This note discusses Consulting.
Today we will be discussing concepts around an individual level transition from a W2 employee to (somewhat) independent consultant. This note is intended as an initial overview and introduction with our detailed view and hard fought cautions to be covered in Part II.
Summary
Introduction
The Consulting Equations
W2 x Offered as a service
Advisory or expertise on (W2 x Offered as a service)
W2 x Marketing x Sales x Delivery x Account Management x Project Management
The Shill
Introduction
Consulting of course also exists as a conventional industry. Amusingly, it’s largely unknown to most people (outside of the white collar workhouses of financial services and professional services), however, it often enters the picture quite soon when you start looking for ways to create a second income stream for yourself or to address immediate un or underemployment.
And now on to our usual disclaimer.
These principles and our opinions are derived from our experiences and will be, by no means, exhaustive or even guaranteed 'good practice'.
We have not had an original thought in years: many concepts and models are drawn from, outright plagiarised, or cannibalised from other scholarly and less scholarly works. Rather than (poorly) summarising these concepts we have focused on suggestions for specific behaviours and taking action. You are also reading the badly edited missive of an semi-aquatic dwelling land mammal.
The Consulting Equations
At its most basic, the "consulting equation" is:
W2 x Offered as a service
Essentially take what you do now for a day job and offer it on a freelance, part time or contract basis (potentially while you even work your day job, although there are many things you will need to consider). Unsurprisingly there's also number of potential traps and pitfalls here which, as is customary, we will heavily caveat later in the piece (see below).
In our view this isn't strictly consulting per se; we would see this more of simply creating a second income stream for yourself by working more. Having said this you'll often see many large companies "de facto outsourcing" by using external consultants to deliver core services at a much, much greater costs than simply employing more staff. Many such cases.
The consulting equation is therefore better represented as:
Advisory or expertise on (W2 x Offered as a service)
Here, the focus shifts from performing your W2 day job for someone else, to leveraging your skill set and experience to advise or teach others on the subject or to teach and train on specific technical tasks.
As an individual looking to make the transition to consulting you will need to consider just what your service offering will be.
For an example there can be world of difference between being a high performing Sales Chad in your market and geography and then transitioning to
Teaching fundamental sales skills to new staff in a high churn (staff and customer!) setting
Designing an onboarding flow to reduce time to revenue and time to break even
Advising a founder on salary, commission schemes and long term incentives
Integrating marketing's top of funnel and messaging with an intake and assessment process and the account management cycle (This sounds like something they should already by doing sur- no)
Reviewing an existing sales tech stack and either optimising or recommending new solutions
Succession planning and mentoring high performers and advising on solutions to move poor performers up the curve
Obviously some of these brief examples would already exist in part (or in full) in your current role, however for some you will need to consider where your skills and experience currently sits, and how you could then map that to a different business to credibly advise them.
To continue with today's math theme here is a third consulting equation:
W2 x Marketing x Sales x Delivery x Account Management x Project Management
This one enters the picture once you have broadly identified what you're going to consult on, and covers the "how" of consulting. For most people working a day job (or if we're charitable, a career) the functions listed above are split out to different people in different parts of the business.
For W2 consultant, such as those at a "Big 4" or "MBB" (see also: the White Collar Workhouse) the functions are again split out among the business. However, as an individual offering a consulting service you will need to personally mange all of these aspects at first.
Part II of this note covers these aspects in detail, discusses the transition from employee to consultant and covers a series of our own Entirely Preventable Fuck Ups that may prove useful to you in your own consulting practice.