Posted: Aug. 15, 2016, 3:11 p.m.
This post, though titled "Do You Really Need a Consultant?" will focus on those times that we might think we need one and really we don’t.
Reason 1: We want to change just to be changing.
Let’s start with a story. Years ago one of my business partners was meeting with the Managing Director of a local manufacturing business (let’s call him Bob) who he knew well. Bob sat down with my partner and said, “I really need your help to change the organizational culture.” To which we asked “why?” as we like to do. His answer was full of platitudes and vague descriptions of how important culture is. The thing is from what we knew and what we got out of asking a few additional probing questions, the company that Bob worked for was really doing well. Sales were solid and increasing year to year, employees were engaged, turnover was low, profit margins were trending above industry standards. Most importantly we saw no reason to expect changes in the future.
My partner pointed this out and said “I am unclear what you want to accomplish. What benefit would an adjusted culture offer?” Bob finally admitted what was really driving his interest in a change initiative. He said, “listen, I have been part of this mastermind group for the last year and almost everyone there has these great stories about the major cultural change efforts they have undertaken and I feel like I am missing out.” Needless to say my partner took the time to point out how risk filled and resource heavy change initiatives were and got his friend to start to brag about his current organizational culture instead. Though this first story does speak to the power of executive coaches, it offers the first example of when you don’t need a consultant. We often think we need to change based on comparing ourselves to others, when in reality we should look internally to see if things are meeting our goals and expectations. Admittedly we can use industry comparison to set our expectations, but we should never do something simply because it is popular or “seems” like a good idea. We must take the time to assess our needs first and then determine solutions.
Reason 2: We really just need to fire someone(s).
Another story helps demonstrate reason two. I was asked to work with a small restaurant chain. They had 6 stores in 3 different cities. The owner had started the first one and still ran it and had GMs in each of the other locations. She called me to talk about one specifically that continually had problems. Sales were okay, but turnover was high and profit margins were low. She couldn’t figure it out. She kept meeting with the GM and the other managers, but nothing changed. When pushed she said, “Angela (the GM) has been a friend and worked for me for 15 years, so I know she is doing everything she can to make things work.” My guess is many of you reading this already know what the problem is…It was Angela. She was burned out and it turned out was not doing her job. At the end of the day it was much worse than we thought. She had been paying a boyfriend that wasn’t working the hours. She had a repair person that was “fixing” things that were not broken and sharing the “repair” cost with her, and more. But, this owner couldn’t see it. She didn’t need a consultant, not really. A shopper maybe, someone to really look at the books with a clear eye, definitely, but not a consultant. She ended up letting the manager go and working with one of the other staff members there and turned it around in less than a year.
Reason 3: We have the talent in house.
I met with the COO of an up and coming software company. She wanted to build a supervisor training program (something I love to do) and asked if I would be interested in working with them. I of course said I would love to look at the idea of doing that, but first I would need to take some time to assess what they needed and then bid it properly. First thing I discover is that they have some internal folks that already do training for their end users and also use this training for new employees to bring them up to speed on the software. Then in interviewing one of these trainers I find out that they have a person on staff that not only has done leadership training and development, but that person has a PhD in education and an MBA. More to the point they are hurt and angry that I am being considered at all. Long story short I was able to work with this person to develop a fantastic supervisor/leadership training that they ended up heading up, making staff and management happy with the result and saving thousands of dollars in external consulting fees. Moral of the story, make sure you don’t already have the skills in house.
Reason 4: The fix costs more than the benefit.
The squeaky wheel gets the grease. Most of us have heard this phrase, but there is an implication that we often miss. Just because something is squeaking does not mean it is the most important thing to fix. I had a manager once that every single day would tell me that we needed to market more. He insisted that if we put out more ads on the radio and in the newspaper that we would see more business. The problem is that these are not cheap solutions. Would we get more business if I spent thousands of dollars on traditional advertising? Probably, but there were two other things to think about. One, would we have an ROI that made the expense worth it? And two, were there other ways we could spend that same money that would work better. After much discussion, we spent that money on things like joining the Chamber and several other networking groups and sending that manager to all of the meetings. The result? A huge increase in event and party sales that far outweighed even what he proposed would be the ROI from the traditional advertising. Always look at the cost of the problem and the cost of the solution and make sure you are coming out ahead. Sometimes we can ignore a squeak that doesn’t detract from the quality and quantity of our output and our employee satisfaction.
Reason 5: You are the problem, are you willing to change?
This final problem can be the hardest to deal with as a consultant and as a client. One of the best stories my dad tells about being a consultant in Africa is the time he was carried out of the CEO’s office and placed outside the front door for pointing out the issue might be the CEO. I too have seen this, though with less lifting and carrying out. I recently worked with a company that had for years been a small family service company and then suddenly got a huge contract (for them). They struggled to adapt and externally seemed to. Internally however they were a mess, there was no structure. The family still ran it as a small company, but now it was a 50 million a year company with 500 employees. No one knew who to ask for what, or who was making the decisions. I sat down with the executive team and pointed out that the biggest issue was that if someone didn’t like the answer they got from dad they could go to the daughter and get a different answer. It was not sustainable and they knew it, but were reluctant to see that they were the cause. It was only after they lost some key employees and a substantial contract that they called me back in to break free of their own egos and face the needs of the organization.
So, when should you bring in an external consultant?
- You have a problem and you don’t know why or sometimes even what. This can be:
Relational outputs not meeting expectations
- Quality issues
- Turnover and satisfaction issues
- You have or can anticipate a problem that you are not currently equipped to handle
- You are willing to embrace change should it be called for, including letting people go or changing yourself
- You may have some internal resources, but need to either bolster or develop them
- The cost of addressing the issue does not outweigh the costs.