When considering the use of consultants many people focus purely on the cost of doing so and far less on the cost of not.
The consultant in question here is not a task-based contracted resource to be dropped into an existing workforce in order to execute a series of operational processes, they are, if used correctly, a concentrated powerhouse of experience, knowledge and delivery expertise.
But how do you gauge what a consultant is really worth to you? How do you find one that will save your valuable time without rinsing though your precious resource?
If you have spent any time at all browsing through the offerings of anything from the “big 4” all the way down to independent specialists you will see that they all look good on paper [or their shiny websites], but the question is; how do you know what that will look like when you get it home and take it out of its pretty packaging?
The Management Consultancies Association (MCA) noted in their SME guide that “There is a difference between an organisation having previously delivered a similar project, and the actual consultants who arrive to deliver the project.”
Well to start with, a good consultant knows how to ask all the right questions.
Defining the problem – without jumping to the solution
This is often far harder than it sounds.
Being too close to a problem or overly focused on a specific solution, can really skew the perspective, so defining it in a way that can be both understood and executed is actually quite a talent.
This is where the consultant adds their primary value, they [should] know exactly what to ask.
An article in the Harvard Business Review quoted a partner in a consulting firm as saying,
“I sometimes feel the biggest benefit we provide is asking the hard why’s that substantive workers are too engrained to ask – perspective is everything.”
Interestingly these initial client consultant conversations are invariably an enlightening experience, for the client at least, as they generally conclude with a set of requirements that are quite some way from the their original brief but never the less fully aligned with the best possible outcome.
The power of why cannot be overstated at this stage of the proceedings, swiftly followed by some carefully selected how’s and then a whole host of who’s, what’s and when’s, but these answers to the right ears are the foundations upon which the consultant can build a set of sustainable solution options.
In the same HBR interview the consultant noted that:
“I frequently ask: What will you do with the information once you’ve got it? Many clients have never thought about that. Even the most impatient client is likely to agree that neither a solution to the wrong problem nor a solution that won’t be implemented is helpful.”
There is a reason why any LEAN practitioner will tell you that of the 5 [DMAIC] stages of change, the first: Define, is by far the largest and the most important.
Inspiring confidence and creating a sufficient rapport with the client is imperative to enable these hard questions to be asked and to fully grasp the meaning in their answers. It’s all part of the package for seasoned consultants who are able to step back from the problem at hand and support the client psychologically to arrive at the right answers.
“The best consultants meet both the technical and psychological needs of their clients.” (Mentorworks.ca)
Despite a well-defined problem and a perfectly engineered solution, a great many consultants’ final reports are bound and shelved like a really expensive graphic novel, but without the entertainment value.
The reality is that taking action on the end results starts way before the consultant starts work on their exit strategy – just handing a set of instructions to the client simply won’t get the job done.
Delivery should start with the initial relationship between the client and the consultant which develops over the duration of the contract and grows to encompass every level of the organisation. It creates grass roots ownership from day one, ensuring that the discovery, development and design are as much a part of the business as BAU processes.
There needs then to be no final report, just a gradual handover from consultant to process owners, a transfer of skills and on call support to manage the project to its conclusion.
This horizontal integration of consulting resource creates a much more sustainable solution and a trusted ongoing relationship, adding far more than the surface level value provided by a piece of analysis.
LAO TZU – “A leader is best when people barely know he exists, when his work is done, his aim fulfilled, they will say: we did it ourselves.”
Choosing the right consultant: Big firms, boutique or independent specialists?
So, given that well integrated consultancy teams are the way to go for sustainable outcomes, how do you choose?
It sounds like a tough choice, but really it just depends heavily on the scope of your problem, your time frame and the constraints of your business operations, such as requirements for tendering or the use of framework suppliers.
The Public sector has been criticised for is excessive consultancy spend for many years and although the actual sums vary wildly depending on what you read, all the numbers are presented in a way to cause an inflammatory response. However, this really does need to be seen from the perspective of the client.
From the end of 2019 the UK public sector has faced unprecedented challenges with both BREXIT and COVID to contend with, it’s no wonder that they needed to bring in the big guns. Failure in these cases simply was not an option, time was not on their side and whilst some limitations were lifted to enable a little more freedom to enlist support, the challenge cannot be understated.
So given these pressures, would any of us have chosen differently?
Larger national projects of course require extensive manpower, a wide range of rather diverse skill sets and enough recognised authority to move the required mountains. Add this to the need to choose from preapproved suppliers and move as fast as humanly possible and the choice to go with the larger and more expensive consultancy firms becomes a little more obvious.
This is supported by an analysis by Tussel in June 2021 which shows a breakdown of the contracted spend, estimating that of the £812m awarded to consulting marketing and research, £279m was allocated to Deloitte, with a further £30m to PwC & £21m to McKinsey.
But what about the myriad of smaller projects that require a more personal approach? Consultancy is not a one size fits all, just as you wouldn’t use a sledgehammer to crack a nut, you might be better off with an SME consultancy for a flexible, highly specialist or hands on approach to longer term engagements.
“The UK Government is committed to levelling the playing field for smaller organisations. Government has a target of committing 33% of procurement spend to SMEs through direct and indirect spend by 2022” (The Management Consultancies Association SME guide)
As it is always better to be proactive than reactive, it may be time to start looking at consultancy from more than one perspective.
Not just crisis management
Stepping away from fire fighting for a moment, not all decisions to bring in a consultant have to be concerned with problem solving, there could be a multitude of other reasons.
Maybe you just need a temporary knowledge resource to get past a bottleneck in your day-to-day business, or perhaps you want to bring in some experts that can upskill your substantive staff whilst delivering some value, or maybe you need their expertise to get your business off the ground so you want to take advantage of the flexibility offered by smaller consultancy firms.
Whatever your challenge is, when you are weighing up the pros and cons, don’t just look at the price, consider the investment of your time [as this is our only truly limited resource], your various options, compare it with the cost of inaction and then finally, in the words of Tim Ferris; “what would this look like if it were easy?”.
Consultants are used to a speedy learning curve, what ever issues you have, they have probably seen it before and can hit the ground running in less than the time it would take for you to stress over the size of your inbox and make another cup of coffee.
Many great authors of our time have focused heavily on the premise of outsourcing the tasks that you either do not have the skills for or just really don’t like doing, yet so many business leaders still see this devolution of duties as a failure. They prefer to nobly run themselves into the ground than to share the burden with a seasoned professional.
14 Great reasons to hire a consultant
- To fill skill gaps
- Address temporary requirements
- Handle political situations that you’d rather distance yourself from.
- When you just need it done quickly and without error
- There is too little internal resource
- You’re too close to the issue to see a solution
- There’s a requirement for mass engagement
- The project is too challenging or controversial
- You need to test new ideas
- It’s too time consuming
- You need an opportunity spotter – fresh (educated) eyes
- Requirement for specialist skills
- Start-up resource
- You really just don’t want to do it yourself!
Making it “easy” might actually be more cost effective too.
A balanced workforce
Many non-governmental organisations rely heavily on contracted resource, which to varying degrees includes consultants. (Forbes, 2019)
The main drivers for this appear to be around flexibility and the need for specialist skills that fit into the business on an “as-needed” basis. Employing an expert to sit in your office for 40 hours each week when you only need them for specific projects is not only inefficient but unsustainable for both the employee and employer.
The public sector has many specialist functions that would (and do) undoubtedly benefit from this same approach as not all roles can be easily shoehorned into a contract of employment.
“According to the [PAC] committee, the current cost of using external consultants across government stands at £980m, and warned the amount is likely to increase in 2020–21 because of “the need to fill gaps in capacity and skills as a result of Covid-19 and EU exit”.” (cips.org, Dec 2020)
Whilst we cannot see from the data how public sector spending on consultants equates to headcount, it does bring a little perspective to the matter when you consider that according to the office of national statistics:
“There were an estimated 5.67 million employees in the public sector for March 2021, an increase of 206,000 (3.8%) compared with March 2020” (ONS, March 2021)
Proportionally its impossible to ascertain the balance between consultants and substantive staff and any numbers that could be assumed would be arbitrary as it would completely disregard the complexity within the system as a whole.
Despite the emotion surrounding consultancy spend, government organisation recognise the need for consultants, they understand that the flexibility, expertise and objective viewpoint makes them an absolute necessity for a balanced and effective workforce. So in order to address the need whilst reducing costs they have introduced (with the help of external consultancy support) an internal consultancy resource known as “Crown Consultancy”. (Institute for Government, March 2021)
Whilst this sounds like an ideal solution, the same article noted that they;
“…could not justify keeping a large stock of permanent civil servants on hand and idling…[in previous attempts at an internal consultancy] they tended to be kept busy with useful work, which then made it just as hard to redeploy them as any other civil servant.”
Additionally, the article also stated that
“Any in-house consultancy function, however well developed, will be a drop in the ocean compared to the resources needed to tackle Brexit fallout and the rolling coronavirus crisis.” And that “the real gap is of subject-specialist experts who can advise on and implement these highly technical challenges”
As the world settles into its new version of normal and the public sector undergoes many aspects of long-awaited transformation, it could be that the balance lies between these 2 extremes of large organisation consulting price tags and unsustainable internal resource, in SME consultants.
McKinsey noted that the necessary changes within public sector must “Ensure faster, better decision making that harnesses data and analytics, cultivate smarter, more productive ways for public servants to work & foster new forms of partnership with the private sector.” (Rethinking resilience: Ten priorities for governments, November, 2020 – McKinsey)
Creating a balanced workforce that is constructed from internal resource and external expertise would address these points, retaining the flexibility of providing supported delivery for internal projects (and keeping costs down), whilst providing a consistent level of horizon scanning to identify potential improvements. Its like going to the dentist for a check-up so that you don’t end up having to go to a specialist for a root canal!
There will always be a need to enlist consultants to “fire fight” immediate issues but that is not their only value.
Consultants come in all shapes and sizes with an equally wide range of expertise and price tags. They are predominantly people who have worked their way up to the top of their game and relish a new opportunity to share that knowledge and make a real difference.
Adding a liberal sprinkling of the right consultant resource into your organisation could be just the catalyst you need to move from good to great and beyond!