I’m a big fan of consultants, and not just because I launched a consulting firm this year. I’ve hired consultants often throughout my years as a chief executive at several large firms, and have found their assistance to be invaluable. I start with the premise “If you’re the smartest person in the room, you’re in the wrong room,” and go from there.
I had to figure out how to use consultants. Nobody taught me, and I used them incorrectly several times before I learned my lessons. Interestingly, the consultants themselves were rarely willing to tell me what I needed to know to benefit from them the most. So this column is for all those willing learners out there who may wish to hire a consultant and want to know how to extract every dollar of value.
Hire the Right Consultant
This sounds crazy simple, but it’s not. It seems like every laid-off executive from one coast to the next is a consultant. Many consultants claim to have skills they cannot actually demonstrate in real life. Just because a person has ideas about marketing doesn’t mean they’ve actually tested those ideas on their own budget. And just because someone worked directly for a CEO, say, as an HR Executive, doesn’t mean they know beans about how to lay out a business strategy.
Vet your consultants carefully. Make sure the consultant has actually had a job directly in the area of expertise for which you are seeking their advice. Ask them to tell you about their biggest mistakes in those roles. One of the things you are paying for with a consultant is the opportunity to learn from the consultant’s mistakes and possibly avoid making some of your own. If they haven’t made any noteworthy mistakes, they either weren’t doing much or they weren’t doing it for long.
Do your due diligence. Interview carefully and check references. While it is much easier to cut the cord with a consultant than an employee, you risk spending a lot of money on inadequate consulting services before you realize it. Hire a consultant with the same care you would hire an employee.
Ensure potential consultants enjoy the highest level of professional respect for their integrity and business ethics. This person will be in a position to suggest that you do certain things with your business. You don’t want to be at the starting gate wondering if you are about to do something shady.
Ask potential consultants how they would approach specific issues in your business. If they are reluctant to discuss their methodology, either they don’t have one or they are paranoid that you will take their idea and run with it. A good consultant isn’t just selling a great methodology – she is also selling her thought process and her ability to analyze issues and grasp nuances. A confident professional will happily discuss actual business issues and give you lots of ideas about how you could resolve them – with or without her.
A Consultant is Not a Contractor
This is an area that is often confusing. A consultant is someone who advises you on your business or a segment of your business. The consultant participates in reviewing history, analyzing performance, and making recommendations about how to proceed. Typically this work is done with the expectation that people within the organization will be taught to do the work the consultant is spearheading. A good consultant is an excellent teacher, handing off business knowledge with each recommendation, analysis, and suggestion.
Consultants are often confused with contractors. A contractor may be hired to manage a specific project or do specific jobs. This person sets his own schedule and bills by the project or by the hour. The contractor may or may not set direction (he may take direction from the consultant).
When the Consultant is Doing Nothing
Beware any professional who blazes through your doors with suggestions flying. Sometimes the most important work a consultant can do is observe. Every business that is still in business is doing many things right. A good consultant doesn’t wish to undo those things – she wants to supplement and refine them. So if she tells you she needs time to observe, ask questions of your staff, and observe some more, trust that.
A Consultant is Not a Magician
Just because your consultant knows how to do something that you don’t doesn’t mean she can make it happen tomorrow. Are you looking for cultural change? Give it two years. A major shift in your brand perception? Minimum 10 months. Implement a new selling strategy? Same. Implementing new operating systems? Six months to plan, 4 months to implement/go-live, 2 more months before people stop complaining, a year to true benefits. A consultant’s superior knowledge and experience in an area of change can make the process go smoother, but some things take as long as they take, and many things are dependent on your organization’s acceptance and participation style.
A Consultant is Not a Genie
If a person tells you he or she can guide you through a major business initiative without making mistakes, run for the exits. You aren’t paying for the benefit of someone who never makes mistakes – that doesn’t exist. You are paying for the benefit of someone who makes more sophisticated mistakes because the dumb mistakes are behind her. You are paying for the benefit of someone who knows her craft well enough to suggest something new and possibly groundbreaking with reasonable expectation of success. You are paying for the opportunity to take it up a notch, not play it safe. If you just want to play it safe you can do that without consulting expense.
You May Not Always Understand – or Agree With – Your Consultant
If you already knew everything you wouldn’t need a consultant (remember the saying “If you’re the smartest person in the room, you’re in the wrong room”). If your consultant is truly an expert, she will talk about things you don’t understand. Ask her to break it down for you, explain where she is coming from and to help you understand it. That’s an appropriate role for the consultant-as-teacher. But if you’re arguing with your consultant about whether or not she is right, take a step back. You may actually be arguing about your fear of taking a risk or your need to understand something better before you proceed – and those arguments are understandable. But if you’re arguing about something you don’t know as if you know it, what’s the point?
Your Consultant is Not Your Employee
Your consultant is not your employee. Your consultant should be a challenger, ruffle your feathers, and tell you want you need to hear (versus what you want to hear). Your consultant should be unwaveringly direct.
Your consultant will not drop everything when you need her. If she’s good (and remember, that’s what you need), she has lots of other customers.
Good consultants aren’t cheap. You want a consultant with the skills and experience to be paid at the top of her field, and her hourly rate will reflect that. Think of it as rent-an-executive for business owners who otherwise couldn’t afford that skillset.
Still Want to Hire a Consultant?
Does this sound daunting?
Well, business is demanding. It makes us take risks, spend money we don’t want to spend, and put our identities and self-worth on the line. We hire consultants to help us take those risks and make necessary changes. An excellent consultant can make a huge difference to your bottom line and your optimism for your business. Once you find the right one, remember that she is not a magician, a contractor, a genie, or an employee. Plan it right, and you’ll have engaged an expert, a business partner, and a support system.