I've also done it by working backwards. This can be useful particularly in smaller consulting firms. Say you have three tech guys who want to start consulting, you start by saying how much do you want to make each year? How many hours do you want to work a week? Then how many people do you want to hire to help? How much would you have to pay them? From this you have some variables you can tweak to see what various numbers of subordinates and various annual salaries get you as an hourly rate.