Friday, February 16, 2007

Money and Competence

Where do you make money?

No matter what business you're in, you make money where you have the highest level of competence. By that I do not mean (necessarily) that you have greater technical prowess than your competitors. But, as you'll see, sheer technical prowess will put you in a position to make more money.

Let's say there are four levels of technical competence in your job. If you're wise, you'll spend 99% of your time in two of these levels.

The Obvious ----- High Competence ----- Low Competence ----- Super High End

Level One is The Obvious
This includes things like changing the background colors in Windows or how to right-click a mouse.

Yes, we all get the occasional question in this area. But this is really a level so basic that you can't make any money here. It's frustrating and not fun at all. These are the people we joke about who use the CD tray as a coffee holder.

If you spend your time at this level, you are probably a sad, depressed loner who spends all of your spare time polishing your gun collection.

You're not making any money and you can't be satisfied with your job here. Figure out how to get into another profession or move to the next level.

Level Four is Super High End
If you're in the SMB space, you will probably never bid on a contract to replace the statewide computer systems for the Department of Health. When a project involves high-end technology or high-end pricing, it's probably not your project. Most of us have never bid on a $100 million dollar project and never will.

I'm certainly not saying you can't get there. But if you do get there, you won't be in this space any more, you'll be in that space. You'll work your way up to that. You'll leave Small Business Consulting in the past. Five thousand dollar deals will be dismissed without a thought.

So that leaves us with two levels of technology:

Level Two is Your High Competency
For most SMB consultants, this includes setting up basic networks, installing workstations, configuring services such as DHCP, DNS, and configuring RAID controllers. This can be a pretty broad collection of skills.

Once you MASTER a skill at this level, you can make all the money you want.

By master I do not mean "I can do it." By master I mean that you absolutely understand every aspect of every level of what's going on. You complete the task quickly and efficiently with near-zero rework. Just like McDonalds makes fries: You have this job down to a science. It's done exactly the same way every time, it's perfect 99% of the time, and you know you will be successful every time you take on this task.

The more time you spend at Level Two, the more money you'll make.

Level Three is Your Low (or No) Competency
For most SMB consultants, this includes SANs, clustered servers, iSCSI and an array of other technologies you've heard about but probably never used.

You will occasionally get a request for this. You may be tempted.

You know you're in this category when you don't know what the shopping list looks like. What do I sell in order to create a cluster? How do I share a storage array between three servers? What parts do I need to order?

You may take on the project. But you probably won't make much money. You'll have re-work for sure. You'll spend hours putting together the quote, talking to pre-sales support, and making sure you didn't miss anything. And when the client wants you to adjust the price, you won't know what can be cut and what can't. You'll certainly guess the hours wrong and give away most of your time.

You won't make money. But if you're successful, then you'll be able to do the next job better. And the next and the next and the next. If you stick with it, you can move this skill set into Level Two. When you absolutely master the technology, then you can make money doing this thing every day.

So, you make almost all of your money in Level Two. You will consider Level Two your "core competency."


Take an inventory. Be honest with yourself. What skills do you absolutely master? Those are Level Two. That's where your money is. Go get it.

What skills do you know some, but not absolutely master? This is probably a large list. This is Level Three. Master those skills and move them to Level Two so you can make more money!

It's also fair to say that there are skills in Level Three that you don't care about, will never learn, and don't expect to make money on. Fine. Let someone else have this work while you're off making money. There's nothing wrong with that.


To be continued . . .

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