Million Dollar Consulting

1. Define Your Value Proposition and Target the Right Buyers

"Everyone knows what he or she wants, but few people know what they need. The difference between want and need is what I call the value distance."

Craft a compelling value proposition. Your value proposition should articulate how you improve your client's condition, focusing on business outcomes rather than inputs or deliverables. For example, instead of "We provide training in leadership skills," say "We reduce sales closing time and acquisition costs."

Identify your ideal buyer. Target economic buyers who can write checks without anyone else's approval. These are typically executives with P&L responsibility in large organizations or business owners in smaller companies. Avoid wasting time with non-buyers or gatekeepers like HR departments.

• Examples of strong value propositions:
  • We reduce undesired attrition
  • We turn customer complaints into additional sales
  • We decrease sales closing time

2. Master the Art of Building Trusting Relationships

"Logic makes us think, but emotion makes us act."

Establish trust through emotional connection. Trust is the foundation for successful consulting relationships. It allows you to have honest conversations, push back on client assumptions, and gain conceptual agreement on objectives, metrics, and value.

Use language strategically. Control discussions through powerful language techniques:

• Ask "Why?" to uncover true objectives
• Use numbered lists to structure your advice
• Provide options instead of binary choices
• Interrupt politely to redirect conversations

Develop peer-level relationships with executives by dressing professionally, speaking confidently, and demonstrating expertise. Remember, you're there to offer value, not to "sell" or be subservient.

3. Implement Value-Based Fees for Maximum Profit

"Fee follows value, until thought leadership and branding enable value to follow fee. That is, the more you charge, the more people think you're the best."

Abandon hourly billing. Value-based fees align your interests with the client's and allow you to capitalize on your expertise. Calculate fees based on the tangible and intangible value you create, aiming for at least a 10:1 return on investment for the client.

Structure your fees effectively:

• Provide options with increasing value and price
• Never negotiate fees, only terms
• Offer a professional discount for full payment upfront

Remember, most consultants undercharge and overdeliver. By focusing on value, you can dramatically increase your income while working less.

4. Create Compelling Proposals That Close Deals

"My definition of a proposal is that it is a summation of conceptual agreement, and not an exploration (of whether to proceed) nor a negotiation (of how to proceed)."

Follow the nine-step proposal process:

1. Situation appraisal
2. Objectives
3. Measures of success
4. Value
5. Methodology and options
6. Timing
7. Joint accountabilities
8. Terms and conditions
9. Acceptance

Key principles for effective proposals:

• Keep them short (2-3 pages)
• Focus on outcomes, not inputs
• Provide multiple options with increasing value
• Present fees only after establishing value

By following this approach, you should achieve an 80% or higher proposal acceptance rate.

5. Develop a Strong Personal Brand and Thought Leadership

"It's fine to stand out in a crowd so long as you look good standing there."

Build your brand consistently. Your brand represents what people think about you when you're not present. Develop a unique expertise or approach that differentiates you from competitors.

Create and share intellectual property regularly:

• Write books and articles
• Speak at conferences and events
• Develop proprietary methodologies or frameworks
• Share insights through social media and your website

Aim to become the go-to expert in your niche. When you achieve thought leadership status, fees become less of an issue, and clients seek you out rather than you chasing them.

6. Leverage Technology and Global Opportunities

"The globalization of economies combined with ever-advancing technology makes this the best and easiest time ever to work globally, whether in person or remotely."

Embrace digital tools for marketing and delivery. Use webinars, podcasts, video, and social media to expand your reach and deliver value. However, remember that for corporate consulting, websites and social media are primarily credibility statements, not sales tools.

Pursue international opportunities. Consider working with clients in English-speaking countries or those where English is commonly used in business. Leverage existing multinational clients to expand globally, or seek speaking and writing opportunities in international publications.

• Ways to expand globally:
  • Form strategic alliances with overseas partners
  • Write for international publications
  • Speak at international conferences
  • Publish books that attract global audiences

7. Cultivate High Self-Esteem and Continuous Growth

"You can't do much better than to try to do the right thing consistently."

Develop unwavering self-worth. Your self-esteem can't be dependent on your last victory or defeat. It must be constant to avoid the "doom loop" of negative thinking and poor performance.

Invest in ongoing learning and development. Commit to improving your skills, knowledge, and thought leadership continuously. Attend workshops, read widely, and seek mentorship from successful peers.

• Ways to build self-esteem:
  • Practice positive self-talk
  • Celebrate successes and learn from failures
  • Surround yourself with supportive peers
  • Set challenging but achievable goals

Remember, your ability to help clients is directly related to your own personal growth and confidence.

8. Build Strategic Alliances and Outsource Effectively

"Alliances are formed with equal partners (despite the size of the other firm) where the formula looks, metaphorically, like this: 1 + 1= 150."

Form strategic alliances. Partner with complementary experts to take on larger projects or enter new markets. Ensure clear agreements on roles, responsibilities, and revenue sharing.

Leverage subcontractors and outsourcing. Use high-quality subcontractors for delivery work, allowing you to focus on high-value activities like strategy and client relationships. Outsource non-core functions like bookkeeping, design, and administrative tasks.

Key areas to consider outsourcing:

• Financial management (bookkeeping, taxes, financial planning)
• Legal services
• Technology and web development
• Design and marketing materials
• Office support and virtual assistance

By building a network of trusted partners and suppliers, you can scale your business without the overhead of full-time employees.

9. Manage Your Business for Sustainable Success

"Remember that money is fuel for life and that the real wealth is discretionary time."

Focus on profitability and lifestyle. As a solo practitioner or small firm owner, prioritize extracting maximum profit annually rather than reinvesting for future sale. Aim for a mix of 80% repeat business and 20% new business each year.

Create systems for efficiency:

• Routinize administrative tasks
• Develop a consistent daily schedule
• Use a physical planner for better time management
• Limit distractions and focus on high-priority work

Plan for contingencies. Obtain proper insurance coverage, build cash reserves, and develop strategies for handling potential threats like disability or legal issues.

Remember, the goal is to create a business that supports your desired lifestyle while making a significant impact on your clients' success. By following these principles, you can build a thriving, sustainable consulting practice that provides both financial rewards and personal fulfillment.

Last updated: October 2, 2024