We met to talk about employee owned IT contracting firms, sharing space with
PLUG's Installfest. There were five participants, two were currently
independent IT practitioners and one had been and independent practitioner in
the past.
There was a genuine feeling that small businesses were not getting the quality
of IT service that they deserved and that the deficit got more pronounced as
businesses got smaller. Small businesses needed time-share IT services. Quick
response was essential. The service also needed to be broad. No single
practitioner can be competent to deal with every eventuality that a reasonable
customer base of small and medium businesses might present. One person
suggested that someone looking to get into serving small businesses should call
dentists, doctors, lawyers, Realtors, construction firms, and so on, to see who
is providing their IT service now.
Although the initial discussion was about an employee owned consulting firm,
the preponderance of successful, independent practitioners drove the
conversation to focus on organizational forms that would enhance business for
small, independent IT practitioners. The conversation generally moved from
solutions that would reduce independence but give reliable incomes, to
solutions that left independent practitioners independent.
The employee owned company theoretically keeps its focus on engineering and
technology. It also should provide relatively secure steady incomes for the
employees. The big down side is that the founders take on entrepreneurial risk
without the potential reward of becoming disproportionately wealthy if the
company succeeds.
Another potential form of cooperative is a firm that outsources all the real
work to subcontractors. The virtual IT firm handles contracts, marketing and
sales, but the actual work is done by subcontracted (independent) experts.
While this could be an entrepreneurial model, the version envisioned in the
discussion would be owned by member IT practitioners and would award
subcontracts to members. The cooperative would be very selective about what IT
practitioners or firms could become members.
We observed that independent practitioners (which for practical purposes
includes IT groups of up to ten or so employees) need to be lean, wear multiple
hats, and bridge the people gap. Marketing and sales can be a challenge for
the independent IT practitioner since these skills will not come naturally to
most of them. We thought that the professions--dentistry, medicine, law, and
architecture are role models for the IT practice. Construction contracting may
be an even better model especially because IT practitioners will have to deal
with fraudulent and non-fraudulent non-payment, shady characters, and so on.
The former independent practitioner said that the only resource that delivered
value to his practice was the Arizona Small Business Association. Networking
groups were worse than useless because they attracted sales monkeys, dreamers,
ne'er do wells, and fraudsters in overwhelming numbers. Also, one should
studiously avoid any trade or barter
deals. Work for real money.
Nevertheless, I observed that professionals built their practices on referrals,
and referrals meant networking with peers. Other participants said they not
only needed an referral network for building a practice, but also so they could
refer customers to trusted providers when there was work that they were not
competent to do.
As a result, the proposal that generated the most interest was one to form a
professional association for small, independent IT practitioners. This
association would help members built referral networks the same way that
professional associations help other professions. The association could also
provide resources on effective marketing and sales. Like other networking
groups, this one would be a magnet for undesirable elements--namely those
trying to sell to the valid membership, those who imagine themselves to be
technical professionals, and those looking to commit fraud. Therefore the
association would need effective membership barriers.
One employee owned start up that failed in the Valley was AZ Refresh, a web
development community.
It was also suggested that it would be useful to talk to Ed Nusbaum and
Francine Hardaway about their experience starting AZIPA.
---------------------------------------------------
PLUG-discuss mailing list - [email protected]
To subscribe, unsubscribe, or to change your mail settings:
http://lists.PLUG.phoenix.az.us/mailman/listinfo/plug-discuss
