Smarter IT Contractors – how to grab chunk of IT system for yourself

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Smarter IT Contractors
Smarter IT Contractors

Smarter IT Contractors Take the Next Step

Smarter IT Contractors keep an eye out for opportunities with their clients.

Whatever you are doing at a company, it may give you an opportunity to really start making big money.

Make a list of all the business and technical knowledge that you have built up at your current company. Highlight any skills or business knowledge that you have acquired that not so many other people at the company have. It would be even better if you have picked up some knowledge that nobody else has.

It may be an area of the system or it could be some technical knowledge.

Contractors With Similar Skills and Experience

Then write out a list of all the people that you know that have that skill or knowledge also. These could be contractors at the client site. It could be employees. Also, it could be people that you have worked with at another company.

What you will do is to offer to support that area of the company that you have good knowledge of.

Take, for example, an area of the system that you know very well and perhaps implemented in the first place.

You can now offer to support this area of the system on a permanent basis.

Disadvantages Even for Smarter IT Contractors

You have two disadvantages here:-

1. You are a risk to their business. That’s because if they passed over all knowledge and control over that area of the system to you, then if you were hit by the proverbial bus, or even just got a better offer elsewhere, then they would be well and truly stuffed.

2. You are financially insecure as well. When companies look to outsource then one of the things that they look at is how financially secure the company is. This is why small companies find it so difficult to win business. They are obviously not as financially secure as larger companies are. A client company sees it as a risk to their business if a company doesn‘t have a strong balance sheet

To be forewarned is to be forearmed though. Now that you know what the dangers are, smarter IT Contractors can then take steps to assay their fears.

Contractor One Man Business

As far as the first one is concerned, the less that you look like a one-man business the better. You can do this by getting the CVs of people that you know with the same skills and knowledge. Get some kind of commitment from them as well.

It would be even better of they already worked at the same company as you are working. Then they would be known quantities to the client.

It would be ideal if there were a few of contractors working on the area of the system. You would simply offer to take over the running of the area of the system with the contractors reporting to you. You would hire them rather than the client..

Your Options as Regards Permanent Employees

If there are one or two permanent employees working on the project, you have several options:-

1. You could offer to take them into your company as permanent employees.

2. If the company wanted to keep them, they could move them to other projects. Then you could bring in some more people of your own.

3. The permanent people could remain on the project, but remain outside your company. You would still be able to levy a management charge for managing them.

Financial Health Check for Smarter IT Contractors

As far as the second disadvantage that you have is concerned, i.e. the fact that you are not financially strong, there is not so much you can do about that, except to show a track record for your company, and hopefully to have a strong balance sheet with some financial assets.

It would also be helpful if you could obtain some bank guarantees or even the backing of a venture capital company. You may not need their money, but having someone like this behind you would make your company look more secure.

It might even be an idea to sell a minority interest in your company to a much bigger company. They could supply you with the financial muscle and perhaps some expertise as well.

Selling Yourself to Client

So how do you convince them to hand the work over to you?

Well, first of all you have to make a good business case for it. You have to write down all the advantages that the company would have in giving this area of the system to you to look after.

Companies are quite happy to hand over the running of areas of the company or of departments as long as you can convince them that it is better for them.

Benefits of Turning Part of Their System Over to You

So what are the benefits for them?

1. Firstly, they are able to keep a key player, with knowledge of a particular area of the system on board. If you are a contractor, you could simply disappear at any time if a better offer came along.

If they were to sign a contract with you then they would be committing you to look after the system for a number of years. This is quite a lot of extra security for them. Quote staff turnround figures to them.

I think I saw it somewhere that the average time that IT workers stay at one company was less than two years. If they gave it to you they would cut their risk.

Run Their Systems More Cheaply Than They Can

2. A big factor would be if you could make it cheaper for them. If there were 10 people working on an area of a system, you know that it could be run equally as well by 5 committed people – especially if they were the best ones.

The old adage is that if a project is running late, the best way to get back into shape is to get rid of the worst half of the team so that all the work is done by the best half. You would simply offer to keep the best people and the firm could re-allocate the other people

3. Another big advantage for them is that if you were able to do the work for a fixed price that was cheaper than it was costing them at the moment.

This cuts down on the financial dangers for the company. AS I said, if this fixed price was cheaper than they are paying at the moment then that is a double bonus for them. They would be getting less financial risk at a lower cost. Who wouldn‘t want to have that?

Making the Systems Offer

So how do smarter IT Contractors make the offer to them?

First of all you have to identify the right person to make the offer to. This isn‘t always easy as it can be different people at different companies.

What you have to do is to work out who most benefits from having a part, or all, of the system managed by someone else who can take the financial risk out of it and also doing it more cheaply. You have to make your judgment call here as you know the personalities involved.

For instance the Finance Director would be an obvious one to gain support from, but you have to be able to assess whether you would put the IT manager‘s nose out of joint. It would be best to gain backing for your suggestion from one or more people.

Make Proposal to Your Systems Client

When you have decided who to make the proposal to, you then have to produce a document which makes your case for you. When you are doing this remember that the more senior that people are, the less they like to read.

I remember at one company where I reduced the weekly project progress report to one page for the Managing Director, from its previous multi-page version, he sent me an email thanking me profusely.

The report should be as short as possible. It should contain a summary of what the proposal is about, and especially it should contain a Cost Benefit Analysis, showing what the company were paying before for the system to be maintained and what you could do it for.

It should also contain a risk analysis as well showing how there is far more risk to the company in doing it by themselves than by handing it over to you.

You have to make a winning case here.

Getting a Start With the System

Don‘t worry if it is not particularly lucrative in the beginning as this is just your starting point. As soon as you get the contract, you are going to be talking to the users to suggest improvements in the way the system is run, and also in enhancements to the system.

Also, once you have proved that you can run one area of the system and department more efficiently than they can run it themselves, there will be further opportunities which will be coming your way.

Don‘t be surprised if you end up running most of the department on an outsourced basis in the future.

Expand Elsewhere With Other Companies

And that is only at that particular company.

As you are now a fully fledge small business with a track record, there are sure to be other companies who will have opportunities for you based on your business or technical knowledge, or even just on your proven ability to run part, or all, of a system on an outsourced basis.

If you have the balls just to ask for the opportunity, and the ability to make a good case for doing it to the company that you are working for, then the world could be your oyster here.

In our article a few days ago, we showed how one computer programmer was able to net himself 116 million by the age of 43. It‘s a shame that a lot more computer programmers don‘t keep their eyes out for opportunities, and to be able to grab them when they do occur.

Smarter IT Contractors should keep an eye out for opportunities to make more money.

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