By Peter Cannone
Let’s face it. The workforce has dramatically changed over
the past few years as bonuses shrink, health insurance is still a bit of a wild
card, and technology affords us the opportunity to work remotely. Given the
recent changes in so many traditional work arrangements, you may be questioning
whether your current full-time IT gig is worth it.
If you’ve done the math, on paper it may look like the independent
route is more lucrative, especially if you’ve mastered any of the IT skills
that are in high demand these days. These include application development,
mobile apps and device management, and networking, according to Computerworld’s
annual survey of the 8 Hot IT Skills for 2014.
While you may be a highly sought after programmer or DBA,
this doesn’t always translate into creating a successful business. Still, you
may be drawn to becoming your own boss.
If this sounds familiar and you’ve given self-employment
more than a passing thought, you likely have a slew of questions. For many
reasons, you may not be able to freely ask friends and colleagues for advice. So
to help you determine if the independent path is right for you, the following
is a list of 20 questions to ask yourself; the questions are divided into three
categories: finances, work environment, and setting up your business. By the
time you answer all of the questions, you’ll know if and when you’re ready to leave
your current job, perhaps find a new one, or hang out your own shingle.
Finance-related questions can be awkward, yet odds are they
are foremost in your mind if you’re considering opening your own IT consulting
practice. Below are the most frequently thought — yet rarely asked — money
- Do you have enough cash to cover your expenses
for a minimum of three months?
- Are you prepared to go without a steady paycheck
for the first month or two knowing that most invoices are net 30 days?
- Have you factored quarterly state and federal
taxes into your monthly expenses?
- Are you diligent about tracking expenses?
- Have you determined a fair and realistic billing rate based on your skills and an analysis of the competition?
- Are you willing to dedicate a non-billable day
every quarter to take a class or otherwise hone your skills?
- Do you have health insurance, and/or have you priced
your options with regard to COBRA or plans
for self-employed professionals?
From long stretches of solitude to networking among
thousands at local conferences, the following questions will help you figure
out if being a 1099 (assuming your business is in the United States) will give you
a decent work/life balance.
- Do you prefer to work autonomously or as part of
- Do you have a network of colleagues you can freely
contact for advice?
- Are you comfortable with ebbs and flows in your
workload, including weekends, or do you prefer to work a steady 40 hours per
- Do you genuinely like attending networking events
to expand your circle of contacts and look for new business opportunities?
- Can you comfortably work out of your house every day, or do you need a separate
Setting up your business
Now let’s consider the ‘business of the business.” The
following questions and links to resources will help shorten the time it takes
to get your business up and running.
- Do you have a business plan?
- Have you already lined up your first client?
- Do you have the essential startup tools,
including a computer, software, and a website?
- Have you determined whether you want to be legally
incorporated as an S Corp or an LLC?
- Have you determined which administrative tasks,
such as taxes, are better handled by a third party so you can focus on
servicing your clients?
- Are you prepared to say no to a potential new client
if it’s going to compromise your principles or your business model?
- Do you have enough years of experience and
proven successes that former colleagues will refer business to you?
- Do you see yourself doing this as a long-term
career move or as a bridge between traditional full-time jobs?
As you’ve likely determined at this point, going out on your
own can be a thrilling, scary, and rewarding experience. These questions may
have helped you reinforce the fact that your business plans are rock solid.
Alternatively, you may have discovered there are still some unknowns to figure
out before you hand in your letter of resignation.
While only you can answer whether being your own boss is the
next best move in your career, the more prepared you are before you take the
leap, the higher the likelihood of success.
Peter Cannone is the
CEO of OnForce and was recently named to the 2013 “Staffing 100” list of
top industry influencers, as reported by Staffing Industry Analysts.
Also read on TechRepublic
- Steps to becoming an IT consultant
personality traits of a highly effective independent consultant
survival tips for new IT consultants
things I wish I’d known before becoming an IT consultant
mistakes that rookie IT consultants make
a consulting business in an unusual market
a project management consulting business without coding expertise
early years in IT consulting: What I did and didn’t do well