FRAMINGHAM (03/27/2000) - Whether you hang out your own shingle or join an established firm, you can reap many financial and personal rewards as an IT consultant.
Increasingly, companies are tapping outside experts for high-profile information technology projects. Many companies find it economically unjustifiable to keep a full stable of permanent IT specialists, particularly if their core business has nothing to do with IT. And most don't want to be regularly laying off internal IT personnel after big projects are completed.
Besides, even if companies wanted to avoid outsourcing, most IT managers say there just aren't enough IT resources to go around. For these reasons, worldwide spending on outsourcing topped $99 billion in 1998, according to International Data Corp. (IDC) in Framingham, Mass., and well over half of that was spent by U.S. organizations.
IDC expects outsourcing expenditures to explode to more than $151 billion by 2003. "To remain competitive, many companies outsource as a way to reduce costs, increase efficiencies and refocus critical resources," says IDC analyst Cynthia Murphy.
For IT professionals who believe that variety is the spice of life, following the consulting path represents a continuum of new beginnings and fresh exposure to different cultures, business challenges and the latest technologies. To help those considering consulting, Computerworld asked several consultants to share anecdotes and offer advice about career moves that paid big dividends, as well as a few that backfired.
To assure success, veteran consultants recommend that you learn humility, get comfortable with diplomatically speaking your mind and above all, never stop honing your listening skills.
Note that becoming an expert in any particular technology isn't on the list. As more than one consultant noted: "Projects don't fail because of technology.
They fail because of relationships."
Those who have gone the consulting route say they feel that they have an opportunity to work on the most exciting part of an IT project - planning, development and implementation - and that they get to circumvent much of the drudgery of ongoing daily systems maintenance.
By plan or by chance, consultants have found that certain experiences and attitudes have been invaluable to them in building successful careers.
Getting hands-on business experience as an auditor can pay off enormously.
Starting here builds insight as to how technology can be applied to successfully support and advance a business.
Allan Frank, a 20-year consulting veteran and founder of AnswerThink Consulting Group in Miami, for example, launched his career in the accounting and finance area. He received a bachelor of science degree in accounting and later earned an MBA in finance and a master's degree in computer science. He spent the first year of his career as an auditor at the then-Big Eight accounting firm Arthur Young, rotating among a diverse set of companies that spanned many vertical industries.
"This was the best thing I could have done," says Frank. He explains that being an auditor requires becoming intimately familiar with the workflow of a business, which translates into understanding how to leverage IT to support the organization. "You follow a piece of paper, such as an order, from beginning to end and see where it goes and the separation of duties among everyone involved along the way. This provides fundamental grounding in business function - which is absolutely necessary for understanding how to support these processes with automation and technology."
Finding himself the victim of a merger ultimately proved fruitful for Al Schulman, now a vice president at TKO Systems, an IT consulting and professional recruitment firm in Atlanta. Schulman had spent 11 years in the IT department at a bank and was in the midst of running a $20 million branch office automation project when the bank was suddenly sold and the project abandoned.
Schulman, who had long considered consulting an unstable IT career alternative, says he realized that job security, in general, was no longer a predictable commodity in the business climate of the '90s.
"I thought I was in the bosom of the company," says Schulman, who co-founded TKO Systems three years ago. "Suddenly, I was the new guy on the block with no control over important company decisions - or the direction my career was taking."
Generally risk-averse and a creature of habit - "I wanted to know where I was going to park every day" - Schulman transitioned slowly into becoming an independent consultant. He spent six months as a contractor, procuring a temporary position through an agency. From there, he moved on to becoming a full-time staff consultant at a professional services firm that followed the model of assigning consultants to client projects and paying their salaries even when workers were "on the bench."
After 18 months in that environment, "my emotional state was ready" to go it alone, Schulman says. "Now I'm in control of my career again."
The bottom line, according to Schulman, is that if you are by nature risk-averse, you don't need to jump from the frying pan into the fire. You can test the consulting waters in various capacities and see which works for you.
He says he was surprised to find himself in business for himself - but getting there incrementally allowed him to do it.
Going the independent route, Schulman says, gives him the most control over his employment destiny.
From a financial perspective, starting your own shop can be particularly lucrative if you can build an impressive clientele and get scooped up by a bigger firm.
For example, in 1981, David Passmore, a founder of and now research director at NetReference Inc., a Sterling, Va.-based firm focused on network architectures, started a consulting firm called Network Strategies. The firm was later purchased by Ernst & Young LLP.
Passmore woke up one day to find his "status in life raised" as a very young partner in the then-Big Six firm. "This was one of the coolest moments of my career," says Passmore.
After four years, Passmore decided he preferred being part of a smaller enterprise and went back into business for himself. "While the Big Six experience was invaluable, ultimately, you start taking orders from the auditing and tax people, which can be less rewarding," says Passmore. Also, at such firms, you and your immediate family are precluded from holding stock in any company that is a client, he says.
"That rules out a ton of firms," says Passmore. He explains that his wife was working at a company that happened to be a client, and she couldn't even exercise the stock options that were part of her personal benefits package.
Most consultants say they learn from adversity, so even bad experiences and mistakes pay dividends down the road. However, they advise avoiding the following pitfalls:
When joining a professional services firm, read the fine print of your contract carefully. If you think that you may want to move on to running your own business, make sure you check out any noncompete clauses with a lawyer.
Quite often, firms have consultants sign these agreements, which preclude them from working in the business at all for a year or more after leaving the firm.
The goal is to protect the employer from losing clients to the departing consultant.
"Those clauses leave you the option to basically mow lawns and paint houses for a year," says one consultant.
Some employers and even attorneys dismiss these clauses as unenforceable or just boilerplate, but some consultants say you should simply refuse to sign them, even if it means you must seek opportunities elsewhere.
"If you get sued, you automatically lose, regardless of who was right, who was wrong or what happened," notes one consultant, who requested anonymity. He says he had to spend six figures to settle because he couldn't afford the three years it was going to take for his case to go to court.
Another consultant was once asked by a senior manager at a client company to comment on an internal employee's performance and behavior. The consultant, who asked not to be identified, says his automatic reaction was to comply and be "brutally honest."
"Looking back, I think I would have just kept my mouth shut," he says. His comments got back to the employee, who eventually wound up in charge of hiring consultants.
The consultant says it's the client's responsibility to evaluate the performance of internal staff and, since you can never be sure what gets back to whom, you could potentially burn a bridge for the future.
On the other side of the coin, Carol Anne Ogdin, a 20-year consultant and founder and president of Deep Woods Technology Inc. in Santa Clara, Calif., says it really paid off early in her career when she asked to be included in the internal IT team's performance review process. She says her client was thunderstruck that she would want to set herself up for potential criticism, when it wasn't a requirement for consultants to participate in performance reviews. "But how else was I going to know if I was doing a good job?" says Ogdin.
The strategy seemed to backfire at first. "I was livid for three days afterward," she says, because her review wasn't stellar. But it made her realize how important the communication of expectations was to her success, and she has carried the experience - and the practice of getting reviewed - with her.
Clients generally already have plenty of nodding heads around and often look to consultants to provide a fresh perspective. It is also politically easier for a consultant to stir things up than internal employees who have to survive indefinitely in the corporate culture.
NetReference's Passmore says it's easy for consultants to get the derogatory reputation as "people who borrow your watch to tell you what time it is. But what companies are really paying you for is an outside, unbiased view."
Ogdin agrees. "You can maintain a rapport without being disagreeable," Ogdin says. "Diplomacy is the art of telling somebody to go to hell in such a way that they look forward to the trip."
Wexler is a freelance writer and editor in Campbell, Calif. She can be reached at email@example.com.