7 reasons to hire a consultantResource planning
The hiring of consultants is sometimes controversial. Are you a large company, an SME or a VSE? Or a start-up? You've come to the right place. And you are probably asking yourself these questions:
- Why should consultants know the business better than we do?
- How can they deliver value in just a few weeks?
You're wondering if hiring consultants will help your company, right? Well, studies over the past decade have proven that management consultants improve a company's performance. We will look at the World Bank and Stanford study from 2012 later. Note also that consulting firms have embraced the digital revolution and reinvented themselves. Their consultants are just waiting for a call from you!
Do you face these problems?
- You do not have time to carry out certain tasks or assignments in your company
- You don't have the resources
- Your employees do not have the required expertise and you cannot train them (for various reasons)
You surely need a consultant! But what can he bring to you?
Advantage 1: Indispensable help
You need this consultant. Nobody in your company can accomplish the mission you have in mind. It could be a lack of time or skills. Or, you do not have the good resources. The consultant can take care of the tasks which are heavy for you and your collaborators. This will lighten their load and yours, your employees will have less pressure on their shoulders.
Advantage 2: Expertise
Indeed, the consultant represents a certain expertise in one or several fields. He has the experience, the knowledge and the adapted capacities to accomplish what you need. The consultant also has the advantage to know well your competitors, having certainly worked with them before. He also has a good vision of the new market trends of your business. This person will therefore be able to provide you with good advice and guide you towards an efficient and innovative strategy, whatever the purpose of the mission. An ERP software is an indispensable project management tool that can help you find the consultant who will have the appropriate expertise for your missions.
Advantage 3: New solutions from an external perspective
The consultant's viewpoint - in addition to being experienced - is external to your company and therefore much more objective. The consultant has no personal interest and can remain impartial in his decisions. He will bring you another perspective and will help you achieve your goals with an approach you might not have thought of.
Advantage 4: You will save money!
A consultant can be expensive. But it remains a good investment for the company in spite of everything. First of all, you will not have as many costs as if you were to hire employees with these skills (overhead, material costs, vacations, insurance, etc.).
Secondly, the consultant is very efficient and can complete an assignment quickly. You will only have to pay him for a limited amount of time. You will save time on these tasks, as training employees can take time. However, you can consider hiring a consultant to train them on a long-term basis if you wish.
Finally, you may be eligible for state aid to co-finance the hiring of a consultant. More information here.
How do you demonstrate with facts and figures that a consultancy project delivers the expected value?
This is not always obvious. An experiment conducted by a Stanford professor for a World Bank study in 2012 provides some interesting findings. The aim of the study was to answer the following question:
- Can management practices explain differences in productivity, especially in countries where the performance gap is particularly large?
To investigate, the Stanford team organised a field experiment.
Medium-sized Indian textile companies were selected. They were offered a free 5-month management consulting project with Accenture to change their factory processes. The results were compared to a set of similar Indian companies that did not change their factory processes.
->The results are indisputable: companies that have followed the consultants' recommendations have improved their productivity by 10%. But also product quality and stock management. They managed to speed up production.
Is it only in India, you may ask? Well, the same professor had worked on a similar study with two LSE researchers and had collected data from around the world. The results were similar.
How can management consultants remain relevant in such a fast-changing world?
Let's look in more detail at the four main advisory functions of information, expertise, insight and execution. It is very clear that management consulting firms have taken radical steps to maintain their competitive edge.
Let's look at each of these functions and understand how consultancies are adapting to each of them:
- All the expertise that Accenture or other consultancies bring to their clients comes from the vast amount of data they have collected over the thousands of projects they have carried out.
- Today, access to large volumes of data has become much easier. A single consulting firm's historical data is less valuable. How do consultants reinvent themselves to remain the information gurus they once were?
- Many consultancies have set up in-house data science teams to take advantage of the wealth of data available.
- McKinsey recruits experienced data engineers. They support the teams in the field.
- BCG has set up a BCG Gamma data science team. Because even though searching for data has become much easier, it is now difficult to compute it intelligently in order to provide the right recommendations.
- Most consulting firms prefer to hire generalists rather than experts. In particular, the larger consultancies hire MBAs who may work on a supply chain project one month, and a pricing project the next.
- However, they have developed an extensive network of experts who join the team whenever a project requires it. Leveraging this network is very powerful in providing better information to client companies.
- Every consultancy firm should strive to expand its network of independent consultants.
- There is always a hope of financial return when a company hires consultants. The information provided by consultants is expected to generate significant or net improvements.
- Increasing shareholder value has always justified the high project fees charged by consulting firms. BCG's famous Growth Sharing Matrix was called the "$1 million framework". It provided such useful information that it justified a $1 million fee for such a project.
- With the growing number of strategy books and the rise of business schools, classical strategic analysis has become more accessible.
- But the most important information from consultancies is now focused on how they see the industry changing and what companies should do to increase their competitive advantage rather than simply providing a strategic framework.
- This is an area in which consulting firms began to adapt long ago. Consultants have always offered to help implement the strategy they have defined.
- But the gap between insight and execution is greater now than it was a few decades ago. Strategy execution has become increasingly technical. And the world is becoming more and more digital.
- For example: if the strategy recommends "developing an e-commerce website and increasing search engine optimisation (SEO)". Or to "create a cross-platform analytics tool to predict customer demand". The client company may not have adequate internal resources. Nor the resources to execute this strategy.
- This is where good consultancy firms can help. Only if they have the resources in-house or in partnership with the right experts.
A consultant is flexible, he adapts and responds to the needs of his clients. He works quickly and efficiently and will be a real added value for your company. What matters to him: your satisfaction. If the collaboration between you is correct and fluid, you have the advantage to have this consultant in reserve for other missions.
With a tool from resource planning, you can collaborate with them even better, and integrate them into your team. The project management tool will allow you to successfully manage your subcontractors and track performance indicators in real time.
To learn more about the Stafiz platform, request a demo.
Other articles you may be interested in