Self-Flagellation

by Dave Schuler on April 12, 2014

This weekend I’m engaging in my annual rite of penance and mortification. Somewhat like Prince Vronsky in Anna Karenina, I take the opportunity of the due date for my federal income taxes to re-examine and put the finishing touches on my books for the previous year.

As I think I’ve mentioned before, last year my income in real terms was the lowest it’s been in my adult life. The reasons for that are complicated. Mostly it boils down to my long-term clients having fallen on hard times, a result of the sluggish economy, changing conditions, and long-term mistakes (not my mistakes but theirs many of which I’ve been fighting for, literally, decades).

Now I’m rebuilding my client base. It’s something I should have been doing all along but, honestly, I got a bit lazy. My new clients haven’t produced much billing yet but I have hopes.

My wants are pretty limited. I need about $15,000 more business to stop being panicky and with about an additional $30,000 in net billing I’d have as much as I want or need. You’d think that would be doable but it’s proven elusive. Nominally I have some pretty desireable skills, I have extensive experience, and I’m very good at what I do. I rarely have problems closing once I’ve gotten my foot in the door.

Only my dear wife’s earnings prevent me from being desperate but it’s pretty humiliating. I really should be doing much better than I am.

I’m not a particularly desireable employee for a variety of reasons including my age and that I don’t want to be employed full-time. That’s why I’m looking for business rather than a job. If this goes on, I may be forced to look for a job, something I haven’t done in 35 years. The conditions are really terrible for that and, as I say, I’m not a particularly desireable employee.

A desireable employee is me, thirty-five or forty years ago. Somebody who’s young, unmarried, energetic, and ambitious who’ll work for half of what he’s worth and put in 60 hours a week doing it. Somebody who doesn’t have a life.

{ 41 comments… read them below or add one }

... April 12, 2014 at 1:49 pm

Only my dear wife’s earnings prevent me from being desperate but it’s pretty humiliating. I really should be doing much better than I am.

I believe this (and other paragraphs) have been copied from my brain. That’s what I get for not putting the little (c) mark after all my thoughts, I guess.

... April 12, 2014 at 1:51 pm

And at least your are up near what is notionally retirement age. I was permanently and involuntarily retired two days before I turned 40.

Ben Wolf April 12, 2014 at 1:53 pm

I assume your business is primarily among small to medium-sized firms and the self-employed, as those are the ones who struggle most in difficult times.

I admire your determination. A friend of mine saw most of his income evaporate in the last two years as his clients stopped spending or went out of business. He’d pretty much given up, saying he didn’t see any point in attempting to rebuild just so the system could pull the rug out from under him again. Then I told him I knew of a man decades his senior who was out rebuilding after a terrible year; that got his attention.

Dave Schuler April 12, 2014 at 1:56 pm

I assume your business is primarily among small to medium-sized firms and the self-employed

Thirty years ago most of my clients were Fortune 500 companies or government agencies. They’ve been pretty much as you describe for the last 20 years.

The only thing I miss about big clients is the scope of the projects. The politics and nonsense simply defied description.

... April 12, 2014 at 1:57 pm

I kind of forgot, but yesterday was the sixth anniversary of my forced retirement. I should have had a celebration, you know, toasting the economic recovery. As it was I think the highlight was probably … hmmm, I’m not sure what the highlight was yesterday. I’m not sure anything worth noting happened to me or my family. That’s probably a good thing.

Oh, wait! My idiot neighbors showed up after a week to take care of the three pitbulls they have pinned in their house. That was probably the highlight. What a day, what a day!

Dave Schuler April 12, 2014 at 2:04 pm

And at least your are up near what is notionally retirement age.

I have no plans to retire. Never have. For one thing I sort of thought I might be dead long, long ago. As it turns out I take after my mom’s side of the family rather than my dad’s.

I still plan to keep working as long as I live. I’ll work for minimum wage if that’s what’s available. The crazy thing about it is that I only really want about 10 hours more a week. There are a lot of people out there who want to pay Third World rates for First World work. For that I’ll do something completely without responsibility.

jan April 12, 2014 at 10:28 pm

Generally speaking, Dave, what kind of work do you do?

Trumwill April 12, 2014 at 10:56 pm

I can relate to the undesirable employee part. My wife’s career sidetracked my employment for long enough that it would be awfully tough finding a job if I weren’t doing the stay-at-home dad thing.

Things in the Himmelreich-Truman household have been in a state of flux. My wife is undergoing a career trajectory change away from Family Medicine (with obstetrics) into a niche that encompasses being a hospitalist with obstetrics on the side. We moved across the country because her situation out there was untenable, both with the employer and the demands of the job. Looking at the income differential makes me wince. Mostly because the demands of her job and the pay of residency plus fellowships (she’s on her third) along with other things have put us way behind in terms of saving. (Plus, it turns out kids are expensive. Ours moreso than most.)

But I recognize that we have it a lot better than most. And we have a wonderful baby girl.

(I apologize if this comment is inappropriately self-centered. You taking stock of your year caused me to do the same.)

Dave Schuler April 13, 2014 at 7:25 am

I welcome it. I was inviting it.

Dave Schuler April 13, 2014 at 7:26 am

Jan:

Generally speaking, I’m a technology consultant.

Guarneri April 13, 2014 at 7:44 am

Without revealing any confidences, could you cite 4-5 business practices or policy mistakes you have advocated against? For obvious reasons I’m always fascinated by the “body of ill-work’” others have encountered.

Since your experience seems to have been large corporate oriented I imagine it has been a target rich environment.

Did I just say that? Bad employee. Bad employee…..

Dave Schuler April 13, 2014 at 7:54 am

Just listing the first few that come to mind:

- treating employees as interchangeable parts in a service business
- browbeating as a supervisory strategy
- failing to establish the proper boundaries in responding to customer demands
- systematically overvaluing legacy systems
- designing processes that create empires
- failing to understand the implications of running your business using packaged systems

Update

- business processes that require low level employees to make policy decisions (or even allow them)

michael reynolds April 13, 2014 at 10:12 am

I’m getting a small taste of being the Alpha Male reduced to second-class status. My wife out-earned me last year, and will do the same this year. It hasn’t bothered me a lot, but it surprised me to discover it did bother me a little. But just a little. That was our deal: I’d pay the bills while she wrote the long-shots. One of those long-shots came in.

The result is that for the first time since I was 16 I am not the donkey carrying the biggest load. I have to actually think in terms of what I might like to do rather than thinking in market-driven terms. It’s a case of first world problems, I’m absolutely not complaining, but it is strange. I have two years of committed work ahead but now is the time to think about what I want to do then, and I really have no experience thinking in terms of what I’d just like to write.

steve April 13, 2014 at 1:11 pm

Agree with your list. The good news in health care, at least at my facility, is that the coming changes are obvious enough that we are getting people to give up some of their legacy systems. Still amazes me how many docs actually prefer a chaotic system with lots of inefficiencies. It takes a bit to convince them to do something else.

Steve

TastyBits April 13, 2014 at 2:42 pm


systematically overvaluing legacy systems

I am constantly trying to warn about the hazards of developing for the the “latest and greatest” platforms. When the client does not have the version of server or database you require, you have problems.

Nobody told this to me, and I learned the hard way. It took lots of re-coding and workarounds, but we did not lose the sale.

One customer was finally able to get funding to upgrade. The software is 20 years old, and he has been trying for 5 years. With a Windows 7 upgrade, it finally stopped working.

jan April 13, 2014 at 3:30 pm

….tasty, do you know anything about the windows 8.1 softwear — better or worse than windows 7?

Dave Schuler April 13, 2014 at 3:54 pm

I can tell you what I’m telling my clients. Just as with Windows 8, there’s a learning curve and potential compatibility issues with drivers and legacy software relative to Windows 7. I’m not convinced it’s time to adopt Windows 8 (in any version) yet.

Andy April 13, 2014 at 3:57 pm

Dave,

I wish the Federal Government would make you technology and administrative reform Czar. All those issues you list are endemic.

I hope this year is a better one for you and everyone else at this site. It’s kind of amazing after all these years visiting this site (I’m not even sure how many it’s been, about six?) I still don’t really know what you do for a living. It’s pretty rare for a person not to sell themselves or at least link to their business on their own blog. It’s a testament to your character.

As for my family, this was a good year for us financially – the best yet, actually, since I’m working full time. We’re getting out of debt and saving because we will move again next summer (2015) and who knows if I’ll be able to get another job. That will probably be the last military move as my wife will likely retire in 2017 or 2018.

This past year really was an eye-opener as the transition from me being basically a full-time at-home Dad to full employment took some adjustment both personally and financially – the cost of employment was more than I predicted and handling the family issues with two full-time parents took some adjustment. Childcare is really expensive. For our three kids (one toddler and two in elementary school), the total bill last year was over $13k. It was over $7k just for the toddler.

My wife earned more income than me every year since we were married. It’s not something that’s ever really bothered me – I knew going in that my wife’s military career would take priority and job opportunities for military spouses are rare, limited and temporary. We’re a good partnership, we have a plan and the older I get the less I care about what others think are appropriate gender roles. It’s nice that men are more accepted as either caregivers or the secondary breadwinner, but there’s still a long way to go.

Dave Schuler April 13, 2014 at 4:05 pm

I wish the Federal Government would make you technology and administrative reform Czar. All those issues you list are endemic.

I had thought of saying something but avoided it. Now is as good a time as any.

If you want a better idea of who I am, I’m the guy who could have brought Healthcare.gov in on time and under budget. Not only do I have the knowledge, skills, and experience, I have the ability to communicate with both the management and worker bee sides of the equation and I always tell my clients the truth.

Dave Schuler April 13, 2014 at 4:07 pm

My wife earned more income than me every year since we were married.

For the first five years or so my earnings were more than hers. Since then, she’s been the big earner.

michael reynolds April 13, 2014 at 4:35 pm

I always tell my clients the truth.

Well, now we know why you’re having trouble lining up work.

Dave Schuler April 13, 2014 at 4:38 pm

Michael:

I can usually sell the truth. It doesn’t need to be unpleasant. A lot depends on how you couch things.

And my clients tend to be extremely loyal to me at least in part because they know I’ll always tell them the truth. I’ve got clients I’ve had for more than thirty years.

TastyBits April 13, 2014 at 4:42 pm

@jan

Depends. I would recommend ClassicShell.net whichever one you use. It makes the damn thing workable.

I use Win7 Professional because of “XP Mode”. It is a mostly seamless Virtual Machine that allows me to run older software. I have 32-bit applications that will not run on 64-bit Windows 7, but “XP Mode” lets me keep them going.

This is why most businesses never switched to Vista, and why they will stay on Windows 7 for a long time. Legacy applications that work are expensive to upgrade.

Unless you are building your own system, you are going to be getting Windows 8.1. I rarely upgrade an existing machine. If your machine is sluggish, save your files, trash the operating system, and rebuild it. To be safe, do a system image first.

Ben Wolf April 13, 2014 at 8:49 pm

@Michael

Sounds as though your wife’s score will give you an opportunity to focus on a more artistic path, assuming that’s what you want of course. Do you have an interest in doing something other than YA?

Andy April 13, 2014 at 10:58 pm

I have Win 8 on my home computer – work is Windows 7. For some reason, however, the only browser available on work computers is IE version 8. The computer people won’t upgrade it on the standard desktop. Probably legacy compatibility.

You’ve probably heard it in the news, but there are a lot of government computers that still use XP. I haven’t personally seen any with XP, but we still have a few Vista computers. Supposedly the feds will end up pay Microsoft millions extra to keep those XP machines patched.

The government has so many legacy systems. Until last year our timekeeper had to manually enter our timecards via a command line window to the payroll system. Now we have a website (probably just a front-end) but we still have to do an excel spreadsheet manual timecard because the website can’t record everything that must be audited by law. So we have to do two timecards – one electronically so we can get paid, and the spreadsheet to give to the timekeeper for audits.

So, your tax dollars are paying me probably a couple hundred dollars a year just to fill out timecards.

jan April 13, 2014 at 11:33 pm

Thanks for the information Tasty and Dave….the feedback on 8.1 has not been good. However, much of it stems from people saying it’s so different from 7. I’m not really a ‘tech’ adapter (no ‘geek genes in me), and in looking around for a new laptop have been reluctant to entertain the idea of yet another learning curve to conquer. So, I think I’ll try to grab one of the lingering models having windows 7 professional.

Guarneri April 14, 2014 at 5:39 am

Interesting list, Dave. I cannot speak to the details of info system items. The first two dash points are of course universal. I have to admit I’m not sure what an example of the Update dash point is.

For all here, for those designing useful business decision metrics tools or processes………….as strange as it may sound, one of the least answerable questions we ask in diligence is “where do you make your money?” Its generally followed by blank stares or cock sure answers that later prove false. They can’t get at the data. It’s nothing more than the old slicing and dicing by customer, by market, by product, by salesman by, by, by. But 9 times out of ten you can’t get to the answer.

“If you don’t know where you are going, any path will do.”

Having returned from Florida to beautiful spring weather here in the Midwest (snicker) a buddy sent this:

https://www.youtube.com/watch?v=gmoPBe_frvM

TastyBits April 14, 2014 at 6:31 am

@jan

Unless you have really old software applications, you should not need Windows 7 Professional. You should get Windows 7 Home, and you can upgrade if needed. Microsoft has made this painless. Win7 Pro is for businesses, and you will pay more with less choices.

You could try Newegg for refurbished laptops. You can trust them, and the reviewers are usually tech savvy. DO NOT buy anything without reading the reviews, especially the negatives. You may be OK with what they do not like, but too many people complain about the things previous reviewers complained about.

When buying, CPU, video, screen resolution, and screen size are the factors you should focus on. The RAM and hard drive can be changed easily and cheaply. The other parts cannot.

If money is not a problem, you may want to look at a Lenovo x230-Tablet. It is no longer manufactured, but there are still new ones out there. It has a dual type touch screen. It works with your finger like the iPad, but it also has a stylus you can use. It has a screen that twists. NOTE: There is a non-Tablet version.

My mother got one for my stepson, and he uses it at college. She got him the top of the line, and eventually, I will upgrade it to Windows 8.x. This is the only laptop I have seen with this feature, but it is not cheap.

Dave Schuler April 14, 2014 at 8:07 am

one of the least answerable questions we ask in diligence is “where do you make your money?”

I think there are two interrelated questions: “where do you make your money?” and “what business are you in?”. Maybe 30 years ago Peter Drucker pointed out that most managers really have no idea of what business they’re in.

“Where do you make your money?” really asks what component of the business you’re in derives the most revenue.

Let’s take Apple as an example. I think that Apple is in the business of selling people ways to demonstrate their superiority. It seems to me they wouldn’t be making money without careful supply chain management and process engineering.

How Apple reconciles their core business with a mass market will be their challenge going forward. The ball can stay up in the air for so long but not forever.

Amazon’s another interesting example. Obviously, they don’t make their money selling books. I think they’ve realized the limitations of retail and have bootstrapped their way into the retail services business. The company has been in search of a business model since its inception.

... April 14, 2014 at 8:55 am

Not sure about Amazon, but Bezos’s business model seems pretty tight.

Guarneri April 14, 2014 at 9:05 am

Dave

I think we have had this discussion before, and agree on “what business you are in.” But I really care fairly little about revenue. Its where the profit is made – and that’s the entire point of the exercise -, and that generally differs from revenue. Once I know where the money is made – or not – I can pull the tool kit out and go to work.

Dave Schuler April 14, 2014 at 9:29 am

You’re right. I should have written “profit” there. It’s what I meant. If you look at the balance of the comment, I think you can see that’s what I was getting at.

Dave Schuler April 14, 2014 at 9:32 am

Bezos’s business model seems pretty tight.

What’s Amazon’s business model? What was it five years ago? Ten years ago?

See also here. And even more importantly here. Amazon is a stock offering in search of a business plan.

... April 14, 2014 at 10:57 am

I’m not talking about Amazon’s model, but Bezos’s. Bezos’s model seems to be to convince people to bid up the price of the stock of the company he owns an enormous percentage of until he’s richer than Crassus. He’s been enormously successful!

As for Amazon’s model, I think it is to drive every brick and mortar establishment out of business, establish a de facto monopoly, and then profit thereby.

Guarneri April 14, 2014 at 11:34 am
TastyBits April 14, 2014 at 12:05 pm

@Icepick

As Amazon grows, they are building more fulfillment centers, and they are collecting sales taxes in those states. The advantages drop dramatically at that point for items you would check out at a store but buy online. Large retailers can compete on price, and they can offer a convenient return option.

The Amazon storefronts allow small mom & pop operations to have access to a market they would never have otherwise. I prefer it over Ebay or Craigslist because Amazon is fairly strict with the merchants.

... April 14, 2014 at 12:27 pm

TB, I keep hearing about how Amazon is helping small businesses. But I’m seeing fewer small businesses in operation practically every time I leave the house, certainly with every week. Fewer larger businesses, too, for that matter.

TastyBits April 14, 2014 at 1:29 pm

@Icepick

One of the guys in our carnival club sells CD’s & DVD’s on Amazon, and he explained it to me. He does it as a sideline out of his garage, and he can make $500/mo profit. He buys them from garage sales, flea market, swap meets, discount sales, etc., and he has a machine to polish out the scratches.

If a small local business needed a larger market, they could open an Amazon storefront and sell online. Using Amazon, it makes the process somewhat safer. You are not giving your credit card info to just anybody.

Amazon is not the only site doing this. Newegg has it, but it is not as extensive.

Andy April 14, 2014 at 5:26 pm

Jan,

8.1 isn’t bad with a $5 mod called Start8. It basically brings back the Windows 7 interface. I’m pretty happy, actually, as Windows 8 does come with some benefits like faster boot times.

michael reynolds April 14, 2014 at 11:03 pm

Let’s take Apple as an example. I think that Apple is in the business of selling people ways to demonstrate their superiority.

No. Apple understood three basic facts that eluded other computer makers

1) A computer is not an erector set, it’s a car. We didn’t want to have to learn how to use it, we wanted to just use it. We didn’t want to have to build the damned thing, we just wanted to open the box and plug it in and voila!

2) Pretty beats ugly.

3) When it breaks, you want a service department to fix it for you. You don’t want to spend 3 hours on the phone talking to people in India who don’t fix anything.

Microsoft understood nerds. Apple understood humans. It works, it’s pretty and there’s a service department. Just like a car.

Dave Schuler April 15, 2014 at 7:41 am

I don’t think that stands up to analysis, Michael. If it does, it raises another question: if Apple understands people, why do 95% of them buy something else?

I think the better answer is that Microsoft understood corporate management and Apple understood the graphics art department. People who want to identify with the graphics art department continue to buy Macs and Apple has never been able to expand beyond that base.

However, in a sense you’re right. Apple computers, like some cars, as I said, are about status. Self-image.

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