I'd love to see a thread started on the "whys and wherefors" of breaking away from working for someone else's organization.

Essentially there are two paths to do that

become "self-employed" - essentially a one person shop (maybe hiring some full-or part-time support staff.) Rarely do these expand beyond working more hours or raising fees.
create or take over an existing business with full-time employees and a plan of expansion (more capital investment, hiring more employees, including other, sometimes MORE SKILLED employees) with an exit strategy of being able to sell out for cash or retain ownership and income while retired from active labor.Somebody ready to start that thread instead of us highjacking Sean's?;)

Wes, I think you have a great idea, and I think it's a worthy topic. I hope you don't mind me kicking in my two cents worth.

1. Determine if you are owner material. I would surmise there has not been one person that at some time in their working career wanted to go out on their own. "Working for the man" does wear someone down, and instill a rebellious nature of "I'm just making other people money".

However, given a circle of equally talented individuals, there are few of them that can successfully own their own business. Having no boundaries whatsoever is an overrated experience, and will require a profound amount of self-discipline. NOTE: Being a good insert your profession does not make you an automatic good businessperson.

2. Experiment with the concept- What would you do on your own? Do you have a hobby or profession that you could start? Maybe start a side-project while working your full-time. If you don't have that much time, you might want to re-consider going out on your own. You will be married to your new business for a while.

4. Surround yourself with the right people- This would include people who have gone out on their own. I would include a lawyer and an accountant in that circle. Yes, money is tight starting out. However, there will be a time you will need each of these occupations. It will be much better if you already have some on your side.

5. Make your decision and don't look back- Regardless of your decision, make it and don't put yourself in a mindset of second-guessing your decision.

Ok, the last post was a bit on the philosophical side. But for me, those were some painful lessons I had to learn. If if wasn't for the wisdom/insight of my dad, I probably would not have made it.

1. You will need money to sustain you for up to a year. Even reducing your personal living expenses, you will have business expenses (foreseen and unforeseen) that you will need to cover. Don't go crazy; keep your expenses as lean as possible. If you are going to work out of the house... that's yet another topic for posts.

2. It will be an immense help if you already have an established clientele of some size before you go out on your own. That's why I suggested the side-project suggestion above. NOTE: A customer saying they will switch to you, and actually switching are two different things. Just be aware of the old cliche "Don't put all your eggs in one basket".

3. Either formally or informally, develop a business plan. This should outline what you are going to do, marketing, your target audience, your business structure, etc.

4. Approach partnerships very carefully- It is very difficult to make business partnerships work. The working partnerships are a rare compliment of needed talent. When the business cannot survive on one's talent, but will succeed well with the talent of two, the partnership may have a chance of working. Be sure to put a plan (including an exit strategy) in writing before you go out on your own.

5. Pay your taxes and develop the proper business structure from the outset-this is where getting the proper lawyer and accountant from the beginning will make the difference. Trust me-it's no fun catching up on back taxes, or wishing you would have done the business structure differently.

Oh, one more philosophy. It's really great that you enjoy doing your profession. I hope you enjoy what you are going to be doing. But.. you have a business to run. Make sure you bill for your services and keep good records. You can be as charitable as you wish with your excess profits!!

After working in Quality for 9 years I was laid off last December. I hadn't planned on looking for work until next spring but kind of fell into house cleaning (kinda odd for a guy) although business is picking up rather quickly.

Wish I had more to contribute other than the fact that Quality affects every you do and everything you touch; do the best you can! :D

Ok, the last post was a bit on the philosophical side. But for me, those were some painful lessons I had to learn. If if wasn't for the wisdom/insight of my dad, I probably would not have made it.

1. You will need money to sustain you for up to a year. Even reducing your personal living expenses, you will have business expenses (foreseen and unforeseen) that you will need to cover. Don't go crazy; keep your expenses as lean as possible. If you are going to work out of the house... that's yet another topic for posts.

2. It will be an immense help if you already have an established clientele of some size before you go out on your own. That's why I suggested the side-project suggestion above. NOTE: A customer saying they will switch to you, and actually switching are two different things. Just be aware of the old cliche "Don't put all your eggs in one basket".

3. Either formally or informally, develop a business plan. This should outline what you are going to do, marketing, your target audience, your business structure, etc.

4. Approach partnerships very carefully- It is very difficult to make business partnerships work. The working partnerships are a rare compliment of needed talent. When the business cannot survive on one's talent, but will succeed well with the talent of two, the partnership may have a chance of working. Be sure to put a plan (including an exit strategy) in writing before you go out on your own.

5. Pay your taxes and develop the proper business structure from the outset-this is where getting the proper lawyer and accountant from the beginning will make the difference. Trust me-it's no fun catching up on back taxes, or wishing you would have done the business structure differently.

Oh, one more philosophy. It's really great that you enjoy doing your profession. I hope you enjoy what you are going to be doing. But.. you have a business to run. Make sure you bill for your services and keep good records. You can be as charitable as you wish with your excess profits!!Some good points here. Think of the idea of opening a business (whether one-man shop or multi-person, multi-site operation) in the same way as ANY quality initiative:
PDCA! (“Plan-Do-Check-Act”)

The things we talk about in quality are pertinent here because they ARE pertinent to any business.

Profitability is key - you want to support yourself and family, NOT subsidize your clients by taking food out of your child's mouth!

Metrics (record keeping and analysis) are important in being able to evaluate when you are doing something right or something wrong for YOUR SITUATION.

Without record data and analysis, you won't have anything to evaluate for possible improvement in efficiency and profitability.

Marketing (effective marketing, that is) is also crucial and demands the same PDCA and concomitant analysis and evaluation as any other aspect of the business. In over forty years as a business executive, often dealing with consultants from large and small firms, my overwhelming experience is seeing many consultants and advisors with excellent technical skills who absolutely stink at marketing in general and "people skills" in particular. Sad to say, the technician as nerd is real and found everywhere.

I believe the majority of complaints we read here in the Cove about "incompetent auditors" (internal and external) will find poor people skills at the root cause of the complaint. Even here in the Cove, where "all the people are good looking and above average" we sometimes encounter folks posting with an obvious chip on their shoulders and very little respect for the guy who signs their paychecks. I am reminded of a former candidate for President of the USA who alienated voters and politicians with whom he would be working by constantly harping on his theme of "It's just this easy!" delivered in a condescending tone conveying the impression he thought he was a genius and we, the voters, were all idiots. Luckily enough, the final vote tally showed who was the real idiot.

In the case of a consultant/advisor, his marketing demeanor needs to be one of "Let me show you the choices and the ramifications of those choices and YOU (Mr. Customer) make the final decision. Some of the choices are easy and some are hard, but only you can decide if the final result is worth the effort."

After working in Quality for 9 years I was laid off last December. I hadn't planned on looking for work until next spring but kind of fell into house cleaning (kinda odd for a guy) although business is picking up rather quickly.Wish I had more to contribute other than the fact that Quality affects every you do and everything you touch; do the best you can! :D

Actually you're into a really hot area ... personal services. People do not have time to do all the things they need to do, and anyone that can take care of some of it becomes a valuable supplier. My wife and I outsourced care of our lawn this year, and I can't imagine it any other way (as long as the budget holds up). And the guy who does the work used to be an HR manager with several major corporations. He's much happier now that he's not being crushed every day by the Dilbert world.

I am reminded of a former candidate for President of the USA who alienated voters and politicians with whom he would be working by constantly harping on his theme of "It's just this easy!" delivered in a condescending tone conveying the impression he thought he was a genius and we, the voters, were all idiots. Luckily enough, the final vote tally showed who was the real idiot.


But I believe that the guy you're referring to was an extraordinarily successful businessman.

But I believe that the guy you're referring to was an extraordinarily successful businessman.He must have forgotten any marketing skill he had there! Business skill and business success are not necessarily the same thing. I have seen a lot of formerly "nice guys" become prime examples of the Peter Principle when they reach a level of success beyond their ability to cope.

I am certain you, Jim, could think of one or two examples of guys who seemed to reach the pinnacle of success and then suddenly have every decision they make be the wrong one. One example that leaps to my mind is Dr. Wang and his son, Fred. These were two guys who had all the tools and ended up driving a $3 billion corporation into the ground with a series of wrong decisions.

I can also think of guys like Neutron Jack and Chainsaw Al who had success by some measure, but were poor excuses for human beings. Neutron Jack got out with a whole skin (even though he consistently weeded out the "bottom 10%" despite many opinions the yardsticks and processes those employees were subject to were more like a bizarre "Red Bead" game.) Chainsaw went down the tubes after his Sunbeam/AMA debacle, earning comments from former employees and associates to the effect they would not let a dog "whiz" on him if he were on fire.

How about the general impression folks had of the "smartest guys in the room" both one year before and one year AFTER the Enron fall from grace? At one point, they may well have been the "smartest guys in the room," but something changed.

I found this to be a helpful site: http://www.entrepreneur.com/startingabusiness/howtoguides/index115868.html

Community Colleges in North Carolina also have a Small Business Center where new entrepeneurs can get free information and assistance. I do not know what's available in other States. I can only speak for NC.

Stijloor.

Actually you're into a really hot area ... personal services. People do not have time to do all the things they need to do, and anyone that can take care of some of it becomes a valuable supplier. My wife and I outsourced care of our lawn this year, and I can't imagine it any other way (as long as the budget holds up). And the guy who does the work used to be an HR manager with several major corporations. He's much happier now that he's not being crushed every day by the Dilbert world.

One problem...Women don't want a man in ther house to clean. On the bright side I have a woman to do all the front line work (phone) and she explains that she will not work alone in a house. We make $11.00 less per hour combined than before (we were both laid off) but the smiles we get are priceless. Word of mouth is so much cheaper than any other form of advertizing.

User name was Cordon..not sure how to get that back????

He must have forgotten any marketing skill he had there! Business skill and business success are not necessarily the same thing. I have seen a lot of formerly "nice guys" become prime examples of the Peter Principle when they reach a level of success beyond their ability to cope.

I am certain you, Jim, could think of one or two examples of guys who seemed to reach the pinnacle of success and then suddenly have every decision they make be the wrong one. One example that leaps to my mind is Dr. Wang and his son, Fred. These were two guys who had all the tools and ended up driving a $3 billion corporation into the ground with a series of wrong decisions.

I can also think of guys like Neutron Jack and Chainsaw Al who had success by some measure, but were poor excuses for human beings. Neutron Jack got out with a whole skin (even though he consistently weeded out the "bottom 10%" despite many opinions the yardsticks and processes those employees were subject to were more like a bizarre "Red Bead" game.) Chainsaw went down the tubes after his Sunbeam/AMA debacle, earning comments from former employees and associates to the effect they would not let a dog "whiz" on him if he were on fire.

How about the general impression folks had of the "smartest guys in the room" both one year before and one year AFTER the Enron fall from grace? At one point, they may well have been the "smartest guys in the room," but something changed.

There's a lot here about groupthink and the Abilene Paradox that helps to explain why things go wrong in business organizations, and it's a complicated subject. It seems to me that one reason I've seen for the failure of small businesses is lack of focus on the part of would-be entrepreneurs. People often start businesses doing things they enjoy doing while lacking the basic personality traits required for being successful in a highly competitive marketplace. If the initial primary goal is something other than making money, failure is almost inevitable. Sometimes in order to make money, one's own personal preferences and proclivities have to be abandoned, and people often find out that it's not as much fun as they thought it would be. It's profitability that has to be appealing.

Most of us have seen instances of new small businesses opening and knowing that they're going to fail. We look at them and say, "What were they thinking?" In most instances they were thinking about everything except whether there was actually a market for what they were trying to sell. I know a guy who decided to open a store centered on one of his primary interests, selling high-end consumer products in a market where there just wasn't enough money to support a steady flow of cash. It was in a smallish town where the guy was sure he knew that there was plenty of interest in his products, but he didn't bother to find out whether the interested people had enough money to buy them. Even if they did, there was what seemed to me a real possibility that the market would be saturated in short order, so any early profitability realized was bound to be short-lived.

It's impossible to put too much emphasis on understanding your potential market, and putting profitability first on the list of priorities. In the end, it doesn't make much difference how much you enjoy what you're doing if you can't make money doing it.

Supporting Jim's point, I used to do volunteer counseling for SCORE dealing with small businesses. What happened most often was people came in with something they really liked to do or were even good at (e.g., the product/service), but had absolutely no idea/knowledge about how to run a business (marketing, finance, strategy ...). When we'd ask them to do research or develop a business plan it was usually the last we'd hear from them.

Unfortunately this is part of the problem quality professionals also face inside organizations. They understand quality, but not the bigger picture. So they run around with their quality tools wanting to do stuff with them, but have not thought about whether/how it fits with strategy, how it will impact the top line (which is primary focus of top management), etc.

Unfortunately this is part of the problem quality professionals also face inside organizations. They understand quality, but not the bigger picture. So they run around with their quality tools wanting to do stuff with them, but have not thought about whether/how it fits with strategy, how it will impact the top line (which is primary focus of top management), etc.

A very good analogy, imo. It all goes back to the old saying, "Everyone wants to go to heaven, but no one wants to die first."

Lots of good responses so far.

I, too, saw dozens, if not hundreds, of poorly organized and prepared folks come into our investment bank looking for loans or investments in their business when they had absolutely no clear-cut path to profit, let alone an actual marketing plan to bring paying customers to their door. These weren't just "mom & pop" operations. Sometimes we had groups of lawyers, doctors and accountants (folks who should have known better) come into our shop with a million dollars in equity, looking for a $5 to $10 million dollar loan on a restaurant or nightclub they wanted to start up.

When I asked the lawyers and accountants what "due diligence" they had done for a business plan, they looked at me like I was speaking Klingon. I particularly recall one deal where a group of 500 lawyers, doctors, restaurant owners, and accountants wanted money for a 500 room hotel with 30,000 square feet of exhibition space, restaurant and banquet seating for 2500. When I pointed out there was no easy access to expressways, tollroads, or any easy way to get to O'Hare Field, and, most importantly that they had plans for only 100 on-site parking spaces, the balance of the land being landlocked by established, thriving cemeteries and a major rail freight yard nexus. The attorney heading the "deal" gave me a "wink and a nod," saying "We got that ALL covered."

I had a hunch I knew what he was talking about, but I was pretty sure he and his group were the victims of a big con being pulled by some politicians who promised them they would get a tollroad on and off ramp built to accommodate them and use eminent domain laws to seize some of the cemetery land for the parking.

After a brief conference with the Board of our investment bank, we turned them down. We were so happy we did. They ended up getting a multi-million dollar loan from Ford Motor Credit and building the edifice. It was beautiful, BUT the Secretary of State of Illinois died and authorities found hundreds of thousands of dollars in cash stuffed in shoeboxes in the closet of his hotel room at the St. Nicholas Hotel in Springfield (most likely the reason for the "wink and a nod") and the extra land and tollroad access never materialized.

Ford Motor Credit took over the property and sold it at a $3.5 million loss to a nursing home operator. All of the equity investors lost every penny of their investment.

The property still sits by the side of the Tristate tollroad and I tell the story to every passenger any time we drive by!

The physical premises were great! The design was attractive. They had natural gas generators for heating and air conditioning which supplied enough electricity for the hotel use and had sufficient extra capacity to sell electricity to the utility at retail prices and make a huge dent in the net utility cost.

The moral: the equity investors relied on a fraudulent scheme to make the location work. If they had been less greedy and chosen a more expensive, but workable site, they would have made a fair profit. They simply didn't consider a FMEA (failure mode & effects analysis) when planning.

One problem...Women don't want a man in ther house to clean.

hmm. I don't think I'd care. If I could afford to have someone come in and clean house, I think I'd be more concerned with their abilities and recommendations. I am thinking that might be a plus. Cleaning and handyman all in one?

On the bright side I have a woman to do all the front line work (phone) and she explains that she will not work alone in a house.
I am thinking that might be a plus. Cleaning and handyman all in one?
Yeah - that should be part of your marketing, Cordon!

hmm. I don't think I'd care. If I could afford to have someone come in and clean house, I think I'd be more concerned with their abilities and recommendations. I am thinking that might be a plus. Cleaning and handyman all in one?

Right to the point! Got home today and had a no message but had the number through caller ID so I called it. The lady that I spoke with hung up on me in less than 30 seconds.

I talked my better half into calling back and within 5 minutes we have a job Monday.

We are both so much happier now than when we were working at Woody's (International Engineering & Mfg. Inc.), what a waste of time. We gave them the insight to eliminate our jobs. I was always under the impression that helping the company was security...how wrong (stupid..naive) I was.

On a bright note, we have 6 full time clients in about a month. :tg: