Franchising

Utilize the Discovery Analysis to Ease Your Fear of Using a Consultant

Consultants can provide real value on many occasions but they can also be your worst nightmare. Some clichés include;

“A consultant will ask you for the time and then steal your watch.”

“Two things you don’t want to watch —– Sausage being made & a group of consultants trying to solve a problem.”

Worst Nightmare

The Hanging-on Strategy —- Consultants can become your worst nightmare in many ways. Some consultants have perfected hanging-on and use it as a proactive growth strategy. When a project starts nearing its end, new problems seem to mysteriously get identified. It may start as a training issue; the training issue grows into a management issue, a technology issue, a channel issue. Each issue can turn into another consultant project or an extension of the original project. Before you know it your costs for the consultant’s advice and assistance becomes a major factor on the expense side of your profit and loss statement.

Unclear expectations——- Some consultants are so skilled at presentations and proposal writing that deliverables become very intangible and they are not measurable. If they are not measurable, accountability goes out the window. This alone can turn your consulting experience into a nightmare. The scope of the project may have a continuous creep that costs you more and more money. Deliverables should be clearly defined and documented. However, even if you have done your homework and feel you have clear expectations things can go wrong.

Employee involvement ——-Your risk of failure is exponentially higher if you have not involved your key employees in the decision making process of hiring a consultant. It is essential that you have employee buy in when you decide you need a consultant.

Accountability ———-Consultants like to say they can lead a horse to water but they can’t make them drink. In other words, consultants can’t execute the plan for the company. As a result, it is very difficult to hold consultants accountable for the results. Often times the consultants make a fantastic presentation and sell their firm based on expertise they don’t really possess. They are skilled at quick research and can be convincing in demonstrating their breadth of knowledge about your business based on this quick research. On many occasions the impressive partners of the firm may seal the deal and then send in a bunch of MBA kids to do the work. It’s a fantastic learning process for the MBA’s that you end up paying for.

Who is in control —— Hiring the wrong consultant can be dangerous, it can cost you sales, profits and even employees if you are not careful. Don’t turn your business over to a consultant. Don’t make the mistake of thinking they know your business better than you. There isn’t any consultant out there that knows your business better than you and your employees know your business. If you do hire a consultant, stay involved and manage the process.

A variety of flavors —- Consultants come in a variety of flavors. They consist of former sales people, former vice presidents, MBA graduates, former CEO’s, former accountants, and even former waiters. There are many professional career based consultants that have developed impeccable reputations. There are also a lot of consultants that are consultants because they are between jobs or retired and bored. Most consultants can be very convincing of their expertise and many can back it up with performance. But, there are those that sound impressive simply because they are exceptional speakers and presenters. Some quote problems similar to what you may be experiencing from work with prior clients. That in itself does not guarantee that they can help solve your problems. Some can, some can’t. Some may do an excellent job for you but some may not.

Walk the Walk —- The problem with some consultants is the fact that they haven’t really walked the walk. They haven’t walked in your shoes. Most have some business experience but many have never owned their own business. Many lack the entrepreneurial experience of starting a business from scratch and growing a substantial revenue stream. Some have never owned or sold their own business prior to becoming consultants. Many lack the experience of running a family owned business, meeting payroll or managing cash flow. Some are well educated, some are not.

The Value of an Experienced Consultant

The right consultant can provide tremendous value to your firm. Just having an unbiased, outside pair of eyes look at your firm can reveal things that you as president and your executive staff can’t see. This is not uncommon because you’re caught up in the day to day operation of your business. Additionally, a consultant does not have the emotional, compassionate attachment to people and processes that you and your management team have developed. As a result, the consultant can help you identify and resolve issues that have gone unnoticed or ignored.

Consultants provide value not because they can do things you don’t know how to do but they often provide value because you and your team may not have the bandwidth to devote the time necessary to address many issues your company may face. This is especially true if those issues involve market or channel research. Research projects and technology projects are often the types of engagements that fall into this category. Training and employee development support are two other area’s where consultants provide exceptional value. The consulting industry is a huge and growing industry that is fast approaching the $100 Billion Dollar mark. A market of this size attracts many players. There are many professional, competent and trust worthy consultants out there but there are also some that may not be able to live up to your expectations. Sales & Marketing Management Magazine Surveys have indicated that over 75% of business executives responded that consultants are necessary for business success. These same survey results concluded that over 50% of the firms utilizing consultants were dissatisfied or only somewhat satisfied. Companies with less than $10 million in revenue reported a much higher confidence level in consultants than companies with over $10 million in revenue

So What Do You Do if You Think You Need a Consultant?

Start by utilizing the creativity and initiative of your own staff to identify the extent of your internal issues. The perfect vehicle to do this is called a “Discovery Analysis”. The discovery analysis utilizes a questionnaire that stimulates a thought-provoking process designed to identify issues and challenges that impact company profitability. The following sales discovery analysis is an example of this process. It will identify issues and challenges within the sales functions of the company. Being sales specific means that you must involve key sales personnel in the process. The independent answers to the questions posed should direct you to very focus-specific areas within your organization that need attention. The Owner/President, Vice President of Sales, Sales Managers and both inside and outside sales representatives should complete this discovery analysis.

A discovery team meeting should be held to review the results of this process. Each team member should prepare an independent S.W.O.T. (Strengths, Weaknesses, Opportunities and Threats) analysis based on their responses after completing this questionnaire. Only the three most critical areas in each category should be recorded:

Strengths: The three biggest strengths the company has that create competitive advantage.

Weaknesses: The three most critical weaknesses that must be addressed to maintain or create new competitive advantages or at a minimum put you on a level playing field with the competition.

Opportunities: The three biggest opportunities for your company to create competitive advantage, improve market share, increase revenues or create cost reduction through process improvement.

Threats: The three biggest threats created by either the internal or external environment. This may include government regulations, internal politics, competition activity or other external influences.

All responses should be collated from each group. Common areas of concern should be highlighted. A minimum of a one-day retreat attended by all management and key personnel is encouraged to ensure that proper attention and discussion is given to every area of concern that is identified through this discovery analysis. The following ten questions are examples of the 75 questions on the sales discovery analysis questionnaire.

Sample Sales Questions:

1. Do you record and monitor customer complaints?

2. Do you maintain a customer complaint database to track patterns and identify recurring problems?

3. Do you use this information to improve performance and increase customer satisfaction?

4. Do you solicit customer feedback?

5. Do you provide customers with a single point of contact?

6. Do you track customer satisfaction with internal operating statistic fill rates?

7. Can you identify waste in operating costs, such as the high cost of errors?

8. Do you receive phone system statistics to analyze calling behavior?

9. How do you measure customer satisfaction? Do you have a formal system? Such as a report card?

10. Does your sales force involve suppliers in the selling process?

You may find that by using this process you have identified th

Consulting arrangements can do wonders for a business. They can provide a boost to your business by utilizing a consultant’s focused expertise and their years of experience in similar venues, and they can give a business a good old-fashioned shot-in-the-arm.

Consultants are distanced from the daily politics of your business. They can provide you with unbiased opinions and fresh perspectives. The thing is, they can only do this if you allow them to do it.

I’ve done the consulting gig for years. In the process, I observed and experienced clients using my services well and not using my services well. I have listened to associates’ stories of how clients work with them, too. Sometimes the clients get great value for their money, and sometimes they get less than that.

How to Make the Most of Your Consultant Dollar

Isn’t the most important thing about working with a consultant that you get valuable results for your money and build a meaningful business relationship at the same time?

In order to do this, you must go into a relationship with your consultant with ‘collaboration’ in mind. The two of you must work together in order for the consulting relationship to work. As the client, you must be a willing participant in the business relationship with your consultant.

In order to get value for your consulting dollar, you must allow your consultant to learn and know about many aspects of your business.

If you go to a doctor with a pain in your side, but then refuse to let the doctor look at it and test it because you’re too modest or afraid of what he will tell you, the doctor won’t be able to help you.

Several years ago I consulted at a company to help them use software to create reports they needed. They did not want to show me their existing reports, however. How could I help them create the new reports if they refused to show me the existing reports? Like a patient who was afraid to show the doctor the pain in his side, this client was afraid to show me their reports. Two people at this client actually clutched the reports to themselves like patients holding their hospital robes closely.

After some explanations and coaxing from me, they finally let me see their pain and allowed me to help them. (Just for fun, I’ll tell you that this company is an underwear manufacturer, and leave it at that!)

A consultant’s role is to give you business information that you need in order to make informed decisions. They do not have the responsibility to make your business decisions, nor do they have the control. The responsibility and control (which go hand-in-hand) are yours.

Before You Decide to Work with a Consultant

First of all, know what you want. Define it before the consultant agrees to work with you. Write it down. List quantifiable and/or tangible objectives. Write out what you think you want the consultant to do.

What goals do you want to accomplish?
What is the scope of work?
What results do you want the consultant (and your business) to achieve?
What do you think is the timeframe?
What is your budget for this project?
As You and the Consultant Agree to Work Together
Discuss how the consultant works. For example, what methodology does she use to gather information, process it, draw conclusions, and make recommendations? There is no magic answer to this question. Most consultants, over time, will develop their own methodology to perform their work. Just make certain they have a plan that is the basis for their methods.

State the scope of work: what the consultant will deliver, when they will deliver it, and how they will deliver it.

State who will do the work (if there is a team of consultants). Also state where the consultant(s) will perform the work.

Agree on the timeframe, money, and invoicing.

List points of time at which you and the consultant will touch base to discuss where the project is at, how it is coming along, and if adjustments need to be made. It’s a good idea to schedule regular meetings or conference calls so that issues do not become surprises.

What Else to Look For?

“The worst consultants believe their companies are smarter than their clients, instead of recognizing that they’re extensions of their clients’ resources. Junior consultants in several well-known firms especially show this trait; it’s part of their firms’ core cultures,” writes Peter Keen of Computerworld. He continues, “Arrogant cultures make lousy partners and are in the rip-off business without realizing it. Because they believe they’re so much smarter, they make many mistakes that the more collaborative and respectful consulting firms don’t make.”

Look for consultants who want to form a collaborative effort with you and your business. Likewise, you must collaborate with the consultant in order to get the most bang for your buck.

Two More Do’s and Don’ts

Treat consultants as consultants, not as employees.

If you treat consultants as insiders rather than as outsiders, you will not receive the benefits of having them work with you. This is more of a mind process for you as the client. If you think of your consultants as an extension of your employee base, you may not be able to hear them when they tell you important information. Remember, as outsiders they are able to skip most of the politics and inefficiencies of your company in order to unearth diamonds in the rough. These are the hidden diamonds you are paying them to find. If you treat them as if they are employees, you will hinder that creative process for which you are paying them.

Treat consultants as adults.

Believe it or not, sometimes clients treat consultants as if they were children. This happens most often when consultants are told to not contact certain people for information, even though the contact and the information is important for the consultant’s work. I’ve also heard about consultants being scolded as if they were children.

On the surface, the reason that consultants should not be treated like children is obvious; no one wants to be treated like that. It’s humiliating. The deeper reasons are the same as for not treating consultants like employees: clients who treat their consultants like children will not get the benefits out of the consultant that they are paying for.

In Conclusion

Working with a consultant can be rewarding for your business. It’s up to you to define your goals, how you want a consultant to help achieve those goals, participate in a collaborative relationship, and let the consultant do their work in order to give you value for your consultant dollar.

Glory Borgeson is a business coach, author, and speaker, and the president of Borgeson Consulting, Inc. She specializes in working with executives in the “honeymoon phase” of a new position (typically the first two years) to coach them to success. Glory is the newly appointed executive’s Secret Weapon!. Top athletes have a coach; why not you?