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To become a software consultant, avoid letting clients pay you for code (2017)

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Re: To become a software consultant, avoid letting clients pay you for code (2017)

#11
post #7

Earlier quoted context omitted.

I tried this a bit myself. You are right that you can provide tremendous value, but early-stage startups either don't have, or aren't willing to spend, the money that you deserve for the value you'd provide. Maybe there's a niche you can target that I was unaware of. Hopefully you have more success!

Seems actually a better use case for paying in stock (compared to regular employees). You only work a short time for them, so you can spread your bets more like a VC, and your influence can have a decisive impact on their success, so it's not just a lottery ticket.

Those days startups take ~10 years to get to IPO.

Even if we assume that they are willing to part with stock for consulting engagements, can you afford to wait years to get paid?

Can you afford to pay taxes on that income this year? (to you it's paper money that might never to turn into real money; to IRS it's as good as payment in cash).

Re: To become a software consultant, avoid letting clients pay you for code (2017)

#12
And that ladies and gentlemen is exactly how American IT became taken over by Indian outsourcing companies and the quasi ones like Deloitte , Accenture. American exceptionalism and a good education system might make you a great consultant but who turns that spec to code and does the grunt work ? Surely you aren't hiring American college grads because they have already been told this work is boring and shitty and they are special and should build domain expertise or salesmanship . Don't get me wrong - it's an excellent article but I think this is targeted towards developers with experience who also understand the big picture (accounting , P&L, systems). However doing implementations , turning spec to code , reusing it are great ways to enter the IT industry with solid pay and something that American college grads encouraged to take up for a solid middle class life . Infact community colleges and colleges should teach those skills similar to how it's done in India. (No I am not a Trump supporter).

Re: To become a software consultant, avoid letting clients pay you for code (2017)

#14
post #6

Earlier quoted context omitted.

> Is there a market for general purpose software consultants? Certainly is, as indicated by the continued success of for Accenture, McKinsey Digital, Deloitte Digital, IBM, EY, KPMG, PwC, Aon Hewitt, and probably a million more smaller consultancies and agencies. Its certainly a suitable career choice if you enjoy a mix of technical solutioning, ideation and development work across a range of clients, geographies and…

These companies/people are paid not for their general purpose skills/consulting. They are paid for trust/brand. """No one got fired for choosing McKinsey/BCG/Deloitte/IBM/MS etc"""

Except in South Africa where Bain etc are under heavy fire for facilitating government corruption on an unprecedented scale during the Zuma years

Re: To become a software consultant, avoid letting clients pay you for code (2017)

#15
>Don’t ever let would-be consulting clients pay you for code that you write.

A similar piece of advice is in the often-submitted article by Patrick McKenzie.[1]

The common idea is that instead of being just a "code monkey", you position yourself higher up the value hierarchy to be more of a "solutions provider".

In my observations of programmers that successfully sell consulting vs earning a W-2 salary, both articles leave out the dispositions and natural inclinations of the reader. This affects how easy it is to move up the value hierarchy.

To do high-value consulting, one has to take an honest self-assessment:

1) Do you like to be somewhat entrepreneurial and "hustle" for work? (Some programmers would prefer to be given a set of defined tasks and then be left alone rather than scout for new jobs and projects. The act of "selling yourself" to prospective clients is uncomfortable.)

2) Do you accept that there can be cycles of feast or famine because of downtime between freelance contracts? (Some programmers would rather have the predictability of steady paycheck rather than stress over contracts and chasing Accounts Payable for past-due payments.)

3) Do you find "solving business problems" more interesting than programming languages? (E.g. some folks are more interested in Python 3 vs Python 2 differences or studying Lisp macros -- rather than tackling the domain knowledge and complexities of modernizing a hospital billing system, or the code to monitor container ship logistics, etc. The coder views the business stuff as boring but programming languages as interesting.)

Once you've done the "know thyself" exercise, you can then analyze how various types of "consulting" is sold in the marketplace and where to position your services.

If you're just a generalist programmer in (e.g. C++/Java/Python), it will be difficult to sell that as "consulting" to companies. You have to go up the value chain and sell "solutions". This is easier if you have expertise in a specific business niche that interests you. As for examples of selling general consulting that covers the spectrum from "bodyshop of programmers" to "solutions providers", that would companies like Infosys (India H1B), Pivotal Labs, Thoughtworks, Accenture, IBM Global Solutions.

Some exceptions to selling small scale "consulting" without being a being a solutions provider would be web freelancing and maybe cybersecurity auditing. Otherwise, generalist programmers either need to work for the solutions providers above, or become a solution provider themselves, or find contract gigs on marketplaces like Upwork and Dice. However, selling your programming skills on Upwork is the probably the opposite of the advice given in the 2 essays.

[1] https://www.kalzumeus.com/2011/10/28/dont-call-yourself-a-pr...

Re: To become a software consultant, avoid letting clients pay you for code (2017)

#17
By the time a business believes that a “solution provider” is not the same type of person hired for the technical implementation, the battle is already lost and you should leave. The idea of wanting to work in these situations as consultant or software engineer is all pretty crazy.

For example, Scrum is a pretty stupid and horrible thing, at least as stupid and horrible as Waterfall and often quite worse.

Anybody who thinks it’s important to give consulting advice about whether to adopt Scrum is someone to run away from. It’s like a daisycutter of common sense.

There are great, small places to work where you can be paid well _and_ have your technical opinion respected and considered as an implementer.

You can’t do that in places that are brainfucked with politics and bureaucracy, and the willingness to hire outside “solutions” consultants is a pretty big indicator that a place is brainfucked with bureaucracy and politics.

Re: To become a software consultant, avoid letting clients pay you for code (2017)

#19
post #11

Earlier quoted context omitted.

Seems actually a better use case for paying in stock (compared to regular employees). You only work a short time for them, so you can spread your bets more like a VC, and your influence can have a decisive impact on their success, so it's not just a lottery ticket.

Those days startups take ~10 years to get to IPO. Even if we assume that they are willing to part with stock for consulting engagements, can you afford to wait years to get paid? Can you afford to pay taxes on that income this year? (to you it's paper money that might never to turn into real money; to IRS it's as good as payment in cash).

Restricted and illiquid shares are rightly valued at a discount to the same shares with a liquid market, so while you pay taxes on them, it's on their fair market value (which can be low as above).

Re: To become a software consultant, avoid letting clients pay you for code (2017)

#20
Having seen all type of consultants over the year:

- The strategic consultant you describe manages to have a higher tariff, but the sales cycle is long and the downtime between gigs significant

- the 'software consultant' has an on average lower tariff (depending on the specialization), but little downtime and faster sales.

Pick your poison and do what you feel most comfortable with.

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