Consultants: Writing Your Own Ticket

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Not all HRD professionals work in-house as corporate training and development specialists. What about those who have eschewed life on the inside in exchange for the freedom of running their own consulting firms? How much do independent consultants make? Unfortunately there is no simple answer. "Don't expect this kind of information to fall into your lap," caution Marilyn Corrigan and Sally Sparhawk in Info-Line 9403: Becoming an Outside Consultant. "People are generally very closed-mouth about fees. You will have to do a lot of digging and experimenting to discover what you are really worth on the market."

Theoretically, the amount of money you can make as an independent consultant is limitless. It depends not only on the fees you set, but also on the type of consulting you do, the going rate in your part of the country (or a client's part of the country), the amount of work you are willing to put in, your experience and contacts, and your reputation as someone who gets results.

You want to keep your rates low enough to attract clients. But you shouldn't sell yourself short. Not only do you need to bring in a reasonable income; you also must cover the costs of running your business. And many buyers of consulting services say they're wary of consultants who charge too little! It's not always true that you get what you pay for, but some clients assume that a cut-rate consultant will give bargain-basement-quality service.



So how can you predict what you could make as a consultant?

Most training consultants base their rates on a daily fee. In its August 1994 issue, Training & Development reports the results of an admittedly unscientific poll (the sample was self-selected) on what independent consultants are paid and what they're worth. Consultants were asked about their highest daily rates. Most respondents (51 percent) said they charged between $1,000 and $2,000. But some set their fees more creatively. A Montana-based consultant said he often barters his services-he has consulted in exchange for golf games, motel stays, computers, clothing, and even a side of beef!

Training & Development's July 1990 issue provided a forum for four anonymous consultants to talk about their prices. When asked about setting his daily rates, one of the four consultants was candid: "Arbitrarily," he admitted. "I look around at what it seems that other people are being paid. To find out, I just ask them. And I ask clients." At the time of the T&D interview, this consultant, a management development specialist based in the Seattle area, was charging between $1,500 and $3,000 a day, plus expenses. And he has no shortage of potential clients; he turns down more than twice as much work as he accepts.

One recommendation for setting your fees is to first ask yourself how much money you want to make each year, keeping in mind the extra expenses-for example, insurance and marketing- you'll have to shoulder as an independent. (The management consultant described above decided he wanted to make $160,000 a year.) Next, determine how many billable days a year you want to work. (His choice was eighty days.) Then do the math. (The Seattle-based consultant determined that he had to bring in an average of $2,000 a day in order to meet his goals.)

Remember that those are eighty billable days. An independent consultant is a small-business owner. As such, you'll work many hours with no paycheck-especially at first-marketing your services, handling general administrative tasks, and developing your skills and contacts.

Another option for an independent consultant is to contract for work from a large consulting firm. Your fees will be much smaller this way; a career-development specialist in southern California told T&D that her fee starts at $300 a day for this kind of work. The advantages of contracting with a larger consulting firm is that you're spared the work of finding clients. It may be a good arrangement to consider, especially if you're just starting out as a consultant. As you build up your own practice, you can gradually cut back on the amount of work you accept from other consulting firms.

WORKING CONDITIONS

What are working conditions like for professionals in the field of training and development? They vary dramatically, depending on the type of work you do, the kind of organization you work for, and your level in your organization. For simplicity, we'll break down our exploration of working conditions in HRD into three sections: in-house practitioners, external consultants, and contract trainers.

In-House Practitioners

Internal training and development specialists are those who are employed within an organization to improve the performance of that organization's own employees and systems. Some, especially in larger companies or agencies-work in departments devoted exclusively to training and development. Others fall under the human resources umbrella and may also have duties involving job classification, recruitment and selection, or personnel administration. Some trainers are subject matter specialists who work for the departments in which they conduct training-for example, engineering, sales and marketing, or information systems.

Like other employees of large- and medium-size firms or government agencies, most in-house training and development professionals who work full-time receive such fringe benefits as health insurance, retirement plans, sick leave, and paid vacation time.

Internal practitioners in training, organization development, and career development have frequent contact with many people inside and outside the organization. Employees at all levels from the shop floor to the executive suite-may become work-shop participants or subject matter experts. In-house trainers might also work closely with external training suppliers, union leaders, government representatives, or others from outside of the organization.

Heavy workloads have become a major complaint in today's downsized, streamlined, and reengineered workplaces. The training field is not immune. Most respondents to a fax-in poll of Training & Development readers (June 1993) reported feeling overworked either all or most of the time. Most said they work more than ten hours a day, and almost all work on weekends. Those responses might indicate that training specialists work longer hours than other professionals. But the survey was not a scientific study; readers who felt overworked were more likely to fill out the questionnaire. And recent studies show that the average full-time U.S. worker-in any field-puts in forty-seven hours a week. In other words, trainers and HRD specialists work hard, but they can't claim a monopoly on midnight oil. Exact figures are hard to come by, but it seems that trainers and HRD specialists work about as much time as other salaried professionals do-forty to fifty hours a week.

Some trainers have plush private offices and run state-of-the-art corporate universities. Others work in open "bull pen" areas with linoleum floors, metal desks, and cabinets full of flip charts and felt-tip markers. In far-flung organizations, frequent travel may be part of the job, with training and development specialists conducting interventions at branch offices, multiple plants, or suppliers' work sites.
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