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Book Excerpt
Chapter 1
The Right
Stuff
What is a consultant? The
dictionary defines a consultant as “an expert in a particular field who
works as an advisor either to a company or to another individual.”
Sounds pretty vague, doesn’t it? But unless you’ve been in a coma for
the past decade, you probably have a good idea what a consultant is.
Businesses certainly understand
what consultants are and what their value is. According to the online
statistical source Biz-Stats.com, U.S. businesses spent nearly $28
billion on consulting services in 2003, while Plunkett Research Ltd.
reports that worldwide consulting revenues were $115 billion. And since
at least 60 percent of all businesses use independent contractors such
as consultants (according to the Bureau of Labor Statistics), you can
see that the market is wide open for new consultants in virtually every
industry.
And there’s more good news. The
U.S. Department of Labor’s Occupational Outlook Handbook 2004-05
Edition says:
The consulting industry ranks
among the fastest growing through the year 2012.
The industry is one of the
highest paying around.
The industry’s workers are
highly educated (72 percent have a bachelor’s degree or higher).
But why exactly are consultants
in such high demand? First, companies understand the value consultants
bring to their organizations by virtue of their experience, expertise
and knowledge. Second, consultants bring fresh ideas and a fresh
perspective to projects. And third, companies that have to lay off
workers for economic reasons still need to get the work done despite
their reduced labor pool.
Taking The
Plunge
For their part, independent
consultants have different motivations for taking the plunge into
self-employment. Some of them are baby boomers who may have worked for
years—or decades—for one or more companies, and simply are ready for a
career that will allow them to call the shots for a change. Others, like
Bill Metten, a consultant in Hockessin, Delaware, have been laid off or
downsized out of a job and decide to seek a new opportunity that will
allow them to use the knowledge they’ve acquired on the job. “I was a
senior executive for a chemical company when the industry went to pot in
the early 1990s,” says Metten, who founded his public relations/customer
service consultant business in 1991. “The company made me an offer I
couldn’t refuse, and since I had long harbored the desire to have just a
few clients and spoil the dickens out of them, I decided to take the
plunge.”
And still others, like Melinda
Patrician, a public relations consultant in Arlington, Virginia,
discovered that technology has made it easier to work as a consultant
from home. “The same technology that has helped me to be successful as a
consultant has made it easier for others to do the same,” Patrician
says.
Simply put, a consultant’s job
is to consult. It’s that simple. But what separates a good consultant
from a bad consultant is a passion and drive for excellence. And—oh
yes—good consultants should be knowledgeable about the subjects they are
consulting in.
You see, in this day and age,
anyone can be a consultant, and you can be a consultant in pretty much
any field or discipline, from management to wedding coordination,
academic course design, interior design and much more. All you need to
discover is what your particular gift is. For example, are you very
comfortable working around computers? Do you keep up with the latest
software and hardware information, which seems to be changing almost
daily? And are you able to take that knowledge you have gained and turn
it into a resource that someone would be willing to pay money for? Then
you would have no trouble working as a computer consultant.
Or maybe you’re an expert in the
fund-raising field. Maybe you have worked for nonprofit agencies in
marketing, public relations or sales, and over the years you have
discovered how to raise money. It’s possible to turn fund-raising
successes into a lucrative consulting business, according to John
Riddle, a fund-raising consultant in Bear, Delaware, who has done just
that.
Fund raising is growing in small
social services agencies, such as soup kitchens and homeless shelters,
and in large universities, colleges and nonprofit hospitals. Once you
have successfully learned how to write grant proposals to foundations
and corporations and get a few years of experience under your belt,
there’s no reason you shouldn’t be joining the ranks of fund-raising
consultants who are earning six figures—and more. And in case you are
wondering, yes, it is possible to be a consultant in more than one field
at the same time. Riddle did this when, in addition to having built a
successful fund-raising consulting business, he simultaneously used his
gift of writing to develop an editorial consulting business. It wasn’t
unusual for Riddle to find himself meeting with the board of directors
of a nonprofit agency concerning fund-raising strategies one day, and
the next day showing a client how to break into the publishing world by
writing book reviews for his or her local newspaper. He confesses,
however, that at times he wished he had concentrated on one or the other
field and not felt so compelled to work in different areas. Certainly
that’s good advice for someone in the fledgling stages of establishing a
consulting business.
Things To
Consider
When it comes right down to it,
working as a consultant can be very exciting and lucrative. Where else
can you work as a self-employed independent agent, set your own hours
and even set your own fees? Of course, you must be willing to devote the
time and effort it takes to make a living as a consultant; otherwise,
your consulting business will be doomed to fail even before it gets off
the ground.
Consulting is not for the faint
of heart, says Huntington Beach, California, human resources consultant
Susan Bock, who is also president of the Association of Professional
Consultants. “This is not the business arena for someone who enjoys
predictability,” she says. “There are no two days or months that are
exactly the same, which can be intimidating for some people. But for
someone who loves the freedom of working with his or her own clients,
it’s a wonderful life, and one that allows for exponential personal and
professional growth.”
When considering starting a
consulting business, first ask yourself:
What certifications and special
licensing will I need? Depending upon your profession, you may need
special certification or a special license before you can begin
operating as a consultant. For example, fund-raising consultants do not
need special certification, although you can become certified through
the Association of Fund Raising Professionals. And in some states, you
may need to register as a professional fund-raising consultant before
starting your business.
Am I qualified to become a
consultant? Before you hang out your shingle and hope that clients will
begin beating down your door to hire you, make sure you have the
qualifications necessary to get the job done. If you want to be a
computer consultant, for example, make sure you are up to date in the
knowledge department with all the trends and changes in the computer
industry.
Am I organized enough to become
a consultant? Do I like to plan my day? Am I an expert when it comes to
time management? You should have answered “yes” to all three of those
questions!
Do I like to network? Networking
is critical to the success of any type of consultant today. Begin
building your network of contacts immediately.
Have I set long- and short-term
goals? Do they allow for me to become a consultant? If your goals do not
match up with the time and energy it takes to open and successfully
build a consulting business, then reconsider before making any move in
this direction.
Do You Have
What It Takes?
While just about anybody can be
a consultant, the best ones possess some important skills, including:
Listening skills: When people
talk, do you listen? This may sound like a dumb question, but listening
is an acquired skill. By carefully listening to your clients’ needs, you
will better be able to solve their problems.
Investigative skills: You need
to have the ability to investigate and uncover the data necessary to
complete your consulting assignment. In time, your investigative skills
will become fine-tuned.
Analytical skills: When you
investigate and uncover data, you had better know what it means! Your
ability to understand and analyze complex information relative to your
consulting field is paramount to success.
Change skills: No, we don’t mean
exact change for the bus! But you must be a person who embraces change
and who can persuade your clients to make the changes necessary to solve
their problems.
Action skills: A good consultant
will be ready to “take the bull by the horns” and do whatever it takes
to get the job done. In other words, you will take action with a capital
“A.”
You’ll learn more about the
day-to-day responsibilities of running a consulting business in Chapter
2.
A Brief
History Of Consulting
It wasn’t until the 1950s that
consultants began to emerge in the business world. Until then,
consultants could be found in the legal, finance and employment fields.
Then something happened. When the U.S. economy changed from production-
to service-oriented in the early 1960s, the real birth of the consulting
industry took place. Since most consultants were providing a service as
experts in a particular field, they were welcomed with open arms by both
large and small businesses throughout the land. Then during the economic
recession of the late 1970s and early 1980s, corporate America suddenly
found it difficult to turn a profit. There seemed to be no other way to
boost the bottom line than by reducing staff. So little by little,
businesses began to cut back on operating costs by offering early
retirement packages to long-term employees and laying off anyone they
felt was expendable.
From a corporate point of view,
the thinking was simply “It makes sense to hire a consultant,” since
paying a consultant seemed like a cost-effective means of doing
business. So not only was there a boost in the demand for consultants,
but also many people who had accepted early retirement packages were now
setting up shop as consultants, often working for the very businesses
that had let them go.
At the same time, many
consultants were faced with a dilemma most people never have to face:
Too much business! So rather than turn away a client, independent
consultants joined with other consultants in their field, and thus the
consulting industry was born.
According to industry experts,
here are the top 10 reasons organizations hire consultants:
1. A consultant may be hired
because of his or her expertise. This is where it pays not only to be
really good in your chosen field, but also to have some type of track
record that speaks for itself. For example, Riddle says he knows that
every client who hired him did so partly on the basis of his track
record. After all, if you are a nonprofit organization that needs to
raise $1 million, it makes sense to hire someone who has already raised
millions for other organizations.
2. A consultant may be hired to identify problems. Sometimes employees
are too close to a problem inside an organization to identify it. That’s
when a consultant rides in on his or her white horse to save the day.
3. A consultant may be hired to supplement the staff. Sometimes a
business discovers it can save thousands of dollars a week by hiring
consultants when they are needed rather than hiring full-time employees.
Businesses realize they save additional money by not having to pay
benefits for consultants they hire. Even though a consultant’s fees are
generally higher than an employee’s salary, over the long haul it simply
makes good economic sense to hire a consultant.
4. A consultant may be hired to act as a catalyst. No one likes change,
especially corporate America. But sometimes change is needed, and a
consultant may be brought in to “get the ball rolling.” In other words,
the consultant can do things without worrying about the corporate
culture, employee morale or other issues that get in the way when an
organization is trying to institute change.
5. A consultant may be hired to provide much-needed objectivity. Who
else is more qualified to identify a problem than a consultant? A good
consultant provides an objective, fresh viewpoint—without worrying about
what people in the organization might think about the results and how
they were achieved.
6. A consultant may be hired to teach. These days if you are a computer
consultant who can show employees how to master a new program, then your
telephone probably hasn’t stopped ringing for a while. A consultant may
be asked to teach employees any number of different skills. However,
consultants must be willing to keep up with new discoveries in their
field of expertise—and be ready to teach new clients what they need to
stay competitive.
7. A consultant may be hired to do the “dirty work.” Let’s face it: No
one wants to be the person who has to make cuts in the staff or to
eliminate an entire division.
8. A consultant may be hired to bring new life to an organization. If
you are good at coming up with new ideas that work, then you won’t have
any trouble finding clients. At one time or another, most businesses
need someone to administer “first aid” to get things rolling again.
9. A consultant may be hired to create a new business. There are
consultants who have become experts in this field. Keep in mind,
however, that not everyone has the ability to conceive an idea and
develop a game plan.
10. A consultant may be hired to influence other people. Do you like to
hang out with the rich and famous in your town? If so, you may be hired
to do a consulting job simply based on who you know.
The Top
Consulting Businesses
Although you can be a consultant
in just about any field these days, the top types of consulting
businesses that are thriving today, according to the Association of
Professional Consultants, are:
Accounting: Accounting is
something that every business needs, no matter how large or small.
Accounting consultants can help a business with all its financial needs.
Advertising: With the price of
advertising these days, it’s no wonder that anyone with any type of
advertising expertise can earn a good living as an advertising
consultant. This type of consultant is normally hired by a business to
develop good strategic advertising campaigns.
Auditing: From consultants who
audit utility bills for small businesses to consultants who handle major
work for telecommunications firms, auditing consultants are enjoying the
fruits of their labor. This type of consultant is normally hired to
audit various utility bills for corporations.
Business: Know how to help a
business turn a profit? If you have good business sense, then you’ll do
well as a business consultant. After computer consulting, people in this
field are the most sought after.
Business writing: Everyone knows
that most businesspeople have trouble when it comes to writing a
report—or even a simple memo. Enter the business writing consultant, and
everyone is happy!
Communications: A good
communications consultant will never have to worry about where his or
her next meal is coming from. Communications consultants specialize in
helping employees in large and small businesses communicate better with
each other, which ultimately makes the business more efficient and
operate smoothly.
Computer consulting: From
software to hardware and everything in between, if you know computers,
your biggest problem will be not having enough hours in the day to meet
your clients’ demands!
Editorial services: From
producing newsletters to corporate annual reports, consultants who are
experts in the editorial field will always be appreciated.
Grantsmanship: Once you learn
how to write a grant proposal, you can name your price.
Human resources: As long as
businesses have people problems (and they always will), consultants in
this field will enjoy a never-ending supply of corporate clients, both
large and small. People-problem prevention programs could include
teaching employees to get along with others, respect each other and even
prevent violence in the workplace.
Insurance: Everyone needs
insurance, and everyone needs an insurance consultant to help them find
the best plan and pricing for them.
Marketing: Can you help a
business write a marketing plan? Or do you have ideas that you feel will
help promote a business? If so, why not try your hand as a marketing
consultant?
Payroll management: Everyone
needs to get paid. By using your knowledge and expertise in payroll
management, you can provide this service to many businesses, both large
and small.
Public relations: Getting good
press coverage for any organization is a real art. When an organization
finds a good PR consultant, they hang on to him or her for life!
Publishing: If you are
interested in the publishing field, then learn everything you can and
you, too, can be a publishing consultant. A publishing consultant
usually helps new ventures when they are ready to launch a new
newspaper, magazine, newsletter—and even websites and electronic
newsletters.
Taxes: With the right marketing
and business plan (and a sincere interest in taxes), your career as a
tax consultant can be very lucrative. A tax consultant advises
businesses on the legal ways to pay the least amount of tax possible.
Writing services: Anything
related to the written word will always be in demand. Find your
specialty in the writing field, and the sky will be the limit!
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