Wednesday, June 23, 2010

Is freelance consulting a good option ?

Having jumped ship and started my entrepreneurial journey a lot of people often ask me about how I managed to take a big career decision and survived the crash that the world market has seen. My savior during the process of setting up our retirement home venture has been freelance consulting work. A lot of people ask me questions around how difficult or easy it is to find freelance consulting work and many a times I find that they carry a lot of wrong notions around how lucrative it is to be on your own. So thought will try and put down my perspective on freelance consulting, hope it addresses doubts in a few people's mind.

Freelance work is easy to get
Sure its easy to get, but then you need to have something of significant value for people to want to work with you. There is a big requirement that a lot of consulting companies have for associates on a flexi basis, many corporates would like to work with individuals and there is lots of requirement out there. The challenges is to be in the right place at the right time, to encash an opportunity, and believe me its a big big challenge. As a freelancer you have limited reach and don't have others selling you.

Freelance work is very rewarding
For some it is, but for most its not. If you are not attached to a regular source of long term freelance work and have to go and sell yourself practically on a daily basis, then budget for approx 3 days of selling for 1-2 day or work. This makes the equation very unfavourable. Mind you no one is paying huge amounts of money for freelancers, cost saving is the biggest driver for employing freelance consultants. Consulting companies employ freelancers predominantly to bring down their cost of delivery, a full time consultant would be priced nearly 4-5 times for equivalent talent.

Freelance work is easy to do
One of the biggest challenge I faced when I moved out of a big consulting firm on my own was the challenge of managing everything on my own. There was no one to do research, no one to print invoices, no one to format presentations and so on and so forth. Suddenly doing the same assignment becomes much more difficult to do, especially availability of information, templates and benchmarks that did not require any effort become big challenges. And when you start thinking as a consultant, thats a lot of valuable, expensive time going waste.

Everyone who is freelancing is having a great time
The grass always looks greener on the other side :-). Freelancing's biggest challenge unpredictable work load. One would have to be prepared for long periods of vella time and then hopefully sudden level of activity. If you do not know how to utilise your vella time well, then you are in deep trouble. If no work coming your way makes you anxious then you have had it, be prepared to enjoy watching TV, meeting friends (hopefully they would have time for you), generally flooding all social networking sites with arbit information to make people jealous or take up new hobbies. I know of many of my friends who tried it but could not bear the uncertainty and were back in their jobs. If you are a married guy, also factor in the fact that your wife who used to complain about you never being in the house, will start chasing you out of the house precisely after two weeks of sitting at home :-)).

My friends will give me work
This could be the biggest mistake when you are out looking for freelance work. Most of your friends and network will not be able to help you, and many a times genuinely, because of company policy or engagement with other established consultants. This can create a situation where people may start avoiding you and you may lose a lot of friends, especially if you start chasing them aggressively for work. Don't expect much out of friends in established large corporate setups, they will feel jealous about your guts, they will always say they will push your case, they will always meet you for the first couple of times and then they will suddenly get very busy :-). Be prepared to not push your friends who you genuinely want to keep.

If you still decide to go ahead and take a plunge, some of my golden rules are the following :

- Have good friends, who believe you have genuine talent, you need to have something of significant value that your friends can push your case
- Attach yourself to a few consulting organisations who are on a lookout for free lance help, most of them are, so you are in luck at this time.
- Never sign an exclusive arrangement with a consulting company, unless there was guaranteed days of work in the agreement
- Find friends in smaller organisations, they want good talent at low cost, thats the sweet spot
- Create consortium with other free lancers so that jointly you can create bigger market reach and support each other on large, complex assignments
- Make sure you know how to enjoy your free time, believe me you will have lots of it, else what was the point on going in for freelance work :-)

Hope you guys find this useful. Feel free to ask questions and will be happy to help.




Sudhanshu Pant said...

the line "Most of your friends and network will not be able to help you.." really resonated.

Sanjay Lakhotia said...

Hi Sudhanshu, a lot of people are saying that, so seems like my experience has not been much different from others :-). Thanks Sanjay

Jemma Taylor said...

Yes freelance is the good work but it is not much easy to get the benefit from that. Yet its interesting and liked to speak out here thanks !!