I learned a very valuable lesson back 20 years ago…I quickly learned why my IT service firm needed to diversify their portfolio. Back in the early dot com days, the Bay Area had start-ups literally on every corner. Money was not an issue for most firms and if you had a half a brain, a pulse, you were hired.
IT services were in huge demand, we lacked a strategy and a value proposition was not required to land an account. If you had the slightest IT experience solving tech issues, your IT service firm was hired. They wanted warm bodies solving problems. A pro-active philosophy was a distant concept and start-ups were focused on product development. If the network was up, all was fine in this start-up universe.
As most of us know, everything came crashing down in late 2000, start-ups were closing down faster than you can say blue berry pancakes. Single Point of Contact came close to closing their doors. We had had 2 or 3 large accounts, and about a dozen startups. We relied on the large accounts for the majority of our revenue. I won’t go into the details, but this is a great Segway into the documentary “McMillions”. I’m not a fan of documentaries, they are slow, boring and predictable. Well, McMillions was captivating and a must see for all C and VP level executives.
If you have not watched “McMillions”…I highly recommend it. It was a reminder on why any business should not put all of their eggs in one basket. Ill give you a short synopsis on McMillions without giving too much away. No spoiler alerts, so continue reading. Simon Baker was hired by McDonalds to run their famous Monopoly game. If you were one of the lucky ones, you could win one million dollars. Simon Baker managed the entire campaign and they were riding high working for one of the most successful franchises in American history.
Long story short, McDonalds produced 98% of the revenue for Simon Baker. They had close to a dozen offices throughout the world. However, it all came crashing down because of one man…ONE MAN took down a successful marketing firm. Hundreds of people lost their jobs.
Ok, enough on McMillions. I learned this lesson back in 2000. Fortunately, we survived four major financial crises in US history. The Dot bomb of 2000, 9-11, 2008 and now…Covid-19. Fortunately, we have five core components that have been the back bone to our firm’s success.
- Strong leadership to run and manage operations.
- An agressive online marketing campaign that is on track to produce 400 meetings with CEOs in 2020.
- Detailed sales process.
- We are obsessed with customer service. Customer service is our number one objective.
- A diverse portfolio of clients.
If your firm is working with one vertical, has a few large clients, or not consistently growing, you need to rethink your strategy. Your firm should always be generating new business. Dollars to donuts, you will lose clients, but if you have a pipe that is constantly filled, you firm will not be at risk of closing their doors.
Good luck, DM me if you have any questions.
