As a McKinsey alumni, I am quite familiar with the consulting business model. I’ve been involved in great projects and others that, let’s just say, were not so great. After joining the corporate world, I’ve had the opportunity to work with several consulting companies, ranging from very large to very small, on a number of different topics.
Just to be clear: I do believe consultants can offer tremendous value to your company if you know how and when to leverage them. However, time and time again, I’ve been surprised by how little value companies got out of their consulting investment. This is even more true for large transformation initiatives, which can quickly become a money drain.
So, how do you ensure you can effectively leverage consultants? The following lessons have proven invaluable for me:
Be crystal clear about your objectives. This may sound obvious, but it is probably one of the most frequent mistakes I observe. Really, you shouldn’t be signing a consulting agreement until you can clearly articulate the help you need and what success looks like for the project. Make sure that your objectives are clearly outlined in the proposal you sign and written in a language you can understand (sometimes, despite your best efforts, projects go wrong and you have to let go of the consultants you’ve hired - and you will thank yourself for having done this).
Shop around for at least 3 strong contenders. I understand that you may have your go-to person or company, but there are fantastic people out there you may never get to meet unless you shop around a bit. As a rule of thumb, you should interview at least 3 strong contenders before making up your mind, even though doing so takes more time. You will learn a tremendous amount by seeing how different people would approach the problem, which can influence your own thinking.
It’s not about the consulting company; it is about the lead consultant. This may come as a surprise, but I am sure about it. I’ve seen some very weak people in big name consulting shops, and I’ve also seen amazing folks in companies you’ve never heard about. The truth is that once you are clear about what you need, it is much easier to cut through the bs and quickly evaluate whether the consultant you are interviewing has real experience with and battle scars from this type of work. You must be certain that the lead consultant is a good fit for you and your team, and that they possess the knowledge and resources to make the project successful.
Assign one of your best employees to be the internal project leader. Ideally, you will have someone who has successfully worked with consultants to assign to the initiative. If not, you should assign one of your top talents. Employees will learn a lot from working with great consultants - and the consultants will benefit greatly from having people who understand how the company works and know where to go for information. This is a clear win-win situation.
Do the internal selling of the project yourself. You should be the one explaining the project to the necessary parts of the organization, not the consultants. You should clearly state that the consultants were not hired to evaluate people (assuming that is indeed true), so that no one becomes defensive. You should also clarify that the consultants will need to learn about the business and that they will request large quantities of information - and that employees should give high priority to those requests. Failing to do any of these things will cost you time, money, and peace of mind.
Meet frequently with consultants and address issues right away. You should be meeting with the consultants frequently to get updated on the situation (I typically meet with consultants once a week at minimum). There will be two main types of issues for you to resolve: personnel-related and content-related. - Personnel: It is not uncommon for consultants to work very differently than your employees, which often leads to commotion and conflict. You should not be surprised if your employees get defensive and show resentment towards the attention consultants are getting (especially if the employees came up with some of the proposed ideas in the first place). Be on top of those issues and address them as quickly as you can. Explain the role of the consultants (yet again), acknowledge people’s ideas and contributions, and get your team excited about the work. You should also encourage consultants to build a relationship with your team (most consultants have a budget just for doing that). - Content: If you are not getting what you want or expect, raise a flag right away. Waiting for things to get better on their own usually just makes the situation worse. Consultants will go out of their way to accommodate your requests, and it will quickly become clear whether they have what it takes to deliver on your needs. Also, consultants are often open to helping out in other areas of the business as an “investment” on you - don’t let that opportunity go to waste.
Don’t share the financial arrangement with your team. This may sound like a minor point, but I can’t tell you how much headache this one has given me in the past. Unless strictly necessary, no one else needs to know how much the consultants are getting paid for the project. Most people won’t understand the value being brought by the consultants, resenting the work even more.
Don’t lose sight of your objectives. As the transformation starts to progress, it is normal to become fully involved in the issues of the moment. Do yourself a favor and read the proposal every couple of months. It is a great way to remind yourself what your original objectives were and to gauge whether you are on track. It also gives you an opportunity to adjust as needed.
These tips can help you create the foundation for a successful project with consultants while minimizing the unnecessary drama that usually comes along.