The Age of the Consultant
More companies are replacing full-time employees with consultants. Here's how to tell if you're cut out for it.
Sharon knew she would have to fire herself.
As an IT executive at a Fortune 500 firm, she had been assigned the unenviable task of downsizing a department and cutting positions that didn't fit with the company's future outlook. As the final layoffs neared, she read the numeric tea leaves. The problem began with her job search. As an executive, it wasn't a guarantee that a new role would become available that had the benefits and salary she commanded. After a few months, leads remained slim, so she decided to bet on herself by becoming a consultant.
Sharon, whose name has been changed for privacy purposes, came to a conclusion that has become far more common as companies tap independent talent in order to cut costs such as healthcare, and to remain agile as their strategies shift. While it's unclear just how large this group of nomads has grown due to the fluidity in defining the term "contractor," the Wall Street Journal found that large firms outsource 20% to 50% of their workforce. Meanwhile, Accenture has predicted that within 10 years, a Forbes Global 2000 company will have no full-time employees outside of the C-suite.
"For highly productive professionals who have reached the point in corporate America where they are topping out in salary, it's highly likely that they will hit roadblocks," says Elaine Pofeldt, author of The Million-Dollar, One-Person Business. "Becoming an independent contractor can be a way to control their own opportunities."
But starting down the consulting path is a bit of a chicken-and-egg issue: Building up a strong clientele takes time, yet companies want to hire consultants who have proven records and can show, quite quickly, that they're creating value. Here are some factors to consider for the consulting route.
Know your personality.
Pretty much every job as a consultant is a performance review-you're judged each time on your deliverables. So those who struggle under the constant requirement to prove oneself could find the practice mentally draining. After all, companies aren't required to keep you on, so you have to knock it out of the park every time. There are also more peaks and valleys in consulting, with busy times and dry spells that can throw people who prefer uniformity into a tizzy.
Consult your former peers.
If you've decided your traits may mesh with a consulting gig, a way to start down the path is to consult for your former employer, or tap into your network to see if people need your expertise. Sharon, for example, connected with a group of contractors run by someone she used to work with. Through this group she landed a number of assignments at Fortune 1000 companies, which helped her build a stronger consulting rolodex-making her all the more attractive to future clients and hiring managers. "Any one of the people you work with could potentially refer you to a job opportunity," Pofeldt says.
Don't fuss with the details.
Career experts say one of the biggest mistakes new consultants make is spending too much time on details. Your logo, business card design, and even your website can wait. After all, what are you going to say on the slick-looking site about your clientele and experience if you have none? Instead, focus on what you can offer companies in terms of your skills, researching rates for your services, and culling your network.
Learn to say no.
When starting out, it can be tempting to take on every project that comes your way, especially with the ebbs and flows of the job. But career consultants say building a portfolio slowly and diligently will ultimately win out over tackling too much. And if all goes well, you could find yourself with an offer to move back in-house … with a client wanting to hire you full-time because you've become so necessary to their firm.