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Becoming an independent consultant is one of the several pathways to self-employment where you can create your brand, get higher pay, and enjoy more flexibility. It will provide you with a unique opportunity of helping others while engaging in financial freedom.
It can be challenging to understand where to start even though you have decided to become a consultant. As such, you need to determine if this career is the right fit for you once you have learned more about it. That is what this piece will do. Hence, it will define independent consultants, what they do, and the steps to becoming an independent consultant.
What Is a Consultant?
A consultant is an expert who engages in the business of providing professional advice to those working in a specific field. In other words, a consultant advises a particular set of individuals. Here, the consultant’s expertise level is valuable to a particular group of people willing to pay the consultant to get their expertise.
A consultant can also:
- Enhance an organizational effectiveness
- Facilitate client learning by educating them on how to resolve similar issues in the future
- Create a commitment or consensus around corrective action
- Help with recommended solutions’ implementation
- Making recommendations based on the diagnosis
- Developing a diagnosis that can necessitate problem redefinition
- Solve clients’ problems
- Provide information to the client
Generally, anybody can be a consultant if they can provide expert advice to a specific group of people. In essence, you can make a lot of money as a consultant. In 2016, PricewaterhouseCoopers became the most significant player in a $148 billion consulting industry when its consulting department brought in a whopping sum of $15.9 billion.
So, why is consulting so critical and valuable?
The Real Meaning of Consulting
Since a consultant is someone who provides advice, who do we buy advice? Why do businesses or people purchase advice? In particular, people engage in this action because they need help. Furthermore, they want to become something, attain a position, achieve success, or change to something better. Hence, people need a consultant’s advice to get to where they want to get.
Essentially, people want to move from one point to another. However, they don’t know how to get there and want advice. Besides, it could be that they don’t know how to surmount obstacles, or they are lost. In particular, the true meaning of consulting is helping individuals move from their present state to the desired shape while solving problems. The more someone sees values in their desired state, the more they will be eager to pay to get the required help.
Independent Consultant Definition
An independent consultant is an entity or a self-employed individual who develops strategies, solves problems, and improves operations. However, an independent consultant requires specialized knowledge of their field. Even though they can work in many industries. Such an expert is often a retired professional in their field and relies on extensive experience and skill.
As a consultant, you perform many functions and hold many titles that keep industries moving forward. Most times, consultants receive fees instead of salaries without benefit packages from their clients.
Businesses hire consultants to help them solve technical, operational, or strategic problems in an existing business model. Generally, a large organization may need to resolve a history of disputes between employees and management by hiring a corporate communications consultant. Hence, the expert will help the corporation implement fair treatment procedures. In particular, to resolve current workplace issues by ensuring that the administration listens to their employees’ concerns.
Independent Consultant Responsibilities
Some of the responsibilities of an independent consultant include:
- Attending seminars, workshops, conferences, and other networking events to be up-to-date with the trends in the field.
- Scheduling training sessions and meetings with employees as necessary.
- Gather opinions for improvements from many experts and staff members.
- Take trips to meet clients to negotiate contract terms and discuss requirements.
- Prepares presentations, scheduling meetings, and writing reports for many stakeholders.
- Identifies an organization’s strengths and weaknesses and comparing them to competitors’ weaknesses and strengths.
- Examine budgets, financial statements, policies, and other research documents by interviewing managers, shareholders, and staff members.
- Understand and analyze the models and existing operations of a company or organization.
Independent Consultant vs. Contractor vs. Freelancer
People often use the terms consultant, contractor, and freelancer interchangeably. However, the reality is that these terms are not the same. In brief, if you are unsure what to call yourself someone just starting, our team has got you covered. We will look at these terms in more detail to demystify them.
In essence, businesses will hire a consultant to evaluate their business and offer feedback and improvements. However, people hire freelancers and contractors to complete a specific project or perform work.
A contractor is an external worker or a self-employed person. In brief, a contractor works on a contract basis for a company or organization. Furthermore, the business that hires them typically agrees on durations and rates beforehand in a signed agreement. Hence, this process often entails the option to extend the arrangement if both parties want to continue.
Examples of contractors are IT and construction workers, working for a contracting agency, or self-employed. Typically, these professionals work on a project. In addition, they then seek work on another project once that is completed.
Particularly, a contract length depends on the completion’s predicted date or the project size. As such, it can be a soft or hard deadline, based on the client’s preferences.
A consultant offers expert advice to businesses in a specific field. However, a consultant may not complete their clients’ works themselves. Instead, they provide the tools companies will use to implement their projects. In essence, a consultant can help businesses overcome obstacles by solving their problems.
Thus, the consultant role is suitable for those with a significant amount of experience in a specific profession. Generally, it implies working as advisers in a high-ranking or senior position within the field.
Usually, the problem size will determine the period a consultant will work on a specific project. As such, a consultant can be a lucrative career choice for many since they can command high rates for their expertise.
A freelancer is an individual who works in their promises, in a public space, or from home. However, these experts can work with multiple clients simultaneously. Thus, making them the free moniker since they can choose what projects to handle.
Freelancers are commonplace in financial and teaching services, as well as media and creative industries. Generally, the typical work duration within a freelancing role will depend on how big the project is. Therefore, freelancers can select the amount of work to take on without a single contract.
Independent Consultant Options
One of the most diverse markets in the professional services industry is the consultancy industry. Therefore, it is not surprising to see a broad spectrum of consultant options in the industry. Also, anyone can title themselves IT, HR, finance, business, management, or strategy consultant since it is not a protected professional title to be a consultant.
Over the past few years, there has been a sharp rise in the number of independent consultants with the various workplaces a consultant can access and the widespread areas in which a consultant can operate. Therefore, it has become essential to define independent consultant options, following how difficult it can be to define independent consultants with the influx into the industry.
1. Independent Marketing Consultant
An independent marketing consultant develops and executes marketing strategies to help their clients improve and grow their business. Furthermore, they can work as part of a team or alone on a contract or freelance basis.
To become an independent marketing consultant, you will need to earn a bachelor’s degree in business, marketing, or a related field. You can also learn about various marketing campaigns or gain experience from senior marketing executives as you acquire an entry-level position in a marketing department or with a marketing company.
After building a successful marketing campaign portfolio, you can go ahead and seek a leadership position when working on a team. The next stage is to start your independent marketing business while promoting your services and skills to area businesses when you have confidence in your portfolio and have many years of experience.
2. Independent Project Management Consultant
An independent project management consultant is an individual who encourages business process improvements in an organization. The consultant also:
- Train staff members within the company on new processes
- Manage the implementation of a change process
- Design potential new business processes
- Research trends
- Analyze current activities
An independent project management consultant projects, advises, plans, and strategizes business improvement processes for the company or organization to manage its resources better. The consultant must also design metrics to evaluate business process changes and identify and scope out new solutions while making a case for those solutions.
3. Independent Financial Advisory Consultant
An independent financial advisory consultant works with clients to better understand their assets and what the assets can do for them in the future. When someone does not know how to save for retirement, an independent financial advisory consultant can answer questions about how much to keep, suggest specific investments, and recommend the retirement account type to use.
The consultant can also help clients with more specialized requirements, such as insurance and tax preparation, based on their certification level, background, and training. An independent financial advisory consultant can also help clients determine what they should be after looking at the clients’ whole picture of financial like, such as income, expenses, assets, and debts.
4. Independent Human Resources Consultant
An independent human resources consultant is an individual hired by a company to handle meeting or solving a human resources-related requirement. Businesses often hire these consultants to offer high-level recommendations and solutions on team management.
Businesses hire independent human resources consultants because larger companies can get an outside perspective on a specific challenge or project. Then, the consultant will focus on handling the actual issues without distractions of internal organizational politics.
Another reasons a business hires these consultants is that small businesses don’t have the expertise or support for internal HR required to take on significant projects like creating a new employee handbook or implementing a new benefits package. Companies look for independent human resources consultants for guidance on these issues.
Outlook for Independent Consultants
We might not know how significant a change can be when it creeps on us. Technology evolution has changed various aspects of our lives. As such, we cannot remember the last time we bought film reels to take photos, research a project by going to the library, read the news by buying a newspaper, or watching movies at a theater.
We can also say the same about postal services, taxi drivers, job recruiters, travel agencies, financial services, etc. There have been many significant transformations in those industries, even though they have not vanished. This transformation also impacts the independent consultant industry.
The Rise of Specialized Consulting Service Demands
Between 2014 and 2019, the global management consulting market’s CAGR was 8.6 percent, reaching a value of about a trillion dollars. By 2020, the global consulting market will reach a value of 160 billion dollars. Over the past five years, there has been significant growth in the number of people employed in management consulting in the US. There were almost 710,000 US-employed management consultants in 2019. Even with this rise in consultant jobs, one of the business management consulting firms’ leading challenges is finding and keeping good employees. Attracting and developing new businesses is the most pressing issue for businesses, which is also a leading challenge for about 40 percent of senior managers.
What now drives the consulting industry’s transformation is the changes in clients’ expectations and requirements. The new catchphrase is agility. However, businesses find it also crucial. Transformative technologies, changing regulations, and market volatility demand a rapid and regular response from companies, part of which is the requirement for fast access to specialized and critical staff.
Therefore, it makes sense for companies or organizations to move to an agile workplace model and tap into a dynamic and fluid talent pool made up of independent consultants instead of trying to employ, reassign, or train employees for each change.
How Much Do Independent Consultants Make?
According to ZipRecruiter, an independent consultant’s average annual pay in the United States is $57,457, around $4,788 per month, $1,105 per week, and $27.62 per month hour. Independent consultant salaries range from $14,500 to $100,000, while the market analysts see annual salaries as high as $148,500 and as low as $11,000. Essentially, some United States’ top earners make about $127,000 per year.
An independent consultant’s average pay range varies significantly, about $85,500, suggesting various opportunities for increased pay and advancement depending on years of experience, location, and skill level.
How to Become an Independent Consultant
It is critical to run your business and prove your expertise to thrive well as an independent consultant. If you want to become a successful consultant, we recommend you follow some of these tips.
1. Required Skill Set for Independent Consultants
As an independent consultant, your self-reliance demands a specific skill set since you are self-employed. You will need some of these soft skills as an independent consultant:
- Customer service – you will work closely with clients as a consultant, and this situation needs excellent customer service skills to assist, collaborate, and communicate with clients efficiently.
- Money management – you will have to manage your income and set your price as a consultant, which requires financial skills to meet and maximize tax requirements.
- Time management – you will create your work schedule as a consultant by managing your time efficiently and efficiently.
- Determination – you need to work as a consultant towards your goals and those of your clients, even with the rise of challenges.
- Discipline – working for yourself needs discipline to continue your education and training, meet your professional and personal goals, and stick to a schedule.
2. Business Acumen
The business acumen for you as an independent consultant is all about finding new clients after you have established your specialty, education, and skills. Start building your client list by listing your current networking opportunities like business, personal industry membership associations, conventions, and professional social networking websites you established throughout your experience years. The next stage is to communicate with this list by advertising your success on your independent consultant skills.
3. Networking/Marketing Skills to Generate New Income
One of the ideal approaches you can do with your marketing skills is to consider offering reduced or free services as a promotion to attract new clients. Since your professional reputation determines your consultancy services, you can market your services using this experience with your field experience.
Remember that a website or online portfolio will act like your presence or resume where clients want to assess your experience and proficiencies. As such, a functional, well-designed website can convince new clients and also increase your overall expertise.
4. Ask for Recommendations
Ask your happy customers for a recommendation to put on your social media pages or website. With that, you can verify your expertise and established credentials to solve new clients’ problems. Recommendations can highlight how you have helped others through your skills, which can determine new clients’ consideration.
How Do I Get Started As An Independent Consultant?
If you have put a thought on starting your independent consultant job, it means you yearn for something more; living life on your terms, being your boss, flexible hours, setting your fees, and the list goes on.
The consulting industry is massive, with companies and businesses worldwide spent over $155 billion in 2018 with consultants and consulting firms. 75 percent of companies spend around 2 percent and 5 percent of their consulting support costs, with more than 5 percent of their consultant expenses by another 13 percent.
You may not know how to get started like many would-be independent consultants. It can be tricky navigating the transition to starting a consulting business from a salaried employee. Many people often ask:
- How do I stand above other consulting companies?
- How much should I charge for consulting?
- What licenses and registration do I need?
- What industries hire consultants?
- How do I market my consulting business?
- Can I start a consulting firm while working full-time?
The list goes on and on. Fortunately, our team will share some tips to get started with your consulting business in this section.
1. Choose a Niche
It is better to differentiate yourself from other generalized consultants by choosing a niche. Doing this will benefit you in the long run when you specialize. Also, being an expert in a particular field will always boost your confidence in getting the job done correctly.
2. Write a Business Plan
It is time to write a business plan after chosen your niche and define your service. Never rush into things before considering your business’s essential aspects, which many people make when starting a new business. While this step may not be compulsory, it will help you avoid many mistakes and crystallize your ideas.
3. Get an Experienced Business Attorney
Hiring an experienced business attorney will add value to your business. We recommend getting a lawyer who has experience representing other consultants and is familiar with the peculiarities of a consulting firm.
4. Be Patient
It can take time to become an independent consultant. Pursuing extensive education or training courses can be essential to increase your industry expertise and skills to handle your consultant works effectively.
5. Time Management
One of the most crucial skills for an independent consultant is time management. As such, learn to master your time by making time for your personal life or being effective and productive at work.
You can excitingly grow your career by becoming an independent consultant. By building relationships with the right clients and focusing on critical skills, you can develop a rewarding career in the field.
While being an independent consultant can be a lucrative opportunity, it is not for everyone. The best approach is, to be honest about having a clear and organized system and addressing, meeting, and defining your goals.
We recommend reading through some of the steps above as a perfect way to start your independent consultant career. Good luck!
Want to know more? Check out how you can become a project management consultant.
1. What is an independent consultant?
An independent consultant helps companies or organizations develop strategies, solve problems, and improve operations using their specialized skills.
2. What is the role of an independent consultant?
The role of an independent consultant includes engaging in long-term and short-term projects to deal with various issues and needs of a company. Their role also includes suing surveys and interviews to collect necessary data and meeting with appropriate staff or management to understand their needs.
3. How do I become an independent consultant?
You can become a consultant by:
- Doing your research
- Putting your financial house in order
- Choose a consulting niche
- Understand the value you will offer to your clients
- Set consulting rates
- Build professional status
- Make a giant leap into consulting
4. How does independent consulting work?
Independent consulting is basically providing advice to your clients who implement that action to achieve their desired results.
5. What is the difference between a consultant and an independent contractor?
The difference between them is an independent contractor is a self-employed individual who agrees to work for someone else for a fixed price. In contrast, a consultant works in a specialized field.
6. How do I start myself as a consultant?
You can start as a consultant through these steps:
- Identify your area of expertise
- Acquire licenses and certifications
- Set goals
- Decide long- and short-term goals
- Choose and research your target market
- Make a website
- Set your rates
- Market your services
- Attract and close clients with a reputable system