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Consultants and Coaches vs. Subcontractors

1 - start right Jan 16, 2020

A couple of days ago I wrote an article that differentiates between consultants and coaches and the respective business models. 

I realized that I was remiss in pointing out one business model that both might choose: becoming a subcontractor.

Quick Recap on the Difference Between Consultants and Coaches

Consultants and coaches are both executive advisors. The difference between the two is the way that they advise their clients. 

Consultants are more focused on enhancing leadership and organizational capacity whereas coaches are more focused on the leaders themselves and helping them improve their personal and leadership effectiveness.

A consulting business is a "business to business" (BTB) model where you get paid to improve an organization's results. A coaching business is a "business to consumer" (BTC business) where you get paid to improve an individual's results. 

What is a Subcontractor?

A subcontractor is a self-employed consultant or coach carries out work for a company as a part of a larger project. They can be hired directly by the company or by a consulting firm that lands the work and then hires them, usually for a fixed price.

As a result of the nature of this employment form - the role is typically an "extra pair of hands" for the organization or a consulting/coaching firm as the person hires the sub-contractor defines the outcomes, deliverables and schedule.

The Benefits of Being a Subcontractor

If you're an individual who has no aspirations of being a change agent to an organization or becoming an executive advisor who guides leaders to create healthy and positive work environments that support all stakeholders - then a subcontracting role might work for you. It's also a good fit for individuals who do not have a desire to be seen as an expert in their industry or a thought leader.

The benefits of this model is that you get to do the work without feeling overly invested in the organization. You also don't have to push yourself out of any fears or discomforts about putting yourself out there marketing-wise. As long as you're a decent networker who can develop positive relationships with successful consulting and coaching firm owners and have a specialized expertise that they and their clients need - you can focus on just delivering the work.

The Drawbacks of The Subcontracting Model

Depending on your goals, there are several drawbacks to this model:

  • If you are seeking control over your career and time - this model is probably not a great fit. You may not be employed by a company any longer but you are still being hired by someone else who sets your schedule. You typically will paid for your time which means that even if you were to make more money than you did when you were an employee, you're likely to be working as many as hours as you did before.
  • If you are seeking no cap to your earning potential - this model won't get you there. You'll quickly find yourself in the chase and hustle for one small paying gig after another or as mentioned above a labor intensive project. A "trading time for money" compensation model requires that in order for you to make more money, you have to either work more or arbitrarily raise your rates (which might be hard to land subcontracting work as the work is often granted to the lowest-cost provider.)
  • If you're looking to generate stable and scalable profits from your business - you won't accomplish that as a subcontractor because by design it's a freelance business model. By it's nature your income is generated from going from gig to gig. If you want to have that type of predictability of revenue and get paid for value vs. time - you need to transition from a mindset of being an employee to one of being a business owner. As a business owner you need to set up a business. People who want to serve food to customers build a restaurant. People who want to sell cars, build an auto lot. People who want to sell their wisdom, knowledge and expertise build a credible website that features all of that value to their potential clients. Investing in a website and content marketing system isn't an option in the same way that opening a restaurant isn't an option if you want to serve food. 
  • If you are seeking to become an executive advisor that holds their own with senior leaders and speaks truth to power - this will be difficult to accomplish with this model. Executives take advice from their equals and their perception of you is shaped by what your website looks like, your content and how you hold yourself. If you come in as a direct report or employee to someone else who landed the work and has the website - they will likely defer to that person's counsel.
  • If you are seeking to stand out in the marketplace, be seen as an an expert and thought leader - you'll never get there as a subcontractor. If that is a goal, you have to do the hard work of going beyond your credible website and become a content marketing master. You need to take the time to go beyond your methodology to dial into your big, sexy, breakthrough idea that shifts and shapes your industry perspective in some new way. You have to face and transcend your fears about being seen and self-limiting beliefs about marketing so that you can create a book, podcast or speech that inspires others to think and then act differently. 

For Reflection

Choose the subcontracting model only if it legitimately is the one that aligns with your career goals, life priorities and values. But ONLY in those circumstances.

Consider if you use these types of filters in your decision-making:

  • "I really don't like marketing and am not good at it - so I'll just find other more successful consultants and coaches to give me their overflow work..."
  • "Marketing doesn't really align with my values - so I think I'll find people in companies that are looking to add people to their list of recommended consultants and coaches..."

If you do - be honest with yourself. These statements are fear dressed up as rational objections because the truth is: Networking to find people you subcontract with IS marketing. It's making people aware of that you exist and can help. It's just not the smart, strategic and bold marketing that you could be doing that would attract the clients you ultimately want to help into YOUR own network that could lead to landing your own contracts at fees in exchange for value vs. time. 

There's a tragedy that comes with playing small and setting yourself up to achieve less than your potential. There's a challenge for your own life as you don't experience the full benefits and freedom that is possible for you with your business. But the tragedy is so much bigger than that.

Executives need purpose-driven consultants and coaches to set themselves to win the business over consultants and coaches who are just in it for the money. When you win the business as a peer to executives, you'll be able to influence the change that is ultimately needed in today's stressed out, short-term profit obsessed workplace. It's you who will stand up for the employees that need to be treated with respect. It's you who understands the implications of horrible customer service experiences on profits and the customer's own lives as they have to waste time sitting on the phone through endless phone trees vs. spending time on what matters to them.

Ask yourself:

  • What do I REALLY want for my life and career?
  • What difference was I put on this earth to make?
  • Which business model is actually the right one for me?
  • How do I get beyond my fears and stop under-valuing or minimizing my potential? 

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