Help save my company! :D (Custom software)

[benles]

There's a thread going on right now talking about how so many people on this board are in IT of some form.

Here's my current business dilemma, maybe you all can help me figure out how to save the company:

Business has been good the past 18 months. We've gone from a one-man-show up to 5 employees due to a couple windfall custom software projects. I can not seem to duplicate that success, it just happened.

It's winding down now. Back in the heyday, I thought long and hard and decided that I would hire people as employees, get the health plan / vacation / etc going, and fully disclose that our survival was dependent on these large contracts continuing. Meanwhile, the strategy was to use the momentum to focus on sales and marketing and diversify. That's not working.

I'm on the verge of concluding that I was just lucky in a really unique way and have no intrinsic capability to make it happen again faster.

Anyone else in the same situation? Were you able to pull out of it? Where are you finding sizable projects at a decent billing rate ($95/hr+)? These are all new problems to me, because now I have 5 people instead of 1 and I burn through more in two months than I ever made or needed by myself.

Some things have already been suggested:

* Specialize. Okay, but in what? We're heavily specialized in .NET right now and it doesn't sell. Silverlight? Rails? Where are those contracts?
* Productize. Good idea, we're building one now. Maybe it will hit before the contracts run out.

[charliex]

i hate to be glib but the short answer is ''adapt" beyond that i don't know what to say, i did exactly the same as you, offices, more people, etc, then as is common with contract work it goes away, its cyclic on about 7 years for us, we planned to get bought out before that 7 year cycle, but it went awry.

we tried different avenues, eventually i just changed direction and created a new product we're trying to get investment for, we still do our thing in the other space, but its a messy business.

otherwise its the old downsize.

.net to me is one of the more faddish languages and you're competing with a lot of people, and a bit limited in scope, C/C++/asm/embedded world is pretty good.

[benles]

Originally Posted by charliex

C/C++/asm/embedded world is pretty good

Adapt to become what, that's the question

I think at the core, we have a good process for managing custom software projects. We fell ass-backwards into .NET and I don't have a particular allegiance to it.

There's no easy answer to this stuff. MBA theory applies less and less, I'm finding.

Embedded market, interesting idea. Closely related is mobile/PDA/set top box. So basically, you're saying specialize.

Thanks for the tips

[charliex]

To what the market wants i usually read all the specialised tech mags, visit the shows and talk to people, see what they're buying etc.

whatever it is, do something you're really into though, it gets old doing something that you don't like and going through the crappy parts.

entertainment is always a good bet.

[Lotus Fury]

yeah, tough situation. Maybe a dedicated sales person could help out? I don't know you at all but in MBA speak you might be running into the "Techie" problem. A really good technical person starts company X. They build it up and then it stalls or begins to fail because they aren't able to market/finance/HR/strategic plan. Again, I don't know what background you come from so I am not saying that this is true. If it does appear to mimic your situation you need to step back and figure out is the problem you have with the way the company is set up or with the product you are producing. You can easily hire people with whatever skills you need. An experience dedicated sales person will be able to get a good idea of what customers want if they are any good. Even so it may be several months before the sales person can get business for you.

Good luck.

[cpforyou]

In K-12 Education, there is a lot of horrible software. Maybe you can sneak into the K-12 market?

[JoshS]

Originally Posted by Lotus Fury

yeah, tough situation. Maybe a dedicated sales person could help out? I don't know you at all but in MBA speak you might be running into the "Techie" problem. A really good technical person starts company X. They build it up and then it stalls or begins to fail because they aren't able to market/finance/HR/strategic plan. Again, I don't know what background you come from so I am not saying that this is true. If it does appear to mimic your situation you need to step back and figure out is the problem you have with the way the company is set up or with the product you are producing. You can easily hire people with whatever skills you need. An experience dedicated sales person will be able to get a good idea of what customers want if they are any good. Even so it may be several months before the sales person can get business for you.

Good luck.

+1 Rainmaker, NOW! Use a LA or NY headhunter, and be prepared to give up a good portion of the candy.

[ace10]

get your hooks into a big (preferably huge), sloppy company. that's all it takes. do WHATEVER is necessary to secure the first job. do a great job at a fair price. the add-ons will follow.

i don't operate in that same space as you, but the concept always holds. oh, and i refuse to hire people. subcontract only as necesary.

$0.02

[benles]

Originally Posted by Lotus Fury

yeah, tough situation. Maybe a dedicated sales person could help out? I don't know you at all but in MBA speak you might be running into the "Techie" problem.

Actually I have an MBA

We tried a bad salesperson for 60 days. He didn't work.

Thanks for the viewpoint, I'm going to compile all the advice together and try to see a new angle.

[benles]

Originally Posted by JoshS

+1 Rainmaker, NOW! Use a LA or NY headhunter, and be prepared to give up a good portion of the candy.

Excellent idea. This might have been my fatal mistake. I don't think the contracts are going to run another 60 days and we already wasted 60 on the last sales guy that didn't work out. Shoulda gone this route to source a good one.

[charliex]

yeah we went through 4 or 5 sales people, they didn't really help either.

K-12 software (or most education sofware) is bad because theres no budget to pay for the development, its a terrible sector for business, people in general don't really care that much about education. most of it is mom and pop made, there are a few standouts but they generally have started in a different sector.

[benles]

Originally Posted by ace10

get your hooks into a big (preferably huge), sloppy company. that's all it takes. do WHATEVER is necessary to secure the first job. do a great job at a fair price. the add-ons will follow.

i don't operate in that same space as you, but the concept always holds. oh, and i refuse to hire people. subcontract only as necesary.

$0.02

Also sound advice. I've got some ties into CA government. They're a little slow, but have plenty of broken processes. I could drop rates to see if it gets more business, but so far I haven't learned of any lost opportunities due to rates.

Also, good point about subcontracting. Consulting is a variable cost to customers, so it makes sense to keep my resources variable too. The business "engine" was originally built this way, but eventually I felt that the baseline level of business had risen enough to support 2-3 full-time engineers. I've found employees to be MUCH more dedicated than contractors and also more willing to follow the quality standards and work processes I define. Contractors prefer to disappear and return with a finished solution - that almost never works.

Thanks for helping to save my company!

[charliex]

its funny how that goes, i found the opposite, FT employees got less done, caused more issues and cost more than contractors, contractors need to show good work in order to get hired again, and that happens at the same rate of the contract period, employers tend to be more lenient wiith bad employees especially in smaller companies, thats certainly something that bit me.

the employee also gets paid if they don't do the work, and contractors don't ( depending on terms obviously ), if you run through a light perioid then a lot of your profit will be just sustaining of the infrastructure.

[ace10]

BENCH KILLS!

[benles]

Originally Posted by charliex

its funny how that goes, i found the opposite, FT employees got less done, caused more issues and cost more than contractors, contractors need to show good work in order to get hired again, and that happens at the same rate of the contract period, employers tend to be more lenient wiith bad employees especially in smaller companies, thats certainly something that bit me.

the employee also gets paid if they don't do the work, and contractors don't ( depending on terms obviously ), if you run through a light perioid then a lot of your profit will be just sustaining of the infrastructure.

I do have concerns about employees sitting idle. We have a time tracking system and quotas for billable hours (like an accountancy or law firm), so low/no productivity is an issue I've fortunately solved. The contractors I've found are very adverse to reporting their time in any detail.

Anyway it's great to compare notes with someone else. I've also talked to people running successful offshoring models and I've never been able to get that to work for me.

[benles]

Originally Posted by ace10

BENCH KILLS!

?

[charliex]

Originally Posted by benles

I do have concerns about employees sitting idle. We have a time tracking system and quotas for billable hours (like an accountancy or law firm), so low/no productivity is an issue I've fortunately solved. The contractors I've found are very adverse to reporting their time in any detail.

Anyway it's great to compare notes with someone else. I've also talked to people running successful offshoring models and I've never been able to get that to work for me.

Offshoring hasn't worked for me, mainly because i've found they lie through their teeth to land the contract, then can't do the work, plus most of the common countries for offshoring are just as expensive as america,, romania is a great place for it.

However saying that i've hired plenty of people that also lie through their teeth to get the work, or with programmers especially their ego's tend to get in the way of their actual abilities. ( this is also a reason i personall y do not use headhunters, their model is based on landing the same person multiple tiems, and they will land someone in a position they know they cannot do, for just the hope of maybe they'll last the 3 or 6 months required, i've been placed by headhunters who've called me a few weeks after a placement looking to move me elsewhere, one even called my manager directly afterwards to tell them i'd been talking to him, hoping i'd get fired so he could place me again)


Picking the right people has definetely been the hardest thing for me, we turn away lots of work just because its too difficult to find good people, there are a lot of sysadmins or web people who are out of work after the dot com bust who think they're experienced programmers, but when they're presented with something thats low level and no supporting API's, with no debugger (if they even know how to use one), or IDE, they're totally lost.

I wish we could get away with not reporting time as much, part of the problem is that the contract holder wants to pay bare minimum so you have to juggle multiple projects to make ends meet, and no one wants to be told you're not working in their project 100%. Basically they want the best of everything, speed, cost and good, but the usual fast,cheap, good you only get two, applies.

Our source control and bug tracking system also features a time card system, however most of the people refuse to use it, again programmers tend to be an akward bunch, the ones who do use it tend to be clockwatchers and keep short hours. I am guilty of it myself, i tend to forget as i get immersed in the work and keep strange hours to get things done.

[ace10]

bench, as in an employee sitting on the bench. bench time. non-billable time. non-productive time. whatever you call it... it kills a business.

keep those two words in mind when you've got an employee sitting around not working on a billable project.

and if you've got contractors that won't keep time records, then you really need to find new contractors. it should be right there in the t's&c's of your services agreement with them. unless of course, you're doing fixed price deals with these contractors.

[ace10]

i'm sure some of your employee have worked for big companies previously (and presumably done a good job for them). if they're not bound by a non-compete or some other contractual limitation, you may want to offer cold hard incentives for bringing leads to you that result in at least the opportunity to pitch your wares.

$0.02

[ace10]

and if i make one more suggestion in this thread, i will be rendering a bill for services provided.