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I think the biggest failures at the software consulting houses I've worked at have come from not building adequate tooling and not establishing a framework for
by 01100011 8y ago
I think the biggest failures at the software consulting houses I've worked at have come from not building adequate tooling and not establishing a framework for knowledge/skills transfer. A close runner up would be failures related to trying to build actual products. The problem with consulting though is scalability. You can make a product and recoup your NRE with the first x units, and then most of what you sell beyond that is pure profit which can roll in while you sleep. Scaling a consulting business is tough. You just have to increase billable hours and that is a lot tougher than it sounds(especially in the current market).
I made a lot of money in consulting over the years, but at the middle of my career I find myself looking for a product company to call home. Consulting can be great... or it can be terrible. My friend is now charging $165/hr for his solo corp... but sometimes the invoices never get paid and you have to swallow a loss(I'm owed over $14k currently and will probably never see it).
- tptacek 8y ago$165/hr is not particularly high (in addition to the fact: don't bill hourly). A $3200 day is not unusually high. Product development is in some ways more gratifying than consulting. But consulting has its own rewards, too.
- toyg 8y agoI’ve just started out in a niche that I thought richer than average, and I charge less than a third of that. Where have you seen people charging that much?
- 01100011 8y agoSure, you could charge a lot more depending on your role and resume. My friend is getting $165/hr doing Sr. Software work, writing code for satellites. It's a steady 40ish hour/week role, so I think that, compared to salaried senior devs in the area(i.e. not silicon valley or NYC), he's doing quite well. For comparison, I know a local engineering staffing/design services firm that charges $200/hr for principal engineer time. You're getting more out of that sort of company though.
- mrhappyunhappy 8y agoSeems backwards, your friend should be the one making 200+
- 01100011 8y agoWhy? He doesn't have to pay a sales team, marketing department, IT guy, etc. He also doesn't have a building full of engineers who he can query if he runs into something he can't handle. I would never pay an individual, regardless of whether or not they're a corp, more than I'd pay a company which provides engineering talent.
- tptacek 8y agoNot that the specific number is worth litigating, but worth mentioning: a sales team, marketing department, IT guy, and all that are part of the competing consultants cost basis, and not so much the value they offer clients. Unless you're selling gypsum, for the most part, nobody is buying based on your cost basis. You're either doing something worth $X, or you're not.
- 01100011 8y agoNot going to litigate the number but I will say that sales teams often do add value. They provide a human point of contact to escalate issues and manage customer expectations. They also may act as a single point of contact for flexible staffing needs - i.e. if they need a second body to meet a schedule, they don't have to hit the open market but can simply buy more engineering talent. That said, I've often felt like the sales team doesn't provide much value. It depends on the company. I will say though that companies are generally more comfortable paying a higher rate to another company vs. one guy working out of his house. There is a greater expectation of responsibility. Also, many companies will not even deal with you as an individual corporation unless certain rules are met. One rule might be that no more than, say, 30% of your income can come from the company looking to hire you. They want to see a diverse revenue stream and a well established business.
- mrhappyunhappy 8y ago$3200 per day? Where do I find those people... This is Dev consulting?