October 2003

Winning Contracts: An Interview with Lisa Goldman
By Kathryn Smith

One of the goals of Women In Consulting is to raise the professional performance of members and allow them to produce results. One necessary component of all consultants’ businesses is to produce the signed contract.

Lisa Goldman, Partner at Management Associates, and WIC Board Member, has been in the management and consulting business for 16 years. She has a total of 28 years of management experience in strategic planning, marketing, sales and customer service. And she has kindly agreed to share her contract experiences and recommendations with WIC consultants.

Throughout her consulting career Lisa has become very familiar with business contracts and how they fit into the selling process, and continues to improve hers based on her experiences. Her answers to our questions can help to shorten our learning curve. Remember, these answers are based on her regular mode of operation – they work for her, and they can work for you, too!

I spoke with Lisa by phone on Friday, October 03, 2003 and the following is our conversation.

Q. Lisa, what is the difference between your proposal and your contract?

A. I actually see there is no difference. I prepare the proposal/contract ideas in collaboration with the client so that the proposal is the contract. Since the client assists with creating the content, he/she is completely involved upfront with the full project planning, so only one document is necessary to confirm the agreement and approve the project. Also, I always assure that my client contact is the decision maker, thus no additional approvals are needed. This can be accomplished in one stage. Save yourself a lot of time and effort and create just the one document!

Q. And, with respect to contracts, what do you consider your most valuable learning experience?

A. I have learned through much trial and error that the contract is not a useful selling tool. Some consultants use the contract as a way to avoid selling. The contract can’t sell, only you can. Write a contract after you have “gone down the garden path” with the client, assuring that both parties understand what will be involved in the project. And, when you think you’re at that point, ask the client: “If I were to prepare this proposal, would you be willing to sign it tomorrow?” If the answer is “yes”, then write the contract. Doing this prep work will save you a lot of time.

Q. Do you have a "most expensive” experience you can share with us?

A. Yes, I made a very costly mistake many years ago. At that time I did not have a cancellation clause in my contract and someone cancelled before the first payment. I now include in the Terms & Conditions (T & C) that either party can cancel with 90 days notice. This, coupled with my upfront payment terms, mitigates the clients’ interest in canceling.

Q. In terms of the fees, how do you assure collection, and why?

A. I include a payment schedule which states 60% of project fee is due at signing, and the next two payments of 20% each are due consecutively at 30 day intervals. By the way, this is really like a gift to them. They may decide they are too busy to continue the project, but will choose to continue with it because they’ve already paid in full; so they ultimately end up with whatever improvements they had initially desired. Creating even a minor difficulty in canceling ensures that my clients work with determination to create breakthroughs in their business.

One very valid reason for getting a substantial payment up front is based on working with the start-ups of the past. Many times, early on in the project, my “client” will transition up or to another company. My client’s replacement often wants to make an initial impact on the business with cost cutting measures, and I want to make sure I’m not the cost that they cut.

Q. And is there a “most exciting” experience?

A. My most exciting experience is related to pricing. My husband/business partner & I were in the elevator on the way to our appointment with the head of a large Silicon Valley company. My husband turned to me and asked, “How much do we have to charge this guy to get his attention?” I gave him a very large number; my husband proposed that fee to the client, and he agreed to it immediately. The lesson I learned is that pricing is often a function of determining the clients’ appetite.

Q. But if your fees are considered “high”, or you require payments up front, don’t you get a lot of objections? How do you handle that?

A. I find no matter what the reason for the objection; it’s not often their personal objection, or their own issue. It is someone else’s and the client is attempting to look through others’ eyes. We’ll sort through the conversation by asking the question “What’s your concern?” They generally share the concern and talk through the entire issue by themselves, without me saying anything; and they come around to the answer independently. I might sometimes alternately ask “Who do you think will have an issue with this?” Do not become involved in their set of concerns. It is not personal or about you. One other way to deal with any payment schedule concerns is to simply state “Oh, that’s how I get paid.” All of these work for me.

Q. What is the number one recommendation you have for someone just starting out with the consulting business?

A. Save yourself a lot of time and develop a contract template with the most often used elements in it and keep using that as your base. Then you are not reinventing the wheel for each proposal and you save time. Be sure to use boiler plate language for the T & C section regarding confidentiality, non-disclosure, cancellation clause, and travel and other expenses. Then when you write your proposal, you can concentrate on composing compelling and meaty outcomes and deliverables.

Q. Is your contract format basically a template at this time?

A. Yes. And it continues to evolve. I’m always tweaking it a little bit. It gets stale if it’s not continuously updated and improved.

Q. Why do you prefer to call this a business document rather than a legal contract?

A. I consider my contract/proposal to be based on a business conversation about business elements. I’m not as interested in focusing on the legal details of the partnership. My contracts focus on work to be done and the results to be produced.

Q. Given that you’ve worked with a number of WIC folks, what is the number one thing you would recommend to them regarding contracts?

A. My recommendation to WIC members is that they create very clearly written descriptions of the result to be produced, what they will provide, and when. I observed that many consultants undermine their relationship with clients and their ability to sell when they have poorly written descriptions. A very important improvement would be to include a timeline in their contract and a clearer, more measurable description of the deliverables.

Q. Do you include a timeframe for acceptance of the contract?

A. I haven’t done that up to now. My contracts generally get signed right away, so I’ve had no need for that so far. That said, it would be good to have a statement in the T & C saying something to the effect of “Valid until date & time”.

Q. About how much time do you typically spend on the “up-front” work in order to write the contract, i.e. needs assessments, research previous to or after meeting the client? How much time goes into preparing the contract?

A. The first client meeting is a preparation and sales meeting. I don’t usually research the company previous to meeting my client. I have found that the more prep work I do, the worse I perform at the sales call. It means that I walk in with assumptions that are false, anyway. I want to find out from the client what they think of their company, and what they think the Board’s expectations are. During that conversation I propose solutions to problems we discovered together. I take notes which I use for further clarification of our discussions and ultimately the contract content. It can take me over four hours to write the contract. (I agonize over whether my messages are compelling and getting to the heart of the matter.) By the time I’m done, the client often doesn’t even read my document! They sign the last page and the project begins.

Q. To change the subject a little, what is your favorite part of your job?

A. I like to talk. This is a great job for me because I’ve been able to mold it so that most of what I deliver to clients is through talking. My consulting is based on having my clients focus on a compelling business result and deliver that in a rapid time frame. I’m lucky that I’ve been able to construct a practice around that formula. I might talk to a team or an individual, and we create a weekly plan: develop action items for them, review results, and re-plan based on results, etc. They have all of the homework. I help them focus to produce results in their business. The company heads don’t care how it works, they just want to see the results. And they enjoy working with me.

About Lisa Goldman
Lisa Goldman is a compelling leader and much-demanded performance coach serving clients in the telecommunications, e-commerce, customer service, securities trading, and computer industries. The results she produces are distinct in their ability to have people act towards a common set of objectives, produce a coordinated framework for success, and achieve unprecedented results that impact the bottom line.

Management Associates is an international management consulting firm that is known for strategic formulation, change and integration management, and the mobilization of high-performance teams. Lisa’s clients extend from Fortune 100 companies to high-tech start-up, such as AT&T Wireless, Apple Computer, Sprint PCS, Computer Sciences Corporation, AOL Time Warner, and E*Trade.