Consultant or Contractor? 3 Key Questions for Choosing Your Path

Posted by Norm Barnett on 3/1/16 11:02 AM

3 Questions to Help you Pursue Consulting or Contracting

There are many benefits to being a consultant or an independent contractor, but there are some disadvantages as well. Before you decide how to approach your career you will need to weigh the pros and cons -- and make sure that your choice is the right direction for your career.

As a professional consultant recruiter for over 20 years, I am a firm believer that people assume the traditional job market is the only catalyst for career growth and satisfaction. But, have you ever thought about the differences between being a consultant and being a contractor?  Whether you have thought about it or not, it is important to understand the differences between the two roles.

There are three main questions I believe you should consider in determining which role is right for you:

  1. Do you understand the differences?
  2. How will you be engaged?
  3. Do the opportunities align with your brand, and allow you to take the next step in your career?

1. Understanding the Differences.

A quick definition between the two is quite simple and can be broken down like this:

  • Consultants give advice about what the client should do.
  • Contractors show up and do what they’re told.

Often the definition can be mixed and some people view contractors as consultants but, following the guidelines above the definitions are clear.

A contractor is similar to being a full time employee in the sense that you develop relationships with other people who work in the same physical location. Often times working as a contractor you relate to your clients internal environment and you have little to no interaction with the agency employees you are contracting for.  You also get paid by the hour, which has its advantages. The disadvantage is you are stuck in the environment you are place in and have little to no control over how it is managed.  You are brought in to fill a gap.

In contrast, a consultant is offered a salary and bench time, your stress comes when your contract is up. Your contract’s renewal depends on your client’s budget and if they have the dollars to fund you for another 3 to 6 months. Rarely does your renewal have to do with your technical skills. Even though you technically work for the contracting company and not the client, this can be stressful because they may not have other contracts available for your skill set which means you can often find yourself on the hunt for new opportunities.

A true consultant is brought in for their expertise or advice in solving a problem. Consultants are typically sent out in very small groups (1-5 people), for short bursts and the intent of the engagement is to provide specific expertise to an organization’s problem.

Consultants help organizations solve issues, create value, maximize growth and improve business performance. They use their business skills to provide objective advice and expertise and help an organization develop any specialized skills that it may be missing.

Lastly, consultants are primarily concerned with the strategy, structure, management and operations of an organization. They suggest and create recommendations for change, as well as advice on additional resources to implement solutions.  Consultants operate across multiple lines of business or services such as, strategy, HR, IT or Supply Chain.   When a consultant project ends they usually go on a bench until the next project or are immediately engaged on their next project.

2. Management Consultants and Contractors are Engaged Differently.

How you are engaged as a consultant versus as a contractor are completely different. No matter how you define the differences, often times management consultants are hired because they are recognized as an authority in a specialized field or are considered a subject matter expert.  For this reason, consultants have great strategic visibility that impacts the end client in many ways.  The most important being the creation of organizational best practices and processes that lead to business growth. 

In addition, consultants will have a defined career model and have a clear and defined career path.  Most consulting firms have three: Project Model, Consultant Model and Specialist Model.   Additionally, consultants will have competency standards and a performance management structure and will be assessed by how they align within the model. 

Lastly, an effective consultant requires a balance of behaviors, skills and knowledge. These are the core skills, tools, and techniques which are essential in delivering consulting services.  This insight is why consultants are brought in and viewed as subject matter experts. They are responsible for engaging client personnel, stakeholders and management to deliver solutions to the expectations of specific business functions (e.g. IT, Finance, Operations).

Several key points to note about consultants and contractors include:

  • Consultants influence an organization’s culture.  They are aligned to the firm’s Mission, Vision and Values.  Consultants want to be engaged and are a part of something greater.  
  • The link between a consultant’s purpose and the organization’s mission is why consultants are fully committed to a positive end result.
  • Consultants are motivated because they can see the direct impact of their work. And are incentivized to perform and advance by aligning themselves to the Mission, Vision and Values.
  • Typically, contractors are aligned to their clients’ Mission, Vison and Values and have no connection to their staffing company.  

3. Brand Alignment; Take the Next Step in Your Career.

If you are committed to taking the next step in your career, it is critically important to start developing a plan. I recommend that you start networking, meeting with colleagues, joining meet-up groups, and seeking professional mentorship.  Your time invested in networking will pay significant dividends and help you achieve new levels of success.

There are several things to consider when aligning your personal brand:

Why should you Brand Yourself?

  • Personal brand brings a unique, powerful, market-focused discipline.
  • Distinguishes you from others in a meaningful way.
  • Commands presence in the market.

Brand Discovery

  • Figure out who you are and what you want.

How does your brand impact what you do?

  • Determining your function is critical in articulating your expertise and service offerings.  Critical for either role.

Define your Audience

  • Focus on your niche or expertise and how you align to the Mission Vision and Values of a firm.

Recognize who has influenced your brand and the impact they have on what you want.

  • Don’t forget your supporters. These are co-workers, clients, direct reports etc.  They too are supporters of your brand and have equal impact.

Lastly, if you are looking for some other practical ideas and strategies on developing your career advancement plan, check-out our recently recorded webinar, “Confessions from a Consultant Recruiter: Consultant Vs. Contractor Positioning Yourself for Success in Either Role” available here:

Register for Consultants Vs. Contractors Webinar Recording

Topics: Consultant Recruiting, Candidate Resources