People often ask me what it is like to be a consultant compared to being an employee at a company.  What is the difference between the two careers?  That can vary drastically depending on the consulting company you work for.  However there are certain differences that you may want to consider when selecting your career.

Cost Center or Profit Center?

This is the biggest difference in my opinion.  Someone said this to me once, and it really hit home about the difference between consultant/employee.  I never really thought about it that way before.

• Cost Center.  When you are an employee, especially a ServiceNow developer, you are a cost center at the company.  You may help them conduct business, but what you are doing costs the company money.  
• Profit Center. When you are a consultant at a consulting company, a billable consultant, you bring in the company money.  

Notice how I highlighted billable consultant above?  Sure you as an employee you are kind of burden, a cost center. However as a consultant that is not billable...that can be a worse experience.  Even if it is not your fault, maybe due to sales or market conditions.

• Employee. Be cheap or useful.
• Consultant. Stay billable and you are great!

Advantage: Either. Both have advantages and disadvantages.  

Overhead Costs

• Employee: Every dollar saved lowers the cost of your department. This means as few wasted efforts as possible and maximization of employee throughput.   
• Consultant:  Billable hours are most important, so any time not billing is a negative in many cases.  Some exceptions exist, when you are helping make new sales, building infrastructure to handle sales, or training new consultants for more projects.

Advantage: Consultant.  When you are thought of as important to bring in profit, I believe you are treated better....as long as you stay billable!

WORK LOAD

• Employee: The more projects completed, means a better end-of-year report, and better reviews.
• Consultant: Billable hours are most important, so any time not billing is a negative in many cases.  Some exceptions exist, when you are helping make new sales, building infrastructure to handle sales, or training new consultants for more projects.

Advantage: Employee.  You cost money and also you require software that costs money.  Software isn't free so sometimes software purchases are restricted.  Your workload is limited to the software you support.

As a consultant you have the pressure to be as billable all the time.  Sure there are projects that have a deadline, but that pales in comparison to an active consulting workload.  Consultants are often tied to fixed bid contracts that really pressure you to finish projects on time.

Training

• Employee: Training is a great way to boost the skills of an existing employee without looking for new resource. 
• Consultant: Training takes time away from billable work. Unless you are at a conference making sales as well!

Advantage: Employee.  Often employees are given more opportunities for training than a consultant.

Benefits

• Employee: Benefits depend on the company.  
• Consultant: Benefits depend on the company.  However if you are 1099 consultant, you are on your own for benefits.

Advantage: Employee.  Most often employees have better benefits, because the they work for larger companies. They can have corporate cell phone plans, better 401K match, and better health plans.

Travel

• Employee: Travel depends on the company and role.
• Consultant: Travel depends on the company.  Larger consulting companies often have a significant amount of travel.

Advantage: Employee.  I often hear about employees that never travel.  Consulting companies are notorious for "road warriors".  However that is changing somewhat due to cloud computing.  Some people like travel however, so in that case, being a consultant might be for you.

Some additional advice.  If you are a consultant, limit your drinking when on the road.  It is easy to often have a drink at the bar with clients.  However you are alone a lot, maybe lonely, and bored away from home.  I have seen many consultants become alcoholics due to this lifestyle.  I am no angel, but I do limit my drinking while traveling as a consultant.  At least I have learned to do that from experience. :)

Company Friendships

• Employee: Depends on the size of the company and company culture.
• Consultant: You meet an incredible amount of people.

Advantage: Consultant. Although you can have longer friendships at a company, as a consultant you meet so many people.  You are going to make a friend or two just out of sheer numbers.

Personal Relationships

• Employee: You are at home every night.  If you can handle work/life balance at your company.
• Consultant: This depends on the amount of travel and being away from home.  Although you can make friends in different cities.

Advantage: Employee, although travelling has advantages for some.

Challenges

• Employee: You sometimes will be challenged to do things not in your skillset
• Consultant: You will be forced to do technical tasks you never thought possible

Advantage: Consultant. Want to wake up everyday with a mountain to climb?  Others might disagree with me on that one!

Recognition

• Employee: Sometimes your boss will recognize your importance.  
• Consultant: Billable hours and client reviews.  Clients will often take credit for your work.

Advantage: Consultant.  Billable hours are a great indicator of performance.  Just be aware that clients will often take credit for your work.  As a consultant, I have not been invited to project end celebrations, even though I built the program. I have seen companies present my work at conferences and said "they built it.".  Just take that as a compliment. :)

Vacation

Neither want you to take a vacation.

Advantage: Employee.  As a consultant, you often are working for multiple clients at once.  So you have to tell 4 or 5 bosses you have a vacation ahead.

Commission OR BONUS

• Employee: Sometimes your boss will recognize your importance.  
• Consultant: Utilization.  Individual or team based.  

Advantage: Consultant

What to choose?

As you can tell, both careers have advantages/disadvantages.  It depends a lot on the company you work for, how you are treated and a lot of other factors.  

Just do what makes you happy.