In 2009, layoffs have become so common that layoff fatigue has set in. In times like these, it’s hard enough to find a place that is hiring, let alone considering the idea of turning down a job offer. That said, even in a year where over 500,000 jobs are being shed per month in the U.S. alone, it is important to carefully vet potential employers.
This is especially true in technology consulting. As I write in my book, The Nomadic Developer, joining a technology consulting company that loses money, routinely fails to deliver on its promises, or otherwise misrepresents itself is possibly even worse than unemployment. Knowing how to spot those companies that will cause you further problems — be it a subsequent round of unemployment (what you risk when you join firm that is bleeding cash), or your own dignity — is even more critical during times like these, when most of us are prone to act out of fear.
The reality of the technology consulting market in 2009 is that business is still here. It may not be growing, and firms tend to not hire "to the bench" during bad times. Of course, because there is no bench, it means the moment there is a new project, the consulting companies will go into a (temporary) hiring frenzy — especially if the company just cleared the bench through a layoff during the preceding month.
The purpose of this article is to offer you ten questions you can ask, and what to look for in the answers, for those occasions when you do get an opportunity to join a technology consulting firm.
These questions are probably best asked to the highest-level person with whom you are interviewing – someone who is in a good position to know the financials. Not being interviewed by such a person at some point during the process is almost, by itself, a huge red flag.
Question 1: What is your target growth rate this year?
Especially now, with the economy working its way through a fear bubble, it is as important as ever to make sure that the firm you are joining has set realistic goals for itself. A well run technology consulting firm does not run on wild hope, nor can it run well if it is paralyzed by fear. This year, unless there is a very good reason, the right answer is probably somewhere between -10% (we are hoping to manage through some small losses) to around +5% (we expect to grow, but much more moderately). If the answer is outside this range, you have a real good reason to ask some follow up questions to understand why.
Of course, anyone can say they are going to grow, and some firms will say they intend to grow 50% — the same month they miss payroll. The key, of course, is to dig a little deeper with the next question.
Question 2: Please describe how you forecast revenue
Some companies are at least reasonably disciplined in how they forecast revenue. They rigorously maintain a sales pipeline — that is, based on a list of clients at various stages of commitment in the sales process, and based on historical data for how frequently an opportunity at a given stage of commitment turns into real work, drive a forecast that someone is actually accountable for. Others just completely wing it based on gut. Ideally, you are looking for the former – as the latter is likely the kind of place where gut is wrong, and massive layoffs occur when wild optimism turns into wild pessimism.
In other words, given that continuing employment in technology consulting depends on how well the demand generation side of the business is executing, you want to have a real sense that the demand forecast is accurate.
Question 3: Do consultants have visibility into the pipeline?
There are some companies where the health of the organization is essentially a state secret. You are asked to simply believe the owner during the quarterly meeting that things are fine, until that day when layoffs come and they are suddenly not. Such places tend to be miserable places to work, on account of the fact that in the absence of real information, rumor mill tends to fill the void. During such times, the rumor mill is usually more colored by fear when times are bad.
While there are some companies who fear that consultants will use the information in the pipeline to steal the client or prospect list – if such a company has that fear – a fear that speaks to lack of trust in its consultants, you should definitely consider that as a data point a decision of whether to accept a job offer.