Project Management optimize

IT consultants, keep your pipeline healthy

In this economy, it makes sense for IT consultants to want to say "yes" to all job offers to ensure a steady income. But Chip Camden warns that overextending yourself can lead to a very unhealthy pipeline.

 As the story on the economy reads more and more like a Stephen King novel, a fear that consultants secretly feel even in the best of times frequently rises to the surface: What if business dries up completely?

The work that you've already agreed to do with your clients is your "pipeline." In order to avoid the feast or famine phenomenon -- well, the famine half of it, anyway -- consultants like to have a pipeline of at least a few months' work. Some would say, the more the merrier -- especially in this economy. But there are a few points to consider here:

  • The more work in your pipeline, the longer it will take for you to get it done. Make sure that the work at the end of the pipeline isn't at all urgent for your clients. You'll probably end up squeezing in a few more small, high-priority projects along the way, so you may get to those low-priority projects even later than you think. Those projects might eventually become higher priorities for your client, or the client may just get tired of waiting for you to get around to them and find someone else to do the work.
  • It's easier to justify delays on low-priority projects to clients who also own some of your high-priority projects. If one client constantly sits at the back of the queue, they'll start wondering whether you're ever going to do any work for them. So one factor in prioritizing work should be "how much attention have I given this client lately?" even if the job itself isn't urgent.
  • On the other hand, it's good to have work lined up from more than one client. If you rely on only one customer for most of your business, he or she has the power to empty your pipeline with one swift decision.
  • The fear of reaching the end of your pipeline may keep you from ever working on those end-of-the-pipeline projects. It's like your rainy day fund, so you hate to touch it. That's bad for several reasons, though. It's unfair to your client, who is certainly not expecting you to sit on their project ad infinitum. It's unfair to your business, because it may keep you from seeking new work to take that end-of-pipeline spot. And it's unfair to you, because it may lower your opinion of your ability to get things done.
  • Too much work in the pipeline may lead to burnout. You start looking at every hour not spent on billable work as an expense -- "It's costing me $500 in lost revenue to watch this football game!" The pressure is compounded when a number of items in your pipeline are semi-urgent to your clients. How can you take time for self-improvement, networking with peers, play, time with the family, or even sleep?

The last bullet describes my situation from a few years ago. I'd sit in front of my computers in the morning and think of eight things I wanted to get accomplished that day, but I'd rarely finish more than two or three of them by the evening. The tasks would take longer than I thought, or some emergency or interruption would arise, or procrastination would set in. The movement in my pipeline was barely perceptible.

In the long run, a clogged pipeline is worse than an empty one, because the empty one is at least available to move the sewage -- er, I mean, projects -- along. You need to keep things flowing at a reasonable pace -- completing projects and adding new ones. To do that, be careful not to take on too many projects. I finally found a good plunger a couple of years ago, when I learned how to say "no, thanks" to some job offers that come in my inbox, and I've done a much better job of managing my workload.

But, as Steve Friedl says, "The fear of an empty pipeline is with most consultants constantly, even if they're consistently very busy." (By the way, I recommend that you read his great article.) That fear is undoubtedly what motivated me to take on so many commitments in the first place. And now that I've streamlined my pipeline just as the economy is tanking, I'm starting to feel the old butterflies again.

None of my clients have dropped any projects yet, nor have they asked me to reduce my hours. I'm wondering how long it will take for the economic crisis to reach that point, if it does. Have you seen any impact on your business? What steps are you taking to keep your pipeline healthy?

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About

Chip Camden has been programming since 1978, and he's still not done. An independent consultant since 1991, Chip specializes in software development tools, languages, and migration to new technology. Besides writing for TechRepublic's IT Consultant b...

29 comments
reisen55
reisen55

I do not enjoy getting involved with low-return jobs at low cost, but always keep an eye for long term benefits. I just picked up support for a local museum, they are dirt poor but belong to several museum associations. OK, this is a LOSS LEADER if they will open the door to live presentations at these associations!!! I have a background in sales so I can speak well to large groups. Thus, I will gladly work with this account PROVIDED they introduce me to these associations for more business!!! Quality and Quantity are a varied match sometimes.

wfreeman
wfreeman

This reminds me of the old story of the programmer who made himself an expert in a narrow and very lucrative technology. He decided to go independent and suddenly found himself in very high demand. He soon realized that a good night's sleep cost him $8000, dinner $1500, and breakfast and lunch each $750. Then, he figured out that even his morning ablutions cost him more than he could afford. So, he gave up eating and sleeping and, as a result, everything else. He died an early death but left a large inheritance.

Sterling chip Camden
Sterling chip Camden

Are you hedging your bets against the current economy? Or are you preparing to get by on less? Or both?

Sterling chip Camden
Sterling chip Camden

... free software projects. No money, just reputation. But that reputation can take you a long way sometimes.

Sterling chip Camden
Sterling chip Camden

How much is your private life worth? Isn't "the good life" the reason why you're trying to make money in the first place? Those are questions I had to find the answer to in order to avoid going crazy.

ProtiusX
ProtiusX

This is the dawning of the ?age of Kaizen? . No longer are we accepting of n-tier system designs that enable service silos. 2009 is the year of optimizing infrastructure utilization, better data life cycle management, and utilizing technology to improve business process management. This is the year of enabling those few employees left at a firm to do more work quickly and efficiently. Last year my company had a hard look at our projects & initiatives list for 2009 and did a great deal of cutting. ?Capitol expense? has become a curse word but with that said we are moving forward with some project and initiatives that adhere to the new paradigm of this brave new world we find ourselves in today. There?s an old Klingon proverb that says ?That which does not kill us makes us stronger? (okay I know Niche said it but I like the Klingon reference better) and 2009 is the year we will burn away the chaff and focus on what lies left in the ashes.

ssharkins
ssharkins

Chip -- I spend time every month drumming up new business. I don't always get new business from the effort, but I put in the time. Unfortunately, for a while, new clients were simply replacing older ones -- some going out of business, others cutting budgets, but that seems to have stopped, at least for the moment. And, the new clients seem more open to additional work and fees than the clients they've replaced. Another thing I'm doing is diversifying and advertising (well, a bit) -- these are areas I never thought too much about. The truth is, I can do a lot of things to make money and I might need to before this is over. So, I'm setting the stage now. Also, remember the discussion about web sites? Well, I should have one up this quarter. I'm starting with an informational site, but now that I'm thinking in those terms, I actually have a few web ideas that might generate some passive income. Finally... I reviewed a book on turning a project into a saleable product. You know what -- had one fall into my lap this last week. It's about opportunities Chip -- they're everywhere and we just have to train our eyes to see them. The truth is, a year from now, I could be in a completely different place, consulting-wise -- which is Okay as long as I'm paying the bills and I'm relatively happy. I don't watch football, but I do knit! ;)

JohnMcGrew
JohnMcGrew

...getting the jobs done and paid before everyone goes out of business.

apotheon
apotheon

. . . skill development. Think of all the thousands of dollars you spend on training each year that you could save if you find equally valuable skill development through open source software development. You just need to find the right projects.

Sterling chip Camden
Sterling chip Camden

I agree that the current crises will flush out a lot of unproductive and entrenched providers. Now more than ever, it's important to provide real value to your clients.

Sterling chip Camden
Sterling chip Camden

... be sure to add it to your TR profile and to your byline on TR posts -- you'd be surprised how many visits you'll get from that alone.

PMPsicle
PMPsicle

It's also the quality. Sure you can fill up your pipeline with plenty of work but a) will you get paid for it, b) is it the type of work you want/need (or is it just keep busy) and c) is the rate appropriate I'm sure each of us can fill in other elements of quality. As you say, there's no point in getting work, finishing it and then having your client go bust still owing you money. In today's world an unsecured creditor is lucky if he/she/it get's a taste of the money owed. And there's always the possibility that you'll take work into your pipeline that leads to you "****ing in your nest". Your nest being your niche. One of the concerns has to be will you have unintentionally changed your niche at the end of this recession. (Of course, that presumes your niche still exists during and at the end of the recession .... ) Again there's not much point in keeping busy today if you starve tomorrow as a result. Glen Ford http://www.trainingnow.ca

Sterling chip Camden
Sterling chip Camden

On my personal blog, I always queue up a link to what I write here. My subtext for this post was "I hear that plenty of fiber and fluids can help." My editor was a little worried about the sewage and plunger lines in the post -- but I convinced her to keep them. After all, I'm making a subtle point about how your pipeline isn't just incoming business, it's also your responsibility to produce, um, stuff.

Sterling chip Camden
Sterling chip Camden

Potential clients will know that you're seriously interested in the work, not just the money.

apotheon
apotheon

It could also [b]improve your employability[/b].

Sterling chip Camden
Sterling chip Camden

Yes, what projects you choose may determine a lot about where your career goes in the near term.

Sterling chip Camden
Sterling chip Camden

Yes, there certainly can be a lot of money in legacy systems -- it's only a question of whether that's the type of work you really want to be doing. With all the shake-up in the economy, I expect that there will be many emerging markets that are hard to spot right now. Good time to keep one's eyes open for opportunities.

PMPsicle
PMPsicle

Sorry, couldn't help the poem .... Being the legacy systems expert may not be the worst thing you could do. Remember that a lot of the "legacy systems" people are retiring in the next 5 years. And those systems tend to be installed where there is money. Also the reason mid-rangers and mainframers haven't reacted to being labelled legacy is that they have no correlation with PC legacy ... mid range and mainframe programs don't turn into legacy, just the hardware. And that's hot swappable. I know of systems that are still running (on the web yet) which are 30 years old at this point on several models of equipment later. Wise man say "Don't get fooled by your own hype". I would be more concerned about picking up small tasks (e.g. web design for a small business or a specialty banking package) where it's going to label you as concentrating on a small or low-pay market which won't be able to pay your way. The trick is to identify small markets that normally wouldn't be worth your while and then determine a method of monetizing them without spending an inordinate amount of time/reputation on them. Someone later in this thread mentioned museums. The problem with that market is that there isn't any money (my wife is a museum tech). One solution is to develop a low cost package for the market but if you become known as an IT consultant to the market you'll starve. So while accepting a project in that market might make financial sense in the short term, accepting (or worse chasing) contracts in that market is suicidal. The trick, instead, is to determine how to exploit the work available to generate future income without becoming focused on that niche (in your mind or the customers). The other side of the coin of course, is that now is a good time to chase markets where you can see a future market but the current market isn't strong yet. An example might be a solar power marketing support package. Right now there isn't much of market but as the "green tech" improves and reduces in cost, that market will increase. So a marketing support package for the "green tech" market might make sense for the future. (NOTE: I JUST GRABBED AN IDEA SO IF YOU TRY TO EXPLOIT IT DON'T BLAME ME IF IT DOESN'T WORK ... on the other hand if you make a killing at it you owe me a royalty :> ) Glen Ford http://www.TrainingNOW.ca

Sterling chip Camden
Sterling chip Camden

Feeling forced to take on work because there's nothing else available, but not wanting to redefine themselves as the neighborhood legacy systems expert, either.

jck
jck

I would suggest that right now is not the time to be aligning your chakras :^0

apotheon
apotheon

I guess "inspired" is better than "expired".

Sterling chip Camden
Sterling chip Camden

As I was writing this post, we were having our septic system pumped. Perhaps I was inspired by what I inhaled.

apotheon
apotheon

Oh, crap. I guess that wraps things up nicely. I'll just walk away now -- before the potty humor really starts to stink.

jck
jck

he "Attends" to it well. :^0

apotheon
apotheon

I hope the analogy breaks down before you get to the point where you describe the "stuff" you produce.