Careers - Spreading your wings

The transition from working in a large consultancy practice to becoming an independent consultant or a sole trader can be fraught with problems. But there are also huge benefits for those consultants who want to expand into new areas and explore new ways of doing things. Penny Bickerstaff worked for KPMG and Coopers & Lybrand before going to ITN as financial director. Then she decided to become an independent consultant. She began doing associate work for Coopers & Lybrand, where she ran the Thames Television division. “I did not want a permanent job because when you get to the top you manage the work; I would rather be one stage removed and doing the consultancy work,” says Bickerstaff. Her work since then has been varied, from working for Legal & General and Nat West, to growing a TV productions company. “The advantage is that you can choose your own direction,” she says. Geoff Kitt, a former president of the Institute of Management Consultants, went from being partner in charge of Deloitte & Touche’s Scotland consulting practice to setting up his own independent, virtual consultancy, Minerva in 1995. “What I didn’t want to do was disappear into sole tradership. I wanted to set up a consultancy that is virtual and has visibility in the marketplace,” says Kitt. “You get to go into business with a few people whom you liked and respected either as competitors or colleagues and there is a real team spirit,” he says. Prior to the Minerva launch, Kitt spent his spare time putting together Minerva’s infrastructure and its marketing plan. He ended up hiring an advertising agency to help bring the firm out into the market because of lack of time and the agency’s ability to produce things in a professional way. The practice, which has four directors and 18 “hard” associates, began trading in April 1995. It has no administration support and operates via the Internet. Kitt has been able to work on the same sized projects as he did at Deloitte & Touche. “The income level is broadly what I was making there,” he says. The firm has increased its turnover by 50 per cent since last year. “One of the great advantages of being at Minerva is you do have a peer group, although it is dispersed, and we do have a pool of income.” Peer support is something many sole trader consultants lose when they leave a large firm. Kitt did not find the transition particularly painful because of the contacts that he and his colleagues had made in the industry. Tom Sheridan, a sole consultant, who worked from PA between 1967 and 1992, says: “You are your own master, so you don’t have to cowtow to people. Someone phoned me and offered me this marvellous job in Moldavia. I said ‘no thank you’, but in a large consulting firm you can’t say that.” Sheridan finished on a Friday at PA and was back the following Monday starting a six-month period of associate work. He then spent four weeks getting his consultancy on its feet. “One piece of advice I would give to people who are leaving a big firm to set up on their own is if they have been fired in an unpleasant way, emotionally they will be very cross. The thing to do is to calm down and not make any rush decisions. The worst thing to do when a firm is getting rid of people is to get together and form a new firm because it nearly always fails. People find that they don’t know each other so well and they get together for the wrong reasons.” Loneliness and how to keep your wits sharp are key problems for consultants, says Graham Mead who set up as a sole trader after he was made redundant from Moxon, Dolphin & Kirby nearly four years ago. He says consultants need to consider how they are going to replace the peer support that they had in their organisations before going independent. “The Richmond Group has been a very powerful force in my life, in terms of being able to work and find contacts. You don’t realise how much you enjoy the interchange with colleagues until you are stripped bare,” says Mead. “I think that every decision made is enriched by having a number of contributors and with the Richmond Group there are one or two consultants who will give me well-seasoned advice.” Sheridan agrees that consultants need to organise some peer support, just to ensure that they keep up with the latest concepts. “Loneliness is the big enemy and you have to decide how you will tackle that,” he says. “The Richmond Group has been excellent, we debate issues important to management consultants – it’s leading-edge stuff.” Administration is another headache for the sole trader: financial management and billing, as well as keeping an eye on the accounts takes your time away from consulting. Mead recommends writing out a business plan to deal with VAT issues, information technology support, and, most importantly, ensuring that sole traders upgrade their training. “You have to be very self-disciplined, and you need to sell hard and be very self-confident and positive,” says Mead. “It takes a long time to develop all that.” Time is certainly an issue, but Gerald Michaluk, managing director of Marketing Management Services, and formerly a lecturer at Strathclyde University, thinks that he has found an answer. In November this year, he plans to launch Going Solo, an Internet franchise call centre operation where sole trader consultants can get administration and research support. “If they use our franchise they will spend less time on administration, credit control, and research, and will actually spend more time with clients and therefore earn more money,” says Michaluk. The cost of the 24-hour franchise service is #25,000 which includes a training certificate from the University of Strathclyde on management consultancy, based on BSENISO9001 and manuals on how to run a consultancy business and balance the books. The firm also supplies consultants with a video phone, ISDN, computers and laptop access to the call centre in Dumbartonshire via a docking station. After that consultants are only required to pay a royalty fee on all their projects, they get the research and administration support at cost. Consultants would have to operate under the Going Solo brand, but for that they also get access to customer lists and tenders for projects, says Michaluk. The main benefit is individual franchise group consultancy support and the help of mentor, whose aim is to make the business grow. “A lot of people who go out on their own underestimate the difficulties,” says Michaluk. “They are Mr Smith Consulting and not Price Waterhouse, and companies tend to buy brand names for the security because they can sue or pass on the blame. In the research that we conducted, the consultants leaving Coopers & Lybrand are billed out at #1,500 per day. But the longer the consultant is away from the Big Six the less they get paid. I can pick up an ex-Price Waterhouse consultant for #250. What we are offering with our franchise scheme is a way out of that.”