will be W2 (permanent) and some 1099 (temporary).
This will also become global, just as you might talk from Lansing, Michigan, to a credit expert for Visa who's in Kuala Lumpur.
Trend 2: HR Becomes the Incredible Shrinking Function
Human resources (HR) departments will continue to attenuate. Their transactional functions (benefits administration, relocation, and so forth) have been outsourced successfully over the past two decades. That leaves the transformational functions (change management, organizational redesign, succession planning, and so on), which, by and large, HR has been excruciatingly awful at fulfilling, following every loony fad and buzzword written by every academic and training company guru. If you don't believe that, then consider the market in front of you and around you. It's not being satisfied within the organizations that need you. And at this writing, I can't think of one HR executive promoted to CEO in a Fortune 500 company over the past decade. It has become a dead end. (That is a consistent fact since the first edition of this book.)
What it means for consultants: We are cost‐effective responses to transformational needs. We come, we improve, and we depart, with no benefits package, no vested political interests, and no intent on a corner office or retirement fund. Change management and organizational development skills will be in great demand, often best delivered by solo practitioners, rather than by outside firms descending with 50 people and creating a pseudo‐HR department!
Trend 3: Emerging Markets
I believe that Africa and some South American and Asian markets will grow tremendously. This includes technological advances, communication advances, remote learning and coaching, and English as a common language. There is a growing middle class and a growing appetite for entrepreneurial success and small business development. Fewer people view large corporations as “safety nets” in view of recent developments.
These emerging markets will be served far better by agile, independent consultants than the mammoth firms that want to descend on clients with 300 junior people who have to learn the business over months.
The Gospel
You don't grow in the consulting profession by getting better at what you've already done yesterday. You grow by anticipating tomorrow.
Trend 4: Volunteerism
We're going to see major increases in volunteering because of retired people with time on their hands, the American ethic about helping others (much stronger here than in Europe, where government is expected to provide such help), and companies lending executives to nonprofits, community organizers, and other social movements. However, as I've said on every board on which I've ever served in the arts and charity, “Nonprofit doesn't mean nonprofessional.” The excuse “I'm just a volunteer” doesn't compensate for sloppy management, wasted money, and a disappointed constituency.
What it means for consultants: The nonprofit world, bereft of government funds and corporate donations for years compared to historical giving, and hurt badly during the COVID crisis, has managed to survive to the extent it has through volunteers and intelligent management of resources. But tens of thousands of these organizations have disappeared. There will be a growing need to educate board members, staff, and management on how to acquire, train, evaluate, and retain volunteers. A poor volunteer is worse than no volunteer. And the money will be there, through donors, sponsors, patrons, and fund‐raisers.
Trend 5: The Importance of Communities
I didn't say “just‐in‐time,” which invokes a frenzied dash to me. I'm talking about individual professionals and corporate employees having access to a variety of platforms that can generate information immediately, from where a certain movie is playing to the best insurance rates for a newly married 28‐year‐old airline pilot. These will be accessible to both the buyer and the seller. But there can be too much access, so how do you narrow down what you need without winding up on Facebook for 20 hours in a row?
What it means for consultants: The concept of communities will flourish, where people are attracted by the value of (1) the organizer, (2) the other participants, and (3) the environment.
There will be simultaneous need for you to create your own communities as well as advise clients on how to create theirs. A complaint, don't forget, is a sign of interest. It's better to be expressed in the community, as are ideas and suggestions for other communities, which create buying trends.
Let's turn now to setting up your business and getting ready for action. If you already have a business, use these guidelines to validate that you're organized in an optimal manner for your own success.
Notes
1 1. See The One Best Way by Robert Kanigel (Viking, 1997) for a fascinating biography of Taylor and his work.
2 2. These were one‐person shops at the outset, solo practitioners, even the legendary James McKinsey.
3 3. As evidence of this, the first management consulting conference was organized in 1888 by the German Post Office. According to records, nobody came.
4 4. Christopher D. McKenna of Johns Hopkins University and Oxford University has written extensively on these governmental factors that promoted independent consulting.
5 5. Edgar Schein is probably the preeminent authority and originator of the term process consulting. See his book Process Consultation Revisited (Prentice‐Hall, 1998) and my book Process Consulting (Jossey‐Bass/Pfeiffer, 2002).
6 6. That number is often claimed as about 400,000 by various sources, but I've never seen an authoritative report or calculation.
7 7. Six of my books have titles using “Million Dollar” because (trust me) a hundred thousand dollars is not what it used to be.
Chapter 2 Creation: How to Establish and Dramatically Grow Your Business
Legal
Incorporation
There are three basic options for incorporation or creating a legal business entity. You will occasionally hear from people who will tell you that you don't have to incorporate. Shun them—they are fools. You will, rarely, hear from a lawyer who will tell you that it's not necessary to incorporate.
Call the ethics committee of the bar association!
You incorporate to create a legal entity that can protect your personal assets, form a firewall to protect you, independently borrow money, create certain tax advantages, and enable you to do business with major clients.1
Always use an attorney and
