More Americans are working as consultants or freelancers, either having given up or been forced out of the salaried world of 9 to 5. It's a trend that began after the economic downturn of the late 1980s, when I became a management consultant like many other laid-off professionals who became consultants.
Evidence now suggests that this is our new economic condition. Today, in fact, 20% to 23% of U.S. workers are operating as consultants, freelancers, free agents, contractors or micropreneurs. Current projections see the number only rising in coming years. Imagine one in four workers, of all collars, working on a contingent basis. Whole career paths and professions have shifted from stable full-time jobs with definable career ladders and benefits to almost completely contingent work forces that shift from project to project.
There are plenty of consultants and freelancers who are earning real income and enjoying success in their careers (as well as redefining what it means to be a success). So, what do these thriving solo artists have in common? What is the recipe for their good fortune?
Entrepreneurs Must Adjust Their Thinking to Survive and Flourish
The way we think is conditioned by our life experiences. If we've spent our life in a classroom, we tend to think as a student or teacher. If we've spent our work life as an employee, we tend to think as an employee.
Many new entrepreneurs talk-the-talk of the entrepreneur -- but their thinking is still grounded in their life as an employee. This can be deadly to their goals and aspirations.
Most employees don't think about where the money comes from to pay their weekly wages and benefits. Or how the cash must flow to meet next month's payroll. Or what accounts are becoming payable, or when tax deposits, rent, and loan payments are due. Or where the money will come from to allow the company to deliver a large order just received from its largest customer...
It's difficult for an employee to learn to think "outside the box" -- whereas the entrepreneur thinks only outside the box, because the box is the venture, and the entrepreneur needs to keep the box firm, clean, full and together.
New entrepreneurs must learn to continually question their assumptions. The decisions that are most likely to come back and bite them -- perhaps put them out of business -- are typically NOT the consequence of bad judgment or faulty reasoning -- but the consequence of applying perfectly sound judgment to wrong assumptions.
Freelancers need to think in terms of the long haul, preparing for a marathon, not a sprint. Unless you think about your venture as a job itself—requiring time, investment, thought—you won't get much of a return. Waiting for business to find you is not something successful consultants do. Clients know a halfhearted attempt when they see one.
Knowing What You Do Best & Matching That With What Potential Customers Need
The consultants and freelancers who are most successful offer a technical skill or expertise that is too expensive or infrequently used for companies to keep in-house. And since their demand is only temporary, it is more efficient for the client firm to hire this talent short term.
Cutting-edge expertise is vital to long-term professional health. Successful consultants don't let their skills coast, even for a short period. Typically, consultants keep their edge by attending workshops or training courses. But the most successful often add another key element to their training: They teach.
Teaching offers four big positives for consultants. First, it provides some income, though admittedly not much. Second, it's a way to network, because sometimes students can become clients or lead to clients. Third, the teaching looks good on a résumé, giving consultants credibility in the marketplace and a way to stand out from the crowd. And fourth, if you're going to teach somebody the latest skills, you better have those skills yourself. So teaching forces consultants to stay current and sharp themselves.
What You Think Happens to You
The most important ingredient that distinguishes successful freelancers and consultants: They think like entrepreneurs. They are known for the work that they do, and this often means the work they don't do. What's more, in this competitive world, prospective clients want to know what projects you're working on. If they aren't impressed, they may not hire you. So being able to say no to certain work, referring it to someone else, is a sure measure of a certain level of success.
It's always difficult to see the frame when you're part of the picture. However, it's vital that entrepreneurs make the effort to determine and clearly understand their technical and marketing strengths relative to their competitors -- and then to take best advantage of those strengths to differentiate themselves from those competitors.
Customers' buying decisions are based upon their perception of the best value available -- from your company or your competitors. Note that "best value" does not necessarily mean lowest cost. Value is composed of service, quality and price.
Note also that it's "perceived" value that counts. Perception is how others view you. You have a great deal of control over that -- not only by what and how you deliver -- but also by how you present yourself -- in person, in your letters, in your literature, in your advertising.
If you clearly understand your technical and marketing strengths, you can deliver a consistent and powerful message. If you don't, you can't. Recognize that nobody will know why they should buy from you until you tell them. However, if you tell them you're great at "everything", that's simply hype, and nobody will believe you.
Source: The Wall Street Journal, February 8, 2010
Note: More than half of today's workers (1.8 billion people) now earn their wages in unauthorized street markets and other businesses that are unregistered, unlicensed and uncounted in official employment statistics according to Robert Neuwirth, author of "Shadow Cities: A Billion Squatters, A New Urban World." By 2020, two-thirds of the global workforce will work in this parallel, shadow economy, according to the Organisation for Economic Co-operation & Development. There is no government nor corporate conglomerate that can rival this scale of job creation.
Source: FORBES, September 27, 2010