Management Consultants - A Guide to Going Limited
With the UK’s economy thriving and independent professionals making an invaluable contribution to that growth, the role of the interim manager has become increasingly important. Businesses are increasingly turning to experienced specialists to help them to improve their performance and optimise their operations. Management consultants can expect to enjoy plenty of opportunities in a variety of sectors and this guide is designed to provide plenty of useful information to anyone considering a career in management consultancy. Management consultants earn an average of around £48,000 with some specialist roles commanding in excess of £100,000, so it can be a lucrative area to move into.
What does a management consultant do?
The role of a management consultant is to guide a company through a period of improvement or transition. This can require skills in a number of different areas including: optimising operations, coming up with an effective strategy, promoting growth, cost-cutting, identifying potential efficiencies in all areas and improving communications. Management consultants are often thought of as company-wide trouble shooters who work with companies to find better ways to do what they are doing.
Which industries use management consultants?
Almost every sector has businesses that need management consultants meaning that there are a range of opportunities for anyone with skills in that area. From banking and finance to medicine and healthcare, there is plenty of scope for anyone with the relevant experience to find work in a sector that interests them. An online search can reveal hundreds of vacancies for management consultants both through specialist recruiters such as MWN as well as through sites such as Reed and Monster which offer a wide range of roles. If you want to gain an understanding of the kinds of duties that management consultants are responsible for in different sectors, then reading job descriptions can give you a good feel for what the various roles encompass.
What skills does a management consultant need?
One of the most important aspects of being a successful management consultant is being excellent when it comes to communication. Listening to companies to understand what they need and how they see their business developing and providing clear directions and recommendations in order to ensure that they achieve their goals. It is also important to be able to deal with a variety of different people in different roles, from customers and clients to high level managers and provide them with the tools they need to effect the changes that you recommend.
There is no need to have a formal qualification such as a degree to become a management consultant, although many consultancy firms and clients prefer their consultants to have a relevant master’s degree. You may find that you don’t need a degree that is specific to the industry you work in, but the highest paying jobs often require specialist knowledge so it is worth researching where your skills might be best utilised.
How do I become a management consultant?
When you have decided that you want to try your hand at management consultancy, the first thing to do is decide how to organise your business. Many people prefer to ease themselves into the role by working at a consulting firm first, to gain some experience of what is required in the role, work with others who have been in the business for a long time and give yourself the chance to get an understanding of the industry before you attempt to go solo. Consultants have to deal with a considerable amount of pressure which can be a daunting prospect if you are also trying to handle the paperwork involved with self-employment as well.
Many people find that working through an umbrella company is the easiest way to keep their finances in order as they will effectively work for the company and have tax and National Insurance deducted at source. Working like this means that you do not have to worry about invoicing your clients as the umbrella company will take your timesheets and collect the money on your behalf, pay HM Revenue and Customs (HMRC) what you owe and reimburse you for any allowable expenses directly.
Using an umbrella company can seem like an easy way to organise your finances without having to worry about dealing with HMRC or remembering to put money aside to pay your annual tax bill, but you will usually end up with a lot less in the way of take-home pay than you could. If you want to maximise your income, then working through a limited company is the most cost-efficient way of operating. You can register your company in a matter of hours and benefit from tax efficiencies which are only available to limited companies such as the Flat Rate VAT Scheme and pension planning opportunities. You may also find our Umbrella vs Limited Company guide helpful.
Working for yourself, without an intermediary, is usually the most profitable way to operate and although it may seem complicated, the actual admin should take no more than around 15 minutes a month. For most people, using a specialist accountant can help them to understand what is required, provide advice to help save you time and money and offer the benefit of their experience when it comes to expanding your business and planning for the future.
The benefits of being a management consultant
For most people, it is the pay rates associated with working as a management consultant that appeal initially. For many, their hourly rate as a consultant is significantly higher than their earnings as a salaried employee and those with specialist skills can be amongst the highest paid professionals in the country. However, it is worth keeping in mind that you will need to put aside money for tax and National Insurance as you earn, so it’s always wise to calculate what proportion of your income should be ring-fenced to ensure you can meet your liabilities at the end of the financial year.
As appealing as the income may be, there are plenty of other advantages to working as a management consultant, the primary one being the flexibility that it allows you in terms of your work. You can choose when and where to work, so instead of having a limited number of days for annual leave, you can take breaks between contracts which will allow you plenty of time to spend with your family, pursuing hobbies, travelling, or just relaxing and enjoying yourself. Anyone who finds it hard to get a good work-life balance in their permanent role can benefit from the ability to take time off from consulting to manage their out-of-work commitments without using up all their annual leave.
Many people find that working for themselves as a management consultant is an ideal way to broaden their horizons and take control of their own career paths. If you’ve ever felt as though you are stagnating in your current role, or not being stretched, then taking on short-term contracts could be the perfect way to enjoy a more rewarding career. You can work in different sectors, gain experience in different types of company and gain the kind of experience which will make your CV attractive to a wide range of employers.
For those who want to go one step further and really ring the changes, a career in management consultancy can offer opportunities for travel that might not come up in a permanent position. There are often short-term roles in companies which require someone who is not on a long notice period or tied to a particular area, and these are perfect for management consultants who want to take advantage of their freedom to explore the world a little while they work.
How to find work as a management consultant
If you want to start working as a management consultant, then there are plenty of agencies which specialise in matching consultants’ skills to their clients’ needs, such as Mindbench or Deloitte, or you can find some opportunities on job sites which cater to a broader market. The Institute of Consulting maintains a database of consultants and has a job section available to members, as well as a range of support services and member resources.
There are also specialist management consultancy agencies which cater to specific industries such as IT, finance, healthcare and marketing or particular skills such as operations, communications, project management and infrastructure among others. It can be useful to browse job adverts on the internet to give you an idea of the kinds of responsibilities that a management consultant has and to give you an idea of the rates of pay and the variety of roles available within your skill set.
Getting the support you need
If you are considering start out in contracting as a management consultant, then you may want to seek out support from those who are already au fait with the ins and outs of working for yourself to help you to make the right decisions about how to manage your money. An accountant will help you to decide how you want to run your business, get systems in place to ensure that your finances are organised and assist you with expansion, plans for the future and any questions that might come up as you pursue your new career.
Choosing a specialist accountant is the best way to make sure that you are taking advantage of all the savings available to you as well as helping you to get the best advice to suit your specific situation from someone who has helped other independent professionals to achieve their goals. Having an accountant relieves you of the pressure to keep up with the latest legislation, news about the tax benefits that you could qualify for and remember deadlines for completing paperwork and paying your tax and National Insurance.
How can Nixon Williams help you?
As specialists, we are able to offer advice which is based on 20 years of experience in helping people in your position. This means that we can offer you advice on everything, from how to get your business off the ground to the most effective way to save for a pension. We know the ins and outs of every piece of legislation which affects you, and, most importantly, we will take care of your finances so that you can focus on your work.
Give us a call today to discuss your needs, ask any questions you might have about our service and find out what we could do for you. Call us today on 01253 362062 or email us at email@example.com.