Why Consultants Fail
This is the final installment of a three-part series. In part one, Eric examined the increasing demand for consultants and considered whether the consultant is a force for good or for evil. In part two, he defined what qualifies a consultant and the standards to which they are held. Today he wraps up with the reasons we hire consultants and potential pitfalls to look out for.
Why You Might Hire a Consultant
Robots, artificial intelligence and dramatic changes in regulations are not the only reasons for hiring consultants. A company may hire a consultant for any of the following reasons:
• Because of his or her expertise
• To identify problems
• To supplement the staff
• To act as a catalyst
• To provide objectivity
• To teach
• To do the "dirty work"
• To bring new life to an organization
• To create a new business
• To influence other people
Without an understanding of why to hire a consultant, failures may occur.
Hindsight has 20/20 vision. It is easy to look back and know mistakes were made, but there are no do-overs where companies can redeem the millions of dollars they invested or return to grace with buyers when their brand is tainted. Many are eager to tell their story about the worst consultant in the media. Here are a few examples of why hiring a consultant can fail:
If a consultant does not thoroughly understand what it takes to research and implement a successful plan, it can result in not preparing the client to make a commitment for successful implementation.
The right consultants have a process for developing new areas of expertise, and when needed bring in outside consultants to provide potential clients optimal service. A less experienced consultant might slip and overstate capabilities due to need, greed, passion or naivety. Be aware of those who have not yet learned to refrain from selling things they don’t know how to do.
A company that says they want to develop a strategy and hires a consultant who agrees to provide services and a potential solution without reviewing the internal and client responsibilities is at risk and may potentially fail.
While it can be difficult, both the client and consultant need to identify the capabilities of anyone at the company who may be potentially involved with implementation. Without understanding the essential processes and tasks involved with new consulting engagements and the capabilities of those responsible, unexpected barriers can impede success early on. An experienced consultant will know to confirm in the agreement who will do what and what is expected.
Lack of Due Diligence
Those who hire consultants can get maximum value when they have a sense of how the tactics work. There is a trend for companies to hire specialists who can add sparkly new tools or tactics but have no idea how they work or why they matter.
The responsibility of education can be placed on the client company or can be part of a consulting agreement.
Lack of Internal Support
Regardless of the enthusiasm, passion and expertise a consultant can bring to a company, when it becomes apparent that those involved are not all on board with key implementation approvals and tasks, a lack of success quickly becomes “the consultant’s fault.” If everyone involved agrees at the start that it won’t work, it becomes a self-fulfilling prophecy and the consultant is cast as the villain.
It makes sense that it is the responsibility of the client company to ensure ample research is conducted before bringing in an outside consultant.
Long before engagement begins, the client company must map out why they need a consultant, which type of consultant they need and who the consultant will work with internally to ensure successful implementation. With an outline of the benefits for the team, departments and organization in hand prior to the engagement, the self-fulfilling prophecy is much more positive.
Some leapt into working as a consultant, others were pushed into it and no doubt a few defaulted to becoming a consultant due to a lack of prospects. Whether they are in this challenging profession by choice or by circumstance, they make more of an impact than they may realize.
Measuring character is probably the most difficult aspect, and this lies at the heart of whether a consultant is a villain or a hero. Membership in the associations previously mentioned may not be a perfect reference, but it certainly shows a more serious commitment than those who simply hang a shingle and start handing out business cards.
Stephen M.R. Covey wrote, "Trust is equal parts character and competence." Consultants will deliver less than optimal results if they lack one or both of those parts.
We do hear the success stories from those we trust in our network, who have achieved success but are not always ready to reveal their secret or competitive advantage.
It is understandable why some consultants may be perceived as villains, and it's unfortunate that those who are heroes don’t get the same press. Success stories are rare, as they should be when regulation is lacking.
Whether you are hiring a consultant or hiring a bookkeeper/accountant, we understand and appreciate the reasons you might hesitate to trust. Hiring a professional services firm can make an impact over many lifetimes. Understanding and identifying why you need help, the type of services you need, researching references and not making a rash decision without due diligence, are all necessary to work with professionals who are heroes.
About the Author
|Eric Moore is the Practice Manager ofAccounting Solutions Partners (ASP). He brings two decades of progressive experience in controller, CFO and general management roles with privately held companies. He has a broad perspective from working in environments ranging from start-ups to multi-generational mid-market companies with revenue in excess of $100 million.
Eric holds a bachelor's degree in business administration from Washington State University with an emphasis in accounting and finance. He is an active community volunteer, serving with various faith and compassion-based organizations for the last 20 years. He enjoys time with his wife and three children, watching college football, traveling, hiking, riding his motorcycle and soaking in the sun at any warm beach.
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