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5 Steps to Take When Choosing a Consulting Firm

January 27, 2024

There are more than 900,000 consulting firms in the U.S. (nearly 2.5 million globally) offering business management, risk management, technology, and financial services consulting. Many offer myriad specialized services across a wide range of disciplines and industries as well. Consulting engagements can range from strategic advice to implementations of new processes and tooling, and workforce augmentations.

So how do you choose? How can you assess a consultancy’s fit for your business before you engage?

Don’t Shop “Solutions” 

The purpose of consulting is to offer objective insights, strategic recommendations, and practical assistance to help clients overcome obstacles, capitalize on opportunities, and enhance their overall performance. Consultants bring a fresh perspective and often [unfortunately not always] employ a systematic and analytical approach to assess the client's situation, identify areas for improvement, and develop tailored strategies and action plans.
— Vanessa Leikvoll, Leaders

A good consultant typically brings in-depth knowledge of your relevant industry, experience working with companies similarly situated to yours, and expertise in best practices (and the limiting realities) germane to the challenges you face. 

What is crucial here is that firstly, the challenges are rigorously assessed, and then, and only then, a systematic and analytical approach is taken to formulate a solution that is tailored to your business’ specific challenge(s). The solution and its approach should be cognizant of your resource constraints, operating models, infrastructure, company culture, and goals. Bear in mind that industry knowledge and “best practices” are generalizations. Your challenges are not. They are specific to your organization.

In other words, there is no pre-existing “solution” to buy. No one-size-fits-all. A pre-packaged product or service by definition presupposes what you need before any assessment and analysis. Avoid buying a “solution.” 

It would certainly be easier if there were a plug-and-play solution. That elusive “easy button.” Unfortunately, solving complex business challenges is never easy.

Choosing the Right Consultant 

You are faced with the dilemma of choosing the right consultant when neither you nor the prospective consultant really understand what is required until the assessment and analysis process is undertaken and validated. Given this reality, we propose that following these 5 steps will put your organization on a proper footing and set the foundation for a successful engagement. They will clarify what you need from the consultant, how you will work together, and help establish clear expectations and accountabilities. 

Step 1: Internal assessment

Best efforts are essential. Unfortunately, best efforts, people charging this way and that way without guidance of principles, can do a lot of damage. Think of the chaos that would come if everyone did his best, not knowing what to do.
— W. Edward Deming

First,  gather all the relevant stakeholders within the company and work to define the challenge(s) with actionable granularity. It is not enough to say, “We need to improve customer service.” This can mean any number of things: CSR training, improved access to customer data, process engineering, CRM tooling upgrades, adjustments to management strategy, or all of the above. This definitional work (or lacking the internal skill sets to excavate root causes) will help you discover the specific types of expertise you will need, if any. 

Second, you are now in a better position to determine if you need outside help. Carefully consider the skillsets required, resource bandwidth, and potential disruptions to the business if you take the work on yourself.

Step 2: Assessing consultants

Having a firmer understanding of the skills required to augment internal resources, you can target consultancies with notable strengths in relevant areas and begin focused discussions with those firms. 

Be mindful of certain behaviors evidenced by responses in those initial contacts. A good consultant retains a level of skepticism and won’t automatically embrace your assessment. Even if your analyses are spot on, validation or competing theories would be premature at this point. Be wary of phrases such as “this is straightforward,” or “we have a product/solution that will work.” An experienced (and honest) consultant knows nothing is straightforward. 

You want a consultant that asks A LOT of questions and challenges your assumptions. Don’t mistake this as rudeness or a tactic to make themselves look smart. It is a means to understand the current state and establish needed context (which is very smart).

Step 3: The tortoise or the hare

Tortoises can tell you more about the road than hares.
—Khalil Gibran

Ask the consulting firm how they work – procedures, methodologies, tactics, and strategies – will reveal much about the firm and its fit with your company’s culture. 

Some consultants like to jump into execution as quickly as possible. We suggest that this can lead to multiple challenges, including rework and scope changes leading to additional time and cost. You want a consultant who takes the time needed to understand your company’s culture, the relevant technologies, and critical processes: before any heavy lifting occurs. Though it may seem counterintuitive, this more thoughtful approach is faster and surer.

The first deliverable should be an in-depth assessment of the work required and a detailed roadmap that you agree to. The process and expected results should be detailed, documented, and measurable. Expectations should be set and clear to all.

Step 4: Team integration

How closely your team will work with the consulting team and how well that integration occurs will directly impact the efficacy of the project. It can be a project impediment or accelerator.

Some firms appoint a single point of contact (SPOC) who handles all communications between your company’s leadership and their teams. Some position this as the ultimate accountability: the “one throat to choke.” In reality, the SPOC is a bottleneck that leads to delays, errors, and potential misalignment which can become very costly. 

You will want to engage a firm that has multiple points of integration: someone in leadership coordinating with your leadership (the throat to choke), technical expert collaborating with technical expert, and so on. With the consulting team continually interacting with their internal counterparts, an agile and responsive execution becomes possible.

You will want to know that the consultancy has a team that is a good fit for your elected team. (Even if you don’t have expert resources on hand, you will want folks who can coordinate with the consultant(s) to ensure a high degree of alignment.

It would be ideal to meet with that consulting and team, or at least, obtain their CVs. (Some firms often don’t assign resources until after a deal is signed which strains early interactions as everyone sorts through who the players are, their roles, and responsibilities.)

Step 5: Post-implementation services

Once the changes have been implemented and the solution validated, you will want to ensure you are in a good position to maintain those changes. For example, If technical changes were made, then at a minimum you will want to know that design specifications and a maintenance window are in place. 

Both for the technical changes and any new processes or practices that are developed, you will want a firm experienced in coaching and effective knowledge-transfer protocols in place to properly train your internal resources. Critically, if new behaviors are required to leverage the new systems, you will want to see a plan in place to ensure those behaviors are maintained to sustain and optimize the new workflows.

Finally, keep in mind that you are not so much choosing the firm as choosing the individual consultant and team that will be performing the work. The size, ranking, or reputation of the firm as a whole is of much less importance. You are buying the capabilities of a specific consultant and or team, not the larger firm. That said, the availability of needed resources – especially when multiple skill sets are required – to complete the project effectively and efficiently is vitally important. 

Finding the right consulting firm to help you with your needs is tough, but we are confident that leveraging these 5 steps will increase your ability to find the right consultancy.