Practitioner's Forum
Judith S. Blanton
RHR International
Typically, our training as I-O practitioners emphasizes building skills in doing the work: understanding the research behind practice and learning methods and techniques. However, to become a practitioner who can make a living through I-O practice, just knowing how to do the work is insufficient to be successful. We must also have skills in getting the work, managing the relationship with clients, and managing the business.
This column will describe how three successful practitioners (and SIOP members), Vicki Vandaveer, Alison Mallard, and Dirk Baxter deal with these critical but often underaddressed aspects of professional practice. They will also discuss what they see as the advantages and challenges of individual practice and share advice with those considering a career as an independent practitioner.
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Vicki Vandaveer of the Vandaveer Group (v3@vandaveer-group.com) started her career working internally with large corporations; she also worked as part of a major consulting firm and started her own business 17 years ago. It was a client who “pushed her” into starting her own company and provided her first project. She specializes in organizational change, executive assessment and coaching, as well as executive and team development. Her client base consists of both domestic and international clients.
Alison Mallard started her company, HRCatalyst, Inc. (www.hr-catalyst.com), 6½ years ago in Atlanta. At that time she was part of a small, family-owned boutique consulting firm.
When that organization declined a project, she proposed to her manager that she might bid for it herself. With their support, she had the basis for starting her own company. Although that project dried up after 3 months, she continued to do contract work for the boutique firm while building her business. As she put it, she was too naïve to be scared. She persevered and has been successful. Alison spends most of her time on executive development, team development, and customized project work. She has also built an alliance partner network to provide a broad scope of I-O services (select–measure–advance) to her clients.
Alison has recently started another company, I-O at Work (www.ioatwork.com.), a Web site where readers can find short summaries about relevant I-O research related to work issues. (This is a free site, although she is currently looking for sponsors.) She employs graduate students to review these articles, which are drawn from a wide variety of scholarly journals and can be searched by topic. The site provides a quick overview of the article and comments on why it is important. The reviews are written in lay language with the goal of getting relevant research to those who could use it in their work but may not have access to, or the time to read, scholarly journals. She currently posts about three reviews per week but plans to increase this.
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I-O psychologist Dirk Baxter works in partnership with his wife, Karen Steadman, who was trained as a counseling psychologist, in their firm, Leadership Futures (www.leadershipfutures.com). Dirk has an entrepreneurial background from working in his family’s small businesses and ranch. This, he believes, was an asset as he and Karen started their company. Although the firm has a broad practice in performance optimization and accelerated leadership development, Karen specializes in the coaching side of their practice while he focuses on hiring and selection. Dirk, like Alison and Vicki, has built strong partnering relationships with other practitioners in order to provide scalability and broader range of services to clients.
Getting the Work
The literature about small businesses finds that about half of them fail within the first 5 years. We have no statistics about psychological practitioner firms, but it is clear that business development, marketing, and sales are part of the task of running a practice. None of those interviewed considered cold calling or mass mailings to be effective sales strategies. Relationship building among colleagues and clients was the preferred means of developing business. Practitioners who can help the client clarify the issues and understand the value that the practitioner can add will do better than those who merely present ready-made products or describe the features and benefits of their specific approach. Clients typically don’t care much about HOW we solve the problem; they just want it solved. Vicki does not describe herself as a strong “sales person” but has been successful through having a high ratio of repeat business (through satisfying clients) and asking for referrals from her clients. This vital step is something many forget to do, but clients who are pleased with your work are generally happy to make introductions to potential customers. Other strategies she has found useful include public speaking to target audiences and publishing in client-read sources.
Allison says that at least 70% of her work can be traced back to people she knew in graduate school or fellow graduate school alumni who have taken on internal positions, referred her to clients, or invited her to partner on projects. Her involvement in professional associations has helped to maintain these relationships. Her “marketing” has been through networking and doing good work. She spoke how demonstrating excellence in graduate school is important early in your career as this builds your reputation among fellow students who may, in the future, have need to hire someone with your skills. She does not just wait for referrals, however, and is active in reaching out to network and develop business contacts.
Dirk Baxter says that it is important to “dig the well before you are thirsty.” He warns against the tendency to neglect business development and networking when you are very busy. Although it takes discipline, he emphasizes the importance of making time for ongoing business development no matter how busy you are. He agrees with the others that one of the best methods for attracting business development is delivering on what you have promised. He has also found it useful to build strong alliances with other professionals where you can refer work to each other. Because any referral reflects on the one making it, he makes it a point to know what products the partner can provide and assures that the partner will satisfy client needs. Dirk also suggests that you need to know the client or client organization well enough that you not only understand their current needs but can anticipate potential problems and what services they may need in the future.
Managing the Client Relationship
Keeping the client satisfied is critical. Dirk suggests that it is important to learn the business side of an organization in order to become a trusted advisor, not merely a vendor. He makes a point to understand the client’s business model, keep up with the news of the industry, and understand the client’s market and its trends, as well as what legislation is being considered and how these things might impact the company and its needs. It is also useful to make time for informal as well as formal meetings with the client. Vicki has built strong, often personal, relationships with her clients over the years and keeps up with them even if they do not have immediate needs for her services.
Part of doing “good work” and having a strong reputation is making sure that the ongoing administration of the assignment is meticulous. Billing errors, calls not returned promptly, scheduling mix-ups, perceived rudeness, or reports that have typos can seriously damage the relationship with a client and be more likely to lead to a project cancellation than mediocre work. Good communication is key. Ongoing progress reviews and follow-up discussions to evaluate the project can help the practitioner learn and often lead to additional work.
Managing the Business
Alison reports that strategic planning for the business is critical. “What do I strive for in 5 years? Given that, what do I need to do now?” She says it is very easy to get wrapped up in the day-to-day work, but you need to think long term. “Where is this getting me, and what I am working toward? It is not too soon to think about your plans for retirement.”
Dirk and his partner update their strategic plan annually. He says it helps if you value entrepreneurship and devote time to learning about business. He suggests putting together a “board of directors” who are your trusted advisors. These are professionals to whom you can turn for help and advice. Vicki echoes the need for professional advisors. She has at various times used her CPA, financial advisor, colleagues, and former clients to counsel her. Alison reported that she started out doing her bookkeeping herself. She said it was difficult to pay for something that she “could” do herself but now considers outsourcing the process a good investment. Using a professional to help with accounting and bookkeeping helped her save money and make better decisions. Alison has both an IT person and an editor (for proposals and reports) as contract employees. At one point, she even treated herself to hiring an office organizer who helped her set up office efficiently.
All the practitioners we spoke with maintain relationships with other I-O and consulting psychologists and other professionals who can be called on to assist when taking on a larger project or one that requires a mix of skills outside of their specific expertise. Having “partnerships” and “alliances” with individuals or other firms has been extremely valuable. With such alliances, the practitioner–business owner need not support a large permanent staff and can draw on expertise as needed. A caveat in working with partners or contract employees is the issue of quality control. You need to be sure that your partners have the expertise required and manage their performance carefully.
Advice to Those Considering Starting a Practice
From Alison: Love what you do; find the intersection of your skills, interests, and passion and go for that. Develop a strong network of people for support. Prepare yourself to be a business owner by getting guidance and knowledge. (Alison hired a business coach to increase her knowledge of strategy). Do your homework: Prepare well for every meeting, call, and program/product delivery. Find a way to deliver beyond your clients’ expectations without giving away your services for free. Be ready to work very hard. Leverage your training as a psychologist; we are trained as scientists, which gives us unique skills to develop metrics and change behaviors. Don’t take this for granted.
From Dirk: Gain experience before beginning. Working internally brings street credibility and shows you can do a “deep dive.” Having experience across different industries is also helpful. Take the time to learn about business (e.g. how to do invoicing, contracts, deal with clients). Cultivate mentors; build a “board of directors” who become YOUR trusted advisors. “Show your soft underbelly” to these people; be coachable. If you are a graduate student, “just do it!” Run a little project yourself. Create your own LLC. Do volunteer work.
From Vicki: Get your “ticket punched” first. Good practical experience is invaluable. Assess your own strengths and weaknesses and find others to support you in your areas of limitation. Engage top professional advisors early on. Specifically, get a really good CPA who understands small business. Don’t go on the cheap there; a good CPA + small business advisor will save you more money than you can imagine and will help you build your business. Evaluate how many hours you are willing to put in. Although being your own boss provides great flexibility, you will clearly need to put in an enormous number of hours initially to make your business successful. (It will be more than you think!) Although others are more cautious, Vicki advises that, once you take the plunge, never look back! No Plan “B” (i.e., some fallback plan in case it doesn’t work out)! “Every setback is a challenge to be solved! You must be fully (100%) committed to your business being successful. And it will be!”
Advantages and Disadvantages
All agreed that independence and flexibility are major advantages of an independent practice. You have the opportunity to control your own destiny. Independent practice allows for greater flexibility of hours and scheduling and often provides a broader variety of work. You have the opportunity to choose those with whom you want to work. You can set your own standards and policies. If you are successful, having your own company can be financially rewarding. Dirk described how he was able to react more quickly than most large companies, which can improve client services. He also noted that being small allowed him to have a more flexible pricing strategy and to work with small to midcap companies rather than needing to solely pursue larger organizations.
Disadvantages include serious financial risk. It is often “feast or famine.” There are no built-in benefits or retirement plans provided by an employer. Another disadvantage is potential isolation or loneliness. (All those interviewed stressed the need to keep up your professional contacts, go to conferences, and stay in touch with peers to counter the isolation.) Although the hours may be flexible, they are long, typically much longer than when working for a company or in academia. Further, administrative duties involved in running your own organization can be burdensome and take away from what practitioners like to do: the work itself.
I’d like to close with a quote from Vicki Vandaveer. “There will be highs and lows, agony and ecstasy, disappointments and excitement that you never imagined. My only regret is not having done this sooner.”