Corporate or Government Contracts: The Holy Grail?

Yesterday I posted a link to an article in the Independent about how Capita have been accused of allegedly abusing it’s position as training provider for central government.  That, along with the publication of my latest NLP Demystified series “Your Professional NLP Practice Demystified” got me thinking about that supposed holy grail of any trainer or coach – the contract with a corporation or government institution.

One of the most common questions I get from people who want to set up as NLP trainers and coaches is what I think of corporate and government contracts, if they really are the holy grail people think and, if so, how to get them. So here is my take.

Firstly, you have to think whether you actually want one! There may be a belief that a big corporate or government gig is the holy grail, the cash cow, that will make you rich and successful, but sadly it isn’t true (as we will see).

Here are a few things to consider:

(Note: I have used the word “company” to denote both a corporate or government contract for brevity and ease of reading).

Might is Right

If you contract with work for reasonably large company, you will be expected to abide by their terms and their their contract. You may want to charge £35 an hour travel, stay in 5 star hotels and be paid upfront, but if their terms are 90 days and only pay 43p a mile and £50 overnight expenses, thats what you have to accept.

There may be additional clauses in the contract too, so you will have to pay very careful attention, like who owns the rights to the course or coaching package you deliver, anti-competition clauses (not being allowed to work for anyone they deem as the competition) and all sorts. You have to be really on the ball and sometimes even employ a lawyer to go through it all (which eats into profit).

The company know they can go elsewhere and find a trainer or coach who is willing to agree with their terms, so they have all the power in the negotiations. I have walked away or turned down corporate gigs (or mainly government ones) as the hoops they wanted me to jump through really weren’t worth the amount they were going to pay me. Which takes me to my next point…

It’s Not as Lucrative as You Think

Day rates used to be high (most trainers I knew were on £1000+ a day, most coaches £150+ an hour) and there used to be a lot more work to go around, but that has all changed. Yes, there are some trainer and coaches who can still charge that (me included), but that is because they have a reputation, references and a track record. If you are just starting out you won’t get anywhere near that, unless you are very lucky or have the right contacts (it really is all about the contacts, see below).

Supply has increased significantly, demand has fallen and the process has become much more complicated and time consuming with more third parties, paperwork and processes (tendering and such) to go through to get the gig.

Unless you have a strong reputation you will earn about £200-£500 a day for coaching or training, which may sound a lot, but you won’t be working every day (on some occasions you may be lucky to get a day a month).

“All Your Eggs In One Basket”  – Lack Multiple Streams of Income

I have known a number of trainers who have gone bust because they put all their eggs in one basket and taken work on from just one company. All of a sudden that company has not renewed that contract and they have been without an income and scrabbling round trying to find work. Most of the BIG contracts (the ones that pay well) are almost full time jobs (see below) and you will take up all your time, meaning you are running the risk of not diversifying your income. Other trainers I know have worked through agencies (see below) and all of sudden the agency has cut their day rate or work has dried up, again meaning they struggle to make a living.

What is much more important than chasing that big cash cow contract which will give you a perceived sense of security (but not real security), is to build multiple streams of smaller incomes so you are not overly reliant on just the one.

Almost a Full Time Job?

If you are contracted to just one company as an external coach or trainer, you are essentially working for them without all the benefits of actually being employed! No sick pay, no holiday pay, no redundancy.

If you want the security of big contracts you may want to consider whether being self employed is the right thing for you. Maybe you would be better off getting a full time job doing what you do. For example, many organisations are now actually employing in-house coaches as it is much more cost effective for them than using external ones (another reason that there is less work to go around for external coaches and trainers!)

How to Get A Contract

Still with me? Still want to go for corporate or government contracts? Lets have a chat about how you actually get them.

It used to be about supply and demand. A company wanted a coach or trainer and would look for one. They would contact a few, have a chat, get a quote and then decide which one they preferred, it was all very straightforward. If you had a good reputation and were easy to find and put yourself out there a bit,  you would tend to get approached fairly frequently (that was how I got all my in-house contracts back in 2007!) There were agencies and tendering back then too, but because NLP and coaching was less known, the scope for that was very limited.

Nowadays a large proportion of in-house work is through agencies or a tendering process.

1. Tendering

I used to have a rule of thumb that if someone wanted me to tender for some work, I would refuse to do it on principle. I was (and still am) very skeptical of most tendering processes. It was once summed up to me by a procurement manager that I knew as “ Cost first, quality second”, so they would often employ substandard and or inappropriate trainers or coaches as they were the cheapest and then get terrible feedback from the delegates!

This is still the case, if not worse! More and more companies are asking for you tender for work. Tendering used to be reserved for very large contracts but the threshold has been lowered by many companies meaning almost all training and coaching programmes have to go through this process now.

This, to be honest, is a nightmare for individual freelance coaches and trainers. Tendering in itself is a very specific skill set, and is time consuming and costly processes (incidentally, in some cases, you used to actually be able to charge to submit a tender. You can’t any more). Add to that the fact that trying find a tender is a nightmare! Most tenders are listed on specific websites that charge you a (not inconsiderable) fee to join and be alerted of any tender you may be interested in. So, you have to find the websites where the appropriate tenders are listed, join, pay the fee, search for any tender you may want to go for, complete bid and then hope that you get awarded the contract. It is a long, drawn out  process that most trainers and coaches are ill-equipped and ill-prepared to do.

Which is why you finding the rise of the agency model…

2. Third Part “Agencies”

The way companies such as Capita tend to work, is they are experts at the tendering process and at building contacts. What they are not experts at is delivering the training or coaching package. For that they will have a network of third party trainers and coaches that they will draw on to deliver the packages they have successful bid for. Sometimes they will already have people on their books that can do it, other times they will need to find someone (it is not uncommon in my experience for such companies to bid for work they cannot yet deliver and then, if they win the contract, scrabble around trying to find someone to do the work).

Which means they may contact you out of blue (as I have been on several occasions) when they have won a contract and don’t have anyone to deliver it, but more often than not they will have a banks of trainers and coaches to draw upon.

If you are going to go down the agency route there are a few things to bear in mind:

1) Most agencies specialise in a particular business sector – legal, finance, etc  – and not in the training or coaching packages. Which means you will need to sign up to a number of them to get a broad range of work (this also reduces the risk of putting all your eggs in one basket – see above).

2) Your training fee will be a lot less (in my experience up to 50% less) than if you work directly with a company. You will earn around £300 when first starting out.

3) Some pay expenses, some don’t, so make sure you clarify that before accepting work a long way away.

4) Don’t think you can use them to get an initial contact and then re-negotiate directly with the company once you have built a relationship. Many of these agencies have an anti-competition clauses meaning you cannot work with any company directly that they have an relationship with.

If you are happy to accept the lower day rate and more restrictions (not always in exchange for more regular work) this may be perfect for you, especially if you are not comfortable with selling yourself or lack the contacts. I know of trainers and coaches who work almost exclusively through agencies as they feel more comfortable with that than touting themselves out and they are very happy.

I must make it clear that I am not against these sort of agencies, I am signed up to a few myself. But what I do have an issue with is a number of agencies that have cropped up who have taken advantage of the fact that more companies are tendering for work and most individual coaches and trainers lack the knowledge to be able to bid. Many of these are too small for the larger agencies to bother with. So what they do is get the tender then offer the work out to anyone they can find, for a meagre sum and pocket the lions share themselves. This bluntly is a scam. I have been approached by a number of such companies who offer a laughably low day rate. Sadly they, more often than not, find someone desperate enough to accept the work. It is a real shame.

Please be very careful when working with agencies and make sure you only accept work or approach ones with a track record, references and good reputation.

3. Direct Contact and Referrals

My recent experience in trying to make direct contact with anything more than an SME, is that you will hit a wall of bureaucracy, requiring a tendering process, or they will be outsourcing their training to the one of the agencies.

Of course, even with all these additional barriers to entry it is still possible to get “straight in”, this is most commonly for shorter training or coaching programmes though (where a tendering process is just not cost effective). You may be contacted because they have heard of you and your reputation, or you have been either mentioned or specifically referred by someone (this is how I still get around 75% of my in-house work nowadays).

Or you could focus purely on SME’s, they tend to have a more straightforward process for in-house training (but a smaller budgets).

This is why having contacts is so important (see “Your Professional NLP Practice Demystified”), if you don’t have any relevant contacts yet, you need think of ways you can run in the same circles as your prospective clients. Business clubs, events and networking organisation are good things to consider. Join professional organisations and go along to their workshops, seminars and event. Offer to do talks to organisations. Remember, if you are going to these to avoid the direct sell, it is about building contacts (it is also a long game, you may not see any fruits from your labour for some time, but I have had people contact me years after).

LinkedIn is also a great place to build contacts, but that really is a topic for another post!

Closing Thoughts

This may, in places, sound a bit of a cynical post. That is probably because I really wanted to highlight the pitfalls that most people don’t know of. The world of in-house training has changed a lot since the “credit crunch”. No doubt some of these changes will be permanent and some only temporary until things settle down (it is hard to believe it has been 7 years and things are still in a bit of flux). I am certainly noticing that direct contact from companies as increased in the last few months, mainly for sending employees on my open training courses (where the agency or tendering model aren’t appropriate).

You hopefully now have some more knowledge and choices about what you can do to get company contracts and are more aware of how it works.

I wish you the best of luck.