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With the entire nation going high-tech, it's no wondercomputer consultants are in demand. But don't think it's aneasy way to profit from the high-tech boom. It takes skill, hardwork and even a little luck to make it in the computer consultingfield.
One of the most critical concerns is determining the scope ofyour consulting services. Specialization is the way to go,according to Debbie L. Handler of the Independent ComputerConsultants Association (ICCA). "You don't want totry to do everything; that spreads you too thin," she says."Find a niche, and be the best at it."
If you've worked in a particular field, that may be yourfirst choice as a specialization. But make sure that expertise isin demand, cautions Max Steiner of the National Association ofComputer Consultant Businesses (NACCB), a 300-member association oftemporary agencies that finds assignments for computer consultants.The rapid pace of change in technology means the field youspecialized in just a year ago may now be obsolete.
If you don't have an area of expertise but want to cultivateone, a number of companies offer certification programs. Microsoftis a good example. The software giant offers training and exams youcan take to gain certification as a systems engineer, solutiondeveloper or product specialist for Microsoft products. Thetraining is offered throughout the United States, or you canutilize self-paced or online learning programs. To find out aboutMicrosoft training, visit the company's Web site at http://www.microsoft.com or contactSylvan Prometric, a Baltimore-based firm that administerscertification for Microsoft and 59 other firms, at http://www.sylvanprometric.comYou can find other information technology trainers by contactingthe Information Technology Training Association Inc. at (512)502-9300 or by visiting its Web site at http://www.itta.org .
The Search Is On
Finding clients is your next challenge. That's where tradeorganizations such as the NACCB and ICCA can help. NACCB membercompanies, for example, act as agents to secure jobs forindependent consultants. Agencies' contacts can lead tocontracts independents might otherwise never hear of. A good agencycan also help you understand the corporate culture of a particularclient.
"To find a good agent, interview people," Steinersays. You can do this over the phone or in person. "A goodagency will want to know your technical skills and should ask aboutyour career goals."
Once you've registered with an agency, be upfront: Tell youragent how much money you want to make on a particular job. Theywill tack their fee on top.
If you prefer not to use an agency, you'll have to advertiseand network to get your name out there. ICCA is one networkingresource. "By becoming active in your local chapter, peoplewill tell you about clients who are looking for consultants withparticular specialties," Handler says.
ICCA members can list their companies and specialization on theassociation's Web site (http://www.icca.org ). Most ICCA chaptersalso run referral services.
Placing ads in the newspaper and Yellow Pages will generateplenty of calls but probably not much in the way of solid businessleads, says Janet Ruhl in The Computer Consultants Guide (Wiley& Sons). If you go this route, carefully tailor ads to yourtarget audience.
Consultants who specialize should consider advertising inindustry publications. For example, if your focus is accountingsoftware and systems, ads placed in magazines such as NationalPublic Accountant or Internal Auditor might generatebusiness. Detroit-based reference publisher Gale Research putsout a hard-cover and online edition of the Consulting andConsulting Organizations Directory. It's updated annually inAugust, and the deadline to submit a free listing is in April. Tosubmit your company profile via the Internet, visit http://www.interlog.com/~ndallen/
Establishing a Web page is another excellent way to advertise,says ICCA's Handler. And don't forget to register your pagewith all of the search engines on the Internet. (See "NothingBut Net" on page 70 for more information.)
For A Price . . .
Even before advertising, however, it's important todetermine your fees. Most consultants bill hourly for time andmaterials, says Ruhl. According to a 1992 survey of computerconsultants by Khera Communications Inc., a computer consultingfirm in Rockville, Maryland, the median rate for all types ofservices is $55 to $60 per hour. But, cautions Ruhl, don't baseyour fees solely on the national rate because the going rate inyour region for your service and experience will dictate how muchyou should charge. To find the going rate, ask other consultants inyour region what they charge or ask local consulting brokers whatthey would pay you hourly (add 40 percent for theircommission).
Some consultants base their rates on an estimated cost of doingbusiness. To determine this, you would estimate your expenses,decide the annual income you want to make, divide that figure by1,000 (the number of hours per year used as a base figure by CPAsand other professionals) and then establish an hourly rate thatcovers expenses and yields the desired income. Ruhl offers an evensimpler way: Take the annual salary a person of your experiencewould receive and divide by 1,000. Whichever method you use,remember that the result will be tempered by the going rate in yourarea and your experience level.
Obviously, operating a computer consulting firm is more than amatter of technological troubleshooting. It takes entrepreneurialknow-how and a willingness to take a risk. If you fit that bill,then boot up your business and get growing.
C.Y.A.
There's one other vitally important question to answer: Howwill you protect yourself if something goes wrong? The answer issimple: Purchase errors and omissions (E&O) insurance.
E&O insurance provides coverage for claims of allegeddamages as a result of an error, omission or wrongful act in theperformance of an insured service. E&O can cover legal fees anddefense costs as well as the damages awarded, says Sheila Allen ofAllsouth Professional Liability Inc., an insurance company inTampa, Florida. Premiums for basic coverage start at about $1,000.The best place to look for this insurance is through a broker. Getrecommendations from associates or check with the IndependentInsurance Agents of America (http://www.iiaa.org ) for their directoryof agencies.
Real Life
The idea of owning a business intrigued Ray Rauth so much thathe left a comfortable job in the academic computer center at CityUniversity of New York in New York City to co-found a computerconsulting and training company in 1982. But after about a year,Rauth, 56, decided to consult for the company he helped found.
"I wanted to step out of management and be more involved inthe technical aspects," says Rauth, now co-owner of Pine CreekConsulting LLC, a computer consulting firm in Westport,Connecticut.
Although he worried about the decision to go independent, Rauthknew he had one major plus on his side--his former company waspleased with his work and planned to work with him long term.
Rauth also had leaped into computer consulting in its earlydays--and starting early paid off: Today Rauth has six clients, andhe brought in a six figure income last year.
Finding and keeping clients has been a challenge for Rauth,however. "Like most consultants, I'm not really marketing-or sales-oriented, and I find it difficult to do," he says.Instead, he emphasizes customer retention and networking with peersthrough the Independent Computer Consultants Association(ICCA).
Rauth's networking is helping move his company to the nextlevel. His recent merger with another firm to form Pine Creek wasdone because, he says, "I think business has changed so muchthat a one-person shop has difficulty doing off-site work forlarger companies. Technology is more complicated and requires us tospend more time [at a client's] site. It gives one organizationmore capabilities, and clients appreciate it."
And therein lies the key to becoming a successful computerconsultant. You have to be responsive to your clients' needsand keep pace with an industry in a constant state of change.
Contact Sources
Allsouth Professional Liability Inc., (800) 913-9260,marketing@allsouth.net
Khera Communications Inc., http://www.kcilink.com
National Association of Computer Consultant Businesses,http://www.naccb.resourcecenter.com
Ray Rauth, (203) 846-2535
For additional information on computer consulting, log on tothe following Web sites:
http://www.consultlink.com
http://www.occ.com
http://www.monsterboard.com
http://www.expert-market.com
http://www.just4u.com/webconsultants
http://www.computerwork.com
http://www.cvp.com/freelance
http://www.ceweekly.com
http://www.icca.org
http://www.allianceofconsultants.com
