Don’t Hire a Management Consultant Without Doing This First!
So, you are thinking about hiring a consultant? Good on you. You’re about to join the league of smart business owners who seek expert advice before making important decisions.
Back in the day, when the consulting industry was dominated by big firms, only some companies were in a position of hiring experts. Now, the tables have turned, and even small to medium-sized businesses can easily hire consultants for almost any business-related issue.
But how to find top consultants? And what exactly makes a consultant worthy of hiring?
In this article, we will discuss how to find the best consultants? what to look for before you hire them? and how to save money while hiring them?
Use this as a guide and go through it before you officially bring a consultant on board.
1. Hire a Consultant for the Right Reasons
Before you try to find the right consultant, ask yourself: “Do I really need a management consultant for this?” Well, there are right reasons to hire consultants, and then, there are ‘wrong’ reasons to hire them. For example, if you need expert advice on an internal issue, such as business growth strategy or supply chain management, then hiring a management consultant makes sense.
However, there are some scenarios in which the decision to hire a consultant may be wrong. For example, if you’re on the hunt to find the right consultant only because you think a consultant is a genie. you think he will make all your wishes come true, chances are, you may end up getting disappointed. Also, hiring consultants because of a lack of trust in the internal team is also not a good reason. It may affect your team’s sense of self-esteem and morale. So, let them know why exactly you’re hiring a consultant if you decide to hire one. But never imply that your team is too young, old, or inexperienced to handle the job internally.
2. Be Aware Of the Fact That You Can Hire Management Consultants Who Work As Freelancers
Where does one find the best consultants? Umm, in big management consulting firms, right? Well, not quite! As a matter of fact, the consulting industry is going through massive disruption right now. Two things are causing this disruption:
- Experienced consultants who are leaving their corporate jobs behind and embracing the freelance lifestyle
- Online consulting platforms that are connecting these freelance consultants with businesses.
Gone are the days when a business had no choice but to engage with big corporations to find the right consultants. In this day and age, a business can easily find the right consultant from a pool of thousands of freelance consultants. And why should a business hire freelancers? First, you can cut costs substantially by not engaging with big consulting firms. Rest assured, you will still get quality consultants. It is because lots of consultants who work on a freelance basis have worked as employees in these top-tier consulting firms before. Secondly, you will have more control over the whole situation since you will have the opportunity to interview multiple freelance consultants and choose the one you like the most.
3. Check Out Case Studies and Testimonials From Their Previous Clients
Now that you know how easy it is to find the best consultants using online consulting platforms, let’s discuss the key steps you should take before officially hiring one. Before you hire a consultant, you should take some time to examine their past achievements. If they have case studies of projects that they have completed in the past. Go through them to understand how exactly your potential consultant helped a previous client achieve their goals. Case studies also serve as proof that a consultant has faced business-related challenges before and is likely to be confident while facing future challenges.
However, a consultant who doesn’t have any detailed case studies to show isn’t incompetent. If there are no case studies to read, look for recommendations and client testimonials. Although they’re not as detailed as case studies, you could still learn a lot about a consultant through them. Since we’re living in the age of social media, you might also want to check out their LinkedIn profile. If a consultant has dozens of endorsements for skills like strategy, management consulting, problem-solving, etc., then that’s a really good indicator of their competency, too.
4. Discuss the Fee Structure Beforehand
You can easily find the best consultants online, but ultimately, you’ll have to hire the one (or ones) whose cost structure fits with your business’s budget. Let’s quickly discuss various fee structures that freelance consultants use:
- Hourly rate: A set hourly rate multiplied by total billable hours is what you will pay to the consultant as a business.
- Project-based fee: Some consultants quote the full cost of the entire project at once. Certainty is always good when it comes to cost. This may be helpful to you as a business because you will know exactly how much you have to pay the consultant from the get-go.
- Value-based fee: Some consultants may charge a commission on top of the base fee based on the value they provide. For instance, if a consultant helps a business increase its revenue by $100,000 a month, they could ask for a 5% commission ($5000). Any percentage of commission should be agreed upon beforehand in the contract.
- Retainer model: If you need a consultant’s help on a regular basis for the long term, you may want to use the retainer model. In this structure, you pay them a fixed monthly fee to access their services on an ongoing basis.
You can find top consultants based on their skills. But, if you want to find the right consultant, you will also have to take their fee structure and your company’s financial status into account. Indeed, the right consultant is someone who can get the job done with ease without costing you an arm and a leg.