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Contractor vs. Consultant

Written by: Jose Anes

Article Overview: Consultant, Contractor… is there a difference? Sometimes there isn’t, sometimes the same person can be both, even on the same engagement. However, I define the difference this way:

Contractor vs. Consultant

Consultant, Contractor... is there a difference? Sometimes there isn't, sometimes the same person can be both, even on the same engagement. However, I define the difference this way:

• Consultant: An expert in a topic. Some sought after for his/her knowledge. A trusted adviser. Someone you can trust to get things done on time and under budget. Ideally associated with high hourly rate (only needed for his/her knowledge) or a lower risk retainer.
• Contractor: A technical resource. Someone you hire to perform a certain task, but you define most of what the outcome will be. Normally paid by the hour (or day/week/month), and thought to be easily replaceable and interchangeable with a similar one from a different provider. Some companies replace some of the tasks they could have done with permanent employees with a temporary one that could easily be fired, even if more expensive in the short term.

No problem or shame on being either one.

Contractor	Consultant
Pro: Lower level of responsibility. Flexibility to finish an engagement as soon as they stop paying more hours. The job market markets your services. They set your rates and the level of need (demand) for your services. You just need to put a sign of "Joe The Plumber" or "Joe The Programmer" and people will call you.	Pro: People request you by your name. Once you reach that level, competition is less relevant. You may help define the state of the art of your industry. Normally you can handle more than one engagement at a time. (More networking if done right) You may be able to charge higher fees.
Cons: You will be paid at market rates, and people will comparison shop. Normally you handle only one engagements at a time. You may be seen as a replaceable/interchangeable resource.	Cons: You retain some of the project "ownership" (read: responsibility for it to be successful). It is difficult to understand why pay for your services. (Justify rates with the Rate of Return). You need to market your services.

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Article Tags: adviser, flexibility, hourly rate, level competition, li li, market markets, networking, plumber, programmer, retainer, shame, state of the art, table border, tbody, technical resource, temporary one, th th, tr tr, ul



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