Nerd Journey: Career Advice for the Technology Professional
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Finding a Better Way: Contracting, Independence, and a Consultant’s Reputation with David Klee (2/2)
Does a successful consulting career mean you should only work for yourself? David Klee insists you first need to become a skilled consultant with the right kind of reputation. In episode 310, part two of our focused discussion on the nuances of consulting, we dive into the realities—and the pros and cons—of contracting, working full-time for a consulting firm, and the independence of running your own business. These represent 3 of the 4 ways someone could work as a consultant. Building on last week’s conversation about what makes a great consultant, we discuss the importance of developing a reputation and some tips for how to do it. David also shares his approach to assessing consulting talent, highlighting the key traits that make a consultant stand out. And we’ll also hear why, after 11 years owning a consulting firm, David can’t see himself doing anything else. Original Recording Date: 12-18-2024 David Klee is the founder of a niche consulting company called Heraflux Technologies. If you missed part 1 of this discussion with David, check out Episode 309. Topics – Contract Work as a Consultant, Working for a Consulting Only Firm, Starting a Consulting Firm / Doing Your Own Thing, Keeping Consulting Enjoyable 2:25 – Contract Work as a Consultant Another way to do consulting work is to be a contractor. How does this work differently than full-time employment? Full-time employment could be 1 project for 40 hours per week, but it is unlikely. It will more often be a certain number of hours per day working on a few (or even several) different projects. “Things just kind of float to where you’re juggling anywhere from 3 or 4 to 20 projects at the same time. A contract is going to be a tightly defined scope for a block of time for either per day, per week, whatever. And it’s going to run a duration such as 2 months, 6 months, a year…something like that where you’re able to refine what you do. It’s generally speaking going to be a task or a set of tasks, and that’s what you do.” – David Klee, contrasting being a consultant working full-time for an employer that does more than just consulting with being a contractor A project you work on as a contractor is controlled. You know when it starts, what to expect, and when it ends. A contractor has to line up the next project once one ends. Knowing the endpoint can help you understand when it’s time to begin looking for the next project. Contracting might allow focusing or going deeper on the work you are tasked to do instead of getting too broad. David gives the example of needing to build a data warehouse for a specific ERP system within 6 months. David says contract work is safe and sustainable. In fact, one of the first projects after David started Heraflux was a contract engagement which required travel to Connecticut and working 5 days per week at a customer location for 6 months. Where can people find contract job openings? Are these on company websites, on LinkedIn, only available through headhunters, etc.? David says it works best if you can go through a headhunting entity. Companies may post contract positions on LinkedIn or popular job sites, but a headhunter can evaluate someone’s skill set and share a set of projects that align to that skill set. The candidate can then select which projects they would like to interview for, and the interview may be with the headhunter, with the end customer, or possibly both. “It’s a way where instead of you looking (and there may be phantom jobs or people just fishing for who is out there) the headhunter is usually going to be a lot more serious. If it’s through a headhunter, the right might be a little lower than if you would go direct; however, the headhunter might also be able to provide you healthcare…and that goes a long, long way…. There are some benefits like that that really do help.” – David Klee, on contract work through headhunters A headhunting firm could potentially provide the healthcare benefits for 6 months or 12 months while you are working on a project so you don’t have to look for it yourself. The headhunting firm may also be able to handle tax withholdings from your paycheck so you don’t have to handle it after the fact. Contract workers would likely be paid via a 1099 form in the United States. What type of headhunters should people who want to do contract work seek out? Are there big names to be aware of? There are national chains that do this as well as regional and local. Each one will have benefits. A national chain may be more likely to offer you interviews for projects that require air travel to a customer location each week. Regional headhunting firms may have some travel, but you can easily get a feel for their reputation. You can speak to people who have worked with them as contractors as well as companies who have worked with them. This can help you get an idea as to whether the firm is a fit for what you want to do as well as a cultural and a people fit. “The national chains will almost certainly have more opportunities. You may have to travel for it. The regional stuff you’ll be able to get to know them a little bit better, and after enough time they may actually know to call you if they have a project of a certain type…. And there’s no reason to say you only have to work with one headhunter.” – David Klee, on contracting and working with headhunting firms David mentions he has gotten to know a number of good firms in the Omaha and Lincoln, Nebraska area. When a project ends and the headhunting firm you have been working with doesn’t have more projects that fit you, nothing is stopping you from working with a different firm. Working with the headhunting firm can help spread your reputation to multiple end customers because of the reach of the firm. Would a headhunting firm or end customer pay for travel if you are working on a contract basis, or would the contractor need to pay for it themselves? David says it should be that someone else pays for the travel, but this can work in many different ways. Sometimes the headhunting firm may book all your travel arrangements as part of any travel you do. If this happens, beware of getting placed in very inexpensive accommodations. Sometimes you may be given a travel budget, and it’s up to you to figure out how to use it. Exceeding that budget would come out of your own pocket, but if you come in under budget you may get to keep the difference. Some people may do contract work as a side gig in addition to their full-time job in the form of moonlighting. David says you have to ensure your contract for your full-time job does not prohibit you from doing this kind of thing. For some full-time employers, doing extra work on the side is not a problem as long as there’s no conflict of interest. “…The side stuff should never get in the way of the full-time job…. Some companies out there, including some big ones, they’ll let you moonlight as long as you disclose it and as long as there’s no chance that it could ever conflict and hurt the mission of the full-time job.” – David Klee, on doing part-time contract work in addition to your full-time job David says moonlighting is a great way to gain experience consulting, but you need to make sure no one expects you to be available during normal business hours. This can be challenging as many companies might want things fixed during the day. David gives the examples of database index tuning and custom programming that should be fine to work on after hours. But you should always make sure the company you’re moonlighting is ok with your hours of availability. What about the stability and volume of contract work during difficult economic times? Contract work according to David will ebb and flow usually with what the economy is doing. In difficult times, companies will pause projects that involve outside contractors or maybe just slow them down / decrease the hours. David cites a customer he worked with who leveraged contractors and consultants for 75% of the IT workforce. During tough times this company would pause or suspend the projects, making sure they never had to lay off full-time employees. Being on a time-bound project as a contractor does not protect you from difficult economic times. Companies can still pause the project or end it. “A lot of people I knew were on contracts during 9/11. And boom. A lot changed, and these projects were just done. Within a couple of days a whole bunch of stuff changed, and a lot of people were out of work. Now it didn’t last that long for them thankfully. But, there’s always a clause in there that says these contracts can be terminated at will.” – David Klee, on contract work David shares the story of leading some SQL Server migration projects for a large airline and the changes that happened when the pandemic hit in 2020. “I get an e-mail at 10 o’clock in the morning saying, ‘stop what you’re doing. Document everything you can through the end of the day. That’s it.’ …Because the airlines shutdown, it was cost savings panic mode, and every external project with external people suspended immediately.” – David Klee How do hiring managers for full-time roles look at candidates who have done a lot of contracting? David doesn’t see someone doing contract work as a bad thing, but it depends. He would want to know why the person was choosing to go back to full-time work somewhere. Did the person get a poor reputation from doing contract work, or do they just want benefits like healthcare, paid time off, a 401K, etc.? “Those are a lot of reasons why a lot of folks get out of consulting and go back to being an FTE. There’s stability. There’s job security. There’s benefits. If you’re tired of the constant churn of different projects, you now have a controlled environment, and you know what you’re working with the
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