Discussion on:

IT consultants' four overselling mistakes

... because I get called one so frequently <rimshot/>

The Consulting company I worked was a very large one with a lot of employees and experts across the world. So, Virtually they can even built Rockets. However, Whenever there is an opportunity for new work, the company says "Yes to all" and accepts any sort of work no matter how inexperienced they are. From software development to Cloud Engineering.

The challenge lies in the execution. They face lots of difficulties but in they end They just Do it somehow!

And the whole project gains to their experience for the next challenging project.
Doesn't this sound interesting than resist in accepting overselling work?

Most of Chip's readers are either independents or 1st or 2nd stage consulting companies (i.e. a few consultants).

If you're large enough you will survive any mistake. EDS/HP/IBM etc. are prime examples.Many of the large companies who are their prime customers won't deal with anyone smaller. Like calling to like as it were.

Those of us who don't have the size or clout of a KPMG have to be more careful of our reputation.

Glen Ford, PMP
http://www.vproz.ca

Underbidding--intentionally or not--is a common mistake, and it's a really tempting mistake to make, since you want to snag business. However, if you underbid, you'll end up losing money, and can also sour client relationships. What's more, once you realize that you have to complete a project with essentially non-billable time, your motivation can plummet, making it even more difficult to complete the task when it's competing against billable projects for your time. And having these kinds of outstanding non-billable projects creates stress, since you want to procrastinate working on them and yet know you need to finish them. It's a big trap I've seen consultants fall into--myself included.

Greg Miliates
StartMyConsultingBusiness dot com

It's one reason why I avoid fixed-price contracts if I can. For me, it isn't just about snagging the business, it's also about being over-optimistic. The trouble is, even if I triple my estimate, it still ends up too short.

... for what it's worth ...

Is that someone always loses on a fixed price contract. Either you loose because you underpriced or your customer loses because you built in enough profit to cover your estimation errors.

The only advantage to a fixed price contract is that in markets where they don't know what a fair rate is (i.e. they really don't understand their costs), a fixed price allows you to charge whatever rate you feel is fair. And hopefully, you know your costs. The bad news is that you'll probably find someone undercutting your fixed price because they don't know what their costs are either.

Yes, I've mad most of those mistakes, and the under-bidding hurts especially. Another mistake is to oversell (usually unintentionally) what you're willing to do for a customer, to not be clear about the scope, the limits and any conditions in the beginning. You can end up with a pretty sour customer relationship that way. What's obvious to you isn't necessarily obvious to your client. I've gotten jobs where the client told me what made them angry about their previous consultant...and realized that I might have done the same if they hadn't complained about it.

I am honest with myself as to the things I do NOT do, such as support Linux servers, that does not mean I would not work on one but I also have a pool of co-consultants I can properly farm such a project off to if I had to. My most recent unsolicited hell was a severely damaged Sonicwall in a small medical office. I have never worked ON one but it is an industry requirement now that experience here counts, so in out field we can GET experience sometimes the hard way, as I learned but i defeated the monster. If we are honest and count ONLY what we have worked on, then the consultant cuts out learning opportunities. Our clients are our most important resource. I discovered a wonderful backup program for Windows servers, BackupAssist, and I commend it strongly. Again, something a client had that I had not worked on before. I do believe that the Sonicwall was a case of the previous consultant overselling the client. Badly too.

I have often found that if the client says "OK" when I say "I don't know that technology well but I can spend some time and ramp up... let me see what I can do" then they are a great client. If they say "oh well then if you don't know it then we'll get someone who does" then they're a crappy client anyway and it's not worth the effort... this is in the case where what they are really looking for is someone who can solve problems... and you are trying to develop a long term relationship.

As for selling and selling... I've found that solving problems efficiently and cost effectively is the best way to go... that coupled with always interfacing and working with the C-levels... if you work with C-levels and make their business run smoother, while saving them money, they will always come back for more.

My credentials:
almost 10 years ERP consulting in Architecture and Engineering industries with clients as small as 30 employees to 500 employees... have clients in USA, Canada, South Africa and Hong Kong.