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Ongoing Client Services, Episode 154

with Pat Ramsey on August 15th, 2017

Pat Ramsey on OfficeHours.FM
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Listen to this episode:

About Pat Ramsey:

Pat Ramsey is part of the leadership at Crowd Favorite, providing managed services for enterprise clients. As Director of Technology, he oversees all aspects of the technology group to more comprehensively meet the ever-growing needs of clients. Outside of Crowd Favorite, Pat has been an organizer of the Austin WordPress Meetup since 2007 and part of the tech networking community, Refresh Austin, since 2005. Every spring, Pat & his better half, Katrina, put on a crawfish boil where their backyard becomes “Mudbugs, Texas.” Pat’s also fond of the occasional cigar.

Show Notes

On today’s episode, Carrie is interviewing Pat Ramsey. Pat and Carrie are discussing the lifecycle of a project. Specifically, the handoff of Ongoing Client Services after a project is complete.

What you will learn from this episode:

  • OCS (Ongoing Client Services) happen after the project is complete.
  • Ongoing Client services are not always preceded with a project.
  • Client Services mean different things for different audiences.
  • Services can include maintenance agreements, enterprise maintenance and support or retainers for future help needed by your clients.
  • Keep packages basic (ex: making sure you’re monitoring that the site is up, updating software and plugins, or providing reports for Google Analytics).
  • Having ongoing maintenance agreements can help you through the “feast or famine” with recurring monthly payments.
  • You are selling convenience and value to a client by providing time and tasks that the client does not want to do.
  • A larger agency will have similar contracts for work. The Ongoing Client Services often includes an agreement for a certain amount of work with a specific time commitment.
  • An eCommerce or marketing site adds functionality to the site over time with digital content and features. This is the ideal situation for a fixed-term agreement.

Tips Freelancers can use when setting up OCS:

  • Set up your scope for services and define it clearly.
  • Have a readable text file that can become your Ongoing Client Services (OCS) Agreement.
  • Make sure that the client understands your terms.
  • You need to balance the work with rollover hours from a contract with multiple clients. The scope of rollover hours needs to be clearly established and address what happens to those hours over time.
  • Establish and maintain regular communication.
  • Set the level of expectation for response times.
  • Invoice on time (preferably using an automated system).
  • Having a one-time prepaid clause in your agreement with a set price can help you with the awkward client question of “Can you help me with this?” “It should not take too long.” This addresses the unbilled overhead.

Conclusion:

Ongoing Maintenance can become established monthly revenue for a freelancer. Be clear with your agreements and make sure that your client understands what you will be delivering on a regular basis. You become a partner with your client over time. If your client is buying a set of hours, you are invoicing ahead of time which helps you with your overhead and how you are going to account for your time. As you gain experience in your business, the established contracts help you manage your time effectively.

Resources:

Crowd Favorite
The Contract Killer
Andy Clarke’s Human Readable Contract

Follow Pat:
Pat on Twitter
Austin WordPress Meetup

Episode Transcript

Carrie: Hey, Pat. It is so great to have you on the show today. How are you doing?

Pat: I’m doing great, Carrie. Thank you.

Carrie: Yeah. When I was putting this season together and kind of looking at all the aspects of just the lifecycle of a project, the discussion would not be complete without talking about ongoing client services, ongoing support, which just so happens to be your area of expertise. [00:00:30] I’m excited to glean some wisdom from you today.

Pat: Cool.

Carrie: Let’s start out by … Maybe for folks that aren’t familiar with the term OCS, or ongoing client services, describe what that is and broadly what it entails.

Pat: For different audiences, it probably means different things. For somebody who may be a freelancer, you could be talking about maintenance agreements. [00:01:00] You move on up into more of the small business, larger business, enterprise space, you’re talking about things like just maintenance and support. You’re talking about supplementing existing teams with ongoing help. You’re talking about retainers. You’re talking about ad hoc or sort of pay as you go type of arrangements for problem solving here and there as needed. It’s kind of a wide [00:01:30] swath of things, but the gist of it is you’re talking about doing work with clients that’s not just one-off projects. You’re talking about they can call you up, they can send you an email, and you come back and work with them again and again and get paid for it.

Carrie: Okay. It is broad. My goodness. We might have to break it down as we go and kind of what might be the best way to approach that based on whether you’re a freelancer or a small team or a larger agency, like you’re [00:02:00] at at Crowd Favorite. You said this is ongoing, obviously from the title it’s ongoing, but you have initial contact with the client at some point. Is an agreement or arrangement like this always preceded by some sort of a full scale project?

Pat: More often than not, but it doesn’t necessarily have to. You could end up where somebody needs that type of ongoing support, either [00:02:30] … They’re not looking to have a whole new site built, for instance, or an app made or something like that, but their dev team isn’t up to the task, their developer quit, somebody retired, whatever, and they need somebody to sort of be there and act as their in-house dev team or in a similar type fashion.

Carrie: Let’s go through maybe some small, medium, and large examples of how this could look like. What I’m looking for are some specifics, [00:03:00] so in terms of, “Is this going to be a five hour plan? Can somebody call me 24 hours a day?” What are the … If you could break that out in maybe some different kind of scenarios, based on size of team, what an actual maintenance agreement plan might look like.

Pat: As a one person dev team, let’s say you run your own shop and you are the developer, designer, accounts receivable, [00:03:30] sales person, marketing person, the solopreneur, maintenance agreements can be really helpful and handy things, and they can be something as simple as for x amount of dollars per month, you get five to 10 hours of time for development or other such purposes. We make sure that we have a monitor running on the site to keep it up. We’re watching [00:04:00] your Google analytics, and you get a prepared PDF emailed to you every month. That’s it. It could be very, very simple, easy peasy type things like that, which if you’re able to get two, three, four, five of those as a single person dev shop, those recurring monthly payments can carry you through the feast or famine phases of not having projects and then all of a sudden having 80,000 projects then not having projects [00:04:30] again.

Carrie: Absolutely. That’s a great point. Would you recommend in that scenario doing more fixed fee, I guess it would be fixed fee either way, but fixed fee to knock out a bulleted list of things every month?

Pat: I would say do that. Make it very simple and very concise. Don’t go building 20,000 packages and offering those to people because then you got to keep track of all that. Just come up with something very basic. If you know what [00:05:00] your development demands have been, if you’re tracking things in a spreadsheet or whatever, if you can put hours to dollars and see what kind of demand people have asked of you over a period of time, you can start to look for patterns and then see, “Okay. A 10 hour type retainer might be the perfect offering for now.” See how that goes after some time and then make an adjustment to it. Maybe do a 20 hour one. Maybe do just a very basic five hour one that’s [00:05:30] a little more than updating plug-ins in a WordPress website type thing, making sure things don’t break when somebody hits the button.

Carrie: Yeah. I guess there’s just some different approaches in terms of are you selling your time or are you selling a set of tasks.

Pat: You’re selling the convenience and value that they get from not having to worry about that.

Carrie: No doubt. Yeah. No doubt. I guess I was just trying to mentally wrap my head around are you saying to your client, “Hey, [00:06:00] you’ve got up to five hours this month”, or are you saying, “Hey, each month, I’m going to take care of these line items for you.”

Pat: When I did this as a freelancer when I was kind of running my own shop, I did it in a mixed way. I said, “You get three bullet points. These three things are done every month, and then you get up to five or 10 hours worth of time”, depending on how much they paid. They could call me up and I’d be [00:06:30] on call and I could come to their office and we’d work through some problems, do some troubleshooting, that type of thing, and that worked against that bucket of hours, but then they also knew that the site was going to stay up, we were going to do what we were doing. We were taking care of any 404 reports, monitoring various services to make sure things were running, things stayed up, and that was really about it.

Carrie: All right. That kind of covers, I guess, the small guy, or the [00:07:00] solo person. What would the next tier look like?

Pat: The next tier would look like a more detailed set of offerings and larger hours, larger numbers of hours. You’re getting into bigger dollars. You’re probably getting into contract times too, so instead of maybe recurring month to month, it’s for six months at x amount of [00:07:30] rate for this deliverable. You’re defining longer relationship times, so you’re increasing your value there, which means you’re also offering more on the regular basis. You’re probably looking to have a couple of extra people working with you in that case because the only finite thing in this is time and there’s only x amount of time per day and per month.

Carrie: Who is the ideal client? Anybody with a website could use sort of that first [00:08:00] tier, right? Just making sure everything is up and running and up to date. Who’s the ideal for kind of what we’re talking about right now? Is this like an ecommerce shop that might need you to go in and add some custom functionality kind of here and there, or is it-

Pat: It could be that. It could be somebody who’s starting off with initially a marketing site, just as an example, but they know, over a period of time, they [00:08:30] have goals in mind of having various pieces of functionality added to the site. Somebody may be on a campaign and they’re going to have lots of recurring type of work over a period of time that involves updates to the website, digital content to be created, things like that. It could be somebody working towards the development of an application and a website interfacing with a third party system, so there’s a fixed period of time [00:09:00] in which they’re going to need some help. Maybe not necessarily purely on a project, but it’s involving development of … You got a team building out the app. You got somebody who has to keep the website up. You’ve also got some marketing materials going on, so you kind of have a mix of things all revolving around the website, perhaps. Those are just some thoughts.

Carrie: Would it look really that much different at a larger agency level?

Pat: It doesn’t look that much different. It’s just there’s either more of [00:09:30] the work to be done or larger type of contracts. You’re talking about one year contracts, longer periods of time, bigger numbers of hours.

Carrie: That makes total sense. It’s really the term of the engagement, or it’s at least the upfront commitment, I guess.

Pat: It is. I think that, all things being equal, it is the amount of work you’re talking about doing, being able to scale up because [00:10:00] of all the various pieces that go into that work. There’s a lot of overhead involved, not just writing code.

Carrie: Let’s say that I’ve completed a web build project with you. I’ve hired you for some level of ongoing services, kind of doing some bulleted list things, and every once in a while, some extras in there. Let’s say I’ve got a huge chunk, like I’m like, “Okay. [00:10:30] I’ve decided that I want to add this whole other wing to my house.” I guess the question is, at what point does a mini project that sort of falls under that OCS agreement become a full project that needs to be scoped and go through a formal process?

Pat: Oh that’s a great question. That comes up all the time. [00:11:00] I think the answer there starts with the relationship you have with your client. You have an understanding of the work with your client because the hope is that you and your client are operating as partners. That’s one of the first things with ongoing support is it’s the relationship you have with your partners. You have that built-in relationship that you nurtured and you’ve worked on together, so you approach the problems together. When [00:11:30] something like that comes up, it’s not that difficult of a question to come to a realization of, “Yeah. Let’s not divvy this up against a bucket of hours over a period of time because this demands sort of the full project type of approach, a fixed bid, a fixed timeline. We need this delivered by x and there’s x amount of work to go into it. The ongoing support structure [00:12:00] isn’t the best fit for that.”
The ongoing support structure is you’re there to help take care of things as they come up to be proactive on various things, keeping the website running and running smoothly, making sure the new content is added, making sure the new functionality is put into place, but once the scope of a need gets to a certain scale, mathematically it doesn’t fit within that structure.

Carrie: Okay. That [00:12:30] makes a whole lot of sense. Let’s say that we … Going back to we are operating under some sort of an ongoing service agreement, how are you planning out the time against the tasks? I’m not necessarily asking about the tools you use, although if you want to talk about that, that’s totally fine, but let’s say you’ve got five hours in a month, or 10 hours. What’s the communication [00:13:00] between the client and you in terms of, “Does that mean that you’re spending two and a half hours a week? Does that mean that you’re spending 10 hours at the first of the month and it’s, ‘Oh sorry, Charlie. If you don’t have that new bucket of hours rolled over and you need something else’, or” … Obviously that wouldn’t be the case, but how do you plan for and distribute those maintenance hours?

Pat: In the world of me, in the way back machine, operating [00:13:30] as a freelancer, and I thought, “Hey, why don’t I start doing maintenance agreements with people? That way, I’m on hand. We already have an expectation set of what can be done, that type of thing. It’ll be awesome.” Five seconds after that realization and starting to email some people about maybe doing this, I immediately thought of, “What happens if the time’s not used throughout the month and nobody wants to do anything? How much of that banks? How much of that adds up? Oh, wait. What if I have five [00:14:00] of these things and everybody wants to use all their hours all at the same time? Oh crap.”

You start having those sort of eye opening thoughts in your head where you sit up and go, “Wait a minute. I didn’t think about this.” The first thing is to play that out and make sure you’ve got all that written down. The next thing is be very clear in the expectations that are set between you and the client as to how this works. The mechanics of how you do that vary from case to case. [00:14:30] When you’re, again, that one person shop and you’re wearing all the hats of running the business, you want to keep your overhead to an absolute minimum, so you’re probably not going to have a complex structure of communication, expectations, response times, deep contract setups, that type of thing. You might. I guess I’m saying I’m making an assumption here that you’re going to try to keep your overhead to as [00:15:00] minimum as what’s necessary to keep things running smoothly so you get the work done for your client.

That actually doesn’t change when you get to the enterprise space either. The enterprise space, nobody wants to use their time for a lot of overhead. They want to use it for actually solving their problems, which is the goal. Even there, you’re going to have a lot of efficiency and reduction of overhead in place just to keep the focus on solving the problems that are rising up. [00:15:30] You’re going to want to be pretty clear so that you understand, and the client. You both are sitting there, sitting on the same side of the table, saying, “This is how this works. Here’s how we expect this time to get used. Here’s what happens if it doesn’t get used. Here’s how much rolls over, if any. Here’s cancellation.” You just kind of work those details out as efficiently as you can.

Carrie: Is there a sort of industry standard for rollover time, or is that just [00:16:00] anybody’s guess?

Pat: To my knowledge, there’s not an industry standard. It entirely depends on how you operate your business. If you have scoped the needs out for your client properly, if you and your client have sat there, you’ve worked out, “Here’s what we see this looking like. Here’s our expected needs. Here’s what we anticipate”, you can model a monthly contract with a monthly budget that’s not going to need to get rolled over.

Carrie: Okay, okay.

Pat: [00:16:30] Now until you’re in it for a while, until you’ve worked with people for a period of time, until you’ve gotten a sense of how that works, that may be difficult to do. I’d fall back on the make it very simple and try to find a number that you think you can do, however many you see yourself doing per month. What happens if you do want to allow rollover? Are you still able to get everything met contractually? Do you need to cut it to where it’s not going to rollover? What do you show [00:17:00] every month? How do you report that? That type of thing.

Carrie: Yeah. That goes back to your original point about all of these happen … In theory, it’s like, “Oh yeah. These hours roll over”, but then-

Pat: That’s awesome. But wait. Eight of them are doing it at once.

Carrie: Oh my gosh. Yeah. That definitely-

Pat: You have three days left of the month. Everybody wants to get all their time done. What do you do?

Carrie: Oh, well clearly you plan it better from the start, but any tips there on how you distribute [00:17:30] that for multiple clients so you don’t have that pile up issue?

Pat: I think you, speaking with sort of that target audience of, “Hey, I want to get into doing retainer agreements with my clients so that I can make a little extra recurring money, or whatever they call it, that type of thing”, you do want to define a scope of, “What does this mean? What does a rollover look like? Do I allow x amount to roll over? [00:18:00] Do I expire them after a period of time? Do I not roll them over? Is there a cutoff date in the month of when somebody wants to basically call in their marks and get a bunch of stuff done?” There are a lot of different ways you can approach that. I don’t know that there’s a right answer. I think it depends on the situation.

Carrie: Yeah. Okay. We’re talking a little bit about the things that would go into some sort of an agreement or contract. [00:18:30] Have you seen any good open source, if you will, resources out there to kind of just show what maybe some of those contracts or agreements would look like and some of the language involved?

Pat: I have not. When I was doing this on my own, I had sort of a basic English language or human language type contract that I would use for my projects. I can’t remember who put that one out there. This [00:19:00] goes back probably about a dozen years.

Carrie: Oh wow. You’re old.

Pat: Yeah, yeah, yeah.
One of the early sort of public speakers on the web, I can’t remember his name, did a lot of the Java script and CSS web standards work, had a human readable type contract. He would put that out there. He would say, “Here’s a text file. This is what I use.” I modified that and that became my agreement, to keep [00:19:30] it simple, to keep it clear, not to go into a whole bunch of lawyerese at the time, because, again, in a one person shop, I was kind of keeping my overhead down. For me, that worked. That may not work for everybody. For me, that worked.

If I were going back and doing it again now, I would have a deeper actual contract, various sections and things like that, but that’s 12 years of learned experience. Yes, try [00:20:00] to keep it simple, make it effective, make it real, and as far as how you would structure a retainer agreement, you’re just defining the scope of, “These are the expected hours. This is the cost”, or whatever, however you’re breaking it down. It’s very clear in there, just like any other contract.

Carrie: Okay.

Pat: Here’s the thing. If you’re a freelance developer and you’re building sites for people, and that’s great, you build [00:20:30] a site, you give them the site, they pay you, you walk away, you’re good. You’ve done that. You repeat that process for the next client. When you’re doing retainer work, or you’re doing ongoing work, you’re building value in yourself. You’re not a freelancer anymore. You’re a business. You have contracts signed for periods of time upon which you deliver certain types of work. There’s sort of a expectation that comes with that of, “Yes, contracts matter.”

[00:21:00] Make a nice, straightforward, but still professional, contract because you’re building a portfolio of contracts, of agreements, of work with people. People are relying on you day in and day out. They’re not just saying, “Okay. Yeah. Build the site. Great, thanks. Good to know you”, and then walk away. You and your clients are working together as partners for a period of time.

Carrie: That actually makes me think of a question on the flip side. Are you usually signing any kind of contract on [00:21:30] their end, or you as the provider, partner/provider, the one-

Pat: If you’re doing a contract with people, you are both signing it. You’re both agreeing to do it. That’s my take. Is that what you’re saying?

Carrie: No, I meant like are they … Let’s say that you have client x, y, z and you’re giving your contract to them to sign. Do they also maybe have their own in-house contract that they get their vendors to sign kind of thing?

Pat: [00:22:00] No. I don’t … I wouldn’t do that if that were the case. I’m not a lawyer or anything, but when I was doing this on my own, no. I would sign non-disclosure agreements, but that would be about it.

Carrie: Okay.

Pat: I’m providing you the service. I’m going to provide you the contract for the service.

Carrie: Yeah, that makes sense. I was just-

Pat: That was my approach.

Carrie: I’m feeling you. Have you ever heard of the contract killer?

Pat: No, I haven’t. [00:22:30] Sounds like a bad WWE name or something.

Carrie: It’s something that I came across a couple years ago, but it’s up on GitHub and it’s just basically human language for writing, like if you had a contract for some sort of creative project, a web project or a design project or something like that. It doesn’t really quite work if you’re getting into like a retainer or maintenance agreement, [00:23:00] but I love that it just sort of gives a baseline, like some ideas for the types of things you’d want to include in just a regular project contract.

Pat: You are talking about what … Yeah. The original version of this is what I used. Going back to 2008, that’s when it was.

Carrie: Okay. All right then.

Pat: Yeah. Andy Clarke’s Human Readable Contract.

Carrie: Did you just pull that out from the depth of your memory, or did you cheat and Google?

Pat: Are you kidding me? I’m in front of my laptop.

Carrie: [00:23:30] Just checking, just checking. Wow. We’ve kind of covered like all the major components of what that agreement might look like, some of the things that it might include, when it’s appropriate to maybe get out from underneath that agreement in order to break out and do a project all its own. You do this day in and day out. I know that there are things that [00:24:00] … I’m not going to ask you, “What question did I forget to ask you”, because I hate it when interviewers do that, but are there any tips or maybe just common gotchas that you’ve seen?

Pat: Yes. The first is set your scope and define it. Make sure that you and your clients understand exactly what’s going to happen. Now, you’re not predicting the future, you’re not saying, “These are the functions we’re going to write. Here’s the code we’re going to deliver”, [00:24:30] but you’re stating, “Hey, this is how this is going to work. You’re going to see this and this is going to happen every month.” Make sure that that’s clear. If it’s not clear and you go into this agreement, something’s going to come up that’s going to be a problem. That, again, harkens back to make it simple, make it clear.

The next one, there are a few things I’ve seen, the next one I would say is establish and maintain regular communication. If you’re talking about monthly agreements, you should be talking [00:25:00] with … You and your client should be talking at least once a month. I would expect more than that, depending on the terms of the arrangement. Think of it as you’re at a restaurant and the waiter or waitress is coming up and keeping your glass filled. You don’t want them there every five seconds adding more ice to the glass, but you don’t want to sit there with an empty glass either. The perfect waiter or waitress understands how to keep the beverages full without [00:25:30] being a pain.

Carrie: That’s a great example.

Pat: Maintain that. Set that level of expectation and maintain that level of communication with your clients.

A big one is get paid, which means invoice on time. If you say you’re invoicing on the last day of the month every month, whatever, if that’s a Saturday or a Sunday, you’re invoicing every month. Hopefully you have a system set up to automate this, but you’re still doing that. You’re [00:26:00] not being the slacker, fly by night developer going, “Oh yeah. I got to send you that invoice”, because on their end, they have financial expectations and financial forecasting their doing. On your end, I’m hoping you’re starting to do the same thing too.

Carrie: Sure. That brings up an interesting question. Are these sorts of agreements typically paid for ahead of time, like before the work is delivered? I guess it just depends at what point in the month you set up the billing cycle, but have you seen any standards [00:26:30] there?

Pat: If you’re buying a set of hours, I would say you’re paying ahead. You’re going to invoice them on the first of the month, and you’re invoicing for the month ahead.

Carrie: Gotcha.

Pat: Because you’ve already defined what that looks like.

Carrie: I had a great conversation with Emily White who runs a small agency here in Texas, and she was talking about how she had implemented some sort of ongoing [00:27:00] arrangements and basically it’s buy a block of time on her website, prepaid, and she said that the relief that it’s brought has been fantastic in the sense that when a client emails or a client calls and says, “Hey, I need this”, then it just removes that whole awkward, “Okay, am I giving my time to you, or do I actually quote you for something.” There’s just already an arrangement and an agreement set up, and then [00:27:30] it allows both of you to kind of move freely in that.

Pat: Yeah. If you have a contractual arrangement already in place for time spent solving your clients problems, you’re exactly right. She’s dead on. You’ve just eliminated all of that unbilled overhead of, “How am I going to recoup my time? How much time am I putting into this?” It is so true. That’s all the way up from freelancer to enterprise.

Carrie: Awesome. [00:28:00] Pat, you have been a fountain of information, as I expected. I expected that you would be. Where can people follow up with you online if they want to stalk you or say hello?
Pat: The agency’s website is crowdfavorite.com. You can always see what we’re doing there. You can find me on Twitter at I believe it’s pat_ramsey. I hope I know my own Twitter handle. I click the icon and it comes up. You [00:28:30] know? Yeah, you can find me on Twitter, Pat Ramsey. If you’re in the Austin area and are looking for a WordPress meetup, I’m very active in the WordPress meetup that we have here and you’ll probably see me at some of our regular events every month.

Carrie: Or if you’re in Austin and want to smoke a good cigar or drink a great craft brew, Pat is your man.

Pat: Yes. If you are in Austin and want to enjoy a nice cigar, we can find a porch somewhere.

Carrie: Awesome. Thank [00:29:00] you so much for your time, Pat.

Pat: Thank you, Carrie. It’s been a blast.

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