurement health check.

Don't make false economies: in my case, I pay the rather excellent Amazon Office Management to keep my books on the straight and narrow. Equally, Leapfrog is insured to the hilt in case something happens to me or Jac or if there are any problems with our work (no problems on either count in 11 years). We've never had to claim on any of the insurances, but at least can go to work unworried that the business is at risk.

Cashflow, especially in the past few years, is never too far from the forefront of any microbusiness' mind. But my advice is to get to know not just your clients, but also the people who physically are responsible for paying the bills. We all rail against bureaucracy and a culture that aims to keep money in the biggest organisations for as long as possible, but I tend to find that the individuals actually working in the accounts payable teams are a pretty good bunch. The worst possible thing to do is to blame the inconsistencies of a payment system on the person at the other end of the phone. Much better to find a way to work things out.

It's harder to establish a working relationship with your bank or the taxman - these days they tend to be faceless machines and loyalty appears to count for little. The best bet is to set achievable parameters for paying tax or repaying any borrowings and move heaven and earth to work within them. And, if things go wrong, get on the phone fast. You may not get a lot of sympathy, but you'll generally get a way to move forward.

Running a business is about doping significantly more than the service you're paid for. It's rarely sexy, but it's essential to get the basics nailed as early as possible in your business life.

Sunday, June 12, 2011

The Freelance Rules #7 - Keep Developing

While out and about last week I ran into a guy who used to freelance regularly for me back in my Barclays days. 'What are you up to now?' I asked. 'I'm pretty much out of the comms game now,' he responded. 'I do a bit of book keeping for my son, and have a sideline in importing specialist wines, but the comms work dried up a few years back - I think the market just moved away.'

It was a bit of a shock to hear this, as the guy had been one of the best independents I'd used - and is only about 10 years older than me. He was a magazine specialist, with a long background in printed magazine journalism. His problem, it seems, is that's what he did. As comms moved ever more electronic and then social; and as the skills of an organisational communicator moved from packaging information to facilitation/corporate conscience/leadership coach and all the other areas that have built on the basics of an ability to tell a story, he was rather left behind. 

When you're out of the corporate world, it's very easy to get left out in the cold when it comes to training and development. But our world moves pretty quickly now, so it's incumbent on any freelancer hoping to keep up with the game to stay on top of the trends and keep finding new ways to apply our skills.

Straight-forward commercial training courses from the likes of Melcrum and similar outfits in the market are a non-starter for most microbusinesses. They're aimed at corporates and thus are premium-priced. Given that independents pay twice for any training opportunities (cost of attending and opportunity cost of a lost day's work), I've always reckoned the best way to take part in such a course is to present it! If you have a skill that's in demand in the market, train people on it. You'll probably gain as much as you impart - and if my experience is anything to go by, you can generally barter a couple of days delivery for places on other courses.

Make the most of associations too. I've been to a number of IoIC conferences and IABC events down the years without ever paying full price - instead, I've given something in kind to hear the latest industry presentations. In the days when the IoIC was CiB and even BACB, I've presented sessions; covered the conference as a news event and even driven exhibition kit up and down from Newcastle for a conference place. I've gone on waiting lists for standby tickets to events and have even stepped in when clients have had to give up a paid-for ticket.

Never forget that associations deliver training too. It may not be as flash as a Ragan or a Melcrum, but IABC or IoIC training days are likely to be a fraction of the cost - and often with the same calibre of expertise.

These days, LinkedIn groups are a great informal developmental source. People throw out questions and the collective brain power of the group quite often gets involved in an electronic brain dump - often there's great insight to be had: free of charge.

Just because you work for your own business, don't neglect on the job training either. So often we work as part of a major change project or large corporate initiative where our clients grow and develop through the experience. Why shouldn't we do that too?  Wherever I can on a big project (and the comms team is a great place to be) I've looked to suck the brains of leaders and experts dry. I suspect every new thing I learn now will be applied on future work further down the line.

Finally, I've found another route to keep developing. I went back to university in 2007, first gaining my MA, and now working towards a PhD. The research has little directly to do with my current job, but often opens up new avenues of thought to me. Sometimes just sitting with fellow students talking about each other's work can set me off thinking about a project I have in my work-life. And it's weird how people expert in Hungarian economics, Arctic politics or sovereignty among Native American nations can spark off a great idea for a thorny comms problem. Perhaps it's just being among people devoted to learning, but it;s given my own development a new lease of life - and may even open new areas of opportunity to me in the future.

The bottom line is that however good you are at what you do, the business world will keep evolving. If you don't, the only way to go is the way of the dinosaur.

Monday, June 06, 2011

The Freelance Rules #6 - Know your worth

I love Jessica Hische's contribution to the unending debate microsbusineses and our clients get into around price and value. For me, the bottom line when it comes to commercial organisations is never work for free. I'd add another strand to that: establish your real value and stick to it. In essence, don't give your services away cheaply.

That's been really tough in the downturn, but once you know your worth, aligning your charges to the real value you bring to a client it helps you, the market and clients too.

I hate quoting a day rate to potential clients: in terms of £ per hour/day, I'm by no means the cheapest (though, I surprised myself on a rates survey recently to find out I'd dropped from upper quartile to middle) - and far too many service procurers are driven only by price. I don't actually know anyone who does what I do as fast as I do it. Equally, I have 20 + years experience in my field, and work with a group of people equally experienced. So, what the client 'gets' for a day's worth of my time is far more than they'd get from someone who may charge less, but may also not deal so well with the real issues - and may end up reworking (and recharging) several times before the client is satisfied.

Price-driven procurement is fine when the procurer is sourcing widgets that will meet the same need in the same way day in and day out. Buying a service is very different - but the pressure on the smallest businesses is to keep cutting prices to satisfy the client's desire to cut their costs. But microsbusinesses have to be braver: we have to recognise the value we provide and stick to it. The easiest way with procurement teams is actually a cop-out: it's to start higher than you would expect and compromise pretty much at the point you would normally charge anyway. They feel better - and you still get your expected return. But overall, this probably has the effect of inflating the market: not what 'procurement' is supposed to do.

Once you know the client and are dealing with the real commissioner not their procurement team, you can actually negotiate on the basis that they'll understand the value you bring to their team. If you merely duplicate something they can already achieve in-house or can buy in cheaper from another supplier, you can't expect to charge huge rates. But if you have specific experience or a skill that they can't duplicate elsewhere, your service will be at a premium and you're in a much stronger position to stick to your guns on price.

The flips side is that you have to offer service levels that justify your charges - there's absolutely no room for complacency.

Somehow clients seem to think they can pay an independent or two-person business considerably less than their high-powered, all-singing-all-dancing agencies. I'd contend that if I'm guaranteeing to provide as good a service as that agency - or indeed a service that the agency can't offer - there should not be a difference in the price the client pays. The reality of course is that I don't carry the overhead of that agency so Leapfrog can be a far more cost effective vehicle for getting the job done. And, of course, many agencies are little more than a front. The business developers and a small core team work directly for the agencies - and many services sold on to clients are actually bought in from independents (and we're charged out at well over the price we charge the agency).

Occasionally, clients have a very naive view of payments though, and assume that the £xxx a day I charge them goes straight in my pocket. Somehow the fact that I have to cover pension, insurance, office costs, legal and accountancy costs, VAT, corporation tax and all the rest before I even see any of the income passes them by. Though there are undoubtedly some tax advantages in operating as a limited company, it's marginal these days. What I would say is that it's apples and pears to try and equate a day rate to a salary.

Driving down on price has a harmful effect on clients in the end as many really good small suppliers are simply driven out of business - and those that remain will, in due course, simply push up prices again as their services will be scarce. It's all terribly cyclical when it doesn't need to be.

Meanwhile, those independents who deliberately undercut the market do themselves no favours. Names soon get around in what's a pretty small, tightly-knit community - and once you set a value on your services, it's hard to increase your prices later. If your clients know you as a £200 a day person, how can you expect to justify double and triple that - even if that actually reflects your market worth?

So, as a microbusiness, it's essential to check out what the rest of the market is charging, not just when you start, but on a regular basis. You will have to justify your worth time and again. You'll know what it costs you to run your business - you have to get to know your break-even point and the point at which you can make the money that delivers the lifestyle you want. If your service justifies it, price around that (without being greedy). If not, it may be time to get a job.

Wednesday, June 01, 2011

The Freelance Rules #5 - know your place

I learned a very salutary lesson on one of my first projects after I left Forte. I was commissioned to collect testimonials for an internal change team and produce an internal communications strategy, activity plan and toolkit they could use to promote their services to the rest of the organisation. They were a busy bunch, so after agreeing a budget and timeframe, they pretty much left me to get on with it. It was a relatively large project and I decided the best way to fulfil it was to work with a larger consultancy who could provide both bodies and expertise to ensure we got the research completed effectively and could then work on the necessary tools.

The problem was, as we interviewed stakeholders across Europe and the US, the picture of the change team that emerged was not as rosy as we'd expected. The feedback was by no means awful, but a number of issues emerged . The value of the change team was called into question by some stakeholders; some points of process clearly rankled with some of the areas of the business they'd worked with and some of the personalities in the team - including its leadership - had definitely rubbed the internal clientele up the wrong way. We sat down as a research team to discuss our findings and rapidly moved into solution mode. Over the course of the next week - a week in which I devoted a good 70 hours to the project, we turned a six figure assignment into a small five figure one - all by exceeding our brief and not being attuned to what the client required.

The meeting where we presented our research back to the client ranks in the top two of awfulness for me still - the best part of a decade on. It's only trumped by the day I wore one suit's jacket and another's trousers to pitch for a hotel's PR account while beset by a migraine and not knowing that the brief had changed significantly between getting the appointment and delivering my presentation.

But back to this early experience. In my days at Forte and Barclays I had been expected to stand up and challenge management on their behaviours and practices. My comms team had fulfilled the role of corporate conscience, calling to account actions that sat outside our corporate culture, vision and values and then working with the leadership team to use communication as the enabler to role model the desired culture through the organisation.

I hadn't been asked to do that here. I'd been asked to facilitate a sales communication process for a team that was confident in its own abilities; had the mandate of the global management team and was delivering a significant change that was painful but necessary for many of its stakeholders. We weren't being asked to hold up a mirror to them to show them their faults. I have never known a client so incandescent with rage either before or since that day. Much of what we had to say was right and the issues we were highlighting were real. But we did not have the authority to presume that we were the people to provide the solutions to those issues.

Our mistake had been two-fold: first, to jump into solution mode and to second, to bypass the team's communication manager who had hired us. We assumed we could change the nature of our assignment by appealing straight to the top guy. We had brought the comms manager into the loop a couple of days before the meeting. But she, feeling undermined, had quite understandably let us hang ourselves in front of her boss. We hadn't set out to undermine anyone, and thought we could add real value and integrity to our offering. But in listening most acutely to the views of the most disgruntled on the receiving end of the change process, we'd manage to completely lose sight of the brief. Our proposed strategy, though sound, never had a chance of a fair hearing and the lucrative website, training, events and supporting collateral all disappeared to another supplier more willing to execute the brief as stated.

At that point I learned the difference between being an internal communication lead and an external supplier. Ever since I've worked hard to deliver on the brief given to me to the best of my ability. By building relationships with clients and working closely with them over the years, I've reached a point where often I can influence a brief; where my viewpoint is respected, sometimes sought and sometimes acted on. I'm a partner in the communication process, but when my input to the company is measured in four or five figures, and their turnover is measured in billions, I know that it's no way a partnership of equals. I know my place.

Knowing my place doesn't mean being humble or simply delivering without question. My value comes in being able to get to the heart of an issue, challenging where necessary and charting the best course of action. It's best expressed by getting on board early in a project working with and for my internal contacts and finding the best way to use communication as an enabler to achieve the required outcome. But the bottom line is that whatever project I'm engaged on is owned internally. I can influence the shape and direction of the project, but the buck doesn't stop with me.

In effect, my role is to make whoever commissioned me look good, not to undermine them. There's a business dynamic at work here: the best way I can make them look good is by delivering my best possible effort. The more I do that, the more I get invited to pitch for better quality work and the more word gets around that Leapfrog's a decent business to work with. The more that's the case, the easier it is to pay my mortgage and even provide some decent work for others.

Sometimes, work comes along where it's best just to bite your tongue, execute the brief well, and take the money. Take pride in what you do, but leave your ego at the door.

Next up on The Freelance Rules will be: Know your value.

Tuesday, May 31, 2011

The Freelance Rules #4 - Establish a routine

When you move from corporate life to an independent operation, it's often very hard to establish an effective routine. It helps to know if you're really out of the corporate world for the long term or whether you're just passing through an independent phase for a short time while looking for that next great corporate opportunity. But if you've established that a microbusiness life is the working life for you, it's important to set a routine that distinguishes your work from the rest of your life.

That's what we set out to do when Jac and I set up Leapfrog, though 10 years down the line, I look back at some of the early thoughts (and early expense) and cringe. Having freelanced from a back bedroom for three years in the 90s, I was determined that Leapfrog would be different, so set about finding an office we could work from to give us a presence. And to a degree, Leapfrog was different - it wasn't just me making money from the venture, and I wanted  to be competing a little further up the business chain - getting the projects, not just the in-house overflow. So we sub let an office in Henley and then moved to a lovely office in Oxford - marble pillars and even a shared swimming pool! With the desks, the tech and even a sofa in it looked a treat. The problem was, we were hardly ever there.

My two main associates lived in Kent and Bedfordshire respectively - so while we occasionally met up at the office (and they even more occasionally worked from it), we were more likely to meeting in London where most of our clients were. And the fact our client base was in London largely negated the need for an office in Oxford. We'd selected it, cleaned it up and made it look welcoming because I naively thought we'd have plenty of clients coming to see us - but of course, that didn't happen. Since they were buying our brains and the ability to make their communication work, what they needed was us: sometimes in person, sometimes on the end of a phone - more often across a flurry of emails. In the first year of the Oxford office, I spent 40+ days working on Diageo's premises and more than 60 in London, Paris, Bristol, Brussels and Zurich on a project for Orange. For many of those days, the office was empty. It was something of a vanity expense and not in the best interest of the business long-term.

When Jac and I moved house, we decided to buy somewhere with an office built-in. The room I'm writing from now is an extension to the original extension on the house. It has space for two desks and is just about big enough for Leapfrog's needs. But it fits a changing microbusiness world. The business is portable and goes where the work is. Sometimes it's just me working on a project and at other times the network swings into action again - though now we're all connected over the internet from our respective home offices.

The difficulty working from home though is establishing a working routine. It demands discipline and balance - but can be far more productive than working in a office.

If I'm not at a client's premises, I'll be in here from 8.30 in the morning. I close the door and am 'at work'. The difference to being in a big corporate office is that I'm not called into a million meetings that are less than directly relevant to my work and I'm not also copied into all those interesting but not overly productive emails that circulate in any organisation. It tends to mean that when I have a task to focus on, it gets done quicker and with far less distraction.

Much as the office brigade may buy into the myth that we homeworkers just sit with feet up and the telly on when work is slack, I can probably count on one hand the number of days I've actually done that. Sure, I'll put the washing on and get the dishwasher going. I might even put out the bins, but from 8.30am - 6pm I'm in 'at work' mode. I will, however, break off for a natter with the kids when they come in from school and wander up to Costa to meet up with my fellow homeworkers - the very worst thing to do is to stay in the bubble all day with no external contact. I'm also very reward-driven: editing a document by such a time might earn me the time to read a chapter of a book; arranging my week's meetings might get a chocolate biscuit - that kind of thing.

I wish that all those hours in the 'office' during the week were billable, but of course they're not. But the trick is to make them productive nonetheless. For the last few years for me that has been fairly easy. I do some training and coaching, and there's always a deck to tweak or material to update. I'm also in mid-PhD and that, frankly, counts as my learning and development. So, as well as the part of the week I devote to university stuff (scheduled in, of course,) I'll grab a couple of hours here and there to take notes on a text or do a bit of online research. Then there's the necessity to 'stay connected' (see previous post) and the aligned need to keep up with clients and former clients and even potential clients to see where future work may come from. So, even if I'm not immediately busy on a piece of work, I have to keep myself occupied on ensuring there's work in the pipeline. And of course, business red tape ensures there's plenty of admin to fill the remaining time - as a microbusiness, there's no-one else around to do it for you (that was quite a shock after so long in-house).

When I started off running my own business, a more experienced colleague said: "Make the most of your downtime." A decade on, I know what she means.

Of course, routines are there to be broken, and one of the great advantages of being my own boss is that I've been able to walk my youngest daughter to school for much of the time we've lived here and can slip away more easily to school events than I ever could when I worked at Forte or Barclays. I even have the chance to take a day off on a whim.....though in practice, rarely do.

Rules get broken the other way too. While I endeavour to finish up my working day by 6pm (earlier if I feel I've put the right effort in), the dynamics of working to other people's agendas do still mean I work some late nights to hit rush deadlines. But it never feels so hard to switch off the PC at midnight and just walk up the stairs knowing I'm home rather than contemplate a late-night tube and train ride.

My routine works for me: others will find a very different way to make microbusinessing work. The trick is to find the balance that's right for you.

Monday, May 23, 2011

The Freelance Rules #3 - Stay Connected

One of the biggest shocks of moving from corporate life to a microbusiness was the status change that comes from no longer being a budget holder and instead being a service provider. Overnight, my position on the chain of influence slipped hugely and suddenly the people who'd been generous with their time, their interest and their lunch accounts when I'd been on the inside and putting work their way were far less willing to return my calls or even answer my emails.

Instead of being an opportunity for their business I was, to some, a threat, and to others simply not worth wasting their time. No longer a corporate decision maker, I was no longer worth any effort. What hit hardest was the change in relationship with former colleagues. Some stayed in touch, were supportive and, indeed, put some great work Leapfrog's way. For others, I was obviously tainted with redundancy, and I rapidly moved off a few people's Christmas Card lists.

Frankly that's an attitude that has baffled me over the past decade as I've watched myriad former colleagues move in and out of corporate roles, interiming and freelancing. I work in a small, incestuous and interconnected industry - and you tend to bump into people time and again, so surely it pays to keep up cordial working relationships when you can?

In truth, when I formed Leapfrog it didn't take me long to realise that I had to move on - and if I couldn't move my business connections with me, I had to find new ones. Too many fledgling microsbusinesses fail when they rely only on the people they've worked with before to provide their future success. It sounds like an absolute no-brainer - but you'd be surprised how many independents just end up picking up the slack from their old job as a 'consultant' - and never really make the break (I should know, it's what I did for nearly a year with Nationwide back in the early 90s).

You'll recognise your real friends from the corporate world by considering who you're still in contact with six months down the line after your last leaving 'do'.

Today, it has never been easier to build connections thanks to the plethora of social media abounding in the tekkywebisphere. But being 'linked'; being a facebook friend or following someone on Twitter doesn't establish a real connection. You have to work on those: to get your voice out there; to become a recognised voice in the right fora; to be seen in the right professional social media environments. Create the right net rep and it will help add credibility to your emerging business reputation. While it won't bring you work directly it might help open the odd door.

But the best connections remain real face to face ones. That's where the real work comes in. It's terribly easy when you're working on your own or perhaps as part of a two-some to get really isolated. It's good to let people know you're still out there. Steel yourself for the polite refusals, but ask the person you'd like to meet professionally out for a coffee, or just give them a call. Emails are very easy to ignore - and going that step further shows people you're willing to make an effort.

Think beyond business development too - work at building a network of people in associated services - or even people who could cover for you (or you for them) at some point down the line. You're not working in isolation, and the sooner you can build and contribute to a network of professional interest, the better you'll be placed to move onwards and, who knows, back up that influence chain again.

Friday, May 20, 2011

Appreciating the quiet aura of success

I spent yesterday morning in the company of the great and the good who link technology education and the workforce environment as part of one of Adecco's 'Unlocking Britain's Potential' round table events. One guy stood out: not for his loud voice or strident opinions; not for the force of his rhetoric or, indeed, any startling originality of contribution. 

That guy was Mark Richardson, a British Olympian who won Silver on the track in Atlanta in 1996. He's a slight guy; not very tall but with a fierce intensity and sense of focus that I've only ever seen in people who have been at the top in their sport. I used to work with a guy called Jon Potter, another Olympian who won a hockey Gold medal. Yesterday I recognised that same sense of calm authority and absolute belief. Each is someone who has benefited from superb coaching in their sporting career and has turned that same approach back into their business life. It's an approach we still use too rarely in the time-pressured atmosphere of the workplace today.

Listening to Mark made me recall the absolute high I felt at age 16 when I broke 54 seconds for the 400m in an early summer school athletics meeting. My time, in benign conditions when I'd been towed round the track by a faster runner (and probably benefited from hand-timing) was almost two seconds under my personal best. I didn't even win the race but it was one of the best feelings I've ever experienced, and briefly, for a few seconds, I felt I could really achieve something in sport. Athletics had been my main focus, but rapidly gave way to O Levels. By the next summer, I had a Saturday job and a girlfriend and the track didn't have anything like the same allure.

Guys like Mark Richardson followed their passion, pushing all other distractions to the side to be the very best. I've no doubt I could and would have shaved a few more seconds off my PB (which would have put me 100m behind the winner at Atlanta!) but I never had the natural talent nor the strength of focus to be more than a decent club athlete. Nor did I have that coaching environment around me to help me to excel.

In business, the best organisations I work with have that ability to bring on excellence; to encourage, to motivate and to celebrate when we get things right. We need a few more Jon Potters and Mark Richardsons in business - more personality, empathy and understanding of that un-bottleable feeling that success delivers.

Monday, May 16, 2011

The Freelance Rules: Numbers 1 and 2: If you can, do - but don't over-promise

Over the last couple of weeks, I've been working with a number of newbie independent communicators - a couple have chosen to move out of full-time in-house roles, while a couple more have had the decision thrust upon them.

As an 11-year veteran of running a microbusiness that has never involved more than four people - and most of the time has involved half of that or me alone, they've been picking my brains as to what it takes to keep in business year in and year out. In the coming weeks, I'll be happy to share any insights I've garnered.

First, I'd say, never turn down work unless you really, really have to. Today, for instance, I had planned to write part of a large report - something I thought would take all day. Mid-morning, I was actually going great guns, so when a request for a news story for a client's portal came in before lunch, I thought I might as well knock it off straight away. I did so - to the client's surprise and got the response "My god man, you're quick." She's a relatively new client, so it's nice to go beyond her expectations. Meanwhile, I've raced on with the main project and probably covered twice the ground I expected today.  

But that's just a small example. Over the past few years I've very rarely turned down any work - and nearly always regretted it when I've had to. There's a weird freelance maxim at work: work will only come in when you're busy. There'll be times you look at your calendar and think: 'I haven't possibly got time to do that extra piece'. The problem is, someone out there will find time. If you say no, you don't only run the risk of damaging a client relationship, but are handing an opportunity to someone else who may get the client's call first in the future. And, as has happened once or twice in the last couple of years, the big piece of work that's set to block out the week or month can sometimes arrive late, or not quite as big as expected....or even not arrive at all.

As freelancers, we're not bound by the 9-5 or the Monday to Friday. So, wherever I possibly can, I'll try and say yes to any work that comes in unexpectedly. And if I really, really can't take on the job, I'll at least try and hand it on to a someone I know (and know will do the work well). We're a fairly small bunch in this profession, and I certainly believe if you help fellow freelancers, the good karma will come right back at you.

My second, connected, rule is don't over-promise. The worst possible thing you can do is take on a challenge you're really not up to. While I've choked through my teeth on it sometimes, I've always tried to be honest about what I can and can't do. If something's out of my skillset, I won't pretend I can do it (though that skillset is distinctly elastic around the edges) - but again try and turn a negative into something positive. I've built a lot of good connections in associated professions over the years, so if someone's looking for design consultancy, I know a man who can, and the same goes for quant research, photography, illustration, conference organisation etc.

This job is all about personal relationships - and any independent is only as good as the last impression we've made.

Wednesday, May 11, 2011

The CFO - Strategic Expert and Commercial Co-Pilot

The CFO workplace study I wrote for Badenoch & Clark is now out. You can get hold of the key findings at:

The next phase of the research sees B&C host a series of meetings up and down the country (which I'm facilitating) to dig into the findings with groups of senior and  up-and-coming finance people. The plan is to produce a follow-up report later in the year.

Monday, April 18, 2011

You make your choice and take the consequences

I'm a tad gutted that I've had to turn down Sean Trainor's offer to speak in one of the CIPR Inside's Engage Inside Expo sessions in London on May 5. It would have been a chance to share the research I worked on at the tail end of last year - and look forward to how it may move on this year.

But, the way I choose to operate my business has meant I've had to give up the opportunity to share a platform with the MacLeod 2 team and other practitioners with some skin in the engagement game. While the Expo will be in full swing, I'll be a dozen miles west in Uxbridge on day two of my university's annual research student event. It's just about the only compulsory event for researchers all year, but if I'm not there (and I missed it last year while stuck under a volcanic ash cloud), my chances of advancing to my next year of PhD research will be slimmer than a pre-pregnancy Victoria Beckham.

Back in 2007, I took the conscious decision to ease back on work and complete an MA in International Relations. It meant about a day and a half a week onsite at University from late September - April - with a frantic drive to over-index on work from late April to early September. The MA went really well and by 2010 had segued into PhD research (NOT part of the plan in 2007). That was easy to fit in when times were tough and I wasn't picking up work. However, the past year has been a less easy balance.

Long-term (post PhD) I plan to do more in academic research and, if there's any left by then, academic teaching. To that end, I've been balancing up comms work with part-time lecturing and support for some of the full-time staff (essay marking, running seminars etc). At times there's a really interesting synergy between the academic work and the organisational comms stuff but at other times there are some tectonic crashes as my two worlds collide. The Expo is one of those occasions.

Still, last week I had the pleasure of sharing a roundtable event with MacLeod 2's Nita Clark (of course it should  be Clark/MacLeod ) during the kick-off phase of Adecco's 'Unlocking Britain's Potential' .  The theme of this first roundtable was engagement - and while there was probably still too much time spent attempting to define what engagement is, there was consensus that no successful organisation can afford either to ignore it or to place it in a 'task' box. I'm going to be working with Adecco and the research team Loudhouse on the research outcomes/plan of action report later in the year. Perhaps it's another tip in the balance from organisational comms consultancy into research into the outcomes of such consultancy? It's not a leap I want to take totally yet, but the applied end of research is an area I find fascinating.

Monday, March 21, 2011

'A list' clients

Whether directly, or via the excellent ArtHaus , I've got the most amazing list of clients for current projects. At the moment, I have work on for Lafarge, Unilever, ITV, IHG, Adecco and Diageo. I just have to put in a 'blue chip' performance now.

Wednesday, March 09, 2011

There's a long way between a great meeting and a done deal

Every time I think I've crested the worst waves of the economic downturn and ridden out the financial storm, I get a little reminder that running a microbusiness is far from plain sailing quite yet. There are two brooding enemies on the horizon as I write, cashflow, and the gap between the great first meeting and actually landing the work.

My cashflow has taken a buffeting recently through two causes: large companies pushing out their payment terms ever further, and a small company going under before I could bill them. I'm pig sick about the latter as I incurred cost on the company's behalf - and then naively held off billing them as more work was supposed to be coming my way. It never did, and when I called to find out what was happening, the phone just rang and rang. A few days later I found the company had gone into liquidation.

With the larger companies, long payment terms are now the norm. It's an area where Government could and should act to protect the smallest businesses where even a couple of payment delays can break that business. The effect that I'm actually seeing is that small businesses are charging more to offset the impact of a long payment wait and are less willing to cut prices when the client can clearly afford to pay an 'honest' rate.

As I write this, I'm sitting waiting for a client telecon that should have started half an hour ago. For the client, keeping me waiting half an hour for a call or an extra few days for feedback or a couple of weeks between meeting me and getting going on a job, may mean very little. All I see in client companies now is fewer people asked to do more with less resource. However, in trying to structure my day, my week and my projects so that I can try and regularise my income, those delays are a major hassle. Sometimes I don't think the penny has dropped with some clients: whatever they do, if they're in-house, they'll get a salary payment at the end of the month. On the other hand, if i don't generate the work, do the work and then bill the work, I don't get paid.

That other potential storm on the horizon is turning great meetings and conversations into billable work. There are more projects out there and even today, I've picked up a website to revamp. But much of my last few weeks has been responding to client calls, meeting them, agreeing a way forward....and then waiting. There's still a great caution to commit on new communication work out there. At the moment it's merely frustrating. Many more months like this and it'll be distinctly financially damaging.

Anyway, 45 minutes now - and still no telecon...

Tuesday, January 25, 2011

Engagement: a definition

My recent research paper on the role of employee communication in engagement (see blog entry below) has thrown up a few very fair questions on my definition of engagement. So, here it is. The definition I use in the report states:

The Leapfrog view is that engagement is a cultural state, driven by leadership and supported by strategy, environment, systems and processes, which enables organisations to get the best out of everyone in achieving organisational goals. Effective employee communication is an enabler to achieving and maintaining an engaged workforce – but it is only one of a number of factors in the mix.
The interesting question now is how far that squares with other views in the discourse.

Friday, January 14, 2011

Download employee comms in engagement report here

If you would like to download Leapfrog's report on the role of employee communication in engagement, you'll find it in the News section on the IoIC's website. There's a downloadable version at the end of the news item.

Thursday, January 13, 2011

Employee communication's role in employee engagement

In September and October, 72 employee communicators completed a Leapfrog online survey looking at employee communication's role in organisational engagement; the tools employee communicators are using to fulfil their role in engagement; what's most effective, and what would make the greatest difference to employee communicators in improving their contribution to engagement.

The headline findings from the Survey stated:

Over 40% of respondents told us their organisation still had no engagement strategy

11% of respondents stated that Employee Communications was solely responsible for engagement in their organisation while a further 72.2% said they had a defined role in their engagement strategy/process and/or activities

More than a third of respondents' organisations really didn't see a difference between communication and engagement, while a further 25% are firmly on the fence

HR is still the primary owner of 'engagement' and the most popular home for the day-to-day management and delivery of the engagement agenda

Employee communications is playing a leading role as a contributor to the development of the engagement strategy in organisations

Just over half of all respondents consider their workforces to be relatively engaged (scoring 7+); but 36% state their workforces remain largely disengaged with their employer

Electronic tools dominate the employee communicator's toolkit; with email and intranets virtually ubiquitous. Face to face communication is regarded as vital - but print appears in decline

Social media is now a planned part of the communication mix in more than 70% of respondents' organisations

The most effective employee communication tools in delivering the engagement agenda rank as:

1. Face to face meetings (four times more popular than any other suggestion)
2. Communication Champions
3. Line managers
4. Intranet
5. Annual engagement survey

The top three factors that would make the greatest beneficial difference to the role of Employee Communication in organisations' employee engagement came out as:

1. A joined-up approach across functions
2. Effective line management support
3. Active buy-in from the CEO/Top Team

Contact Leapfrog if you'd like to receive a copy of the full report

Friday, January 07, 2011

The pain of the procurement culture.

I'm working remotely today - actually writing a book review, which is one of my several sidelines. But a break for some lunch gives me time to reflect on the first working week of 2011.

This week has been all about the return to work. I'm just about on top of things, and very pleased that the pipeline looks considerably better than it did at this time both in 2010 and 2009. Since UK plc opened for business again on Tuesday, I've spent time in London and Brighton on one project; have seen my work signed off on two others and am waiting for client feedback on two more projects.

The only fly in the ointment is one client - an important one for me - tripling the time they plan to take to pay invoices. Now if I was a large supplier, this wouldn't worry me in the slightest, but working at the end of the business food chain - and after the nadir of 2008-2010, still operating rather hand to mouth - this news, which I found out on Tuesday - was a particularly hard smack in the solar plexus.

What made it worse was the fact I found out only when an invoice submitted early in December hadn't been paid, as it usually would be, by Christmas. For the past four years, this particular client has paid me within three weeks - I'd have been happy with four. But now they've put their terms out to six weeks.....and seemingly not told anyone about it. That's what really sticks in the craw.

If they had told me they were changing their policy, I would still have been cross, but at least i would have been prepared.

Supplier relationships work best when there's mutual respect. That respect breaks down when the perception on one side is that the other is taking the piss. I have great relationships with clients and the payment side never is a problem where my direct client - or at least someone in their team - has direct management of the supplier payment process. Things have a tendency to go wrong when the client loses that authority and Procurement or Finance steps in to 'manage' the supplier relationship.

What happens is that the 'relationship' is severed, and replaced with a transactional approach which too often tends to be based on price only. Service, and the added value a small supplier brings gets lost in the mix and is replaced by a process that tends to load the relationship in favour of the client organisation. Given that day rates have been squeezed significantly in the past couple of years - and every large client wants more for less - the loser in just about ever case is the small supplier - micro businesses such as my own.

I have a relatively small number of clients. They all matter hugely to me since my income is directly dependent on me giving them good service, and them consequently buying more of my time and expertise. A procurement or supplier payment team, dealing with thousands of suppliers who are rarely more than a line on an entry screen to them have no need to go the extra mile for me - and probably no comprehension of how important my relationship with their organisation is to me.

I put my terms on every invoice I submit - yet these are routinely ignored and I'm paid only when it's convenient to the client organisation. the effect is that I'm currently giving six to 12 weeks' credit to some of the largest organisations in Britain. Does my bank manager, the VAT man or HMRC understand this? Not really - but again, they're salaried employees who'd soon kick up a massive fuss if their monthly pay cheque wasn't paid.

So what's going to suffer in the end because of the rise in the Procurement culture? It will be the relationships that departments within organisations who depend on the army of small service and goods suppliers have with those suppliers. Will I give my fullest discretionary effort to an organisation that sees me only as a commodity? However much I may like my individual clients, I rather like getting paid at the end of the month too....just like they do....and their Procurement and Accounts Payable colleagues do too.

For all that organisations drum the vital importance of relationship building into their teams, they appear very blinkered when it comes to supplier relationships. It's an area where we're heading swiftly into a cultural breakdown.