Recent business trends have made it possible to start independent work more easily, and with more possibilities, than ever before. There is strong support in the business world for hiring expertise on an as-needed basis, and as a result, the consulting industry is undergoing change, with more opportunity for independent consultants.
As work becomes project-based, companies are making the employment of independent workers a key part of their strategic plans. For consultants ready to jump into this market, the timing could be right. But independent consulting is not for everyone, so it’s important to consider some key factors before you take the leap.
Recent studies show that the number of independent workers keeps growing, and soon approximately 45-50% of the world’s total workforce is expected to be independent. Included in these forecasts is an increasing demand for high-end gig economy workers who can work on critical projects and serve in interim roles. A recent index compiled by the Business Talent Group shows that while there is growth in demand for a wide variety of skills across industries and project types, project management continues to be one of the top in-demand skills for independent consultants, and the single fastest-growing in-demand skill is marketing communication.
There are many reasons why you might want to become an independent consultant: you have more control over which clients you’d work with and what types of projects you’d like to do, and you have more flexibility about how and when you use your time. But not everyone is a good candidate for success in this type of work. For example, not all potential consultants have an area of expertise that makes them unique. Specialization is important in the consulting game.
So before you set up shop as a freelance consultant, you need to understand your niche. Here are 6 key questions to ask yourself as you think about making the change.
What is your specialization? Client companies want (and pay for) expertise. Having a specialization, and being really good at it, helps you command top price for your services. It can also bring more opportunity. An emerging business trend is “projectization,” where managers meet corporate goals by bringing together teams of independent specialists. Your particular specialization might make you a desirable candidate for these project needs.
Is your expertise marketable? Having real expertise can get you started as a consultant, but you have to have marketable expertise. I’ve seen too many would-be consultants do a sort of magical thinking, figuring that if they have expertise, demand will somehow be there. It’s much smarter to commit to understanding the market: to take a deep dive into understanding the demand for your “product.” After all, that demand will directly impact your earning potential.
Have you thought about your cash flow? When you think about the problems you are qualified to solve for clients, you also need to assess the market rate for solving those problems. Will tomorrow’s clients need the same sort of expertise? How crowded is the field? Are there opportunities for further specialization within your field, and could that make it easier to command higher prices? Asking yourself these questions will help you analyze whether you will be able to support yourself financially. Cash flow can be a real problem for independent consultants and entrepreneurs, one that is too often ignored until it’s too late.
Are you prepared to go it alone? It’s important to remember that as an independent consultant, you’re essentially running your own business as a “solopreneur.” Are you prepared for that? Are you confident that you can keep a strong pipeline of potential new business? What are your strategies for finding business? Don’t forget that while you’re working on a project, you still need to market yourself so you can find the next project (and the next one).
Can you stay on top of things? I’ve noticed that consultants too often neglect their marketing because of their focus on their current project work, only then to have to scramble to find the next opportunity. To prevent this perennial problem, you’ll need to constantly stay on top of things. In addition to networking and social media, digital platforms such as Upwork have made it easier to get started as a freelancer. However, it would be wrong to think you can just get onboard and new clients will continuously appear. Digital platforms make it even more important to have a good handle on what makes you unique. With thousands of consultants listed, you’ll need to stand out, so knowing your competitive advantage is critical, especially as the market changes. Why should clients choose you? What do you bring to the table? What makes you valuable? Why should a company hire you?
Are you open to learning and change? In addition to knowing your value, knowing how to adapt to different companies or industries is crucial. You might be lucky enough to develop a niche (for example, you might be great at developing software for the healthcare industry), but going from project to project requires the ability to adjust to different management structures, cultures, and styles. Your personal openness to change is what’s most needed to enable you to adapt when necessary. As an independent consultant, you need to be unafraid of change. Being a quick learner will definitely help; you’ll be constantly learning on the job. And having a strong knowledge of business and how it works will make things easier, because you will have a framework, or reference, to help you interpret new situations.
So are you ready to become an independent consultant? Have you taken a hard look at the challenges and still remain optimistic about that direction? If so, it might be time to begin.