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Principles of A Modern IT Consultancy

Appeal To Tradition is a logical fallacy that can be stated as follows:

X has been done for a long time.
Therefore, X is right or good.

First Principles reasoning is an alternative to appealing to tradition:

Problems should be broken down to their fundamental truths.
Solutions to those problems should be built from what you know to be true.

A bridge in Austin

Founding Cooptimize

While founding Cooptimize, we’ve tried to avoid appealing to tradition. We strive to use First Principles reasoning in our structure and decision making.

Does First Principles thinking mean all our ideas are right? No. It only means when we come up with new ideas, but are wrong, we can examine why our premise was flawed.

(so far, we’ve been less wrong than we expected…)

Exploring Consultancy Fallacies

There are plenty of Appeals to Tradition to choose from in IT Consulting. With our decades of IT project experience, this page could be a book.

But these eight fallacies made our heads explode the most. 🤯

The fatal flaw with hourly billing is inefficiencies are rewarded, and efficiency is discouraged. It’s an uphill battle; your great, time saving idea has a negative impact on revenue! Of course, the solution is for 23 people to figure out monetizing the idea, at which point your Great Idea™️ morphs into Mediocre Idea™️. You’re still in charge of it.

Time entry is also a significant business overhead. Filling timesheets, the mental space to remember what you did, follow up on late time, budgets, budget reconciliation, billing, and collections are all hidden overhead costs. None of these tasks add value to a client; in fact, the client also has to have overhead to check all this data.

Timesheets aren’t required. We don’t do them at Cooptimize. We’ve found units of measure other than hours to bill for our value. If we ever did end up with some hourly billing, it’s going to automagically pull from our calendars or something.

We want to encourage automation and innovation. Continuous improvement must have positive correlation with our business outcomes. We also want to discourage overtime. Cooptimize shouldn’t make more money by overworking employees.

The average consultant’s timesheet probably looks something like this, with each color representing a different client or project:

A fake calendar showing a disorganized schedule.

This type of schedule is absurd, a frustrating way to work, and probably missing Saturday.

There is a mental and productivity cost to task switching. In our experience (and some fancy academic study agrees) it takes about 15 minutes on both ends of task switching to get your brain focused on the new topic.

Let’s say a consultant has four calls in one day at 8:30, 10:30, 1:30, and 3:30. The consultant now has two hours left to focus and actually get work done after subtracting all of the task switching time…

BUT WAIT! Under that schedule, the two hours of remaining time is in 15-30 minute blocks. That’s about enough time to enter your late timesheet and explain to the project manager why all the tasks are overdue!

At Cooptimize, we believe it’s more effective to plan 8 blocks of Focus Time™️ per week, with 6-7 blocks being the maximum that can theoretically be sold and scheduled for any one person. Fridays are part of the weekend because 32-hour weeks are long enough.

A fake calendar showing an organized schedule.

Focus Time™️ means three things:

  1. Collaboration – Consultants work on the same client at the same time.
  2. Reduce Distractions – Unless something is on fire (it’s never on fire), it can wait until it’s time to focus on that client.
  3. Efficiency – Enough time to do real, actual, work!

A human being is not a machine to be “utilized”. Analyzing the productivity of human employees with the same metric used to analyze robots is…weird.

In a best case scenario, Utilization could be decent to determine the effectiveness of managers and sales teams in a consulting firm. Utilization % should be “bunched together” across the firm, without a lot of outliers if the available work is evenly distributed.

When trying to measure individual contributors, looking at utilization is flawed because:

  • Inefficiency (or consultants bullshitting their timesheets) is a positive signal.
  • Project managers are tasked with an opposing goal – they are supposed to “keep things within budget” – minimize the number of billable hours.
  • Utilization does not measure progress or value added.
  • Teamwork isn’t measured, good consultants can make an entire team more effective.
  • Measuring progress is hard, especially on larger IT projects.

Not utilizing utilization metrics is low hanging fruit. We don’t have some magic solution to measure value. However, since we can’t fall back on time spent as a measure of value, we’d better be able to demonstrate results!

Humans owe each other fairness. Loyalty is a state of mutual, ongoing fairness. Loyalty is not a “fairness bank” from which a company can withdraw when things are unfair.

The rise in unions in the USA is heartening; I wish we’d see more demand for unions in IT Consulting firms. It’s possible to collectively bargain for fairness if it’s not given by ownership.

Cooptimize hopefully goes a step further than a union, as we are organized as a cooperative. That means employees collectively make the decisions.

Your brain and skills are worth a lot. If your company doesn’t operate with fairness, quit and start something or go somewhere that does.

There’s a saying in Business Intelligence by Matthew Roche related to transforming data:

Data should be transformed as far upstream as possible, and as far downstream as necessary.

I’m going to steal his structure and relate it to managing a company.

Decisions should be made at the most detailed level possible, and executed as widely as necessary.

Companies we’ve worked for have generally made decisions at the highest pyramid level possible, then they looked down and said, “activate execution mode: go!”

W believe decisions should be made collaboratively and based on consensus. We should actively push decisions to the people most affected by them, and we should ensure priorities at all levels are aligned with the business strategy.

We don’t know what the right “shape” for Cooptimize will be, but it’s not a pyramid. If that means we can only grow so big, then we’ll stop growing.

Is it hard to get pricing from a vendor? We think that’s a red flag 🚩.

Cooptimize puts our pricing on our website. We use the same pricing model for everyone. The prices will go up once per year on January 1st.

(Client Pro-tip: When dealing with consulting companies, spend time negotiating the “who” instead of the “how much”. Bad Consultants™️ cost significantly more than good ones.)

Consulting firms don’t keep salaries secret so they can overpay you.

Not having a salary formula is also begging for discrimination. Employees who already have less of a financial safety net may be in a position where they are forced by their life situation to accept what is offered. It’s unfair.

Our salary structure is clear and transparent. We even post it on our website.

When companies talk about profit, it’s usually tied into business operations like cash flow, investments, growth, return on capital, etc. In our careers, the answer to “where does the profit go?” was never “straight into the workers’ pockets.”

We think profits should go straight into workers’ pockets – 100% profit sharing. We all participate in the same, transparent profit-sharing formula.

Structuring Cooptimize this way means no yachts, or private country clubs, or exotic pets for us. We’ll be ok.


“Congrats on Your Hippie Cooperative…
…How Does this Help Clients?”

Good question, snarky reader! And thank you for making it all the way down here.

Our Business Strategy

The Cooptimize Strategy can be stated as follows:

Companies Require:

  1. Ongoing, long-term help to apply “business intelligence” to their strategy and processes
  2. From a consistent group of people
  3. With expertise in specific business intelligence tools, specific ERP/CRM systems, and broad business knowledge

We Will Help Them.

Executing the Strategy

  1. It’s not enough for us to complain about consulting processes we don’t like. Our First Principles reasoning ties to the execution of our strategy.
  2. Providing ongoing services means carefully structuring time, providing fast value, automation, and investment in open-source tools.
  3. Having consistent employees means wage transparency, profit sharing, short work weeks, and no dumb metrics or annoying processes.
  4. Expertise means meaningful collaboration, researching technology, and targeting specific Microsoft technologies to consult on.

Eliminating Fallacies

We’ve been doing consulting for decades. The level of service we can now provide our clients is just…different. It’s still us. We have the same skills. But it’s different. 🤷

So get rid of all that “Appeals to Tradition” reasoning! Deal with our brand new fallacy – Argument from Font™️:

Cooptimize is different (with italic font).
Therefore, Cooptimize is right or good (or at least bold).

A different bridge