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As someone who has both been and hired a lot of freelancers/contractors, I would say that there is a genuine difference in game level between freelancers and co

As someone who has both been and hired a lot of freelancers/contractors, I would say that there is a genuine difference in game level between freelancers and consultants. It's a matter of professionalism and willingness (and ability) to steer the project/engagement. Consultants are experts who come in and figure out how to achieve a goal, who investigate the clients' needs, who tell the client "these are the steps we will need to take to figure this out, and then to make it happen." At an advanced level, they will even help figure out the right goal to begin with. Freelancers typically have to be told these steps by the client (and managed). If you can come in and steer a project, and let the person hiring you relax his/her no doubt overworked brain for just a few hours, you can charge practically whatever you want. That's how we were doing $500+/hr (each) before we quit consulting, because I led the processes for our clients. They didn't mind paying $2k simply for meeting with us both for 2 hours because they got to be the subject of conversation, instead of the leader, and they'd get a valuable report out of it at the end (for an additional price, of course). Never once had to worry about price shopping, because if that's the service you want, there is zero competition! Foolishly, I thought this was just Normal Professional Behavior until I started hiring people for my business. Sadly, it seems most people out there prefer the unprofessional and haphazard approach where they take on too much work/too many clients, wait for the client to tell them what to do, then jump between clients like a scalded cat to whichever project causes the most screaming at the moment.

tptacek 14y ago
I admire people who can execute this consultative approach (and, it should go without saying, I admire Amy Hoy's work in particular). If you can make $500/hr/person for talking sessions, I think you should do that. But I want to take yet another opportunity to stab wildly at the idea that only people who can execute at this level are "consultants", and the rest "freelancers". Though I find the terminology a little silly, let's stipulate that those are the two words. Then: a consultant is simply someone who pitches projects with value-based pricing, and a freelancer is someone who pitches market- or cost- based pricing. Start pitching value-based deals now. Don't wait until you feel like you're at Amy Hoy's caliber of delivery. That is literally the only thing you probably need to change in your practice to start transitioning towards being a high-value "consultant". The only thing it takes to move from market- to value- driven pricing is a positioning change. You're stuck with market-pricing when you're doing something lots of other people do. So pick specialty practices or practice focus areas; it doesn't hurt if you pick focus areas that are "closer to the money" (conversion optimization is an obvious example), but even that's not necessary if you can drive your practice towards a desirable and underserved niche. It's fine to deliver Rails or iOS contract software projects for market-based rates (they're pretty high right now), but that doesn't have to be all you do.
- ahoyhere 14y ago
  I don't think we're disagreeing here about pricing at all! Lots of very good freelancers are undercharging and everybody should price on value delivered. (Especially those freelancers who disappear and only get work done when yelled at. If only!) That's why a lot of the educational content I've used to promote Freckle is about delivering, understanding & capturing value… for freelancers. (Which includes understanding & identifying your ideal clients because if you use a hammer to break a window and steal $1 million in diamonds, it's worth a lot more to you than if you use it to hang your kindergartener's fingerpaintings.) Any freelancer can become a consultant, though, by changing the way they work. Read a few books, take personal responsibility, experiment with being more than a tool for executing the client's vision. If you ask your client questions and debate features, that's already a good start. This kind of consulting — consulting, as in the dictionary definition -- is a huge value and therefore hourly rate multiplier. Anyone who improves their management skills can vastly increase their rates. If you only provide execution, and not the other stuff I described, you will hit a ceiling a lot sooner… and suffer more price comparisons. Not as many problems as a person who just says "I code in Ruby" rather than "I help your biz make more money," but more problems than somebody who approaches the biz like I did! BTW - I rarely did just-talk engagements. All the stuff I described above was as part of design-dev projects. The process I came up with is as follows: We would meet the client, give them a fixed price quote ($5-10K) for these meetings and guidance and the report. They would pay 100% up front. The report, then, was a deliverable they could take to use with any other (cheaper) service provider to implement. Which, naturally, never happened, because as soon as the client saw how we ran our projects, they would never dream of hiring anyone else. That's the power of being a consultant!
  - goblin89 14y ago
    > If you ask your client questions and debate features, that's already a good start. I've always been doing that, and felt uncomfortable to call this activity ‘programming’. Local clients (small businesses) hire a web developer to build a site, but it usually requires at least some education and research, as they rarely have good understanding of their needs. Still I'm shy to call it consulting except to myself. Your comment helped me understand better that it's almost exactly that consulting everyone talks about—thank you. You mentioned books—can you recommend some titles, authors, or maybe subjects?

tptacek 14y ago

I admire people who can execute this consultative approach (and, it should go without saying, I admire Amy Hoy's work in particular). If you can make $500/hr/person for talking sessions, I think you should do that. But I want to take yet another opportunity to stab wildly at the idea that only people who can execute at this level are "consultants", and the rest "freelancers". Though I find the terminology a little silly, let's stipulate that those are the two words. Then: a consultant is simply someone who pitches projects with value-based pricing, and a freelancer is someone who pitches market- or cost- based pricing. Start pitching value-based deals now. Don't wait until you feel like you're at Amy Hoy's caliber of delivery. That is literally the only thing you probably need to change in your practice to start transitioning towards being a high-value "consultant". The only thing it takes to move from market- to value- driven pricing is a positioning change. You're stuck with market-pricing when you're doing something lots of other people do. So pick specialty practices or practice focus areas; it doesn't hurt if you pick focus areas that are "closer to the money" (conversion optimization is an obvious example), but even that's not necessary if you can drive your practice towards a desirable and underserved niche. It's fine to deliver Rails or iOS contract software projects for market-based rates (they're pretty high right now), but that doesn't have to be all you do.

ahoyhere 14y ago
I don't think we're disagreeing here about pricing at all! Lots of very good freelancers are undercharging and everybody should price on value delivered. (Especially those freelancers who disappear and only get work done when yelled at. If only!) That's why a lot of the educational content I've used to promote Freckle is about delivering, understanding & capturing value… for freelancers. (Which includes understanding & identifying your ideal clients because if you use a hammer to break a window and steal $1 million in diamonds, it's worth a lot more to you than if you use it to hang your kindergartener's fingerpaintings.) Any freelancer can become a consultant, though, by changing the way they work. Read a few books, take personal responsibility, experiment with being more than a tool for executing the client's vision. If you ask your client questions and debate features, that's already a good start. This kind of consulting — consulting, as in the dictionary definition -- is a huge value and therefore hourly rate multiplier. Anyone who improves their management skills can vastly increase their rates. If you only provide execution, and not the other stuff I described, you will hit a ceiling a lot sooner… and suffer more price comparisons. Not as many problems as a person who just says "I code in Ruby" rather than "I help your biz make more money," but more problems than somebody who approaches the biz like I did! BTW - I rarely did just-talk engagements. All the stuff I described above was as part of design-dev projects. The process I came up with is as follows: We would meet the client, give them a fixed price quote ($5-10K) for these meetings and guidance and the report. They would pay 100% up front. The report, then, was a deliverable they could take to use with any other (cheaper) service provider to implement. Which, naturally, never happened, because as soon as the client saw how we ran our projects, they would never dream of hiring anyone else. That's the power of being a consultant!
- goblin89 14y ago
  > If you ask your client questions and debate features, that's already a good start. I've always been doing that, and felt uncomfortable to call this activity ‘programming’. Local clients (small businesses) hire a web developer to build a site, but it usually requires at least some education and research, as they rarely have good understanding of their needs. Still I'm shy to call it consulting except to myself. Your comment helped me understand better that it's almost exactly that consulting everyone talks about—thank you. You mentioned books—can you recommend some titles, authors, or maybe subjects?