Disclosure: This is a massive pitch. Please don’t misunderstand though, it is not meant to sell you or convince you – it’s a direction that I’m going in and if you’d like to hop onboard with me, you’re quite welcome. Enjoy.

…

We have just come out of a massive VAR extinction level event. Somewhere between automation, consumerization and overall technology just getting remarkably better and easier to use a large segment of the “IT business” population either got jobs or found a place in other industries. It used to be easy to make money, even if you didn’t like to market, sell, promote, manage people or even if you were not that great with technology and keeping up your skills. The easy money is gone.

With the easy money gone, companies that want to grow rapidly are finding it harder and harder to find qualified partners in a crowded field and reaching that next new partner is both expensive and logistically complex – they don’t attend shows and they aren’t just going to buy stuff for the sake of small incremental revenue: It has to fit the strategy and it has to impact the core business significantly to get promoted, sold, deployed and delivered over time. Without the ability to address a massive performance annoyance (spam, viruses, downtime) or critical business component (backups, failover, continuity) the solution sale and resistance (and effectively the cost) are more prolonged.

I knew this was coming. It’s why I wrote Shockey Monkey. It’s why I gave it away for free. It’s why we currently enjoy a rapid increase in the number of resellers and the level of activity across those resellers. Not just by showing the blueprint but by executing it ourselves. And you ought to listen to the folks that are actually making money and copy them. Wanna know why? Because the alternative sucks.

Just about everything else hasn’t worked. “You mean to tell me that the VARs that failed at the game are NOT the best people to tell me how to run my business? But they sold their business for nearly 3 times their monthly reoccurring revenue a month before barely making their payroll! I should ignore that?”

Yes, that’s exactly what I’m saying.

The traditional “from the trenches” expert panel of successful MSPs/VARs/Cloud managers is arguably less valuable to you in terms of advice because their model is being challenged by consumerization of the industry. Why should you sit around and listen to a conversation about desktop PC expertise when the tablets are taking over?

Really successful IT Solution Providers are at a junction point: Minimize spending and consider a sale or invest in expansion/transformation to a more consumer-oriented technology business. Considering the premiums that the market is dictating on the MSP businesses that have been acquired so far, most of your sub-$10,000,000 shops are going to transform.

Of course, my sales figures support that thesis What we are doing is not a coincidence or an experiment.

Where Shockey Monkey Fits In

When I launched Shockey Monkey I told everyone that it’s not a PSA. I still maintain that it’s an extension to a PSA model and it’s inherent design isn’t management of your business but the service delivery to your customer – portals, chat, remote access, invoicing and accounting, reporting – in the face of changing demand your customer service is more important to your business than the tech solutions.

Yes, you need a tool to manage the tech solutions. And I’ll give it to you for free.

You also need a system and partners – today we will be inviting many of them to the platform.

You see, the way software and hardware vendors currently market their solutions is by throwing messages out and hoping that they stick. When you walk by my booth at a trade show, I have a few seconds to get your attention. If you enter a drawing or a contest, it’s another opportunity. But it’s only an opportunity to pique your interest about what I can do for your business. I do not get to take you through the whole benefit of my solution. And quite frankly, for some solutions the business decision maker or sales guy or even the support manager may be the wrong person to talk to.

This is where Shockey Monkey, and advertising you will see in it, are fundamentally different. It’s not a game of impressions and hoping someone will click. It’s an annual campaign that can be updated daily. Shockey Monkey users will be working in the portal and seeing vendor messages – almost constantly – and have a clear idea of the value and benefits that are offered. This includes everyone from the lowest paid helpdesk admin to the highest-compensated partner who is only in there to see the quarterly sales figures.

This is a marketing approach that is both new and mutually beneficial for all of us. IT Solution Providers get a free portal experience that ties into virtually all the systems from the PSA (if you have one) to the accounting package to quoting package to the RMM and even your own web site. All brought to you by the vendors who want you to make them a part of your business. But do they get your business just because you clicked on their ad? In a way that we’ve implemented the marketing in Shockey Monkey, they win when you win – and it’s on them to show you how to grow and do so in an assisted, supported and illustrated way. We have a common goal here.

Over the next few blog posts I will go into details on how this will happen. Vendors, hardware and software, have very deep pockets but also very talented people and lots of insight into the industry. IT Solution Providers have the customer service, connections and willingness to do the implementation process.

It makes everyone more accountable. You can no longer overpromise, underdeliver and move on to the next sale – the dynamics of IT business have been flipped from large deals to smaller deals that are earned every month. In order for vendors to stay in partners toolbox they have to deliver every day of every month. In order for the IT Solution Providers not to be removed, they have to deliver far more value. Which means the cost of business is higher, margins are lower, and we’re racing to gain a larger market share.

Shockey Monkey is less of a tool and more of a platform to make this possible. Not only will we make those connections but we’ll turn them into a relationship that is connected at the service delivery.

The synergy of the two potentially turns every single one of us into IBM.

January is the month in which I’m obligated to offer my opinion on the coming year and what we will see. For the past few years I’ve had a relatively consistent opinion that cloud will continue to drive growth and displace the more traditional technology providers as they both have less to manage and customers spend less on technology that needs high end management (instead buying consumer devices). I’ve been fairly accurate in that assessment.

This year we will see something different.

This has been brewing for some time.

The major industry trend is the bet on vendor consolidation. While I agree, I don’t believe this will be a major driving force in the world of IT Solution Providers.

I think the major play this year will be the IT Solution Provider consolidation. Lot’s of people are looking to either exit or cash out on what they have built because posting remarkable growth numbers gets more difficult with each passing year once the business matures.

The marketplace is already saturated with events, coaches, experts, speakers, advisors and various groups that do not have an actual tangible product.

So with more people looking to exit the ranks of IT Solution Providers and become mentors to those solution providers… who will be left to actually deliver these solutions to end users?

In my opinion, business owners and managers will start to reverse the trend of outsourcing and will start doing majority of their technology sourcing themselves.

The pressure vendors feel to post ever increasing numbers will fuel acquisitions but also further competition with their partners.

Regardless of which way the economy goes, the spending on technology is going to continue because we’re only going to be using more technology.

What all this really means is that you’ll have to work a lot harder for the dollar but thankfully: your costs will go down.

Now here is the beauty in all this: Everyone is aware of it. So if you have a business model and plan that’s a few years down the road, you’re going to focus on further development of your core competencies and more sales/marketing activity. The distractions over “next big thing” or “paradigm change” or “blue oceans” will quiet down as people look at their cards and go all in.

Looking forward to showing you what we’ve got on deck for 2012. If you haven’t already done so, go sign up for Shockey Monkey at http://www.ShockeyMonkey.com – yes, it’s free.

Over the past week I have given you my assessment on the state of IT in SMB and beyond, a look to the past and to the future. I appreciate all the emails and only wish I could follow up with them all.. but I don’t just make up stuff you read on Vladville, all of it is influenced by many of you that talk, email and chat with me every day.

The theory of small business IT consumerization and how modern service providers can ride the wave to the more efficient and profitable future.

1. No future without the past
2. unRMM – What’s managed?
3. unPSA – Whose business is it anyway?
4. Derrivatives – Who does the IT work?
5. Ultimately, who pays the bill?

I’m also not putting this out for your enjoyment like some disgruntled English major that couldn’t get a real press job. I have a lot of money riding on me being right about things and the reason I’m right more often than not is because I have thousands of you offering me insight and different points of view that help me improve what I do.

But tomorrow, at noon, even more is on the line. It’s the biggest webinar I’ve ever done:

Shockey Monkey Reloaded

Thursday, December 1st, Noon EST (max 1000 seats; will be recorded)

https://www1.gotomeeting.com/register/812869640

It’s also a big bet on the future of IT. It’s a huge bet on the future of my company.

Right now, we (as in solution providers and their vendors) don’t have an upper hand in the marketplace. We sure as hell don’t have the marketing budgets and sales staff headcount that the big boys do. We also lack resources, economies of scale, farms and farms of slave labor in third world countries, tools and plenty of other excuses.

What we do have is flexibility and the size. There are way more of us than them and we can move faster when there is an opportunity.

Join me tomorrow, regardless of what PSA or CRM or stack of papers you use.

I promise you one thing, after you hear me out… I will be your best friend. The single greatest thing about Shockey Monkey is just one word… and I hope you like it when you hear it, I know I do!

Over the years my company has managed to keep it’s most gifted, albeit at times difficult, talent while most of the bad hires fell off the bus rather easily without too much pushing. I firmly believe that it’s employees that choose their path, not their bosses – though bosses are easy to blame for it.

Which brings me to the topic of investments that you’re never going to read on a self-help career site. Also something your boss is unlikely to ever say to you because.. well.. if you need to hear the following from your boss it’s probably time to move your career elsewhere.

The Beginning

In the beginning you go through the typical hiring process. If the employer chooses to hire you and you choose to take the job you agree on a set rate and benefits and start what is a mutually beneficial relationship together.

Employee is thrilled for the first few days because they have a new job, new opportunity, new money.

Employer is happy as well. However, this is the investment stage for the employer: Unless you’re at McDonalds, you are not worth the salary yet. You need to be trained, you need to be oriented, you need to learn how to do your job.

The Honeymoon

Once the employee has learned how to do their job their supervisors are happy because their workload can be spread over more people now.

Employees tend to be happy as well because they have the confidence that this will work and they can build their career here.

Then it all kind of goes to shit. Or you get a remarkable employee.

The Standoff Ladder

Over time the employee will start to feel like the salary they initially agreed to isn’t enough to make the ends meet. Something that was amazing at the beginning is suddenly unfair. The job is more difficult than it seems, the boss is a much bigger ass than he was before, the hours are longer and there are other people who make more money than you do even though without you the whole company will collapse.

This is true if your name is Shaquile O’Neal and it’s the late 90’s or early 2000’s. If that’s not your name and the calendar says otherwise, you’re out of luck. Time to start climbing the ladder.

Here is what you need to know as an employee: You are not as valuable or as irreplaceable as you think you are. In the eyes of the employer your replacement tradeoff isn’t in the job tasks (that someone else can be trained to do) but in the likelyhood that they can easilly replace you with someone that is willing to work just as hard as you do. And if you barely string together 40 hours a week in an economy with more than 10% unemployment things just are not in your favor.

This is where the standoff begins.

The employee is unwilling to do any more work than 40 hours a week.

The employer is not willing to promote or train the employee because it makes no sense to invest in something that will not produce more than has been put into it. When you consider the overhead of perks/benefits, the initial underutilization of the employee and the typical shrinkage of work appreciation (longer lunches, late to work early to leave, spending time dealing with personal items) the employer has no incentive to further invest in the employee.

The Balance

This is where you as an employee get to choose which way you are going.

For most (and in my experience, just about all) employees there is really little perceived incentive to do anything beyond what they are paid for. This is the entrepreneur trap that bewilders business owners who are on the eternal quest to find someone as stupid as they are and is willing to believe in the dream of the possibilities instead of the reality of the present. Hard working business owners dream of finding people that are just like them but the problem is that those people own companies of their own. The stalemate is that employee-employer relationship always goes between the honeymoon-standoff stages as employees progress through their careers.

Employees want more money.

Employers want employees to do more work.

When everyone has a job and economy is doing really well, employees have the advantage. Otherwise, employees have a choice: work hard and get promoted or just work and hopefully not get fired.

Almost all the employees out there live in this balance where their role is constantly threatened by the economy, marketplace or office politics. They aren’t thrilled with their job or their pay but it beats unemployment. Employers aren’t thrilled with their employee utilization or performance but it beats training new people. Hence the service you get at the DMV and virtually every other branch of government.

The Invested (crazy)

There is a very minor chunk of the employment base that is willing to work harder than they should but not stupid enough to undertake the task of running their own business and living in poverty while the new business takes off. Yes, indeed, there is a group of people who are stupid enough to put in long hours but not quite stupid enough to do it for $5/hour. Every employer wants these.

Unfortunately, due to their insanity, these are typically not the most pleasant folks to work with but there are no shortcuts in life.

Your star employees put in long hours and actually invest in themselves. Yes, these folks go home and don’t stop working. They invest in themselves and don’t wait for you to push them in the direction, they map it on their own. They don’t sit around and bitch about how nobody is training them – they go out and learn on their own. They see the problems and work on the solutions without being asked to do so. They see an opportunity in solving the problem instead of treating problems they haven’t caused like they aren’t theirs.

They are damn near impossible to manage because they have their own agenda but if we are to be honest, the whole concept of management is the impossible task of getting a full time employee to do close to 40 hours worth of actual work. Here is a quick summary

Ideal Employee

- You consistently work over 50 hours a week.
- You do projects that benefit the company without being asked to.
- You aren’t constantly asking for the 1:1 compensation for your time.
- You don’t bitch and complain about work. (you actually like it)
- You aren’t destructive (trying to get other employees, projects fired)
- You aren’t difficult to work with

Now, if you’ve read that and thought it was unfair you’re right! Sadly, you’ll never make more than teens per hour because business isn’t a fair game. Only the hungriest and most competitive folks win.

There is no shame in not being an ideal employee. Almost none are. But those that are make a significantly higher amount of money than the ones that work the bare minimum. Unless you work in the government, I can’t understand why you wouldn’t want to work 20-30% harder for a 50% higher salary but that’s why I’m not an employee.

Advice

If you’re an employer and have star employees, overcompensate them. Stop trying to find someone to replace you because you will not find someone that is exactly like you yet dumb enough to make less than you and doesn’t have your personality (which would make you want to kill them)

If you’re an employee, understand that it is not the employers role to turn you into an ideal employee. In most places it’s actively discouraged: imagine ordering a Big Mac and getting two cheeseburgers stacked between a Fish Filet (sorry, it’s 4:30am and I’m hungry). Don’t pay attention to politicians that are trying to appeal to the masses of idiots – “We need to modernize and train our workforce for the new jobs” – no, we won’t. We’ll just outsource that job to someone that can do it. Welcome to the new economy in which you only have a job if you know how to do it and unless you are willing to earn the next one you likely won’t get it.

This takes most people a long time to figure out but you really can’t push people – they are either wired to overdeliver or they just do the bare minimum. All the management books I’ve ever read embrace this idea of incentives that are basically the carrot for the stupid sales people pulling a truck of manure – all you are doing is trying to shape the 1:1 compensation model that is constantly unfair to one party. I outright refuse to do it. You can’t incentivize selflessness. Most small business owners refuse to do it too because of the mindset:

“If you want something, prove it to me.” Otherwise there is a whole office worth of people that are in the exact same position and millions of people that would love to have your job.

You cannot incentivize people to be selfless and do more than their job asks of them. But you can over-compensate them when they demonstrate that trait.

Over time you will get to the nirvana of a crappy situation that is unfair to both the employer and the employee: The employee will be getting paid more than they could make anywhere else and the employer will be paying the employee more than they are worth but won’t fire them because the replacement cost would be high. So the employee is unhappy about some aspects of the job and the employer is unhappy about the cost – but everyone is making money and at the end of the day that’s why we all go to work.

Remember: work is not about fairness, it’s about performance and results. If you can’t deal with that, I hope you can dunk! And even that’s not too bright because the NBA is in a contract dispute (the ladder stage) – so really you only have one option.

So many of you have emailed me to ask about my impression of what was said and done at Microsoft WPC that I have to make this brief post about it. If you ever have a question, feel free to email me at vlad@vladville.com

First of all, the attendance. I wasn’t there so I can’t speak to the count of people that Microsoft says was on hand. My staff (we sponsored Microsoft WPC and were there as huge Microsoft fans) was there at a booth and mentioned to me that we had a lot of foreign audience – so I see no reason to doubt the numbers and I don’t think that really matters as far as the big picture is concerned. I know many of you feel like WPC is a waste of time for a small business and that there is no ROI to it. And you’re wrong. And perhaps Microsoft would put in more SMB tracks if there was more SMB interest in working with Microsoft. It’s a causality loop – and I’m not playing the devils advocate here just pointing out the common business sense – you have to spend your money with Microsoft to make them care about you, not the other way around.

Second, Office 365. No big surprises there. But suffice to say if you’re not doing this, your clients are being marketed to and you’ll soon be pushed out of those accounts if you don’t have an offering.

Third, Apple. Every year Microsoft shows it’s remarkably low level of class when it addresses whoever is pissing them off at the time – be it IBM, Oracle, VMWare, etc – and they seem blissfully ignorant of the fact that the audience is not their staff and is not brainwashed to believe that Microsoft is the only technology capable of making money on the planet. Same mentality exists at Apple but at this point Microsoft is doing more than just shamelessly copying Apple products poorly – they are going after their business model too.

I tweeted recently that when you see the flamboyant loudmouth (CEO, Ballmer) of the company say the exact same thing as the guy running the company (COO, Turner) there should be no doubt where the company is heading.

It is what it is.

Microsoft doesn’t need partners in a sense where partners are a part of the solution. It needs partners in a sense of partners being a part of completing the transaction.

This is a major change since the days of technical complexity requiring a geek – the world is changing to the one that is decidedly geek free. It’s not there yet but it will get there eventually.

The decision for IT Solution Providers seems quite clear: Are you providing a solution or are you making a sale? If it’s the later there needs to be a clear and major distance between you and the Microsoft brand.

One of the more neverending debates I have with my entrepreneurial friends is over development of new business lines. Regardless of how big or small you are, venturing outside of your comfort zone tends to require new skill, new connections and cash. Most of all, it’s about the right timing.

There are a few things that success is not about:

Potential. Ever hear someone tell you that they have an awesome business, incredible revenue growth and potential – but they just don’t have the cash to grow as fast as they possibly could? Bullshit. Investors love great ideas and growth potential – what they don’t like the risk. So if you have an incredible potential and incredible risk – you’re like everyone else out there.

Uniqueness. Almost every hopeless entrepreneur that has sold himself his own dream believes they have a unique business model. The problem with that is that business models are easy to copy and more savvy people can get things done faster than people obsessed with perfection and quality.

Connections. It’s all about who you know, right? Unless you deliver a total disaster. Then those connections are your enemy because nothing spreads faster than bad news. In every new venture, you have to establish new partnerships but that is by no means the primary vehicle for business development. For some reason, many people I’ve met in business spend an incredible amount of time trying to network but it rarely works out – I suppose because it’s more enjoyable and easier than actually working.

Right Message, Wrong Timing

Even if you have a great product, if your timing is wrong you’re going to be spinning tires. For example, if you just decided that you were going to start building networks or selling computers at the time when the world turned to the cloud and tablets, you’d be out of luck even if you got fancy with financing because you’re pushing in the wrong direction. Marketing hardware and large investments in a bad economy is the wrong message.

But let’s say you had the right message – it’s all about the cloud now so let me ride the hype! I’m gonna build me a data center! Well, slow down Bob. First, what is different from your data center and thousands of others that are already built and not at capacity.. aside from not having SAS70 Type II audits, bandwidth redundancy, power redundancy, business history – you know, the stuff that takes years to develop and prove? Being right alone is not enough if you’re showing up late to the show.

Right Message, Perfect Timing.

The trick to having the right message is research, experience, case studies, test marketing. That part is relatively easy.

In terms of timing, you have to be lucky.

There you go, class dismissed. Do some research and toss the dice and hope they come up lucky. Hey, the blog is free

On a more serious note, I wanted to write this because I speak to a lot of you that are currently reorganizing and refocusing your companies to move them forward. Not all business models work forever – we had a great run with managed services. The cloud move in the small business we are enjoying right now won’t last forever either.

Focus on growing a dynamic, versatile company. Don’t fall in love with what you’re trying to sell, try to build what your customers want to buy. Demand should drive sales which should drive marketing which should drive more demand. If your chain is not spinning in that direction or is missing any of the components you’re going nowhere fast.

Most of all, accept failure. For every Own Web Now, ExchangeDefender, Shockey Monkey and CloudBlock I’ve got 20 other things I’ve tried to build and it just didn’t work out. Remember all that hype around Health Care IT that flopped? Well, what if you sunk all that money and effort into the cloud? The point isn’t to dwell on the stuff that didn’t pan out but to stay focused on building the next thing.

Do your research.

Stay ahead of the curve.

Stay loyal to your clients and deliver what they are asking.

Everything else will fall into place given enough passion, effort and luck.

At a recent conference I was asked if I’d consider doing the ironman push again.

For those of you that aren’t devoted Vladville followers, I worked 90 days straight from January 1st – March 31st. No breaks, no vacations, no days off, no Nyquil. It was a brutal schedule that allowed me to break through some crazy personal and professional obstacles and reach new milestones.

I’ll never do that – but allow me to offer some perspective. If you’re squeamish you might want to skip the next section. Scroll down to The Business Design Challenge.

The CEO

Best job in the business.

Flexible hours, obscene pay, minimal supervision and unlimited opportunity.

Then you kind of wonder how shit like this happens:

To all my friends in business and those who want additional responsibility: be careful what you wish for. While it’s easy to only see the nice parts of the job, there are those emotional aspects of it that you don’t get to leave at work at 5:30. Most employees think their bosses are awful and that work can ruin their day. Then again, most employees can find another job in a few months and they are only accountable to themselves.

Slightly more pressure on the management. You see, a crappy toxic employee not only sucks at their job but also happens to antagonize everyone else they come in contact with – both employees and clients alike. In a way that would affect that business for a while. It’s a domino effect that affects the performance of the entire organization – if the manager has a bad day, so does everyone that works for them. And everyone those people touch as well.

The job of the CEO is two fold – deal with the employees and deal with the customers. Defend your team, listen to your customers. Represent your customers and argue with your team over the right direction of the company. Empower employees while guiding them. Guide them while attempting not to lecture them. Take their feedback while dismissing their concerns and opinions of the overall direction. Line up the marketplace demands with the client expectations with the employees ability to do their job in the goal that the company delivers on it’s promises at a scale that generates a profit.

Oh yeah, try not to offend anyone while doing it.

Maintain composure throughout this process while that nagging little voice of no confidence and risk aversion keeps on whispering: “If you fuck up, you don’t just fail and move on – you affect thousands of jobs, companies and business relationships that have taken a lifetime to built.”

The Business Design Challenge

Every small business owner has an idea and a passion. That’s how it all starts.

After you reach any reasonable level of success the ideas you’ve had as the entrepreneur take on a life of their own, different employees take on the vision and drive the delivery of those ideas and solutions to the marketplace. But because you’re so disorganized and relentless in pursuit of your dream in it’s early stages, little cut corners and “problems that will be fixed later” snowball at this stage: The Avalanche.

The Avalanche: Trouble with problems in small business is that they never get smaller. They only get bigger. And more complex. And involve more people. And require more money. Oh – and end up distracting the whole company to get resolved.

I’ve seen most of my entrepreneur friends crack and burn out in this stage. They either fire everyone around them and attempt to blame everyone but themselves for the issues or throw their personal life in an repairable disarray.

The trouble with the avalanche is that the person that caused the problem must both be strong enough to let those around them in on the issues and help own the problem and fix the solution – while the person also admits they created the problem while showing confidence that they know how to fix it.

Describe the problem. Explain it, solicit input, delegate, lead through the fix.

As the company grows from being a small business / startup mode in which everything goes, growing up takes forever. Designing a large business is not the same as a small business maturing – it’s about sustainability, mentoring, delegation and elevating your game to the next level.

Most people crack here. Personally. Professionally. Mentally. At the end of the day, is all this hassle worth a few more million or am I bored with it?

This is where most small businesses end. Either in a tailspin out of business, or an acquisition… or hopefully something better.

Motivation Process

My Ironman was an admission that I couldn’t deal with the pressure of fixing the problems I’ve caused in designing OWN for a full year that it would take to address them. So personally, I decided I could do it in 3 months if I absolutely focused and did nothing but work. I was right. So here are some tips:

1. Recognize the problem.
2. Admit it’s your fault.
3. Ask others for ideas how to solve it.
4. Ask inside / outside. Employees and clients.
5. Draw up a plan.
6. Sell the plan.
7. Cut the plan up and delegate it all away.
8. Draw up reporting.
9. Design milestones and rewards for reaching them. Start here.

You wanna line up a lot of witnesses to you don’t wuss out. What people often make a mistake of doing is hiding what’s going on – it’s easy to quit when you don’t have a bunch of people that will watch you fail. Call it motivation.

My Challenge

I’ve been fortunate enough to be around some great people while building Own Web Now. I’ve seen some succeed. I’ve seen many fail. Those that flunk out and get jobs aren’t going to be writing books about it. Those that succeed have businesses to run. I on the other hand don’t sleep a lot.

You’re not gonna read a book about it. But boy will you know when the problems you’ve created in your business are bigger than you or your ability to solve them yourself.

My problem was that I had a lot of really wacky ideas that I built into products and services from 2003-2007. Then as the cloud stuff started picking up steam all of my crackheaded ideas turned into big products. Then from 2008 we had to focus on service and grow up fast – away from grunt work of infrastructure and data centers to a mature business model of delivering services. It was a huge transition. And while we figured out all aspects of the business – running a business is more than just making it through the day. That’s business management. Running a business is about taking it in a direction. At the beginning of the year, we had a hustler problem – we could do everything but you needed to know someone. That doesn’t scale. So my challenge has been to document the business, delegate it away and dedicate more of my day-to-day on what the business needs to do next.

I made it through my ironman and my company, my team and everyone we serve is much better off as a result of it. Own Web Now is operating on a different level in June of 2011 – instead of at some point in 2012.

That, I hope, makes all the difference. After all, I now play in the big leagues.

Have you ever been to a Best Buy and just left the place floored at how knowledgeable or expert the staff there is?

If you have, someone must be reading this post to you because there is NO way you can read.

Best Buy is to computer experts what Apple Genius is to a winner of a Nobel Prize in Physics. But when you need a power cord or an Xbox controller today, Best Buy is awesome and their college dropouts stuck working retail and living with their partents Geek’s sure know how to point in the right direction (sometimes).

Which makes the following cease and desist letter even funnier (click on the thumbnail for the full size).

Here is the best part:

“We also recently learned that Newegg is running a commercial on television and Youtube depicting a blue-shirted salesperson in a store with a similar layout/color scheme to a Best Buy Store, so as to represent a Best Buy employee. The fake Best Buy employee is depicted as being slovenly and uniformed about computer products, in contrast to your employees who are portrayed as “experts””

Oh boy.

This is a textbook case of how not to settle a dispute.

First, no matter what you do, every cease and desist letter your company sends will be blasted all over the Internet – and mind you that this is not a real dispute – it’s one bunch of marketing weiners upset about being picked on by another bunch of marketing weiners. It could have been solved by putting the two parties in a room for an hour or so with a gallon of water – they would have reached a settlement in record time after realizing that a room full of marketing people can’t figure out how to work a door knob. But I digress.

Second, Best Buy owns a trademark on the Geek Squad. They are trying to shut down a Newegg marketing campaign that uses the word Geek (power icon) On. Umm. That’s not how the trademark law works.

Third, “Best Buy is concerned that Newegg’s use of the Geek On Logo is likely to create confusion among consumers and to dilute the distinctive quality of the Geek Squad Mark..” – Come ooooon! Now I know this was written by a marketing person. There is no distinctive quality to Geek Squad, it’s a laughing stock of the IT profession. If there was a confusion over Best Buy (overpriced and outdated electronics vs. other defunct business models of: CD store, DVD store, etc) and Newegg model – which focuses on low price, feedback from thousands of other people that bought the item, direct links to the manufacturers and prompt shipping – it would only help improve Best Buy not hurt it.

Competition

The competition that Best Buy has with NewEgg is something that we as IT Solution Providers need to think about and watch closely. For the most part, cloud solutions are newegg – fast, agile, low overhead. IT Solution Providers on the other hand are brick and mortar, local establishments that work in the community.

But if your community is not aware of your effort, and the cloud thing is cheaper.. then what’s your value?

While the dispute between Best Buy and NewEgg is somewhat comical, the background is a real concern on the mind of many MSPs that I talk to on a daily basis – Microsoft’s launch of Office 365 will put a lot of MSPs on defense because direct marketing is so powerful. The whole notion of a “trusted” advisor is very difficult to assert when your client starts thinking that you’re robbing them when you provide so much more than the supposed flyer seems to be charging for.

Options seem clear: Start sending C&D letters with full assurance that you’ll be mocked for them online or start marketing your local expertise and value that delivers. I (and we) get a lot of our partners marketing materials and it’s shocking how few (almost none) of you stress the local part.

Every business needs a nemesis.

For example, do you know how much harder you need to work to make something mediocre look good? Now imagine taking something that’s good to great. Now imagine yourself as a perfectionist, where you are constantly motivated to squash that next little imperfection that you see out there.

Have you ever painted a room? You know how once you peel the tape there are drips, missed spots, paint under the masking tape, etc? You’re aware of all the imperfections. Nobody else looking at the same thing would see them – but you know they are there and it’s driving you crazy.

Business is not so much different than that.

Every day we work on building a better solution and making sure that it has the most meaningful impact it possibly can have in the lives of our clients. On surface, what we do at Own Web Now is not that special or that unique – we play with computers. But a few of us also know that our solutions play a small part in curing cancer, in not making Blackberry go off every few seconds during surgery, in fund raising, in financial markets and in things that are very much life and death.

So we invest everything we are into building that.

We also invest in you – even if you’re not one of our clients – we’ve likely spent some of our money on your lunch, dinner, air conditioned room, training webinar and so on. Yes, the cost of sponsoring MSPU, CharTec, ASCII, CompTIA, SMB Nation, XChange, Microsoft WPC, Microsoft Teched, msmvps.com, SBS Migration, Autotask, ConnectWise, smbbooks.com and tons of other things is immense.

We don’t do it just because it’s great marketing or just for the sales leads – we also do it because it’s the right thing to do that advances all of us as an industry.

That puts us on the edge of the marketplace where we can design the solutions that are ahead of the game of the companies much faster and richer than we are.

It arguably puts Own Web Now and ExchangeDefender in the leadership spot. We’re not the cheapest thing out there.

Own Web Now and ExchangeDefender are my self-painted walls. I see all the imperfections in them daily and wake up to fix it.

Yet… I often hear “We love you [random praise], but business is business and can you beat _____”

Business is Business

When people say Business is Business what they really are saying is all that other stuff you do really doesn’t matter, only my profit on this deal matters.

I’ve heard that a lot. I’m sure you have too.

Unfortunately, when all that matters is the price, the playing field is not equal.

There is a reason why a dinner at a fine Mexican restaurant is more expensive than Taco Bell. Yes, it might still be a taco that you’re eating, but the two are beyond comparison.

Same goes for IT services.

But let’s just look at the taco. If you can’t tell the grade of meat used in the taco, if the sauce used completely masks the relative freshness and it quenches your hunger, why should you be forced to pay $12 for a taco plate when you can buy one for $0.89 and have it served in your car?

You might even argue that eating in your car is more convenient. It’s certainly nicer to be in control of having the ability to refill your soda with the precise mix of ice and soda you like as opposed to waiting on a waiter to do it for you.

It’s all relative.

Which is why you need a nemesis.

The Nemesis

The fine dining version of Mexican food would have a hard time justifying the cost of their entrée if they had to compare their taco to a taco sold at Taco Bell to someone who didn’t have the common sense to tell the difference between the two: “Yeah, so you have a fountain – they have a bigger menu!”

Without being able to take the differentiation conversation away from the price, the nemesis argument doesn’t exist.

The nemesis argument is also far worse when you don’t control your nemesis. It’s natural to want to have people believe that you’re offering much more than someone else.

But what if the nemesis was just an option?

What if you had a choice?

That’s fantastic, you are only concerned about the price. Here are the two prices. In one corner, we have this awesome all you can eat full buffet and on this other side we have a bargain hunter menu item. Which one would you rather have?

Naturally, they want everything for the price of the bargain hunter special. But world is unfair and you have to make a decision.

Do you want to pay a premium for a premium solution, or are you only concerned about controlling your costs?

You see, the argument becomes a little bit easier to break down once we take the price out of the conversation. Because with the price, there is only one logical conclusion: the lowest bidder wins.

Justification

The way you justify the value of your solution is by explaining how all it’s components are greater in sum than the pieces that put it together. Your job is to present your solution in a way that the client would seemingly make a mistake not to pick you.

Polarity… helps.

Nearly a decade ago Dell started selling $349 servers.

These beasts were powered by Celeron processors, barely had a gig of RAM and came with a tiny single hard drive. If you tried to adjust the configuration even slightly, the price would explode.

End result: tons of people bought really high end stuff. Yes, some bought the barebones special and lived to regret it, some were even happy with it.

Without the choice, fewer people would understand the value of the higher priced solution and would not even entertain the chance of listening about it.

There are many people on both sides of the spectrum: those that only have the budget for the entry level system and those that really need something more adequate to suit their needs.

Without being able to differentiate the two, you (the seller) lose.

This in no small part was the reason we built a solution that you will be hearing about a lot. It’s a direct competitor to what OWN does, running on top of OWN’s IP.

How does it make sense?

I make money on both sides of the pole.

If they are only willing to pay for the bargain basement special, I can make a tiny margin and still have an opportunity to introduce them to my partners. If they are however interested in the premium solutions, then they can appreciate the difference in price and be more willing not just to pay it but to appreciate how much of it goes to delivering the service.

In a world where IT services are rapidly being depreciated and phased out of the marketplace, you can’t just look at the cheaper competition and dismiss it as inappropriate because nobody cares what you think – people that vote with their wallet are the only ones with an opinion that holds any value. If they want to compromise, let them. But those that understand will allow you to preserve your margins.

In business as a business, decision makers are asked to manage tradeoffs and take risks. Cheaper solution might make the sound budget decision but create a management risk of picking something that loses 150,000 accounts in a day with no Gmail phone number to call. Is the customer comfortable managing that risk? Do they even have any flexibility to check out other solutions? Is the solution just a feature point or is the solution the implementation of that feature?

Dear Vladville readers, this is the Trusted IT Advisor obituary: The age of IT arrogance is over. To be in the IT world going forward you don’t get to dictate to the clients what they need to pick, how much they need to charge – because it’s easy to find another provider. You have to embrace your nemesis, you have to elevate your value and make your clients think hard and long about whether the compromises they are about to make are truly best for their business.

Allow me to introduce you to my new kid, my nemesis: www.cloudblock.com

P.S. Value is arbitrary and relative to the observation of someone that likely can’t understand the whole scope of it anyhow. But if you can’t make money on both sides of the spectrum, and separate your premium solution from your entry level one, then for your sake I hope you’re truly exceptional. To the rest of us realistic folks out there, game on.

(this is not a motivational post that will be featured at monster / careerbuilder)

We’re at the start of the biggest hiring spree we’ve ever had. OWN is launching upgrades to all the existing product lines next quarter and introducing brand new products and services online in Q2 and Q3. We’re shorthanded now and on the verge of becoming a sweatshop very quickly.

Over the past few years I’ve been very lucky to hire some really hard working, smart people.

Unfortunately for them, it’s their turn to hire their own “teams” now and build on the success that we’ve had together.

Sadly, the e-myth and standard hiring process for private enterprise reveals an ugly, disheartening truth:

You can’t hire a replacement for yourself.

This is so frustrating to people that have worked very hard to get to where they are. For every good employee there are typically at least 2-3 slackers that sail along somewhere above being fired for gross incompetence but below possibility of promotion or trust with anything more than a mid-range cell phone and netbook.

I see this frustration everywhere. The mythical “me” employee. Everyone wants to hire themselves. From the people that make $30K/year to people that run multimillion dollar companies – the person that you want just doesn’t exist. If they do, they are either too smart to work for you or have control & ego issues that prohibit them from reporting to a 20-something.

There is a safe way – hire, evaluate, keep or fire. This is the safe way because the investment is seemingly quite low – folks either pan out or don’t. This is the most expensive way to do it and if you’ve read emyth, it can be catastrophic even if it works. If it doesn’t work out, you’ve frustrated whoever manages them. If it does work out, and they quit, you’re starting from square one. The frustrating experience of building your own apprentice in the fast paced world of professional white collar business can not only affect your new hires, it adds an enormous amount of stress to everyone involved in that food chain.

I used to have a friend who bragged about how his team was able to run the company without him. Yet every time we hung out outside the business, he had to get on the phone and deal with fires. He’d go back to work, fire whoever was on top of the s#@%list that week and be back in the rebuilding mode. Yet nearly half a decade later, his business is smaller than when I first met him. Why?

There are two sides to the story. New hires will always feel like they are not receiving proper training, motivation, incentives, etc. I actually heard this last week: “Training? What training? We are still here due to the sheer will power of wanting to figure things out on our own.” Yet, when their boss got called out for being too lazy to record some training, a similar (yet opposite in direction) frustration came out.

In a perfect world, we would all be able to hire competent hard working people that require little training and are self motivated to move past the frustration of not being hooked into every process and every undocumented piece of information. Such a beast does not exist and I’ll try to sum up my 6 credits of management courses at UF in a paragraph:

Most employees are motivated by money and rank: keep in mind that majority of the workforce is not looking to be rich & stressed, they are looking for the comfort zone. At a certain salary level, the effort curve straightens out where they make enough money to spend more time away from work. The more money a person makes, the less incentive they have to work harder.

As I told a buddy of mine: The person that wants your job and can actually do it is too smart to work for you – they are working for themselves.

Now.

I am not an HR expert.

I’m pretty sure the following is illegal. I hope that the Foxconn people don’t read this and think: “That Vlad guy could help us ramp up our white iPhone production”. But I hope it helps you in some way. I’m really writing it up because I hope it helps my team in getting help.

Step 1: Document Your Job

We started doing this last year. Take any cheap webcam (Flip HD, $130) and point it at an employee that you think has a good grasp of their role. Start the role play. Here is what it looks like:

No lights, no production, no editing, no script, no worries. Just point, shoot, and roll. This becomes your training collateral.

Think it’s expensive to put a new employee through rough videos where they just sit there and watch stuff for the first week of their employment? The apprentice stuff is far more expensive – it takes your currently performing employee away from their job and the new hire (that may or may not turn out to be a serial killer) still just sits there and nods their head.

Warning: Your staff, particularly the more technical ones that think they are geniuses (which would be every single f’n one of them) will think that the new hires are complete morons that they need to teach the TCP stack to and gauge which parts of the training they understand and not understand by the dilution of their pupils or the number of hair twirls. See step #2.

The video process is important for several reasons. 1) You can pack a ton of information in an hour of video 2) When you talk openly you can easily sidetrack and come back to the main message to make sure you explain both the context and the details correctly 3) It’s all internal so you don’t have to get it past the lawyers 4) You can disagree and pass on tips and tricks for dealing with difficult stuff 5) You get to emphasize what is important to you.

Step 2: Make them earn it

The problem with the professional workforce is entitlement.

Most people looking for a professional job feel they are entitled to it and a high salary with benefits because they went to college. Most will expect a high level position as well, based on their (largely unrelated) work experience. This tends to die during the interview process as they clearly have no answer to the questions that come with the role.

For example, you may have Exchange experience.

But unless you worked in an environment with thousands of employees and an unlimited budget, you likely have no experience dealing with autoconfiguration, migration from 2007 to 2010 or the performance issues that should not be happening in the first place.

Monkey: So I see here that you have experience managing BES. How did you handle OTA?

Candidate: OTA?

Monkey: Activations, how did you activate devices that showed up in the field.

Candidate: Oh. Well. Employees (all two of them that had a Blackberry) had to connect their device to their desktop and…

Very few people have the exact experience you need.

So you need to document the training process and give people the tools. Even if they have worked in Exchange for the past 12 years, they will not know how to deal with the stuff you just figured out last week.

Qualify people that would understand the basics and make them want to learn how to do the advanced stuff. Here is what it looks like:

Congratulations, we love you. We’d like to make sure you can handle the more intricate parts of this role so here is an offer: Come over and do a few days in the life of this role. You’ll be paid for it. If you rock, the job is yours. If you don’t like it, no harm – no faul.

If they are between jobs they will jump on this.

If they aren’t – but are sincerely interested in the opportunity – they will still take a stab at it.

Why? Nobody wants to take on a new job working on @#%^ they hate with the people that they may not get along with. With this, all of the uneasiness of starting a new gig is removed.

Step 3: Jeff Foxworthy (aka “blah blah bull@#%”)

The problem with professional employees is that they can bull$#&* their way out of anything.

The smart ones know to keep their mouth shut. The dumb ones will keep on talking and remove all doubt Sadly, most people know to keep their answers short, the details vague and defer being called out at any time with “I am not entirely certain, I don’t want to lie to you, let me find out and get back to you on that one.”

This is where most small business owners end up with a frustrating, ineffective workforce. Here is the cure, and it comes from Mr Jeff Foxworthy and “Are you smarter than a 5th grader.”

Step 1: Make them watch the video.

Step 2: Talk to them about the video.

Step 3: Call them on the details not explained in the video.

You should know in less than 72 hours whether you’ve got someone that is just professional enough not to be blatantly incompetent or if you’ve got someone that is capable of learning.

In nearly all roles, you want problem solvers.

You should know right away if the person you’ve hired is one or the other.

But.. without the video and training collateral, you can only call them on things that you’ve explained. No matter how well intentioned you are to perfectly train an apprentice, you will have better stuff to do. It’s so damn easy to give people your busy work that too much time will pass before you realize they are not a fit. As unprepared as new employees may be for your job, you’re far more unprepared to train them for their job. Very few people have psychic powers – new employees will not know how you like things done, how you communicate and what your expectations are.

So take the time and put in the effort to make it easier. Employees are the most frustrating part of business because they are your family – there will come a time where you will not want to fire them – but fire at them. As an entrepreneur and a business owner it’s frustrating to deal with the expectations and employees – but it’s much easier than doing their job. If you want to grow, you gotta grow up.