Get the most from management consultants

Source: Technology Digital

Date :01/06/2007 11:45:46

The ultimate success of a consulting project is determined long before you’ve talked to an actual consultant, and depends on the reasons why you’re hiring one

By Fiona Czerniawska

In most organisations, managers think about these reasons in terms of what they expect the consultants to do, not in relation to the underlying role they’re expecting the consultants to play. Nor do they consider how their expectations match the prevailing market conditions. What kind of client you are – do you really want to bear the risk of developing a unique approach to an idea? Is the issue you face a new one, or are you trying to catch up with your competitors?

Why use consultants?

Probably the single most important reason for hiring consultants is to bring in people with a particular set of skills. The more specialised a consultant is in his or her field, the more valuable they are to clients. Specialist know-how falls into two categories. First, there’s ‘industry-specific skills’ – you need people who are experts in your sector, perhaps to assess the implications of a move by one of your competitors, or to help decide whether a new management approach – customer relationship management (CRM), for example – would have benefits in your unique organisation.

Second, there’s what you could call ‘issue-specific skills’, which is where you need people who are experts in a particular issue – it may be a problem or an opportunity. You’ve decided that CRM is for you: now what you need are some CRM experts to apply it.

But there are times when you simply need help – bright, energetic people who are well-informed, who can help you get a new initiative up and running at a time when it’s proving difficult to free up your own internal resources. You’re quite definitely not looking for specialists here. You need the consultants to be very flexible – rolling up their sleeves and doing whatever it takes to get the job done – and that’s something that requires a broad base of knowledge, rather than in-depth expertise in just one or two areas.

Even in the smallest organisations, managers find it difficult to stand back and analyse what’s happening. Opportunities are missed, and threats are ignored. Even where time is allowed for such reflection, how can you ensure that you’re seeing what matters most to the organisation, not just what matters most to you as an individual? Outsiders, like consultants, can provide you with an invaluable perspective because they’re looking at your organisation with new eyes. This may be just what you need when, for example, you’re wondering whether a difficult decision is in fact the right one.

Sometimes an outside ‘opinion’, expressed by an expert is enough to jump-start a project. ‘Yes’, the consultants effectively say, ‘we agree that entering this market with this product is a good idea, now go for it’. And you do. But there are many other occasions when you need hard data to help you decide what to do. Here, you’re not so much looking for an opinion which your colleagues will accept, as the underlying information from which such an opinion can be formed by your colleagues themselves. It might be, for example, that a particular initiative you’re proposing is very controversial: in such circumstances, there’s no point bringing in an expert to rubber-stamp what you believe in, but your peers don’t – you only open yourself up to cynicism. It’s much better to hire consultants who can lay the facts as they find them in front of your colleagues, enabling each one to take their own decision.

There are also occasions when you want access – not so much to an outside view, or new data – but to creative thinking, when you want someone to sit down with your organisation an innovative approach. It may be that you and everyone in your industry face a similar threat – for example, the appearance of new, potentially disruptive technology. All your competitors may have adopted the same stance, but you may be looking for a different approach, one that takes the problem and converts it into an opportunity for you to differentiate yourself.

How to use a consultancy

The most effective consultancy projects are those in which client and consultant work as members of a team each bringing their own knowledge, expertise and resources to bear in realising an opportunity or resolving a problem. Team members who trust one another will share information and knowledge and – as a result – work together effectively and efficiently. Getting the commercial relationship between client and consultant right is essential in establishing this kind of trust.

The MCA has developed a Statement of Best Practice in conjunction with the Office of Government Commerce and the Institute of Management Consultancy. The document provides practical advice on project definition, consultancy selection, contract terms, project management and evaluation.

The statement highlights four general principles that underpin an effective working relationship between clients and consultants:

Be truthful and constructive to, and easily contactable by, consultants and other stakeholders.

Do not be defensive. The consultants are there to assist your organisation.

Respond to the client’s initial request and avoid second guessing the problem at an early stage.

Do not be afraid of providing too much information. Consultants would prefer this to lack of detail. Always listen to the client’s opinions first before explaining your own.

In general, ensure that risk lies with the entity with the greatest ability to manage that risk.

The following guidelines from the statement provide a useful framework for the management of consulting projects;

• Do not be afraid of providing too much information to your consultants, who prefer this to a lack of detail.

• The briefing for the consultants should contain information about the project and the people involved, and should outline broad criteria used at the selection of bidder and evaluation of tender stage.

• Build in the expected outputs from the project and any budgetary constraints which the business case has highlighted.

• On appointment, confirm with a written statement the key elements of the way the project will be carried out, to include a plan, deliverables and expectations. This should also contain a risk register defining who is responsible for which risks.

• Flag up problems with the project early on so that remedial action can be implemented.

• Hold regular reviews on the progress and delivery of the contract and project. Action points arising from review meetings should be agreed in writing.

• Where necessary and agreed, provide staff, facilities and information promptly.

• At the end of the project both parties should undertake a joint project review to see what they might gain from the experience.

Choosing consultants

Many clients rely on word-of-mouth recommendations when selecting a consultancy. Whilst this is an important element of the process, every organisation will have different requirements of a consultancy and the client-consultant ‘chemistry’ can vary enormously according to the culture of the two organisations.

The MCA would suggest a combination of personal recommendation and a more structured approach to consultancy selection. We are able to provide detailed information on our member firms, what they do and the types of clients they have worked with in the past. A confidential shortlisting service is also available.

Fiona Czerniawska is Director of the MCA's Think Tank and the founder of Arkimeda, a firm specialising in researching and consulting to the consulting industry. Fiona is also a programme director at London Business School's Centre for Management Development. Her publications include: Management Consulting in Practice, Management Consultancy in the 21st Century, The UK Consulting Industry 2003/4, and The Intelligent Client: Managing your Management Consultant. For further information contact the MCA (www.mca.org.uk) on 0207321 3990