Scaling Up From Individual to Team

When scaling your consulting firm up from an individual to a team, you’ll have to decide whether to hire contractors or employees. Learn the pros and cons of each.

When you want to grow your consulting firm, you’re probably going to have to bring on additional people. There’s only so much of you to go around. Make deliberate choices about whether the people you bring on will be contractors or employees. Ensure those individuals’ interests are aligned with yours.

If you’re going to bring on contractors, you don’t run into all the employment and tax issues and they’re going to be a more flexible workforce. The downside is they can leave suddenly and they don’t always share your personal interests.

If the people you bring on are employees, they’re dedicated to the work, but they come along with a lot of administrative issues you’re going to have to deal with. If you need someone who’s fully committed to building your firm but that person’s only interest is part-time work to supplement their income, you’re not going to be happy with that result.

Ensure interests are aligned between you and the people you bring on. A lot of times I get people who say they want to work with me, and we run a training firm. They’ll tell me, “Well Mike, when you can’t do the training session, just throw me that gig.” The problem is, I don’t need people for bandwidth to do the training. I need salespeople. That relationship won’t work out, so I have to hire different people.

I’ve chosen a structure where I have contractors. I don’t want to deal with the overhead. I don’t want to deal with the administrative issues. It’s great that I have contractors because I don’t deal with those issues. The downside is, sometimes I struggle to get my contractors’ attention and have them focus on building my business versus other interests they’re pursuing.

Know the different benefits and drawbacks of contractors and employees. Make sure you choose deliberately to drive the outcome you’re looking for.

Want more weekly consulting tips? How about taking an entire course on it? Go directly to the course and start improving your decision-making strategies. The entire course is available at LinkedIn Learning. Enjoy!

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