Home business ideas for transition out of 9-5?
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@BRRABill said in Home business ideas for transition out of 9-5?:
But to be honest, I am not in the business like you guys are.
As people who provide consulting as our business, we can't just have a single go to solution for anything. For example, I'm often asked to recommend servers. I always recommend several, often specific models, but from lots of makers. Even if the customer makes it clear what vendor they like, or I make it clear which I prefer, it's still "Dell has this model, HPE has this one, Oracle has this other one and SuperMicro will work with this configuration."
In your Synology example, even though I love Synology, I never have that discussion without ReadyNAS getting mentioned. And often QNAP, Thecus, Buffalo and others get mentioned with proper caveats listed so that the customer can make reasonable determinations and understand what non-sales biases I bring to the table.
Consulting means a lot of work on our side to do research and know the options, plus lots of self reflection as to our biases, plus a lot of disclosures to customers, etc. It's a complex world to do in a reasonably honest way.
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I think that companies with really good processes and enough size can mix VAR and consulting in the same company, but it requires a lot of customer trust, good internal processes, top down oversight and dedication to the process and careful separation of duties.
For example, NTG could resell Synology as a VAR and recommend it as a consultancy. But it would require that the Synology resales team never have any influence on the consulting team. That's VERY hard to do. Consultants will always know that their decisions might help pay their coworker's bills. But you can do things like... not let the consultants even know what the VAR team sells! But that's hard, too.
You can never remove 100% of bias, but I believe that you can remove reasonable bias and that you can disclose proper bias to customers. NTG does no reselling (other than Webroot of which I am aware... if they do sell other things, that's how good the secrecy is) but I still have regular bias discussions with customers to help them understand where I might be bringing bias into the discussion (like I do tons of work with Scale, use it internally, have it in the lab, etc.... but neither I nor NTG get compensated for selling it, but I still disclose the strong working relationship because even though it is not a sales one, there is no way that I can't be influenced by the strong internal communications channels, heavy knowledge and experience on the product, etc.)
But some things that I think can be combined to have a VAR/ITSP mixed firm would be...
- Top down management with a clear management of the separation of duties.
- Separation of duties between VAR and ITSP functions with zero overlap of functions.
- Zero direct compensation to ITSP functions from sales.
- No bonus or profit sharing schemes.
- Obfuscation of sales options from consultants.
- Coverage of options via sales (for example, if you want to sell Synology, you might also sell ReadyNAS, ReadyDATA, SAM-SD options, Drobo and maybe one or two others.) If you cover all reasonable options, this minimizes bias heavily.
- Existing biases are disclosed to customers.
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@scottalanmiller said in Home business ideas for transition out of 9-5?:
@BRRABill said in Home business ideas for transition out of 9-5?:
Can a consultant also be a sales person?
No. Sales essentially overrides all other things. Sales pays you to anti-consult, you can't serve two masters in that case. You have to unethically fail to represent one party or the other if you mix the two together. Logically, you only mix the two when you intend to scam the customer, not to scam the vendor because under normal payment schemes you get nothing that way, vendors know better.
I have some problems here.
"Sales overrides all the things" <--- huge assumption about human greed. Non-sequitur. It's entirely possible that a consultant cares more about the work they do and providing the right solutions, than about whatever paltry affiliate fee they might get from promoting a solution they must KNOW is not the best.
"sales pays to anti-consult" <--- Really? By offering an affiliate/commission system, the product automatically becomes the worst choice in all scenarios? It's very possible that the product BOTH fills the need perfectly, AND offers commission. Another non-sequitur.
"You have to fail to represent one party or the other..." <--- False dichotomy. You're assuming that if a product has a commission program, therefore it can never be a good solution for a client. Because either the client is somehow screwed, or the vendor is (if you don't promote/use them in a particular case).
OR the product actually IS a good fit, AND has commission. OR the product is not a good fit, so the consultant does their job well and recommends something else. This doesn't mean the other vendor is screwed, they simply weren't an option on the table, commission or not."you only mix the two when you intend to scam the customer" <--- Seems like another non-sequitur. How is it you can sell Synology to hundreds of clients with good success, but if you change and now receive a small commission, it becomes scamming? The very same customers would have been scammed rather than helped, by the inclusion of a commission?
This discussion does assume a lot about human nature, and it's NOT a matter of logic. It's entirely possible that a commissioned option is available for a particular customer, but the consultant ignores that option if it's not the best choice.
It's entirely possible that a consultant is honest enough to not push services the client doesn't need.
It's entirely possible that the small commission potentially made by a product is insignificant next to the entire job. If a consulting + labor job is going to be $2k or $3k or $5k, then a $100 finders fee from some service provider means nothing compared to doing the best job I can for $5k. $100 won't swing decisions one way or the other, and if the provider that I like so much I've signed up to be an affiliate, happens to work in this scenario, and I make $100, this is definitely not "scamming" the customer. I would have recommended the same product regardless.My opinion is that in most cases, especially independents like me, the small affiliates I get from my favorite products are a simple value add, or bonus, for me. I would be recommending the product anyway.
I don't recommend the product because of the affiliate, I signed up for the affiliate because I like the product so much.This entire things basically seems to come down to whether human natural greed always wins over simple human honesty and sincerity.
Where things fall apart are the grey zones.
The simple product would work, but my affiliate product which is a little more advanced and more than they need, will easily fit too, but hey I get paid!
The super quick job that might cost them $200, but where I could get a $100 bonus, that's a pretty hard-to-reject offer. It's 50% of the entire job!
However, the $5000 job, a $50 or $100 finder's fee is not very cloudy. Maybe one or two little poofy clouds, but mostly a clear sky.Lastly, commissions are not the only thing can cloud someone's view. If the client is cheap and wants as fast as possible, you might be tempted to recommend products you are most familiar with and can work quickly with.
Or maybe the client themselves "know" about a product you already happen to have an affiliate for, they demand THAT product, and you get a bonus, you feel even better about it.
Or maybe you're being clouded by cloudiness! You can go with the non-commissioned simple product, but the client (and you) feel like maybe you should go with something more powerful in case of future growth or needs. But the more powerful option is an affiliate, so now you actively don't want affiliate to cloud your judgement, so you feel almost an anti-affiliate pull to not recommend it just so you don't feel guilty! lolAnyway, interesting conversation. I'm not fully convinced that I should never do affiliations for products for which I already love and recommend, and have affiliate programs available. My loyalty is to the client and doing a good job, I view affiliate commissions as little more than happy bonuses should there be a sale.
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@guyinpv Everything you are saying is correct in theory.
Unfortunately, greed is part of everyday life and in the real world nice guys finish last. If you're too nice you get walked all over. We do that with open source software all the time. Even if it is way better than paid solutions. We will use everything we can for free, it's human nature.
All your potential clients care about is what they can get out of you with as little investment as possible. If you let them walk all over you they will.You cannot by 100 unbiased if you get paid to sell software. There is NO way, you wont want to pad your pockets.
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@guyinpv said in Home business ideas for transition out of 9-5?:
I have some problems here.
"Sales overrides all the things" <--- huge assumption about human greed. Non-sequitur. It's entirely possible that a consultant cares more about the work they do and providing the right solutions, than about whatever paltry affiliate fee they might get from promoting a solution they must KNOW is not the best.
Well, there are a few mistakes there. One is that the amount from sales is rarely paltry, it's often quite significant. Second, they are doing the work and doing the sales based on making money, the money is the purpose of the transaction. If you don't think that the money matters and is influential, you are confused about what business is and how it functions.
In the real world, this is so common and so dramatic that it's the top issue we see with companies - they think exactly like you suggest here and get screwed like you wouldn't. I literally believe this is by far the top issue in the SMB IT space... people thinking that they can get advice from someone who is paid by someone else to give them different advice and that the other person paying them won't influence them.
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@IRJ said in Home business ideas for transition out of 9-5?:
You cannot by 100 unbiased if you get paid to sell software. There is NO way, you wont want to pad your pockets.
And if you truly didn't care about the money, why bother taking the money when you'd be just as happy not getting it? The very fact that you would accept the sales commission means you are biased because of it.
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@guyinpv said in Home business ideas for transition out of 9-5?:
"sales pays to anti-consult" <--- Really? By offering an affiliate/commission system, the product automatically becomes the worst choice in all scenarios? It's very possible that the product BOTH fills the need perfectly, AND offers commission. Another non-sequitur.
Absolutely, it just means that the consulting is corrupted. It says nothing about the solution. You are making an implication that was not said.
But why would someone pay for fake consulting when they could have gotten straight sales for free?
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@guyinpv said in Home business ideas for transition out of 9-5?:
My opinion is that in most cases, especially independents like me, the small affiliates I get from my favorite products are a simple value add, or bonus, for me. I would be recommending the product anyway.
But this doesn't hold up in the real world. I see no problem from people more than this. We routinely see what is being recommended to people and get them to admit that they got false consulting from a sales people based on the obviousy scamming recommendations. You can say that you don't think that this happens, but it's so common that to me, it sounds like you've never met people in IT. This is so insanely common that almost nothing else exists from my experience. Many companies are to the point that they don't even know what actual consulting looks like because this is so common and so severe and so corrupt.
Maybe you feel that everyone is like you and able to 100% ignore the fact that you get money. But this is not even slightly mirrored in the real world. To the point that I don't even know where you could find an example of it.
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@guyinpv said in Home business ideas for transition out of 9-5?:
This entire things basically seems to come down to whether human natural greed always wins over simple human honesty and sincerity.
It's not that simple. If you hide the fact that you are getting paid, you are not in the realm of honest. If you disclose the fact that you are getting paid, then your customers know that you are sales, not consulting, and you can be honest and still do the sales. I NEVER suggest that sales is dishonest, ever. That's something that people, having an emotional negative reaction. to sales people inject. But I never imply that. Sales is generally very honest. It is customers lying to themselves in the hopes of taking advantage of someone, but really knowing that they are taking advantage of themselves.
There is no greed vs. honesty in this scenario (until you don't tell people that you are doing sales, then it is obviously lying.) This is the false dichotomy here, believing that honesty and greed are opposing forces here. It's just not the case.
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@guyinpv said in Home business ideas for transition out of 9-5?:
Do you sell it for the commission, or do you sell it anyway and a commission is just a bonus?
I don't see any problem with a little earned commission on selling things you already promote anyway. Just as long as those little commission benefits don't cloud your judgement about clients' needs.
How can it not?
And while you might not not allow it to cloud your judgement, as someone hiring you, I can't know that.
If my goal is to hire you as a consultant looking for the best option for me, it's in my best interest for you to only be getting paid by me and no one else (at least in relation to the products/project that I want your consultant opinion on).
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@guyinpv said in Home business ideas for transition out of 9-5?:
"you only mix the two when you intend to scam the customer" <--- Seems like another non-sequitur. How is it you can sell Synology to hundreds of clients with good success, but if you change and now receive a small commission, it becomes scamming? The very same customers would have been scammed rather than helped, by the inclusion of a commission?
Well for one, selling isn't applicable. Hopefully you mean recommending.
Second, that it's been "sold" a lot is irrelevant to the conversation, so I feel like the desire for sales commissions is already clouding your thought process. What does "it worked for other people" have to do with the situation? What we are concerned about is if it is the right tool for the next customer, not that it was the right tool for the past customers.
So the issue of being paid to push one product instead of another remains the convoluted, unethical consulting practice that it always did. I just don't see how having recommended it in the past places any significant role when our goal as consultants is to determine the right products, approaches and fits for our customers, not to tell them "what worked for someone else that is different." It's just not meaningful to this discussion.
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@Dashrender said in Home business ideas for transition out of 9-5?:
@guyinpv said in Home business ideas for transition out of 9-5?:
Do you sell it for the commission, or do you sell it anyway and a commission is just a bonus?
I don't see any problem with a little earned commission on selling things you already promote anyway. Just as long as those little commission benefits don't cloud your judgement about clients' needs.
How can it not?
And while you might not not allow it to cloud your judgement, as someone hiring you, I can't know that.
If my goal is to hire you as a consultant looking for the best option for me, it's in my best interest for you to only be getting paid by me and no one else (at least in relation to the products/project that I want your consultant opinion on).
Likewise, that partner is paying you to sell their product, rather than to listen to my needs. You cannot serve two masters. There is no way to "do right" by both, you have to pick. And one pays more than the other, and more consistently.
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@guyinpv said in Home business ideas for transition out of 9-5?:
Lastly, commissions are not the only thing can cloud someone's view. If the client is cheap and wants as fast as possible, you might be tempted to recommend products you are most familiar with and can work quickly with.
I feel like you've never read my works on this. I cover this a lot.
http://www.smbitjournal.com/2016/05/understanding-bias/
All consulting is about bias. The question is, is it good bias that benefits the customer or is it bad bias where you are not helping the customer. Are you a buyer's agent or a seller's agent?
To put this into perspective, what you are suggesting is something that consultants like @JaredBusch and I avoid due to our professional ethics. We don't feel that what you are proposing is something that we are allowed to do, regardless of corporate policies (which for both of us mirror that ruling.) But in other realms, like real estate, what you feel is acceptable isn't just considered unethical, but is actually illegal. That's the degree to which this is frowned upon. Can you legally do it in IT? Yes, as long as you are disclosing that you are being offered money to act against the potential interests of the customer. But it's all on your shoulders to make it ethical.
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Some things that happen when you take commission....
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You say that you sold lots of Synology in the past.... okay, but that only says that you got people to buy that. It doesn't tell us that it was good for them. Maybe it was, but let's continue...
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New customer needs storage. If you earn 10% on Synology, will that influence you to sell them Synology over ReadyNAS, Drobo, Dell, HPE, Exablox, etc.? If not, how? You don't feel that money would influence you to do things to make it look better, like learning it more, having part numbers at the ready, not looking as hard at alternatives, etc.? If you don't care about money, why are you so adamant about getting that money?
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What if the customer doesn't need storage at all, but could use it? Would you not be influenced to sell Synology even if the customer might not need anything at all?
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If you are making money from selling Synology, you've only suggested that it would not influence you are which vendor to use. But what about influencing you to sell larger units, more features, from vendors based on commission rates rather than customer value, units designed to lock customers in, etc.?
Influence happens in a lot of ways, not just one vendor vs. another.
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@scottalanmiller said in Home business ideas for transition out of 9-5?:
@IRJ said in Home business ideas for transition out of 9-5?:
You cannot by 100 unbiased if you get paid to sell software. There is NO way, you wont want to pad your pockets.
And if you truly didn't care about the money, why bother taking the money when you'd be just as happy not getting it? The very fact that you would accept the sales commission means you are biased because of it.
Because like I said, it's just a bonus. It's just THERE. It's FREE.
I'm going to recommend, say InMotion Hosting for most small business website needs. It's a great host, great features, great price. Rarely would I care to recommend GoDaddy or HostGator, they literally have nothing to offer. And only a larger business would need to move to VPS or dedicated box (InMotion has those too anyway).
So if I already recommend InMotion in 90% of cases because their various packages fill almost all needs, why would signing up for their free, available, affiliate program still be bad? It's just THERE. It's a bonus.
It doesn't mean I never try out other hosts. I've got DO, VULTR, and HostGator actively. I also use Softlayer, and am testing UpCloud and AWS currently. I've also got Azure and RamNode on the horizon.
To NOT sign up for the free affiliate program seems to me like throwing away money for some sense of business or moral purity. I can understand if that is a top concern. I don't know if it's really all that concerting for clients one way or the other.
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Let's put it another way... if you won't be influenced by the commissions, why bother having this conversation? I feel that this conversation alone is what you need to know. You are relatively passionate about getting the commission. If you truly won't be biased, then just don't do the sales. You only want to do the sales if you will be biased, right? The two go together.
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@guyinpv said in Home business ideas for transition out of 9-5?:
Because like I said, it's just a bonus. It's just THERE. It's FREE.
That's not enough. If you would truly not be biased, you'd not care at all about that.
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@Dashrender said in Home business ideas for transition out of 9-5?:
@guyinpv said in Home business ideas for transition out of 9-5?:
Do you sell it for the commission, or do you sell it anyway and a commission is just a bonus?
I don't see any problem with a little earned commission on selling things you already promote anyway. Just as long as those little commission benefits don't cloud your judgement about clients' needs.
How can it not?
And while you might not not allow it to cloud your judgement, as someone hiring you, I can't know that.
If my goal is to hire you as a consultant looking for the best option for me, it's in my best interest for you to only be getting paid by me and no one else (at least in relation to the products/project that I want your consultant opinion on).
Many shops are not shy at all about advertising their loyalties. "Certified HP Servers!" "Dell certified reseller!" "Apple certified!" "Your local source for bla bla bla!"
I see these all the time. Their loyalties don't affect me. If I want a server and they say they only do Dells, that seems just as limiting, or just as immoral as the shop who actually offers 5 vendors but two of them have a commission program. What's the difference? Both of them have their loyalties and clouded offerings.
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@guyinpv said in Home business ideas for transition out of 9-5?:
So if I already recommend InMotion in 90% of cases because their various packages fill almost all needs, why would signing up for their free, available, affiliate program still be bad? It's just THERE. It's a bonus.
It doesn't mean I never try out other hosts. I've got DO, VULTR, and HostGator actively. I also use Softlayer, and am testing UpCloud and AWS currently. I've also got Azure and RamNode on the horizon.
I understand what you are saying and I understand how very specific cases can have tiny, tiny value propositions that can make sense. We do this with antivirus and we simply disclose the bias to customers so that they understand what our bias is and they can learn what we earn if they want. It's trivial, it's "free" like you said, and we just disclose it. If a customer wants us to look at other solutions we happily will, if they don't we just use Webroot. They know that, we know that, we disclose it... no unethical behaviour.
You can do the same thing. Make it clear that you are a reseller. You are NOT likely to be a consultant within the hosting space, just a reseller. But as long as they are okay with that, nothing wrong with that. Just don't hide it. Let them decide if they care about that or not.
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@guyinpv said in Home business ideas for transition out of 9-5?:
Many shops are not shy at all about advertising their loyalties. "Certified HP Servers!" "Dell certified reseller!" "Apple certified!" "Your local source for bla bla bla!"
I see these all the time.
Yes, and they are called VARs and have no place in the consulting space.
