"Easy money" is rarely easy.
Question from a reader:
"Hi Dan, thank you for your daily posts - we often discuss them over coffee every morning. Question: My partner has a tendency of bringing in small projects that are outside our "zone of excellence". His argument is that it's "easy money", but clients are always a pain. Can you help me convince him to change?"
Thank you for the message.
You probably know it's impossible to convince someone to change their mind. As Nilofer Merchant puts it, "the best way to sway others is not to tell them your answer, but to arrive at an answer - together." An intimate, face-to-face conversation is more powerful than 100 blog posts in this case.
What I can do is share what happens with other boutique consulting partners when they act in a similar way. Alan Weiss calls this "chasing squirrels" - just like dogs who are easily distracted, we tend to keep running from one side to the other when we see money. We believe if it's there we should bring it home.
There are a few reasons for this, but they are all arguments based on false assumptions:
- We think "easy money" = "safe money": It rarely is. The smaller the project, the more demanding the client. The less money they have, the more they insist on seeing a huge return on their investment of hiring you.
- We think "easy money" = "easy project": It rarely is. From my experience, buyers of smaller projects are often looking for guaranteed results and a magic recipe to solve all of their problems. These projects are often more complex than they look, but you only find this out after an initial diagnosis.
- We think "easy money for them" = "easy money for me": It rarely is. Just because another small consultancy can handle 2 or 3 similar clients every month doesn't mean you can - especially when those projects are outside your "zone of excellence". If you don't have the people, expertise, and processes to deliver it, you'll quickly find out this money isn't easy at all.
Of course, most of the time the real driver is fear. We fear we won't have enough business or won't be able to pay our bills. I don't know what the financial performance of the reader's business looks like, so can't provide further advice here.
For those of you who are running profitable businesses, remember that growth comes with new challenges and temptations. And one of the biggest dangers lies in your inability to say "no". Learning to walk away from crazy projects will make your consulting practice stronger.