Staying competitive in a dog-eat-dog market
Jan 05, 2009
After 20 years of writing The Zweig Letter and its no-named, type-written predecessor, I feel like I know our readers. Most of you are architects, engineers, planners, and scientists. You (rightfully) consider yourselves professionals. Theoretically, professionals, if competent, should be able to hang out their shingle and make a living. Eventually, God willing, they should be able to make a pretty good living— once their reputation for competence is well-established. That’s the way it’s always been and that’s the way it is supposed to be.
Well, guess what? Those days are OVER— at least for a while. It is a dog-eat-dog world we are living in today. Not every firm will survive. More still will decline and fail to make any kind of worthwhile profit. IF you are going to do well, you will have to do so at the expense of the other guy. If the total market for what you do is declining, you cannot grow unless another firm (or firms) shrinks even more so.
This FACT is something you better let sink in. In a dog-eat-dog market, the competition is cruel. Whomever wants it most is likely to win. Those who don’t have the energy level, determination, and willingness to take a risk will lose.
If you say “sign me up”— “I want to compete and win”— here’s some of what I think you are going to need to do.
Stop thinking like a professional and start thinking more like a businessperson. Get over the idea that the most competent professional always comes out on top. Learn about marketing, selling, and numbers. Pay attention to your business as the first priority. Ask yourself if you are honestly doing that and, if not, change.
Be unique. Every business has to be unique to survive UNLESS demand exceeds supply (the situation we’ve been in for the past decade or so in most markets). Forget about what used to work and start acting as if you understand today is different. You have to do something no one else does— or do something better than anyone else does— if you are going to make it in a declining market.
Pare down the nonproductive overhead. If your salaries (for principals) got too high in the good times, cut ‘em back NOW. Don’t waste money on unnecessary unbillable travel. Kill the expensive lunches every day. Don’t have ridiculous offices with 800 square feet of space per employee. Cut.
Get serious about client service. Take no client for granted. Hard times mean that your clients will be courted by your competitors. They are going to be doing all they can to win them over. Better to play a strong defensive game and make sure they have no complaint with your service. Meet deadlines every time. Treat the clients’ money as if it were your own. Put your best people in charge of your best client relationships. Return phone calls and e-mails ridiculously fast. Send thank-you notes, holiday gifts, and don’t nickel-and-dime them with extra services where you let the penny get so big it hides the dime sitting behind it.
Win some new clients away from your competitors. Just as your competitors are going after your clients, you should go after theirs. Give away some free services to demonstrate how capable you are. Be interested. Be available to help with any question the client may have. Reach them 14 different ways with your marketing materials and messages. Attempt to sell your services to every single person in the client organization who could hire you. Get your foot in the door any way you can and prove your worth.
Mercilessly collect. Drop those clients who won’t pay. Get rid of debt. This is just not the time to work for clients who BS you and don’t pay. They will leave you holding the bag when things get worse for them. Why be more invested in them? Get out now. Don’t kid yourself.
Recruit the best from your competitors. You KNOW who their best people are— go after them! Stop acting like you can’t call a superstar and ask him or her to meet confidentially. Their egos will be flattered and you may win over some key spark plugs who could make a huge difference now and in the future. Be bold, be aggressive, and go after the best people your competition has. It will hurt them and help you. That may be just what needs to happen in this declining market, as distasteful as it is to say for many of you!
The business climate for A/E and environmental service firms is going to be a lot less friendly than it was. There won’t necessarily be plenty of work to go around as there has been. It will bring out a new level of cut-throatness we haven’t seen for quite some time in our business. While I would NEVER advocate doing anything unethical, I would challenge you to define what you are willing to do to win work, hire the best people, and keep your firm viable so you can take care of YOUR employees and their families.
Originally published 1/05/2009
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