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Alastair McDermott, Voiceover, David C. Baker
David C. Baker 00:00
I think research is a huge part of differentiation. There are so many consultants for and there’s so many different flavors. But the the only thing I know of that cannot be replicated easily is doing proprietary research and then only making that available to your clients. And I think there are four or five examples of that in my work over the years.
Welcome to The Recognized Authority, a podcast that helps specialized consultants and domain experts on your journey to become known as an authority in your field so you can increase your reach, have more impact and work with great clients. Here’s your host, Alastair McDermott.
Alastair McDermott 00:38
Before we get to today’s episode, I just want to let you know that every Thursday, for the next month, I’m going to be running a live webinar, and I’m going to be presenting everything that I’ve learned about specialization and authority building for consultants. There’s going to be absolutely nothing for sale on the webinar, it’s purely educational and if you’re an independent consultant of any kind, check it out at TheRecognizedAuthority.com/webinar – which will also be linked in the show notes. So that’s going to be every Thursday at 11am Eastern Time, which is 4pm in Dublin or London for the folks on this side of the Atlantic. Okay, on to today’s episode! This episode is a little bit shorter than normal, because we record this just at the end of the holidays and I really appreciate my guest, David C. Baker coming on at this time of year. I’m really delighted to have him on because I’m a big fan of his work. He’s an author, a speaker and advisor to entrepreneurial creatives. He’s written five books, advised 900+ firms, he’s keynoted conferences in 30 countries. His work has been discussed in New York Times, who referred to him as the experts expert. And he co-hosts a podcast that I really love, called The 2Bob’s podcast, and that’s the most listened to podcast in the creative space. So David, thank you for being here!
David C. Baker 01:50
Thank you for having me. I’m looking forward to chatting with you.
Alastair McDermott 01:53
I want to talk to you a bit about consulting because I know that you’ve actually written six books, not five, and you finished your sixth book about 18 months ago you said,
David C. Baker 02:02
Alastair McDermott 02:02
But yet you haven’t released that. Can you tell us a bit more about that?
David C. Baker 02:05
Yeah, it’s – it – and the reason, not reason, but reasons for not releasing it our little bit due to COVID. You know, it was a really hard time to release a book. But also, I’m just not certain about it. I mean, it’s all done, the book, the covers, all done everything. The book is about the tradecraft of consulting. So the nuts and bolts, the they’re not tricks, but the techniques that make it work in, in a world where you’re trying to replicate the way I consult anyway, which isn’t necessarily the right way for everybody, but it’s just an inside look at how I do it. And I’ve been a little bit nervous about whether I should even talk about this while I still want a career. So that’s, that’s the reason I’m sure it’ll get released. At some point, I’m getting more and more courageous as I get older and older. So we’ll see.
Alastair McDermott 02:57
Yeah, so you’re not sure if you want the clients to see behind the curtain?
David C. Baker 03:01
Yeah, exactly. Right. You know, there’s, it’s all designed, all of the techniques are designed for maximum effectiveness. But if misused, they can very much be manipulative. And so that’s what’s giving me a little bit of pause and just want to make sure, I really do believe all of these things, and that they’re valuable, and, and also that there’s enough meat on the bones, you know, so it’s, it’s a kind of second guessing that every author goes through. But I had the, the unique combination of the normal questioning, and COVID. So it was pretty easy just to put it off for a while.
Alastair McDermott 03:42
Right, right. And is there anything in there that you could share with us?
David C. Baker 03:46
Well, it’s, there’s about, I don’t know, 25 chapters, and it just basically follows chronologically, the life of a consulting person from the inside of that. So how do you set up that relationship? And what’s the role of payment terms? And how do you manage their desire to control or shape that process was what you know, works, how flexible should you be? What how do you manage working with an executive assistant that keeps getting things wrong? Or how do you control who’s on the call and the pacing so it’s really really down in it’s, it’s gonna be very interesting to a very small group of people.
Alastair McDermott 04:40
David C. Baker 04:40
People be very bored with it.
Alastair McDermott 04:42
Yeah. Most of the people listening to this podcast, I would say would be interested in seeing what what, what’s in there. Okay. Well, I won’t push too much on that. I am interested in in just talking to you because you work with creative services agencies, marketing agencies, people like that, right?
David C. Baker 04:58
Alastair McDermott 04:59
But but you are a consultant and you’ve been a consultant for for many years now.
David C. Baker 05:03
Yeah. 25 years. Yeah.
Alastair McDermott 05:05
I’m really interested in that part. Because sometimes it feels like a lonely road. If you’re pursuing the consulting route, I think there’s something about when you decide to be a consultant rather than an agency owner, where you’re kind of you’re deciding to go down a route of having a smaller, a smaller business, a smaller firm in terms of headcount, do you think that’s a decision that people make? Or is that just the way that I see it?
David C. Baker 05:28
I think being a smaller firm, as a consultant is simply a wonderful byproduct, I don’t see many people choosing to be consultants, because it means they can do that with it. Really, it’s the whole issue of scale. So consulting, doesn’t scale very well, except at the really large levels. And I don’t really call that consulting. It’s something else. But for what you and I do, it works really well to have a small firm, but I don’t know that people, there’s probably some correlation between people who like to work on their own, or with a small group of very trusted people, insiders. I’ve probably some connection there with consulting. But I don’t think people choose consulting for that. I think people choose consulting, because they can’t turn their brains off. They, they simply they’re it’s driven primarily by this ability to see things that other people don’t see. And then, on top of that, they have this compulsion to talk about it. And they assume everybody wants to hear their views. And and if they get enough people, enough of an audience, and they end up with Bama consulting firm, I don’t think it’s about size. I really think it’s about this strange twist of the mind. And there are very few professions that allow that outlet other than consulting.
Alastair McDermott 06:50
Yeah, yeah. The I mean, I think you’re right. It’s like, how do you know somebody consultant? They tell you? Yeah, I’m right. But I think because I worked a lot with creative agencies, and and also with consultants, I think the big difference that I see is that people who own creative agencies, they don’t necessarily want to be the expert themselves. And they’re also quite happy to add more bodies, whereas the people who I talked to who were more consulting, they really don’t want to hire anybody, even in assistance. And that’s the kind of the split is that, is that something you’ve come across?
David C. Baker 07:24
Yes. Yes. I haven’t thought too much about it. But I do, as you were saying that it did. It did resonate. For me. I think in the creative spaces, you have the I think the primary reason for hiring is to get people to do things that they don’t want to do so that they can stay in the creative spotlight and still be the heroes in a consulting world. It’s, it’s driven a little bit more by a hardiness. Like I just can’t imagine anybody else being able to do things as well as I do. But yeah, that’s absolutely true. I mean, there are really great consulting firms, though, that are three and eight people, all of whom make a huge contribution. And they’ve somehow decided to rely on the idea of working together in a small group, because it sharpens their thinking and I, there are many times when I wish I was in that sort of an environment as well. But I don’t want to trade that for the freedom that comes in not having to kind of feed coal into the machine, and and do what I want and change on a dime and write as much as I want to, and then switch to consulting more. And I just feels like that constant switching. Because consulting is really about being able to see things very differently and be able to pivot quickly. You don’t have people doing consulting, who are driven by process unsteadiness, those are coaches. And so in consulting, it just feels a little bit unfair to drag all these other unwilling victims along with us as we constantly change and innovate and go deeper. And it’s a constant. It’s really consulting is really a learning profession. It’s just, you’re, you’re delivering value while you’re learning every time and it’s and it’s about personal learning. It’s not so much about, oh, it would be fun to build a team that does consulting, I mean, that I don’t know many consultants that think that way.
Alastair McDermott 09:20
Yeah, the the constant learning thing. I mean, in part, that that that can be tiring. And part that was why I wanted to move to productize services, and when I wanted to niche down more as well, because I was constantly learning on each project. And is that is that something that drives people to, you know, to productize or to change their business model?
David C. Baker 09:44
I think that is a big component of it. I, In other words, I don’t mind continue learning but I don’t want to, I don’t want to dig eight inches in the soul in the soil. Every day. I want to dig one really deep hole. In other words, after learning through today, or this week, I want to be a much better consultant, I just don’t want to be a consultant that knows a lot more stuff about things that won’t necessarily be useful. So, so yeah, absolutely, that’s, that’s what drives productizing the services and other things, too, I mean, you can, it’s so much easier to sell, it’s so much easier to price, it’s so much easier to predict how much work what your workload is going to look like. And it just makes you and, and you sort of get to the point to where you decide, okay, I’m less of a waiter here, taking orders from somebody. And I’ve seen this movie play out enough times, I’ve seen this play out that I kind of know how it’s going to end. And so I’m going to start applying a process that almost faithfully universally works. And, and so the productize service just emerges from some of the things that happen if you’re a really good consultant, because you starting to notice those patterns. And then you wake up and you say, Oh, I’m a productized consultant. And I like I like what that does for me.
Alastair McDermott 11:09
Yeah, yeah. And I got to that point, I think, I see it with, with some people in in the creative industry and in the business consulting industry, where they are, I think getting to a point of burnout, and they’re feeling exhausted. And that’s kind of the next evolution or the next step is to start to productize down. And the other thing is, I do find a lot of people are resistant to the concept of hiring people. And hiring a full time system was was the best thing I did in the last year.
David C. Baker 11:42
Alastair McDermott 11:42
So I would highly recommend it. Can I just ask about your your own business? Is it just you do you have full time staff?
David C. Baker 11:51
It’s, it’s just me or it has been just me until about six months ago. My oldest son is between gigs. He started a firm with two partners. That’s 130 people now not not a consulting firm a different kind of business. And he, that job only required half his time. And I asked if he would join me just half time. So he’s a contractor at the moment, doing special projects he doesn’t do. He keeps me organized. He’s exploring some areas that I’m thinking of expanding into. And doing a lot of administrative. He’s not doing any of the consulting. So other than the last six month experiment with a contractor. It’s been just me. Yes.
Alastair McDermott 12:34
Yeah. And does that mean that you know, six months, 12 months ago, you were doing your own bookkeeping?
David C. Baker 12:40
No, I, I have a person who’s a full time CPA here in Nashville. And on the side, she does the bookkeeping, I pay her. I think it’s a half percent of my revenue a year or something, whatever that is.
Alastair McDermott 12:54
Oh, wow. Interesting arrangement. Yeah. So so so basically, you’re outsourcing everything possible.
David C. Baker 13:00
Yeah, but, but I can’t actually, I can’t think of anything I’m outsourcing. Other than you know, I have somebody who does illustrations for everything.
Alastair McDermott 13:09
David C. Baker 13:10
She charges me per piece. And then I’ve got a producer and audio engineer for the podcast, but I don’t think of those as employees. I think those are sort of contractors.
Alastair McDermott 13:20
Yeah, yeah. Yeah. Cool. No, that’s great. I just wanted to get a picture of that firm. And by the way, the illustrations are fantastic. I urge people to check out your website, and the illustrations in the blog post in the book that they’re amazing.
David C. Baker 13:31
Alastair McDermott 13:32
I’m interested in something that you talk about in passing a lot. You talk a lot about doing research, for various things. He kind of mentioned passing Oh, I was doing some research. And can you talk a little bit about the research that you do? Like, is it part of your normal process?
David C. Baker 13:44
Hmm. Yeah, those are all very different processes. So for the book, for instance, I will gather, say, some articles or books that are very relevant to the topic I’m addressing. But I’m very careful to not look at those not even scan them until I’m done writing the book. And then I will read those and see if I’ve missed anything, or made some really obvious errors. And then I’ll do a little bit of revision, but I seldom do much revision at all, I find that I, it’s very distracting for me to be to have all the clutter of somebody else’s ideas. On the other hand, I don’t want to be arrogant and assume that I shouldn’t look at those things. I just don’t want them to influence me too early in the process. In terms of my regular work, I will there’s really two things. So there’s, there’s special projects where if I say okay, I’d like to and this is a real example, I’d like to find, I’d like to develop all the financial benchmarks for the typical firm that I serve. So what does that mean? And that that sends me down $150,000 rabbit hole of figuring out okay, what’s the answer to that question for architects? What about engineers, lawyers? Or consultants, what and, and then adapt that, and so on. So that would be a very special special research project. The other one is more casual, and probably a bigger part of what I do in the sense that I’ve now have, I now have about 300, or 260, something like that articles that I think are viable, I have the idea, maybe a couple scratched bullet points, and so on. And that’s it, they just sit here. But that kind of makes me watch the world a little bit differently. So if I decided this is real for me, because it just happened, I just released the article yesterday. So about a year ago, I said, I really need to understand the procurement process and how it impacts my clients, I need to understand that more carefully. And so I just need, so I just create a folder called procurement. And then anytime I come across something really interesting, I will throw it in there until I have enough, then I’ll go digest it all and I’ll write the article. So I found something in the Times about how much there’s almost $9 billion, where the money paid to procurement officers in all of Russia as well, that’s really pretty interesting. What does that say about power and so on. And then took me five hours to digest the research and write the article yesterday and release it. And now I’ll you know, wait a few days, and I’ll see if it interested people or not.
Alastair McDermott 16:24
I can tell you actually did trust people because I already read it. I was very interested going back to Charles Babbage, who’s who’s very big in the in the world of computing. He actually wrote about procurement as well.
David C. Baker 16:36
Alastair McDermott 16:37
Yeah. Fascinating. Very interesting. And I’ve heard you and Blair talk about procurement. I know he’s not a big fan.
David C. Baker 16:44
Yeah, I’m obviously not either. I called him a bunch of names.
Alastair McDermott 16:47
Yeah. Yeah. So we’ll, we’ll link to that in the show notes. So people can check that out the process of research, it’s kind of it’s something that you you do all the time, as naturally as breathing, then it’s, it’s something that’s just a natural part of your business.
David C. Baker 17:02
Yeah. And partly, you know, it’s, I’m not necessarily proud of this, but part of it is just sort of a paranoia on my part, I’m, what keeps me on my toes is, is being called out publicly, for something that I said that was just really stupid. And I’m trying to avoid that. That’s part of it. The other part is I really want I think research is a huge part of differentiation. People can, there are so many consultants for and there’s so many different flavors, but the the only thing I know of that that cannot be replicated easily, is doing proprietary research, and then only making that available to your clients. And I think there are four or five examples of that in my work over the years, about every four or five years, I tend to come up with another idea and chase it down. And so it’s it’s motivated a lot by either paranoia and or just wanting to be as differentiated to support higher pricing as possible,
Alastair McDermott 18:04
We are kind of verging on on talking about positioning and specialization, which is my favorite topic for the podcast. So let me let me dive into that a little bit. I know that you and Blair, he talked about the concept of positioning versus leaving money on the table. So let’s just agree on terminology. Is is positioning a euphemism for specialization for you?
David C. Baker 18:26
It is the the wider world wouldn’t recognize either one of those terms very much, it really would be business strategy. So that’s the way most people would describe it.
Alastair McDermott 18:38
Right. Right. But we’re talking about we’re talking about specializing picking a niche and position yourself. Yeah. And so a lot of people feel that they may be leaving money on the table if they if they niche down too far.
David C. Baker 18:50
Well, obviously, that’s a possibility. If there wasn’t any risk at all, in this specialization decision, a lot more people would make it. But what that fails to to take into account primarily is the fact that you you just can’t see yet deep enough into it. So Blair uses his example, we keep talking about Blair but so those listeners, Blair’s my podcast partner, he he is a co-host with me, we both started it. Anyway, bear talks about when you walk into a room, you all of a sudden see all kinds of doors that lead to other riches. But before you walk into that room before you make the decision to specialize, you’re nervous about what’s behind it, but you’re out in the hallway now and you see all these doors, and they all look like fantastic opportunity and you and it seems like more than you need. You just need to figure out how to close that opportunity. When in fact it’s you haven’t made a courageous decision yet and you haven’t you’re still very much a generalist which are not worth all that much money. And, and where you can’t really create a marketing plan. So yeah, you’re leaving, I hear here’s a here’s another thought, let’s say we don’t look at this from the perspective of money leaving money on the table, what if we talk about, okay, I want to write regularly to an audience. And if I narrow down my focus, I’m afraid I’ll run out of topics to write about. And it’s the exact same thing, once you start narrowing down, you start seeing things that you never saw before, because your eyes have been flitting all over the place. And you never run out of things to talk about, the more you get in deeply into a subject. So it’s just, I mean, how in the world look at what Google has done, Google’s mission, I think, is something around organizing the world’s information. And they’re essentially saying that the world is so complex right now that there are millions and millions of topics, and we need to bring these things together, we all of us, at at about 20 points in our lives are going to need a specialist. And so they’re just recognizing the fact that the world has changed. And if you want to be relevant as a consultant, you have to focus down, what I can say to you is that there are some genuine fears there. One of them should not be that you’re leaving money on the table. You are leaving money on the table, but a great consultant could choose from 20 different careers. And any choice you make there is leaving money on the table. Right?
Alastair McDermott 21:25
Yeah. So I mean, there’s opportunity costs, and every decision you make, the fear is, I mean, there’s lots of fears with associated with specialization. But I think the the the big fear of you know, what, if it doesn’t work, I think that’s the one. Because I know this generalists position, I know I can cast a wide net. But if I specialize, what if it doesn’t work? Or, you know, if I get bored?
David C. Baker 21:47
Well, then you pick another one. Right?
Alastair McDermott 21:49
David C. Baker 21:50
And it’s not. We’re not just manufacturing expertise, expertise, that decision to focus in an area comes from multiple options. And every one of those options, stems from demonstrated success, you’ve made a difference for a client already. And you’ve also made a lot of money for the client, and for yourself. So it’s not as if we’re testing this completely. We we know that, that this works. Is there enough opportunity? Well, that’s where you need to make a careful decision. And there’s good research to help you with that. Right?
Alastair McDermott 22:31
Yeah. But yeah, I can I can recommend your book as well for that, because you actually go into some numbers in that.
David C. Baker 22:37
Yeah. And if you if you step back, and you think about the individual people who listened to your podcast, and who are your clients, and so on, and just fast forward 20 years, where they’re about ready to phase out of normal work life, and they look back on their life, and they say, oh, shoot, I was not as successful as I wanted. Why is that? Why did that happen? Will it be because they didn’t buckle down and focus on something? Or will it be because they ran out of opportunity? I mean, smart people do not run out of opportunity.
Alastair McDermott 23:09
You are really familiar with the worlds of agencies and the world of consultants, what is different between those two worlds to you?
David C. Baker 23:17
What’s different? Well, there’s a lot of things. One is just the educational background, you don’t get a degree in consulting, you usually get a degree in something else. And then on the agency side, you get a degree in what it is that the agency does, but you don’t get any help on how to run a business. So you’re coming at it from a very different perspective, that that would be a very early difference. Another would be how the client views you. So you already as a consultant, you already have a leg up because they assume that the deliverables are not quite as important that they’re paying for your thinking that it’s about time that it doesn’t scale all that well. But, but I would also say that, even though kind of in the sociological pecking order consultants are above marketers buy quite a few steps. There’s also a lot of stigma around consulting because like you said, How do you know some of these consultants tell you it’s like, there’s just too many of them and, and a lot of them are just bullshit consultants. They just don’t know what they’re doing. And so and and then, more recently, over the last 10 years, there’s such an overlap, and a confusion between being a coach and a consultant. And those are completely different things. So yeah, it just we could talk for a couple hours about all the differences there.
Alastair McDermott 24:45
I think. I’m interested in that difference, because I’m starting now to do coaching. Yeah. Can you talk about coaching and consulting then a little bit?
David C. Baker 24:53
Sure. There aren’t many great certifications for consulting. There are a lot of nonsense certifications for coaching. That would be one difference. But it’s really, most of the material difference lies in what it is that you’re doing and how you’re doing it for a client, a consultant needs to have a more episodic relationship with a client where they drop in, and they, they free the nation, to thunderous applause. And, and then they leave again, a coach is more of a they’re not the invading army, they’re more the occupying army, they’re the ones that set up bases, and they build things and they move in. And they date your daughter’s and they, you know, they want to, you know, it’s just, it’s a different sort of a relationship, it’s much more patterned after weekly or, you know, it’s very specific or monthly, whatever that is. And a consultant is, is in a better position to be listened to. They’re, they’re not a cheerleader, they are telling the difficult truth, sometimes a coach, some of the best coaches obviously do a lot of that as well. But they’re more about this mix of let me help you see things differently. Usually, I’m going to assume that you’re kind of like me, and so I’m going to tell you how I would do this and your shoes, whether that’s valid or not, and then I’m in your corner, and I’m going to give you I’m going to check him with you and prod you, I’m sort of like a fitness coach, you know, people, people in general are in love with coaches. And I think there is a lot of valid business out there to be had for coaching. But it is not consulting. It is. It’s a very different kind of relationship. It’s paid very differently. The Oh, my God, if we if the consulting world has a positioning problem, the coaching world really has a positioning problem. There’s like they all look exactly the same.
Alastair McDermott 27:02
Yeah, yeah, absolutely. Yeah. And it’s, I mean, this is the thing for me, all roads, it’s like all roads lead to Rome, all roads lead through positioning, if you want to get anywhere. And you know, we’re talking about research as differentiation. We’re talking about positioning being specialization. It’s just such a key component, like a key building block, that everything else depends on.
David C. Baker 27:25
Alastair McDermott 27:26
Wouldn’t be fair, I just want to ask you about is I’ve had people say, you know, what, if I start to sound like a broken record, if I’m talking about the same problem all the time?
David C. Baker 27:35
Yeah. And the really good consultants will ask themselves that question regularly. Not because they’re bored with saying the same things, but because they’re really committed to delivering value. And they hear themselves saying the same things again, and again, and they say, Am I just mailing it in? Am I just not paying attention, like, surely, this client isn’t suffering from the same thing that the last client did, right. But I really do think it’s good to listen and make sure you’re not mailing it in. But don’t discount the fact that when you are focused in a pretty narrow area, you are likely to see the same things over and over again, and your client isn’t getting the value they’re paying for unless you tell them the truth. And if that truth is the same thing that you told the last client, so be it, that’s more important than whether you’re saying something different. I do really like the idea of this terror of stopping learning. That’s I think what drives most consultants forward is this idea that they’re they’re terrified of, of no longer learning something every day. But what you don’t want to do is, say different things to different clients unless it’s justified, what you do want to do is you take that urge that you have, and keep looking at the same things a little bit differently, or try to notice even deeper patterns and think of here, here’s a very practical way to think of it. So let’s say you’re really busy. And the last thing you need is something else to do. And you have a client who steps out of the normal lane with you and says, Hey, I have this. There’s this thing that’s been plugging me I really could use some help on it. You understand our business super well, I think it’s covered under this package that you bought, right? And, and your first reaction is, oh, shoot, I don’t need something else. Something a little bit unusual to do. But you should usually as long as it’s not scope creep, you should usually welcome that and saying oh, this is really interesting, because I’ve had several clients now when I think back on it, who’ve expressed an interest in the same issue to solve it. This is not me having to put everything else aside and solve this for this client. No, this is just an excuse to solve this for 100 clients, prompted by one client who came to me and surface something that I know a lot of people are struggling with. So you never solve the same problem again, you, you bring the same solution to the table, but you use that extra energy and drive to look for new problems that a lot of people also have underneath your umbrella.
Alastair McDermott 30:17
And because you are tightly positioned to do you have other clients who have that same problem, because all of your clients are very similar.
David C. Baker 30:23
Sure, that’s right. Yeah.
Alastair McDermott 30:25
And again, it just comes back to specialization positioning as being such a core concept. How would you go about if you were working with a firm who have good positioning? How would you go about setting up a marketing plan for them? What would you look at?
David C. Baker 30:39
Well, part of the definition of good good positioning is that they have a very identifiable target that’s also reachable. And so if we’re struggling to do that, then then we need to revisit the positioning. But assuming that it is a good positioning, then you’ve got to really think first about what is it? What issue? Is this audience losing sleep over? Or what issues plural? Is this audiences slip over? And? And then try to address that? And then figure out okay, what are the water coolers that these people gather at with these people? Would they want to hear about me on Instagram? Or would it be more of an academic sounding written blog? Or what’s what audience do I have? Right? Do I need to borrow and often, there’s a whole lot of borrowing other people’s audiences as well at the beginning while you’re building your own. So you have a guest post on somebody else’s blog, or you’re doing a webinar for some association. What’s changed in my mind about marketing plans over the years is that we need to keep it very simple. It needs to be tailored to what somebody enjoys doing. If somebody really loves outbound calling, well, by God, we should use that most people don’t. So we shouldn’t assume that they’re going to do it and keep it as simple as possible and just nail it. The marketing plan, though, is not just about finding new work. It’s about keeping you smarter. It’s about forcing the discipline of learning. And so all of those factors need to be kept in mind when you design one to make it work.
Alastair McDermott 32:16
I do have a couple of questions that I asked people to I like to ask people, one is about business failure. Is there a business failure that you’ve personally experienced that you could tell us about it? And tell us what you’ve learned from it?
David C. Baker 32:27
Yeah, it was, it was not so much a business failure, but really bad decisions on my part one around personnel, I hired the wrong person and didn’t fix that well. And also didn’t manage them well. And then another was around, just under estimating how volatile a a client relationship could be. It was a big client for us. And I assumed because of the contract that everything was great, it went away when some embezzling happened on their side of things, and that our contact got let go. And, and it was just a really rough it. I just learned, I’ve learned a lot more about money and planning and business from the mistakes I’ve made than from the from some of the great things I’ve done. I don’t remember those so much. Maybe there aren’t that many of them. But I definitely remember the mistakes of hey.
Alastair McDermott 33:23
Did you? Did you change your client intake process as a result of that?
David C. Baker 33:28
Yeah, I did, for sure. And I also pledged to never have a client that represented 40% of my business again, too,
Alastair McDermott 33:35
Right. Yeah. What what is the maximum that a single client should represent of revenue?
David C. Baker 33:40
I my standard for that is a little different than most people’s, I’m comfortable going up to about 25%. Most of the other advisors in this space would say something like 15%, probably. And if you’re angling to sell your firm in an m&a sort of a deal, then the smaller number is the healthier number in terms of how they’ll look at it.
Alastair McDermott 34:00
Yeah, yeah. Do you have a favorite or an influential business book that has that has kind of shaped your thinking or you think that people should go out and read?
David C. Baker 34:12
Yeah, that’s a tough one. And probably not the smartest thing to admit, I don’t read many business books, I find them boring, I find that they should really just be they should have just been a good article. There’s not enough to make a book in there. But there have been some very influential books. I’m not sure you want to go read them now. Because you know, they’re 30 years old. But “The E-myth Revisited” was a really influential book to me by Michael Gerber. It helped explain how he says that most of us are technicians who have suffered an entrepreneurial seizure. And so we’re in love with doing the work or not in love with running a firm that does the work. And that’s been very helpful as I thought through things.
Alastair McDermott 34:54
Yeah. Yeah, that’s one of my favorites. I really actually don’t like the way that he’s written the book, but I love that the messages in the book.
David C. Baker 35:02
Yeah, the last half of the book isn’t even worth reading. But the first half.
Alastair McDermott 35:05
Yeah. And yet it’s still one of the most recommended business books, both on this podcast and just in general.
David C. Baker 35:11
Alastair McDermott 35:12
So So there’s clearly some some gold in there. What about fiction? Are you a fiction reader?
David C. Baker 35:18
Yeah, that’s almost where I focus entirely. I just finished a 10 or 11 book series called the “Gray Man” series. But most of my last 30 years, I’ve focused very heavily around the period of the French Revolution, so I read like Bernard Cornwell would be an example of that, the Jack Aubrey series with Steve Maturin and also as a ship surgeon, so I get lost… the last thing I want to do when I’m not working is think about work. So I tend to get I dive into fiction and love it, yeah.
Alastair McDermott 35:55
Yeah, yeah. Okay. Well, look, I really appreciate your time. Thank you so much for being with us. If people want to go check you out. Where do they go look for you?
David C. Baker 36:03
Probably just if they want to see an example of the work I do DavidCBaker.com probably or if they want to see us, microsite for the last book, expertise.is would be a good place to go.
Alastair McDermott 36:15
We will link to both of those in the show notes. David C. Baker, thank you so much!
David C. Baker 36:19
And thanks for having me. Appreciate it.
Alastair McDermott 36:23
Thanks for listening. And just a reminder, every Thursday for the next month, I’m going to be running a live webinar, I’m going to be presenting what I’ve learned about specialization positioning Authority building for consultants, and there’s gonna be absolutely nothing for sale on the webinar. It’s gonna be purely educational. So if you’re a consultant of any type, check it out at TheRecognizedAuthority.com/webinar. It’s gonna be every Thursday at 11am Eastern Time, which is 4pm in London or Dublin for folks on this side of the Atlantic. So thanks for listening and see you in the next episode.