How To Choose A Business Consultant

For many business owners, choosing a consultant is almost like shooting in the dark.  According to a recent study, only 7% of businesses feel they know all the questions they should be asking when hiring a consultant.

The purpose of this article is to take the mystery out of selecting a business consultant and educate businesses on how to choose the best consultant for their business.

In one respect, the process of choosing a consultant isn’t any different from purchasing other business services. First, you must identify a list of possible alternatives, then you send out requests for quotation (RFQ’s,) and possibly requests for additional information: known in the construction industry as request for information (RFI’s.) Next — with the consultant — you need to target desired outcomes, define a scope of work, and agree on a project budget. Before negotiating a final agreement, remaining concerns on both sides are usually discussed, and the astute business owner will check references before selecting a consultant or consulting firm.

Because so much of the success of a consulting engagement depends on the “human element,” however, there are a handful of specific questions you should be asking the consultant during the selection process.

Consider the following six-(6) categories as a checklist you can use to make sure you have been thorough in your due diligence. Choose a scale of one-(1) to ten-(10) and total the points earned for each category to evaluate consultants for your business.

1.      Knowledge Competence: What is the consultant’s educational background and experience ? How well does the consultant — or consulting firm — know your industry and the specific problems you are trying to solve ? Another question to ask is how well they know your marketplace – i.e., the political, legal, economic & tax environment, competitive forces, etc. To learn more about the consultant’s education and experience, you should review the consultant’s LinkedIn page, resume and/or firm’s statement of qualifications.

2.      Technical Expertise: Some consultants are generalists, and some are specialists. Others can claim both general and specific knowledge. One question to ask is whether the consultant(s) possess any certifications ? “Certified Management Consultants,” for example, have been vetted for their understanding of consulting and have a track record of success; moreover, there are ethical standards to which they must adhere, as well as continuing education requirements they must fulfill.

3.      Process Compatibility: Questions to ask here include: What models and methodologies does the consultant or consultants use to implement change ? Does their process fit with your business ? and how intrusive will the process be on your business ?

4.      Methods of Knowledge Transfer: Methods of knowledge transfer refer not only to the human element (the consultant’s communication skills and how they interact with managers and employees, for example,) but also how practical and “hands on” the consultant will be to ensure project alignment and attainment ? Key questions to ask yourself include: what is the demeanor of the consultant and how is his or her chemistry with your management team ?

5.      Performance Assurance: Does the consultant have any kind of performance guarantee ? How do they follow up after the project ? … and do they have a track record of success in similar situations ?

6.      Character & Ethics: Last, what do their past clients (references) have to say about them ? Do they have past legal issues, BBB complaints or negative Internet reviews ?

Hiring the right consultant offers many benefits, including, the ability: (a) to solve business problems the business is unable to solve, (b) to introduce new ideas and industry best practices, (c) to be a catalyst for change — by circumventing organization dysfunctions, for example, (d) to improve employee morale, and (e) to get you where you want to be more quickly with respect to improved sales, cash flow, profits, quality, customer service, employee safety, more free time and better overall competitiveness in the marketplace.