DECIDING WHETHER TO HIRE A CONSULTANT
A consultant is an individual who possesses special knowledge or skills and provides that expertise to a client for a fee. Consultants help all sorts of businesses find and implement solutions to a wide variety of problems, including those related to business start-up, marketing, manufacturing, strategy, organization structure, environmental compliance, health and safety, technology, and communications.
Some consultants are self-employed, independent contractors who offer specialized skills in a certain field; other consultants work for large consulting firms that offer expertise in a wide range of business areas; and still other consultants hail from academia.
The decision to hire a consultant is not one that a business should take lightly. Consultants can be very expensive, although their expertise can prove invaluable. The business owner must first decide whether the situation facing the company requires the input of a consultant. If it does, then advance preparation should be done to ensure a successful consulting experience. The business owner is then ready to find and negotiate a contract with the right consultant.
An important part of this process is about understanding the ways in which consultants charge for their services. Hopefully, after completing the consulting process, the business will emerge with a successfully implemented solution to its problem.
Deciding Whether To Use A Consultant
In deciding whether or not to hire a consultant, a business owner should consider the nature of the problem, the reasons why internal resources cannot be used to solve it, and the possible advantages a consultant could offer. There are several situations in which a consultant’s services are likely to be required.
When a business needs specialized expertise, talents, or skills that do not exist internally, or needs technical assistance on a temporary basis, then it may want to consider hiring a consultant. Likewise, hiring a consultant might be appropriate when the business needs an objective, frank opinion on a problem. A consultant might also be able to help a business that is having problems with cash flow, the availability of funds, or in acquiring resources.
Political or organizational problems, regulatory problems, and training needs are some of other areas in which a business might benefit from the use of a consultant. A business should not hire a consultant simply in order to have someone else implement unpopular decisions.
Making The Consulting Experience Work
Once the decision has been made to enlist the help of a consultant, there are several steps the business owner can take in advance to increase the likelihood that the consultant experience will be successful.
First and foremost, the company’s managers should define the problem they need the consultant to address. Using probing questions to go beyond superficial symptoms to underlying causes, the managers should attempt to state the problem in writing. Next, they should define the expected results of the consulting experience. The objectives the managers come up with should be clear, realistic, and measurable.
Another important step in preparing for a successful consulting experience is to communicate with employees. The business owner should explain the problem fully and honestly, in as positive terms as possible, and ask employees for their understanding and cooperation. When employees feel surprised or threatened, they may hamper the consultant’s efforts by withholding information or not providing honest opinions.
It is also helpful to gather all important company documents relating to the problem in order to make them available to the consultant. The consultant’s job will be easier if they have ample information about both the company and the problem at hand.
Once the consulting project begins, there are several other steps a business owner can take to help ensure its success. For example, it is important to manage the project from the top in order to give it the visibility and priority it deserves. The business owner should appoint a liaison to assist the consultant in gathering information, and should receive regular progress reports about the project. In the implementation stage, the business owner should adequately staff the project and empower those involved to make any necessary changes.
How To Select A Consultant
Selecting the right consultant for the company and the type of problem at hand is a vital part of the process. The first step to assemble a list of candidates by getting recommendations from the people in the same line of business, contact consulting associations or consultant brokers that represent the same industry, or reviewing advertisements in trade or professional journals. It is important to avoid selecting consultants based upon a current management fad; instead, the decision should be based upon the company’s particular needs.
The next step is to determine, based on the nature of the problem, what type of consultant is needed. An advisory consultant analyses the problem and turns recommendations over to the client, but is not involved in implementation of the solution. In contrast, an operational consultant remains on hand to assist the client in proper implementation or in some cases, handles the implementation without the client’s assistance
Part-time consultants are generally employed full-time within their field of expertise – marketing for example – but also offer their services to other companies on the side. They usually charge less money than full-time consultants, but they also cannot devote their undivided time and energy to that client.
Process consultants are skilled-oriented generalists. With expertise in one or more technical areas, these consultants can apply their skills to any industry or organization. In contrast, functional consultants apply their skills in a particular environment; for example, a hospital facilities planner would concentrate on consulting to hospitals, rather than to other types of businesses that require facilities planning.
Another distinction between consultants is based on the size of their operation. Consultants can work for large firms, small firms, or even independently. Large firms offer greater resources, but also have higher overhead and thus charge higher fees. Small firms or independent consultants may offer more attentive service, but may not have access to the precise type of talent that is required..
Finally, consultants can be academically or commercially based. In general, academic consultants may be most helpful with problems requiring research or a background in theory, while commercial consultants may be able to offer more practical experience.
Once a business owner has determined what type of consultant would be best suited to handle the company’s problem and assembled a list of candidates, the next step is to interview the candidates. Some of the traits to consider include experience with the company or industry, availability, knowledge of the problem at hand, communication skills, flexibility and compatibility. Since consultants are usually required to work within the corporate culture, often in times of crisis, it is important that their style is compatible with that of the firm.
After discussing the problem in detail with the leading candidates, the business owner may opt to ask each consultant to submit a written proposal to aid in the selection process. In some cases, the contents of these proposals may convince the business owner that the problem could be better handled using in-house resources.
After deciding to hire a specific consultant, the business owner should ask the consultant to draw up a contract, or at least a formal letter, confirming their arrangements. It is important to know that the contract should be based on negotiations between the two parties, so the business owner may wish to add, delete, or clarify the information included.
There are several peripheral issues that the business owner may want to address in the contract, including the consultant’s proposed methods of handling conflicts of interest, subcontractors, insurance/liability, expense, confidentiality, and nonperformance.
The Consulting Process
The consulting process begins when the client company decides to enlist the services of a consultant. The consultant then analyses the company’s problem and provides recommendations about how to fix it. Business owners should avoid the temptation to blindly follow a consultant’s recommendations; instead, they should seek to understand the diagnosis and be prepared to negotiate any necessary changes. The consulting process should not be “mysterious or unusual,” but rather a “mutually beneficial business arrangement between a consultant and client.”
Finally, after implementing the consultants’ recommendations, the client company should formally evaluate the success of the consulting experience so that those lessons can be applied to future problems.
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