Consulting's Wild Ride

Many years ago, I taught, designed, and facilitated a course for the Institute of Management Consultants called Becoming a Successful Independent Consultant. I also know many well-educated and experienced professionals who left their jobs to become their own bosses and consultants. In my forty-plus years of helping people become independent consultants, very few have made it past their first year. Why? These are smart, motivated, and successful people. Why did they not make it as an independent? I share my thoughts about it in this article.

Dealing with the Competition

First and foremost, most people who go out on their own want to do what they did working for a company. If you live near a large city, it’s more than likely that there are tens of thousands of people within a 200-mile radius who already do that. Unless you did something or created something genuinely unique or were able to deliver unparalleled ROI, experts in those fields are relatively common. Companies like the one you are leaving already have that expertise in-house. To succeed, you must offer a much-needed service or product that isn’t already saturating a market. Oh, and the competition amongst consulting firms is fierce.

There are millions of consultants in the United States. Most of them work for established and well-recognized firms. McKinsey & Company has over 38,000 employees. Boston Consulting Group has over 25,000 people. Their website shows Deloitte’s current headcount is more than 171,000 people. And that’s not counting Kearney, Mercer, Booze Allen Hamilton, and other prominent firms. IBISWorld reports that there were over 113,500 business coaches in the U.S. in 2022, and growing at a 5% annual growth rate. Think about it and ask yourself, how can a one-person firm enter the market and compete with these established businesses?

Well, you can’t. The single-person consultancy must find a niche and become an expert in it. And even then, one of the big firms is probably already in it. However, becoming a specialist in a well-defined niche limits the competition. For example, let’s say you become very well-known in Seattle for your ability to source and recruit AI engineers. Perhaps you worked in the HR department of one of the area’s high-tech companies and developed an extensive professional network. After a few years, you left the firm to go out on your own. You created an app for finding, evaluating, and selecting high-potential software/AI developers. Meta, Google, and Apple maintain large engineering centers in the Seattle area, employing thousands of top AI researchers and engineers. The area is second in AI development to Silicon Valley. Do you think any of those firms would be interested in your app if you could prove it would cut recruiting costs and increase the quality of their job candidates by 20%?

But before you get all excited about this “finding a niche thing,” let’s look at what it takes to do that. First, notice that you must have experience. Unless you have an app, tool, or process that no one else has and everyone wants, you will need to have experience, lots of it. I got my start 40-some years ago by knowing how to do something people were very interested in but didn’t know how to do. That was employee empowerment and the implementation of self-directed work teams. I read extensively on the theory behind it the issues associated with the concept, talked with the people who wrote the books, and then tried it with my team.

I was the VP of Training for a middle-sized company of 4,000 people. I had ten people in my department. I formed them into two teams of five and gave them projects to complete without my assistance. We all learned a lot about the pros, cons, processes, and resources needed to make them successful. I did that for two years before I thought I could do it again in a different company. When another company hired me, I got my chance. It worked again. And I got a couple of managers in production to try it. It took another two years, but I felt confident about how to do it. It would be another year before I became an independent consultant and could apply my knowledge and experience in self-direction to client organizations. During these five years, self-directed work teams had become popular, and I had a proven track record that I could convert into consulting gigs. I did okay, but I wasn’t very well known.

Becoming Known

Even today, with some 26,000 followers on LinkedIn, I am not very well-known. When I started, I relied on the prestige and, more importantly, the marketing prowess of the consulting firm that employed me. They invested thousands of dollars monthly in marketing to a network of over 100,000 people. It was through them that I got my first clients. But I wasn’t ready to go out on my own. I didn’t have much money to invest in marketing; no one knew who I was, and no one cared.

I had to find a way to establish a brand so people would be aware of me and what I could do. Then I remembered that one of my early bosses sent me to professional development workshops conducted by San Diego State University’s Executive Development Program. I developed a couple of workshops I thought would be viable in the San Diego/SoCal market. I met with the Director of SDSU’s Executive Development Program and asked if she’d be interested in offering one of my shops. Turns out, she was. That changed everything.

Nobody had heard of Alan Landers, but everyone in SoCal had heard of San Diego State. The school sent flyers to its tens of thousands of alums announcing the program. People signed up for the shop because of the topic and the SDSU name, not me. The workshops generated significant income for the university. The Director and I became friends. She introduced me to her peers at universities across the country, and I ended up doing workshops for SMU, Washington State, Michigan State, Northwestern, the University of San Diego, and many others. I was able to leverage my affiliation with major universities to help establish my brand early in my consulting career. Today, my partnership with the Peter Drucker Graduate School of Management is an extension of this branding strategy.

Doing workshops for universities was a win-win for the universities and me. We discovered that if I could fill a workshop with 20 to 40 participants, I could convert 10% of them into consulting clients. I also learned it was wise to have materials for sale “at the back of the room.” This generated a bit of income, but more importantly, the materials were a good way to demonstrate my competencies and turned out to be good for increasing awareness of me in the marketplace.

So, you are probably wondering what the topics of the workshops were. That doesn’t matter. Times and needs have changed. It’s more important to know I discovered them.

I subscribed to and read several business magazines, research journals, and, more importantly, local business journals. Local business journals alerted me to what was trending or “hot” in my geographic area. Eventually, I found a topic in which there was widespread interest among local business leaders. I contacted the authors of the most popular books to learn from them. I supplemented that by devouring the research journals containing the core concepts’ theoretical underpinnings. I took copious notes and wrote my thoughts about what would work and what wouldn’t. It was hard work, and I eventually felt confident in my knowledge of the topic and developed workshops that I presented to universities or marketed myself.

Recapping

Let’s recap how I got to this point. I started my career working in a company. I took advantage of their internal development programs and acquired two valued mentors and many friends. I continued to keep abreast of emerging business trends. I studiously learned as much as I could about the ones that interested me and interested the local business community. I experimented with these new concepts and learned from those experiences. I included this knowledge in my workshops that emphasized practical application. By affiliating with local universities, I was able to leverage their marketing capabilities to expand my brand. Local connections led to national connections, and I was able to conduct workshops across the country. That led to happy participants who invited me to meet with executives from their companies and consulting gigs. Altogether, it took about ten years.

What were the most critical lessons from this experience? Affiliate marketing, leveraging partnerships with the brands of local universities and organizations nationwide and internationally to expand awareness of my firm and its capabilities. Finding a niche, I can’t compete with the big boys on their turf. I had to find a battlefield where my expertise, size, and agility afforded a competitive advantage. The smaller, more defined battlefield, the better my chances of winning. Hard work and perseverance. That’s what I want to write about next.

It takes time to build a successful consulting practice. You’re not going to make a grand announcement on LinkedIn and be inundated with requests for your help. You will get congratulations and best wishes from friends, and that’s about it. As you try to figure out what to do, your bank accounts shrink, your family becomes concerned about income and bills, and you begin to doubt yourself. And after trying really hard for a few months, you realize that it is much easier to find a job. You get a steady paycheck, bonuses, insurance, paid vacations, coworkers, and settle back into a secure routine. It’s a familiar story. It happens thousands of times a month. It’s not a bad thing at all.

Five Things Needed to Succeed Independently

1.???? A Unique and Needed Product or Service. Finding a need and creating a unique product or service to meet that need is not difficult, but it is time-consuming. It involves extensive research and arduous testing. It’s easy for your significant others to become discouraged by your continuous research and little income. But potential clients won’t be interested if you can’t bring a new product or perspective to market. Competing with the big firms or doing what everyone else does is a waste of time. You must be unique and compete in price, value adds, convenience, or some other trait that differentiates you from the competition.

2.???? Get Out and Market. I’ve learned that developing a reasonable number of attendees to a training event takes about three months of advanced marketing to thousands of people. It is also necessary to identify a specific market segment that is interested in your offerings. Advertising your services to people who aren’t interested is a waste of money. Identifying a market and tailoring your product and services to that particular segment is much more effective.

3.???? Hard Work and Perseverance. It takes time to acquire expertise or develop a product that is unique from competitors. You need to research, write, and generate original ideas. That requires long, hard work. I spend about ten to twelve hours a day working. The good news is that I get to choose which hours I work. I can get up at 6:00 AM and work until 10:00 AM. Take a break to go to the gym or shopping. Return to work for an hour and then attend a networking lunch or professional meeting. Kick it until after dinner and work until midnight. Get up and do it again, day after day, until I create a new model, finish an article, make a valued connection, meet with a client, or design an app. There aren’t weekends or holidays. There are workdays and goals to meet. It’s a grind. You must love what you do, be totally committed to your goals, and be willing to make sacrifices. It’s much easier to look for a job and the security of a paycheck every two weeks than it is to force yourself to be creative day in and day out without knowing what the future holds. It does get easier, but the start is tough.

4.???? Doing the Unlikeable. The people I know who went from corporate America to consulting back to corporate America are intelligent, well-educated, and confident. Most have a history of success and upward mobility. But success in an organization that provides structure, clients, products, services, salaries, insurance, marketing/advertising, and has departments full of experts who do those things for you is much different than having to do them yourself. Consultants are experts in their chosen fields. They may not be good at or interested in those other things needed to make a consulting business successful. Writing marketing materials, networking, making sales calls, updating a website, and other administrative chores may be tedious and unappealing to them. It’s difficult for them to do that day after day and generate minimal financial returns for their efforts. It’s discouraging.

5.???? Keep the Faith. The life of an independent consultant is a rollercoaster filled with ups and downs. Like a rollercoaster, the ride up the first incline is slow and requires a lot of energy. The view from the top is terrific. The rest of the ride is a whirlwind of ups and downs, twists and turns. It’s exhilarating, and some people don’t want it to end. For others, once is enough. And some don’t like rollercoasters at all. If you decide to get on the ride, understand its nature. If you’re adventurous and willing to take risks, it’s a great ride. If you’re not a risk taker and prefer stability, security, and steadiness, don’t get on it.

I’ve been on the ride for 45 years. I love it. Now and then, I get off to get a rest. But as soon as I’m able, I am back on the train, sitting in the front seat, with my hands in the air, a smile on my face, yelling with excitement for the next thrill to come my way. I hope to see you in a seat next to me, enjoying the ride as much as I do.