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WHEN TO USE OR NOT A BUSINESS CONSULTANT

Written by: MIchael Otto

Article Overview: What you should know about business-consultants before you decide if you should do-it-yourself, or hire a consulting firm.

WHEN TO USE OR NOT A BUSINESS CONSULTANT

When and why you should (or not)use a business consultant.

Most consulting engagements have three phases.

The first phase is the analysis. This is the identification of problems phase. It is the most important phase because it identifies what is wrong and why it is wrong (cause and effect).

Second is the recommendation phase or more business-advice. At this point consultants make recommendations for you to solve specific problems identified during the analysis phase.

The third phase is implementing recommendations made by the consultants.
Unfortunately, this phase is normally not part of the consulting process (unless they specialize in training and most of them don't).

Consultants can perform the analysis and make recommendations (give you business advice) but are not very effective implementers.

Most consultants are not trainers. Training requires a totally different set of skills most consultants do not possess. Also, most trainers are not consultants.
The implementation requires a great deal of time and hand holding.

A consulting project that takes 250 man-hours to identify and write recommendations will take at least another 250 man-hours to implement through training or/or workshops.
Even if the consultant is a qualified trainer and could implement the recommendations, it might not be cost effective and will diminish your return on the consulting investment.
It will be far more effective if your own people perform the training during the implementation phase of the project.
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Most companies use business consultants to help them with organizational, operational and financial problems, like sales, productivity, and profits. With a little effort on your part there is a good chance you will be able solve most of these problems without using a consultant
Your decision to bring in a consultant should be considered very carefully. In fact, if you are not prepared, the experience could turn into a waste of your time and money. This website will give you all the information you need to make an informed decision.

Any organizational, operational or financial issue you need to fix is just the effect of something else, the cause. It is the cause that needs to be identified, the effect you already know.

For example:
If sales are down (that is the effect).
The reason for poor sales is lack of sales controls or marketing (the cause).
If you fix the cause (improve marketing or setup better sales controls), the effects (poor sales) will take care of itself.
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The decision to hire a consultant is usually based on the business owner's lack of satisfaction with the company's performance.
The decision to hire a consultant will usually be made at an emotional level. In other words, you are not satisfied with something in your company and you want it fixed.
It is important to understand this process (why and how you would hire a consultant) because many business owners struggle with the decision to hire, or not to hire, a consultant.
When your needs and wants are not satisfied, you will decide to hire a consultant to fix it, at least that is your first (emotional) reaction.
The second (intellectual) reaction will be "I should be able to do this my self, why spend the money"?

Always go with your emotional reaction when you make a decision that affects your satisfaction (emotional) level.
This is important because the only reason for your business to be in existence is to satisfy your needs and wants.

When you should never use a consultant

Even though a consultant can be very beneficial to your business there are however several reasons/conditions why you would not benefit from the advise of a consultant.

They are:
A) If you have an unusually large ego
B) Or you can't take criticism
C) It is too difficult for you to accept changes
D) You are feeling guilty about being successful
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UNUSUALLY LARGE EGO:
Unfortunately, this is by far the biggest cause of business failures.
The vast majority of businesses who fail do so because of their owners' larger then life ego.
If you are a "know it all" or "can't tell you anything" person, you have a better than average chance of failure, it is just a question of when.
Even if you really know it all, you still need people and nobody likes a know it all. In time, you will alienate your employees, resulting in high turnover.
When you alienate subordinates and reduce them to yes-sayers to feed your ego, or mindless followers, which will make it difficult if not impossible to build a strong organization.
If you are a person with a larger than life ego, you will not benefit from the advice of a consultant because you will reject the advice subconsciously but rationalize the rejection consciously.

In other words you will sabotage what the consultant is recommending and find a way to blame the consultant for it.

Here is what you can do to deal with an unusually large ego.
A large ego is the effect; the cause is often well hidden and defended in you subconscious.
To deal with a large ego you must first acknowledge that it is a problem. Unfortunately this not an easy task because most people with a large ego don't know it and therefore can't acknowledge that there is a problem.

Ego, by definition means the self, the part of mind that react to reality and has a sense of individuality, self esteem.

An ego-trip is an activity undertaken to boost one's own self-esteem or feeling.
A person with an unusually large ego is constantly on an ego-trip to boost his/her self-esteem. The self-esteem of that person is week and needs constant boosting.
The cause of week self-esteem is often complicated and its identification requires professional intervention, which is beyond the scope of this report.
The most effective way to deal with this problem is by first acknowledging that it is a problem and second before you make a decision ask yourself why you are making the decision. Is it to make yourself feel good, boost your ego (self-esteem), or is it a sound decision that will benefit the company. This will not cure you of the problem you have with low self-esteem, but it will make life a lot easier for your employees.
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CAN'T TAKE CRITICISM:

The second biggest cause of business failures is a business owner's inability to deal with criticism.
When you engage a consultant, he/she will criticize what you have done or should have done. If you can't deal with the criticism the consulting engagement will be over very fast and you would have wasted your time and money.

A person who can't accept criticism will insist on having it his/her way, regardless of the consequences; this person must be right at any cost.
Business owners with that attitude will seldom prosper.
When you discourage independent thinking and a free exchange of ideas you stifle your company's progress and ability to change with the forever-changing times.

Business advice:
What you can do about dealing with criticism and why accepting criticism is so important.
Criticism is finding fault. Finding fault implies you are doing something wrong. Doing something wrong simply means it is not working the way it should or could.
Finding fault is part of the cause and effect identification process used by consultants/analysts during the analysis or survey/analysis process of your business.
Most likely, you already know the effect (problems identified) in you company that is why you are thinking about hiring a consultant in the first place.
The cause of the effect might not be so obvious to you. It is not so obvious to you because the cause is more often than not rooted in you, the owner of the business.
Regardless of the problems (effects) you have in your business, the cause can almost always be traced to you, the owner of the company.
How is that possible? Everything that goes on in your company is your responsibility. You own the business, you get to keep the profits, you fund the losses and you must take ownership of all its problems.

So, if you can't accept criticism you undermine your own effectiveness as a leader/manager/owner.
When sales are down, productivity is low and profits are not maximized, these are the effects. The cause is your inability to effectively deal with the issues (as pointed out to you through criticism) that cause the sales, productivity and profit problems.
When you take ownership of your company's problems, which simply means you never blame anything or anybody for them, you will not only be able to accept criticism, you will welcome it because it is the only way you can affect lasting and meaningful changes.
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TOO DIFFICULT TO MAKE CHANGES:

Some owners have a very difficult time making changes because they are so set in their ways that every change is perceived as a threat to their way of life, or their way of doing business.
This often happens to very successful business owners who get on in years. The older they get the more difficult it is for them to except changes. When this is recognized and accepted by the owner, the best cause of action is for him/her to step down or even sell the company, before the business starts to deteriorate.

A consultant can only be effective if the owner acknowledges that he/she is unable to except changes. Unfortunately, this is seldom the case and many good companies are lost due to this problem.

What you can do about dealing with change.
Change, in this context, simply means making or becoming different, or difference from previous state.
Change is often perceived as a threat because it will be different from what we know and are familiar with.
For a business owner who gets on in years this takes on a new, often threatening, meaning.
After a long and successful career in business, you could view change as a potential for failure. The erroneous perception is that anything that is done different from the way it was done in the past is bound to be a failure. It is bound to be a failure because the way it was done in the past was successful.

Most of the time there is a certain denial involved, especially if there are some serious issues involved. Denial is easily recognized when the owner of a company starts to blame others for the company's state of affairs and does not take ownership of the company's declining condition.
This is very difficult to deal with because it becomes personal. The owner's perception is it is not the business that is failing; it is the owner of the company that is failing.
When you personalize failure, it makes it almost impossible to deal with. It is impossible because you now try to protect yourself and go through any length to find blame for "your" failure.
Again, unless you take ownership of the problem (failure) you will not be able to deal with any change that might be recommended by a consultant.
Remember though, just because your business is failing, that does not mean you have failed. You only have failed if you refuse to accept the condition and refuse to do something about it.
The entire world is changing at an ever-increasing pace. If your company does not change with the rest of the world, your company will become obsolete and eventually fail.
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FEELING GUILTY ABOUT BEING SUCCESSFUL:

This is a common problem with second or third generation business owners.
The son/daughter feels guilty about growing the business out of respect for their father who founded the company (after all this is still dads company, even though they (son or daughter) own it 100%). They don't want to be "too successful" because dad might not approve of the changes required to take the company to the next level.
Unfortunately, this feeling guilty is mostly at the subconscious level, which makes it very difficult to deal with.

Most consultants are unable to effectively deal with this problem and the engagement will go nowhere fast.

What you can do when you feel guilty about being successful.
In this context, success means a favorable outcome, or accomplishment of what was aimed at. You are successful if you accomplish what you aim at.
The guilt starts to manifest itself when you take over the company and still think of it as Dad's company. For you this will always be Dad's company and you simply run it for him.
There is however a good chance you might not be aware of this guilt feeling, and when you hesitate making a decision, like buying a very expensive piece of equipment or even a new building to move the company; you think of it as being respectful to your Dad (or your Dad's memory), when in reality you feel guilty being more successful than your Dad.
What you can do about feeling guilty being successful.
The most effective way of dealing with guilt (the feeling of uneasiness) is by confronting the feeling head-on.

When you start feeling guilty or uneasy about making a certain decision, stop what you are doing and acknowledge what you are feeling.
Yes, put off the decision and logically identify the reasons for the decision and ask yourself why is this making me feel uneasy. If there is no logical answer to the cause of the uneasy feeling than the cause of the uneasiness is emotional and should be ignored.
For the most part decisions in business should not be made at an emotional level; there must always be sound, logical reason why the decision was made (even though sometimes it does not appear that way).

You should not engage a consultant if you suspect you might feel guilty about being successful because the consultant will not be able to deal with it and there is a good chance you will not follow the consultant's recommendations. In fact, you will find fault with most of the recommendations and waste your time and money.
Deal with the guilt complex first before you engage a consultant.

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Article Tags: analysis phase, business advice, business consultant, business consultants, cause and effect, consulting project, engagements, good chance, implementation phase, man hours, profits, sales productivity, trainers training



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