Anyone who was a contractor or in consulting during the last recession (2008-2009) either had his or her project end early or knows someone who did. When I say end early, I mean end prior to the end date established when the project began.
Once you’ve been through something like this, you become more in touch with the realities of the consulting business. This is when you first ask yourself, “What’s the point of a contract end date if the client can just end the project at any time?” Good question...
The end date is a general guidance point for how long you’ll be needed. I’d say that, in general, the end date for contracts longer than six months is changed 80% of the time. Sometimes the contract will end a few weeks earlier or later. Many times, the project will end on time, but the consultant will be retained for optimization work or for another project altogether.
But once you’ve been through a situation in which the contract ended much earlier than you originally anticipated, you start to look at contracts’ stability differently. You begin to realize that the end date is good for guidance, because it generally assumes that funding for your services is in place until that end date. However, as the recession taught us, funding can go away at any time. But what’s also interesting about the recession is that not all projects were cancelled. So, what does this mean? It means that top-priority projects stay on track, while less critical projects get postponed to a future date.
So, when you’re evaluating the stability of your next contract, the end date should be taken into consideration as a guiding point. However, what should also be taken into consideration is the probability that the end date will actually be met. This can be determined by taking two additional things into consideration:
- How critical is this project to the organization. This does not just mean do they have to do it? There are many projects that organizations have to do, but they do not all have to be done at the same time and they do not all have the same level of immediate importance. Projects that have the highest level of immediate importance have a lower likelihood of being cancelled . . . unless.
- How likely is project funding to continue? If a project is of high immediate importance and funding is already in the calendar-year budget, it’s safer than a project that relies on funds that are waiting to be approved during the next fiscal year.
Taking these two additional points into consideration when evaluating your next project will give you better guidance in determining a project’s stability.