I’m sick of this job! I’m going to go out on my own and become a project management consultant!
Hmm… How do you decide if you’re ready to become a consultant?
- Are you comfortable working alone? Can you maintain your sense of objectivity when you don’t have others to support you?
- Do you believe in yourself, and can you persuade others to believe in you?
- Can you walk away from a job you don’t want, even if it pays well?
- Are you good at listening to people, and reframing their issues in order to get to the next step?
- Do you follow up quickly, completely and reliably?
- Can you sleep at night not knowing when you’ll see revenue?
- Will your family support your decision?
The last two questions can be the toughest. The number one reason new consulting businesses fail is undercapitalization. As there are many administrative and marketing tasks that need to be performed in order to set up a consulting practice, you need to ensure you have revenue to sustain yourself for a while. Count on at least 6 months of dedicated effort before you begin to bring in new business. Wow, this is a big risk! As a PM, you know that since this is the risk with the largest probability and impact, a strategy needs to be developed to mitigate this risk. Possible ways of resolving this risk include:
- Wait to begin work until the you have saved enough money to live on for the startup period (This is ideal)
- Take out a loan, while still employed, and use those funds to live on while you build your business (This of course presents a secondary risk of making loan payments)
- Perform startup activities while still employed. (The primary risk here is you will be less motivated to get all the setup tasks done, and have less time to devote to them, which means it’s going to take longer to get your business off the ground.)
It’s not a feasible approach to simply start, planning on getting new business right away, as you will be influenced by financial risk and worry, and will make poor business decisions as a result.
What is standing in your way? Do you want to become a consultant, or does it sound too scary to you?
Join the conversation!