In the first article, we took a look at some of the things you need to consider when setting up your own development firm. In this article, I'd like to take a look at the infrastructure you are going to need for your business. I was going to be dealing with the paperwork that we produce, contracts and so on, but the comments on the previous article led me to think that this article was necessary.
I'm going to assume, for the purpose of this article, that you're just starting out contracting, i.e. selling your skills to companies, or you've set up a small consulting shop. The infrastructure that is detailed here mainly applies in both cases (there can be differences), but can be applied to other business models just as easily.
This article will not guarantee success. It is not intended to replace all the hours that you are going to have to work in order to develop your client base and it only deals with working with clients.
Before we go any further, we need to define what infrastructure actually means. According to The Free Dictionary, infrastructure is defined as:
1. An underlying base or foundation especially for an organization or system.
2. The basic facilities, services, and installations needed for the functioning of a community or society, such as transportation and communications systems, water and power lines, and public institutions including schools, post offices, and prisons.
So, in our case, the infrastructure is the underlying base for the organisation. We're going to take a look at two different types of infrastructure that you are going to need for your company; people based and equipment.
People Based Infrastructure
I use the term "people based" here to define the fact that you are going to need support from people other than yourself. Before you can even begin to think about running your company, you really need to understand that you need support from an accountant, legal team and banking. In some cases, an accountancy company will offer you basic legal advice, but it is worth the time hunting out a good business legal team (due to cultural differences, I've shied away from using the term Lawyer or Solicitor here, but you can take it as read that this is what I'm talking about). Certainly, the accountant will be able to recommend a business banking account, but again feel free to hunt one out for yourself.
In the previous paragraph, I mentioned a business bank account. You are going to be running a business so you need a business account to pay the money into. It's not your money - it's the businesses. You can pay yourself a salary, and maybe dividends and bonuses, but your company needs to be run to post a profit. Hopefully you will build up the profit enough so that you have a financial cushion when business is lean. This is vital, and I can't stress this enough, there will come a time when the clients stop coming in. Recessions happen, and businesses without reserves will fold. In order to ride out the bad times, you need money in the account because you'll still be paying salaries and all the taxes even when there is nothing coming onto your order books.
You need to understand that you will be running a business as a legal entity in its own right, and as a result you have to comply with the laws of the country you live in. I'm not going to go into any of the legal issues that you need to consider because these differ from country to country (and, in some cases state to state). Suffice it to say that you need to get advice from your accountant AND legal team before you start the company.
Part of the people infrastructure that tends to be ignored, is your family and friends. It is vital that they understand what you are doing, and the pressures that will be on you when you are getting your business off the ground. You are going to be working seriously long hours, and you need the people with a personal connection to understand that it's not personal, you aren't ignoring them. If it's family, stress that you are doing this for them - it's harder if you've got kids because they won't understand why Mom or Dad can't play with them, but with a bit of help and support you will build up this personal side.
If you are employing people, you need to consider hiring somebody to look after the Human Resources/Personnel side. Don't outsource this because it is a task that really can keep somebody busy day in day out. If you country is like the United Kingdom then there will be a whole raft of employment laws that you need to keep abreast of, and having a dedicated HR person really does pay off because they can steer you clear of a very messy problem.
So how do you actually go about finding accountants, etc...? Well, this is where you should really start practicing your networking skills. In most countries there are government run agencies that specialise in businesses (here in the UK we have BusinessLink). These often co-operate with local business groups who normally have regular meetings where they get together to discuss issues, get advice and have a general talk about the successes that local companies are having. These meetings are really worth going to because you will talk to potential clients in an informal setting, and you will get the chance to pick peoples brains. Personal recommendation is valuable so listen to these people - some of them will be accountants, legal types and so on. If you are lucky enough to have business breakfasts in your area, these are another valuable way to pick up contacts and to generate potential business leads.
Needless to say, you are going to need a computer, but what else will you need?
Well, you should definitely consider getting a business telephone line. It's invaluable to have a line where customers can ring you that isn't going to be tied up by your other half being on the phone to the parents. Similarly, you should consider having a fax machine and a scanner. With the advent of all-in-one printers, it makes sense to get one that covers for both while you are just setting up.
A mobile phone is vital. You should be contactable at the drop of a hat, so you should always have a charged phone. Don't get a pay as you go, it should be a contract phone. Consider getting an in-car charger for your phone - I'm lucky enough to have one that has a USB charger as well so there is no excuse for it not being charged. Hunt around for a phone network that is going to let you keep in touch. Service from some providers can be patchy, at best, so they should be avoided.
What about software? Well, if you're a developer then you should definitely have the compiler of the language(s) that you are going to develop in. Also, you should invest in an Office suite. The Office document formats are understood by most suites, so you can choose whichever one you really want but you should always transfer documents in the Office format (avoid the new Office format because lots of companies haven't made the leap yet).
Get yourself a day planner. You will come to rely on it more and more to keep track of your appointments. If you are lucky enough to run a firm with multiple staff, make sure you hire yourself a PA. A good PA is like gold - they will keep you on track.
One of the hardest things that you will do is define your corporate identity. You really need to start this up-front. Your identity will evolve as time goes on, but you need to get a version sorted sooner rather than later. You will need business cards, letterhead and a website right from the start. You can get good quality business cards and letterhead from VistaPrint - they allow you to define your own templates. I also like to keep my business cards in a card holder - it prevents them from getting dirty, and keeps them straight and easy to get to. Keep your logos, colour schemes and fonts simple at the start. You should use the same images, fonts and colours on your website and business card, and your letterhead should use the same font and colours (steer clear of images). A personal plea here - don't put up a half finished website. Don't put links to pages with "Under construction" on them. These irritate the life out of me, and will put your potential clients off.
Finally, splash out on some good quality clothes. Suits for the gentlemen (tailored if possible) and smart-business for the ladies. They aren't, strictly speaking, equipment, but they do define how you will be viewed. By the way - when you network, you are initially judged on how you present yourself. People will be far more receptive if you wear the uniform of business.
Well, I hope that this has helped. In the next article I'll take a look at some of the documentation that we use with clients, and how to build a relationship with a client. In future articles, we'll take a more in depth look at issues such as creating your identity and networking. Again, keep those comments coming in - they will help define the shape this series will take.
A developer for more years than I care to remember. I live in the North East of England with 2 wonderful daughters and a wonderful wife.
I am not the Stig, but I do wish I had Lotus Tuned Suspension.