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Tuesday, 2 August 2016

5 challenges for freelance ICT consultants... and 8 solutions on how to overcome those.

I. Help, my knowledge and experience are becoming outdated. What can I do?!

The ICT-industry is constantly on the move. Driven by a mixture of fashion and new innovations within the industry, certain methodologies, skills and tools can become outdated quite suddenly and unexpectedly.  Once popular tools and hardware can fall from grace, while new systems and tools emerge like a lightning bolt.

While some tools and brands are long-lasting ‘winners’ (hence: SAP, Oracle, various Microsoft tools), other tools ‘disappear from the face of the earth’ in a jiffy. You could think about tools and systems, like JDEdwards (CRM), IBM iSeries (including the accompanying software and development tools) or any other tools based upon obsolete-ish hardware and operating systems.

Also methods change very dramatically sometimes: ‘CMM/Waterfall’ project execution, following the Prince II method, has been a staple for almost all large ICT-driven companies for many years. Suddenly, however, it was conquered by storm by Agile / Scrum and other agile methods. 

That happened for the simple reason that people and companies became fed up by the incorporated bureaucracy, the inagility and the too often undesired end results or deadline shifts of waterfall projects.

But where Scrum seems now the winning method in 'ICT-land', its days could be counted too, sometime in the future. Simply for its (obvious) drawbacks, as f.i. underestimation of the need for documentation by development teams, the moderate to poor scalability within large organizations and the poor predictability of the end state of a project.

If you have vast experience in one of those legacy systems, development tools or outdated methodologies, but hardly experience in something else, your immediate career could be under acute jeopardy!

What should you do:

1.   Check regularly if your knowledge and experience are still in demand on the market.

Having such a look at your own experience and skills can be confronting. It is not easy to admit that you are under threat of becoming a dinosaur in your field of expertise. Still, you must do it and you must do it honestly. You are the last person on earth for whom you should cover up the truth.

2.   Before your own train stops moving, be prepared to jump on another train.

Afterwards you must decide whether you want to remain the keeper of your own niche –  for instant Cobol programmers can nowadays earn a very decent living with this “prehistoric” programming language  or that you want to learn something new very quickly and thoroughly.

In case of the latter, try to gather new competences quickly and try to get ‘hands on’ working experience in these freshly acquired competences. Accept one or two lower paid assignments, if you can acquire valuable experience there. Get out of your comfort zone, but don’t do things in which you will never become successful: don’t waste your energy on projects, doomed to fail.

However, waiting without acting is definitely not an option, as your sources of income might dry out very soon. And when you are already without an assignment or even unemployed, despair might get hold of you, making you feel miserable and restraining you from doing the things that you must do.

II.  Help, I want to have a new assignment as soon as possible, but I don’t want to shoot at everything that moves?!

Since the trough of the economic crisis in 2011, the ICT market has improved dramatically. There are currently a lot more assignments available in the market and it might be that your field of experience and your skills belong to the absolute winners. Then you are definitely in business and you can pick the best, most convenient and interesting assignments.

However, it could also be that it is a little bit harder to get a new assignment, because your experience and skills are not that distinguishing for you as a consultant and you did not catch the latest trend in the ICT industry in time.

Writing too many motivations for different companies and industries and sending your resumé to too many people and companies is disappointing and it can cost you valuable energy, that you need for a successful intake. But still you have to find a new assignment.

What should you do:

3.   Choose your battles wisely.

Don’t apply for every assignment, but choose the ones that you like and where you have an above average chance of being selected with your resumé, your hands-on experience and your motivation.

The same when a certain assignment does not sound interesting or won’t bring you new and valuable experience. You are much too valuable to waste your energy on an assignment that does not bring you something new and interesting, just for the sake of getting an income. You should not be too picky, but also not too eager for new assignments.

However, when you find an interesting assignment on offer, go for it! Check out which are the most important job demands that the principals of your choice have and whether you can meet most of them. If not, save your energy and don’t apply.

Don’t be scared away by very exotic tools and methods on the ‘demanded experience’ list, for which you lack the hands on experience. You can learn a lot on the job. 

And besides that, chances are quite dim that the principal will find a lot of applicants who have that particular experience, when these tools and methods are indeed as exotic as you think they are. And even when principals find such a consultant, he will undoubtedly have a 'sturdy'hourly fee, as he is one of only a few.

Nevertheless, when the aforementioned tools are not very exotic after all, consider doing a course, workshop or self-study to gather the missing experience. Otherwise you might miss too many opportunities for a good and interesting assignment.

4.   Try to only do business with intermediaries, who are preferred supplier at the principal of your choice or at least have personal relations with people working there.

The world of freelancers is crawling with companies that want to earn a few bucks at the freelancer's expense. What you as a freelance consultant want to prevent from happening, however, is that you only earn 60 bucks per hour for an assignment for which the principal pays €90 per hour to the main contractor.

In other words: you don’t want to have €30 per hour in fee spillage, as that makes you expensive as a consultant, in spite of the fact that you still earn a rather moderate hourly fee. 

The rule of thumb is: don’t pay much more than €10 in fees per hour to the main contractor of the assignment and about €2,50 for the invoicing intermediaries (i.e. companies that take care of the general invoicing on behalf large principals, like banks and insurance companies). The services of such intermediaries are often mandatory, as f.i. large banks and insurance companies demand usage of their services for the invoicing and remuneration of their consultants and freelancers. 

But remember, if more than one party (except for invoice mediaries) stands between you and the principal, your hourly fee will blow away in the wind. So don’t do that, as you have to work very hard for your money and should not see it land in other people's pockets for nothing! You are not a philanthropist! 

Besides that, there are numerous small bureaus and one man-businesses, that are fishing in the same small pond of second grade-assignments (i.e. assignments that have been ‘floating in the market for quite a while’ and already yielded a stockpile of resumés for the principal). These bureaus don’t have direct contracts and/or good connections and relations with large principals and the people working there, but simply feed on the breadcrumbs that the larger brokers and intermediaries drop. 

Don’t waste your energy on those, in spite of their sometimes convincing stories! The chances are dim that your resumé stands out so much that you will get an invitation after all and sometimes deadlines for such assignments have already past, without you knowing it.

Always ask such bureaus which principal is involved in the assignment and ask if they either have a ‘preferred supplier’ contract or personal connections/relations with the principal for which they state to work. 

If the answer is 'yes', you can do business with them, but ignore the others as they cost you a lot of energy and often can’t deliver anything in the end.

And remember: a personal cont(r)act between a intermediary and a principal is often much more worth, than thousand possible assignments from one of those clueless, small bureaus and one-man businesses.

III.  Help, the ‘usual suspects’ among the principals are offering dozens of jobs, but I would rather work at a smaller and more personal company?!

Large principals, like national and local governments, semi-governmental organizations (f.i. railroad companies or infrastructure service providers), telecom companies, large banks and insurance companies are indispensable for many freelancers. 

Such companies and institutions need numerous freelancers throughout the year and therefore offer interesting jobs and contracts for many, many people.

Downside is, however, that freelancers are rather considered as a ‘flexible labour shell’ for such organizations, than as a valuable asset for the longer term. This often means that when your job at such a large principal is finished, you will be dismissed without hesitation. You are hired for the job, so when the job is over, so is your contract (of course there are always exceptions to this rule-of-thumb).

What should you do:

5.   Get out of the comfort zone of searching for jobs exclusively at the large principals and find a principal that ‘feels good’ to you, fits to your goals and offers the chance for a longer and mutually fruitful assignment.

Smaller principals more often see their freelancers as 'an indivisible part of the team' and aim more often at longer working relations, especially when these freelancers are good at their job. You could become more closely attached to such a company and hop from one assignment to another, within the same company. 

So perhaps a smaller principal can indeed offer a longer and more fruitful relation, that lasts longer than until the moment that the job is done. 

Whether you like this or not, depends on you of course. Some freelancers like short assignments at many different companies, while others like long and close relations with principals.

IV.  Help, I don’t know what hourly fee I should ask while applying at future principals?

In spite of the rejuvenating economy f.i. in The Netherlands, 2016 is still distinguishable as a demand-driven economy, in which there is more supply of available workers than actual demand from principals. 

The effect of this circumstance is that there will probably be ‘a stack’ of offered resumés for every available ‘middle-of-the-road’ assignment at common principals. This means in practice that there is still fierce competition from other freelancers, which puts pressure on the hourly fees on offer.

This effect is reinforced by the still high influx of qualified and skilled workers from the (European) low wage countries or from India. These people seem to offer exactly the same that you can offer, but at a fraction of the price.

What should you do:

6.       Know what you’re experience is worth.

Don’t ask too much money, but do not put yourself ‘on sale’, out of fear for competition from the low wage countries. If you sell yourself too cheaply, you can’t pay the bills and the fixed expenses that come with being a freelancer. Or you won’t be able to build up a nest egg for possible hard times in the future. 

However, when you sell yourself to dearly, you won’t get an assignment; especially when your experience and skills are not that exclusive for you.

Most companies, however, are willing to pay €60 - € 70 for younger and less experienced workers and roughly €70 - €80 for very experienced, senior workers. This is the rule of thumb. More exclusive skills and experience for a freelancer mean a higher hourly fee than the aforementioned ones, while genuine juniors should aim at an hourly fee slightly below the €60 per hour.

If you go cheaper than that, you will get in the zone in which you cannot pay your fixed expenses anymore (i.e. your car, fuel, taxes, disability insurance, health insurance or retirement payments). Due to the insecurity of a life as freelancer, you must take care of yourself in case of tough times and longer lasting periods of unemployment.

Fortunately, most companies learned to understand the wishdom behind the (not very sympathetically sounding) expression: “If you pay peanuts, you get monkeys”.

Many workers and ICT service suppliers from the low wage countries were initially just not good or experienced enough to fulfil their assigned task, in spite of their (sometimes) very low hourly fees. Or they where hampered by cultural differences and a mutual misunderstanding of their language (mostly English), which handicapped the execution of their job.

But while the best knowledge workers from India and Eastern Europe were able to gather the desired experience and cultural skills and grew into very valued workers indeed, it inevitably meant that their hourly rates went higher too. 

These people also discovered their net worth and did not want to work for a 'token' fee anymore, as they discovered the general costs of living in an expensive country as The Netherlands!

So don’t go cheap on yourself... and once again remember: every superfluous service mediator or job broker that you don’t have to pay for his activities, cannot eat away your sales revenues or make you too expensive. So get these guys out of your personal value chain, where possible.

V. Help, there is so much that I don’t know and so many tools that I don’t master yet.

There are so many operating systems and development, deployment and testing tools in the ICT industry and there is so much to learn in this business, that it is impossible to always stay totally ahead of the game and educate yourself in any tool or method that comes along. 

It is also impossible to win every intake, as there sometimes simply are better and more applicable people for the job. 

As long as your general knowledge, experience and skills are still in demand within the business, you should not worry too much about that (see also I. and II.)

What should you do:

7.   When you can meet most demanded skills and experience (i.e. when you have chosen your battles wisely indeed), you will probably be in business.

Many principals offer very long lists of requirements – tools and methods – that a freelancer should master, in order to obtain the job on offer. It is therefore very hard to meet all requirements on that list.

Remember, however, that such lists often represent a 'starting bid' and that people who master every aspect on that list are probably scarce – and therefore expensive. So don't let those lists haunt you and scare you away. 

Browse through the list and look up if you can meet the most important requirements – the knock-out criteria. If you can do that, just apply for the job.

8.    Be prepared on your job interview, but don’t be overprepared. What you don’t know, you don’t know.

Overpreparation for a job interview can be killing. You can sound ‘mechanical’ and nervous, like an overprepared school kid during his final oral exam; not like you are on the top of your game.

Be explicit and proud about what you know and what your skills are – without too much boasting – and don’t feel bothered and nervous or disappointed about what you don’t know. You can’t know everything!

One of my own mistakes is that I want to answer every question sufficiently and satisfactorily, instead of just chosing for 'no' when this is most applicable. When I can't answer such a question properly, I start stuttering and sweating, which makes a very poor impression, of course. This is my personal handicap and it cost me some good assignments in the past, I'm afraid.

When the conclusion is that your knowledge is insufficient for a particular job, then so be it. There is always another job in which you will prove to fit perfectly, provided that you are still on top of the game with your skills and experience and not have 'turned into a dinosaur' indeed. Grab that one!

And my only additional advice is that you closely follow the trends and don’t forget to jump on the right train, when it leaves. 

You will notice that, when the whole industry is buzzing with a new trend or tool. Don’t miss out on that one!