Consultants: How to Choose, Use, and Not Abuse Them

Help them, help you

Since my first consulting project over thirty years ago, I have learned a lot about how to successfully manage consulting projects and the client/consultant relationship. Here is my advice, which I am sharing again to help you with your consultants (and your lawyers, accountants and other professionals):

1. Before you introduce consultants to the process, be sure you need what you want and want what you need. Beware of consultants that agree to do whatever you want, whether you need it or not.
2. Look internally to confirm the three "C's" of consulting project readiness: Capacity in budget, time and resources; Commitment of management and staff affected by the process; and Capability to support the project and implement the conclusions.
3. One more "C" – Compatibility. Select your consultants from an organisation that is compatible with yours - are you a corporate multinational or a local entrepreneurial business?
4. Recognize whether your consulting needs are strategic: requiring outside expertise to inspire and facilitate your business planning process, or operational: bringing knowledge, skills and experience that are not available internally.
5. Meet the operating consultant. It may not be the same charming, talented person that sold you the work.  And at those fee rates you don't want to train a recent MBA, who started last week and studied your industry yesterday.
6. Test Drive: Check whether the consultant arrives with questions, not answers; will operate as neither boss nor employee; and will win the hearts and minds of your staff. Successful consultants will listen, understand, empathize, analyze, strategize and persuade better than normal people.
7. Remember you are hiring a consultant to challenge and push you. You are not renting a friend to tell you how smart you are.
8. Can you confidently expect a solution that will be yours not theirs?
9. Ask for references.  Call them.
10. Ask who is not on the reference list and why not.  Learn what they think causes a project to be unsuccessful.  And ask which list they expect you to be on when this is over.
11. Ask for fee rates and a work plan with estimated hours. Then agree on a fixed fee for agreed deliverables with dates, documents and milestones.
12. Don't let their progress reports interfere with your progress.  Get what you need, not what they need for internal "CYA" requirements.
13. Check who else is billing time to your project.  Sometimes there is a very expensive partner back at the office who needs to keep his billing rate up. Your budget can be quickly consumed while he "supervises" from a distance.
14. Avoid surprises.  Ask about additional expenses: travel, telephone and printing. Terms of payment?
15. Do they have a satisfaction guarantee?
16. Get the agreement in writing, read it before signing it.
17. Watch for signs of trouble: such as, selling more work before the work is done; long delays between on-site visits; too much time spent "back at the office" and billed to you.
18. And finally, remember consultants are people too. They want to boast about good work and satisfied clients.  You can help them help you.  Don't be difficult.

With all due respect and best regards to my favourite clients and consulting associates.

Be better. Do better.

Your Uncle Ralph, Del Chatterson

Other favorite articles at: Learning Entrepreneurship Blogs. 

• The Seven Biggest Mistakes and How to Avoid Them
• Find the Exit before it's an Emergency
• When to Launch Your Business
• The Four P’s of Salesmanship: “You wanna buy a book?”

Visit LearningEntrepreneurship.com for more Blog posts and articles.

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Check out Uncle Ralph’s books: "Don't Do It the Hard Way" and "The Complete Do-It-Yourself Guide to Business Plans" Both are available online or at your favourite bookstore in hard cover, paperback or e-book. 

Consultants: How to Choose, Use, and Not Abuse Them

Help them, help you

Since my first consulting project over thirty years ago, I have learned a lot about how to successfully manage consulting projects and the client/consultant relationship.

Here are some ideas that may help you with your consultants (and your lawyers, accountants and other professionals):

1. Before you introduce consultants to the process, be sure you need what you want and want what you need. Beware of consultants that agree to do whatever you want, whether you need it or not.
2. Look internally to confirm the three "C's" of consulting project readiness: Capacity in budget, time and resources; Commitment of management and staff affected by the process; and Capability to support the project and implement the conclusions.
3. One more "C" – Compatibility. Select your consultants from an organisation that is compatible with yours - are you a corporate multinational or a local entrepreneurial business?
4. Recognize whether your consulting needs are strategic: requiring outside expertise to inspire and facilitate your business planning process, or operational: bringing knowledge, skills and experience that are not available internally.
5. Meet the operating consultant. It may not be the same charming, talented person that sold you the work.  And at those fee rates you don't want to train a recent MBA, who started last week and studied your industry yesterday.
6. Test Drive: Check whether the consultant arrives with questions, not answers; will operate as neither boss nor employee; and will win the hearts and minds of your staff. Successful consultants will listen, understand, empathize, analyze, strategize and persuade better than normal people.
7. Remember you are hiring a consultant to challenge and push you. You are not renting a friend to tell you how smart you are.
8. Can you confidently expect a solution that will be yours not theirs?
9. Ask for references.  Call them.
10. Ask who is not on the reference list and why not.  Learn what they think causes a project to be unsuccessful.  And ask which list they expect you to be on when this is over.
11. Ask for fee rates and a work plan with estimated hours. Then agree on a fixed fee for agreed deliverables with dates, documents and milestones.
12. Don't let their progress reports interfere with your progress.  Get what you need, not what they need for internal "CYA" requirements.
13. Check who else is billing time to your project.  Sometimes there is a very expensive partner back at the office who needs to keep his billing rate up. Your budget can be quickly consumed while he "supervises" from a distance.
14. Avoid surprises.  Ask about additional expenses: travel, telephone and printing. Terms of payment?
15. Do they have a satisfaction guarantee?
16. Get the agreement in writing, read it before signing it.
17. Watch for signs of trouble: such as, selling more work before the work is done; long delays between on-site visits; too much time spent "back at the office" and billed to you.
18. And finally, remember consultants are people too. They want to boast about good work and satisfied clients.  You can help them help you.  Don't be difficult.

With all due respect and best regards to my favourite clients and consulting associates.

Be better. Do better.

Your Uncle Ralph, Del Chatterson

Choose & Use Wisely

Professionals can help

Twenty years ago, I wrote an article titled, Consultants: How to Chose, Use, and Not Abuse Them, based on my own experience as a management consultant and as a client of other consultants, accountants, lawyers, and other professionals. The article offers tips for effective professional relationships and has retained its relevance for a Blog Post at LearningEntrepreneurship.com and inclusion in Uncle Ralph’s Random Ramblings in my book of advice for entrepreneurs, DON’T DO IT THE HARD WAY.

After a recent headline in The Economist, “Do McKinsey and other consultants do anything useful?” it seems necessary to add the additional advice, “Don’t be used and abused by your consultant.”

The abuses of power and influence and the profiteering by both McKinsey and Bain in South Africa recently led to judicial investigations and criminal charges against both consulting firms. Their scandals and outrageous conflicts of interest in the past have apparently not resulted in more ethical and enlightened behaviour in the management of global consulting firms.

So be aware of what style of management is guiding the professionals that you engage to help you and your business. See Rule #3 – Compatibility: Be sure that your objectives are aligned and that they are helping you more than they’re helping themselves.

With all do respect to my fellow consultants and other ethical, enlightened professionals, use your consultants well.

Be better. Do better. Be an enlightened entrepreneur.  

Del Chatterson, your Uncle Ralph

Learn more about Enlightened Entrepreneurship at: LearningEntrepreneurship.com Read more of Uncle Ralph's advice for Entrepreneurs in Don't Do It the Hard Way & The Complete Do-It-Yourself Guide to Business Plans - 2020 Editions.

 Read more Blog posts at: LearningEntrepreneurship Blogs. 

• The Seven Biggest Mistakes and How to Avoid Them

• Find the Exit before it's an Emergency

• When to Launch Your Business

• The Four P’s of Salesmanship: “You wanna buy a book?”

Hire a consultant? Hell no!

You can do it yourself.

A favourite old joke among consultants is that clients always ask, "What do you specialize in?" and "How much do you charge?"  The appropriate qualifying questions from an intelligent consultant are, of course, "What's your problem?" and "How much can you afford?"

So clients need to be sure they need a specialist with knowledge, experience, or time they don't have to solve a problem or implement performance improvements they cannot do for themselves. My more complete guide on Consultants, How to Choose, Use and Not Abuse Them has previously been posted for your reference.

For example, my consulting company, DirectTech Solutions, had a packaged service called a SNAP Review that we offered to clients to prepare for the strategic planning process. Here's our secret recipe for you to use and do it yourself.

SNAP Review: Strategic Needs Assessment and Performance Review  

With this comprehensive business diagnostic, you can assess your strategic position, your plans and objectives and assess your current performance. After review and discussion with management, employees and customers you will be well  positioned to develop a strategic business plan for improved results.

The SNAP Review Business Diagnostic includes:  

• Initial review of company history in sales and marketing, operating productivity, and financial results against current goals and industry comparables.
• Discussion with management of the strategic plan and objectives and current key issues, threats, and opportunities.
• Survey of at least three key staff members and three key clients or customers to confirm whether their assessments are consistent with those of your management team.
• Consolidate the analysis, conclusions, and recommendations for short-term action to achieve long-term objectives.

Please contact us if you need more help. 

Or read a good book by your Uncle Ralph on strategy and entrepreneurship!