CAREERS IN MOTION: Hanging out a shingle

In this follow-up to his previous post, James Abruzzo discusses how becoming an independent consultant can be a path to a new job.
In my January 2nd article—“New Year’s resolution—get a new job”—I promised the next post would be about the fourth option for finding that new job, which is starting your own consultancy, or figuratively “hanging out a shingle.” As the founder of an ethics institute and, therefore, a person of my word, here goes.

Let’s begin with a definition: “Hanging out a shingle” means starting your own business (and putting a sign outside your door); it’s also about taking your professional skill, personal talent, or even a favorite hobby and monetizing it by independently offering that service or product for sale. For example, after a successful 25-year career as a strategy consultant at IBM, my friend Robin is now an independent strategy and management consultant for local nonprofit organizations. Louise, who spent almost 30 years as a stage manager and general manager for a prestigious arts organization, took her love of flower arranging and began offering her own arrangements for sale—and then she held classes in flower arranging. Javier, who worked in corporate IT for two decades, began offering IT services and advice to dozens of small businesses, first in his community and now regionally.

Becoming an independent consultant has taken on new meaning in the last few years given how the employment market is in turmoil. The start of the pandemic brought mass firings of full-time workers. Shortly afterward, the demand for more employees took off. And with the current (some would say robust) economy, the need for talent far exceeds supply across many sectors and levels. Ask any small business owner or nonprofit leader in the Berkshires and they will tell you that their number-one challenge is hiring more employees. As a result, companies in the region and nationally are turning to private contractors to fill skills gaps within the organization.

The statistics bear this out. Since 2020, the number of independent consultants in the U.S. has doubled to 64.6 million. It’s worth pointing out that many of these independent consultants turn to other consultants for help with accounting, setting up and maintaining a website, promoting the business, or even announcing the launch.

Furthermore, what it means to have a career has dramatically changed over recent generations. Remaining loyal to one company for an entire career is now a rarity, not the norm. Having a stint as a consultant on your resume no longer means “out of work.” And the continuing demand for talent—over 200,000 new jobs were created last month and unemployment is at an all-time low—serves as a safety net. If, after giving it a try, you find that you don’t enjoy being an independent consultant, you can likely return to the workforce.

Indeed, some professionals consult in addition to their full-time job—safely testing the waters, if you will. I’ve had my own management and compensation consultancy while continuing to run a division of a global company for over 15 years. It’s a win-win situation: My full-time job helps me get more consulting work, and my consulting work helps me win new clients for my full-time job at DHR Global.

So, if you are tired of working for someone else, or desire a change in how you work and for whom (as in, you’d like to work for yourself), then keep the following considerations in mind and give being a consultant a try.

• Competition: Because there are few, if any, barriers to being a consultant, you can expect a great deal of competition. And competition means you need to generate more proposals for each opportunity along with added pressure on how much you can charge. My advice? Spend less time on proposal writing and more time meeting with potential clients and producing meaningful intellectual capital that will distinguish you from your competitors.
• Working alone: If you are used to interacting with colleagues, you may miss that socialization as a consultant. My suggestion is for you to team up when possible, such as by finding another consultant whose skills complement yours. I work with a strong analytical person who helps me crunch the numbers when consulting on compensation, and she provides the kind of repartee I like. Having a subject expert for strategic planning is also helpful. Grad students are usually looking to earn extra money—if nothing else, being around them tends to keep you young.
• Business development: To consult, you need clients; once you have them, they need servicing. Among the most overlooked good news/bad news for consultants is that once you get an assignment, you may be tempted to spend your time exclusively on that assignment, ignoring new business development. But remember: You can carve out time for business development even when you are going full-tilt on consulting. Otherwise, you will not have any when you finish your consultancy with each client.
• Develop a niche: You can’t be all things to everyone. As with all fields, a particular skill—such as accounting, public relations, or operations—positions you among the competition and could allow for more dynamic pricing. Find a specialty or a unique service that is particularly useful for potential clients and one that can demonstrably solve their problems.
• Build relationships instead of transactions: The best clients are those you know well and put their trust in you. Like all relationships, that takes time and effort on both sides. Think about a consulting assignment not as a task but as a journey. Future business development will become less onerous as well.
• Be patient: You should take at least three months before you sign up your first client and another month before you deposit your first retainer check, so please ensure you have the cash flow in advance.

Good luck. And if you decide to try starting your consultancy or are already your own boss, send me a comment by posting a comment below or by writing me at theberkshireedge@gmail.com. Let me know how it’s going.

Link to article: https://theberkshireedge.com/personal-finance-choosing-an-executor-for-your-estate/