10 Critical Questions to Ask Before Hiring a Consultant

Talk to as many consultants as you can before hiring one. Even if you have one person or firm in mind, interview at least a few others as a sort of due diligence. You'll probably find that each interview helps you focus on the issues you're hiring a consult to help resolve.

1. Most consultants focus on two areas: cutting costs and raising revenues. What do you see as the relationship between the two functions? Which do you do better?

Cost cutting is the consultant's usual expertise. It's what most companies need. Most of these hired outside consultants to take an objective look at organizational charts, value-adding processes and competitive environments. "We spend a lot of time talking to a company's customers, so we understand what they like and don't like," one consultant says. "What does the customer value? Is it time? Is it quality? We define that." What this means is that a company can cut jobs and still not touch on one non-value-added activity or add value to the customer.

2. What was your professional experience before you became a consultant?

Ultimately, you should want any consultant you use to have a strong bottom-line sensibility. You want this person-or team-to focus on the things that will add the greatest amount of value to your company in the shortest amount of time. This kind of thinking doesn't come naturally to many people. It usually demands two kinds of experience: as a chief executive officer or as a corporate turnaround specialist. A consultant who has this kind of experience has dealt with strict cost controls, high-pressure scrutiny and the need for quick results. These are the same traits you should look for in anyone giving you expert advice.

3. How many professionals work with you or at your firm?

Business consultants fall essentially into two categories: Solo-practitioners and team players. The differences between the two usually involve the type of work they take. Most of the time, the soloists deal with less-specific, strategic or vision-related issues; the teams get into more tightly focused number crunching. Less-specific functions tend to take less time (sometimes as little as one day); the more specific take more. One of these functions isn't better or worse than the other. The trap to beware: The marketing soloist who claims he or she can also review all of your accounting.

4. Will you sign a letter of confidentiality? Will you refrain from working for our competitors?

Ask all consultants to sign a letter of confidentiality. Some owners and managers assume that short-term strategic consultants pose less of a threat to proprietary interests than the number crunchers. Don't make that assumption. You and your staff should feel free to discuss any business subject with your consultant and trust his or her discretion. If you feel uncomfortable, you won't discuss things candidly. Your risk in these cases isn't usually that the consultant will knowingly steal proprietary in formation or material. Most are professional enough-and work in small enough markets-that reputations matter. More often, the risk involves a consultant unwittingly mentioning something. If he or she has signed a confidentiality letter, he or she will be more likely to think twice.

5. Who are some of your other clients? Who are some people and companies with whom you've worked before? Can I call them to ask about your work?

Don't be wowed by big-shot former clients. At big companies, consultants are hired in teams to tackle extremely specific projects. Just because the person in the expensive suit claims Microsoft as a former client doesn't mean he knows Bill Gates on a first-name basis. In fact, it's better if the consultant has worked with companies closer to your size and shape. They'll more likely understand your needs.

6. With how many clients do you work at one time? Do you have enough time to devote to our company to accomplish our goals? Will you return phone calls or emails the same day?

Asking other or former clients about the consultant's responsiveness and attentiveness can be helpful. As can more pointed questions of the consultant. These questions all focus on the same point: How much attention can the consultant afford to spend on your needs? The number of clients a consultant can serve well varies with the kind of service provided and client involved. But some general rules apply: You want to have same-day response to questions or problems. If you're undertaking a major restructuring, you probably don't want your consultant working with more than two or three other clients. A caveat: Some owners and managers who've had bad experiences with overly invasive (and expensive) consultants warn that you shouldn't be the only client a consultant has.

7. Will you teach us to do this work for ourselves and become self-sufficient? How long will this take?

One common trap in using a consultant is becoming dependent on him or her. From the consultant's perspective, this may simply be good business assuring future work for himself, herself or themselves. From your perspective, it may be little better than the status you had before you had the consultant come in.

By making training part of the consultant's job, you can limit the chances of a prolonged engagement. Establish a schedule within which the consultant can accomplish his or her goals. Assign a staff person to work closely in this process-and learn everything he or she can.

8. Have you written anything-published or not-that deals with issues like the ones this company faces?

Consultants love to write about their experiences and their theories. Sometimes this can be pretty rough reading, but it will usually help you understand how the consultant sees markets and business factors that may affect you. Also, management or technical literature can be a good place to look for consultants. While the latest management guru writing for the Harvard Business Review may be beyond your needs and means, you might be able to find useful experts in trade or regional newspapers and journals.

9. How do you charge for services? Do your fees include travel time and other miscellaneous charges or are those billed separately?

There's no set standard for paying consultants: Some work on a straight-fee basis, others work for a fee plus performance bonus, a few work on a contingency basis- tied to sales increases or cost reductions. As with paying any outside contractor, your concerns should be assuring a high quality of work and containing costs within a predetermined bud get. With consultants, focusing their use as specifically as possible will help accomplish both of these ends. Also, make it clear from the beginning what incidental expenses you're willing to pay and how you'll pay them. Consultants who've worked at or for large corporations may be used to expense accounts that you aren't. Be very clear about how much you're willing to spend on the whole project or series of projects. Insist that the consultant warn you-in writing-if the project won't be completed on time and within budget.

10. What kind of documentation will you give us when the project is completed? Who will own that documentation?

Keeping a paper trail of the work a consultant does for you accomplishes several ends-all of them good. First, if the consultation has worked well, this will usually give you some forms and tools that you can use to improve some part of your performance. Second, it allows you to keep a record of the analyses made of your company and the responses you've taken. This kind of "scrap book" can be a big help when dealing with future problems or other consultants. Third, it makes clear what the consultant did-and didn't do-while working for you. If any disputes should emerge over payment or ownership or confidentiality, you'll have some support. In general, all work (including spreadsheets, computer programs, mechanical devices or literature) a consultant does for you is your property.

Sometimes-especially in the cases of devices and literature-this becomes an issue. Make it clear from the beginning that you want to own everything that comes from the consultation.

About The Author

Jan B. King is the former President & CEO of Merritt Publishing, a top 50 woman-owned and run business in Los Angeles and the author of Business Plans to Game Plans: A Practical System for Turning Strategies into Action (John Wiley & Sons, 2004). She has helped hundreds of businesses with her book and her ebooks, The Do-It-Yourself Business Plan Workbook, and The Do-It-Yourself Game Plan Workbook. See www.janbking.com for more information.

You have permission to publish this article electronically or in print, free of charge, as long as the byline is included. A courtesy copy of your publication would be appreciated.

janbking0191@sbcglobal.net

---

Get More Impact From Your Annual Conference

How can you get more attention for your conference and... Read More

How To Jump Start Your Profits and Keep Your Profits Rolling

There are so many ways to jump start your prifits... Read More

How To Use W Edwards Deming

Human beings and the way they interact are extraordinarily Complex.... Read More

Rethinking Workplace Security: How the Rules Have Changed

The workplace has traditionally been a dangerous place. Very early... Read More

Creativity Management - The Value of Being Prolific

When asked his secret to success, the author Graham Green... Read More

Your Company Without Training - Any Questions?

Okay, be honest!Are you guilty of sticking in a few... Read More

Profits and Business Success - 5 Profit Traps to Watch Out For

The old saying 'You have to spend money to make... Read More

Must Project Managers Be Technically Savvy?

"Must Project Managers be technically savvy?" This topic always seems... Read More

The High, High Price of Distrust

A paper manufacturer with over 300 employees once announced that... Read More

Keys to Feeling Powerfull In An Uncertain World

Life has always been full of uncertainties. Over the last... Read More

Experiences of Management Coaching (Part 2)

In our experience, we have found that there are several... Read More

Are You Using the Right Form of Energy?

As we near the end of summer, here is a... Read More

The High Cost of Employee Turnover Among Project Managers

Imagine for a moment this scenario from a frustrated Senior... Read More

How to Enhance Quality in Your Business

Every business must strive to provide quality products and services... Read More

11 Strategies on How to Work in An Open Plan Environment

Many work environments now are open plan, with only a... Read More

Middle Managers Behaving Badly ? How To Stop This Damaging Your Results

More and more I hear and read about a looming... Read More

Keeping and Motivating the Best Employees

Keeping and Motivating the Best Employees ... Read More

Steps in Using the Critical Incident Technique

STEPS IN USING THE CRITICAL INCIDENT TECHNIQUE:1) The incident. Read,... Read More

Think Time... Its Now Or Never

I recently read an article published in the June, 2005... Read More

Your Blueprint For Business Success

Before you start your own business one of the first... Read More

Innovation Management ? forced into it!

Creativity can be defined as problem identification and idea generation... Read More

Business Innovation ? Organizational Culture

Creativity can be defined as problem identification and idea generation... Read More

Big Company Intelligence on a Small Company Budget

Information is the lifeblood of the economy. That's especially true... Read More

Think it Over

You can't solve a problem with the... Read More

How To Decrease Profits Without Really Trying

Hurting your sales efforts can be accomplished easily with the... Read More

Crisis Management Tips

The term crisis management has different connotations. In this article,... Read More

Why I always Keep my Promises

Integrity is very important to me, and I try hard... Read More

Dont Let Your Measurements Mislead You

Don't Let Your Measurements Mislead You ... Read More

Dont Get Side-Tracked By The Nay-Sayers

You, the Entrepreneur, are 'normally' a type-A individual. One who... Read More

Tales from the Corporate Frontlines: Creating a Culture of Empowerment

This article relates to the Culture & Climate competency, commonly... Read More

To Thine Own Self Be True--Its Better for Business: What Arthur Andersen Would Say to His Company

As a child, you probably heard, "to thine own self... Read More

The Ten Keys to Maximizing Employee Performance

1. Let people know what you expect. If people know... Read More

How Invisible Communication Barriers Kill Productivity

Many kinds of interferences or disturbances can confuse a message.... Read More