Management consultancy has changed. Once, consultants would arrive, do their stuff, produce a report, send in the invoice and depart - leaving the client to make what they could of the findings. It was an 'outside-in' approach. It led - even consultants now admit - to a fat market.
But the basic model today, after years of questioning the accountability of consultants, could be described as the opposite - an 'inside-out' approach.
Consultants have to work with management; they have to get their hands dirty to earn their keep. They may even be incentivised on results. 'We simply no longer get calls asking: "We need 10 people for this or that - can you supply them?"' says Jeff Thompson, head of the performance improvement consulting practice at PricewaterhouseCoopers (PwC). 'Calls now describe a problem and ask whether and in what ways we can help find a solution.'
This may be why 86% of clients said they were wholly or partly satisfied with the value provided by consultants, according to a new MCA/MT survey, Ensuring Sustainable Value from Consultants, sponsored by PwC. This is a surprisingly high figure, even allowing for the changes in consulting practice outlined above and one that suggests that in modern business, the needs of clients and consultants are much more closely aligned. However, deriving value from consultants requires insight. And several factors emerged from the research as being critical to making the best use of the client/ consultant relationship.
The first is clarity. It is important for clients to be clear about what they want to achieve. They must also have identified how a consultant can help them. Notice how the onus here is on clarity from the client; before even speaking to a consultant, it pays to have a firm idea of what you want them to deliver for you. An incoherent call for help will likely result in an incoherent consultancy experience. In fact, 72% of respondents to the survey who were satisfied with what consultants had done for them had developed a clear business case for the project in advance.
But having poorly defined goals is only one way in which clarity can be lost in a project. It also occurs when people are seconded to it. The problem here is that staff drafted in from other parts of the business don't always have a proper understanding of the consultant's role and so become frustrated by what is expected. Similarly, end users who may have little or no input into the project, but have to deal with the consequences, can suffer from a marked lack of confidence in consultants.
However, clarity about outcomes - where a company wants to be and in what timeframe - is different from clarity about how to get there. Clearly, the client may not be at all clear about how the goal is to be achieved - if they were, they wouldn't need to hire a consultant. 'When you are brought in, you can be asked to do one thing, but other things can come out of that,' explains Lisa Cann, director of C8 Consulting. 'Sometimes, the consultant's role is to dig around and identify other issues that need addressing if the objectives are to be met.' The important thing here is to recognise that the relationship between client and consultant is organic. Some things simply cannot be anticipated and will change with time.
The balance between clarity of outcomes and openness to change in the relationship is mirrored in another balance - that between consultants becoming part of a team and remaining outsiders. They must be close enough to the client to understand their drivers, but distant enough to be able to ask tough questions. 'Consultants need to get under the skin of the organisation but also to challenge it,' is how Cann puts it.
The second factor that makes for excellence in consulting is the ability to listen. Projects suffer when the external experts are all mouth and no ears. Consultants might have all the knowledge in the world, but unless they know precisely how to apply it, they can end up offering the wrong solution to the problem. It's an oft-heard complaint that consultants sell the solutions they know how to implement rather than the one that is right for your situation.
'What is required is listening and showing each other respect,' says Martin Smith of PA Consulting's manufacturing and industries practice management group. 'Companies obviously know their business very well and consultants know about best practice. When the two different skill-sets are working together, you get something that is very rich out of the combination.'
The best scenario is when the consultants have done a lot of listening before any intervention. Then they can not only hit the ground running but hit the ground running in the right direction. Three-quarters of satisfied clients spoken to in the MCA/MT survey said that their consultants knew what they were doing from the outset. The more consultants listened, the more satisfied was the client likely to be.
However, listening is a two-way process. Clients must be willing to listen to consultants too. Satisfied clients are four times as likely to believe their consultants have listened to them and taken their suggestions on board. They are also four times as likely to have invested time to ensure their consultants had all the information they were likely to need at the start of the project.
The third success factor identified is stakeholder buy-in. In fact, this is the area in which the difference between consultancy success and failure is greatest. Nearly all clients who were happy with their consultants thought communication had been good.
Nearly all clients who were not happy with their consultants thought communication had been poor. And stakeholder buy-in needs to be achieved at many levels, not just at the top. 'An ability to engage junior and middle-ranking staff in the client organisation is vital,' says Fiona Czerniawska, director of the Management Consultancies Association (MCA) think tank that conducted the research. 'Consulting firms talk a lot about building up C-level contacts.
These may be the people who can sign the cheques, but it is the people that the consultants work with day-to-day who have to be engaged, not pushed aside, if a project is to be a long-term success.'
Once again, this is the responsibility of both parties. Clearly, the client must take the initiative. But consultants must make an effort to communicate on a day-to-day basis too, especially with end users and those seconded to the project - that is, people to whom they might not expect to report.
Fourthly, best value is derived from consultants when both parties work in partnership. The most satisfied clients end up simply not distinguishing between their internal employees and their external consultants. 'I don't see them as consultants; I see them as part of my senior team' is the sentiment to aim for.
Another way of putting the point is to say that the consulting process should be transparent. 'Projects don't work when the consultants go off in a huddle together,' says Czerniawska. What is particularly interesting about the need to work in partnership, though, is that it appears to be much easier to do so when the consultancy concerned relates to 'people' projects than when it relates to 'process' projects. Given that the greatest proportion of consultancy engagements are primarily related to processes, this suggests that a sense of partnership can be hard to achieve. This is because process issues are much more likely to feel bureaucratic than people ones. The advice of consultants can then come to seem like divine fiat rather than hands-on collaboration.
The fifth factor follows from some of those already discussed. It is the need for the consultant to be flexible. The vast majority of clients who were happy with consultants saw their advisers rolling up their sleeves and being flexible in their ability to respond. Conversely, consultants who did not roll up sleeves but instead rolled out a prescribed programme, with little or no regard for its relevance or fit, were not seen to be adding value.
Thompson at PwC draws an analogy from the building trade. In the same way that nothing is more frustrating than the proverbial builder who replies in the negative to every request for a change of plans, the lesson from the research is that little irritates clients more than experts following to the letter a too-rigid methodology, regardless of what is happening around them in the client's business. 'Managing the change process and allowing changes to be made during the process are key parts of modern consulting,' Thompson argues.
Finally, consultants must focus on the benefits to individuals and not just to the organisation as a whole. And the individuals who derive benefit must not only be the top-level management who buy the consultancy but also the end users of the project. If users can see personal benefit, they are much more likely to be willing to take on the challenges any implementation presents.
The challenge here is that this requires a serious investment of time on the part of the consultants. 'We work with clients for long periods in order to implement,' says Martin Haynes, a delivery manager at Trinity Horne. 'You can build a relationship with the top of an organisation, but you need to be prepared to work with people at the bottom too. The reason it takes time is that implementation challenges them to think about their behaviour and attitudes.'
Further, individuals on the client's side must have a personal stake in a project for it to succeed. 'It is important that the client's people involved gain something personally out of the consulting project, perhaps better skills or promotion,' says Czerniawska. 'For all the talk about paying the consultants according to their performance, clients, too, need to be incentivised.'
So satisfied clients are 10 times more likely than dissatisfied ones to believe they had developed new skills or had access to new opportunities as a result of a consulting project. People are also more likely to have thought they had gained something from a 'people' project, presumably because the consultants were explicitly hired with such specialist skills.
'In many ways, a successful consultancy relationship is not rocket science,' concludes Thompson. After all, who likes to work with people who don't particularly like them, are not clear what's going on and cannot see the point?
SIX STEPS TO HAPPY CONSULTANCY HIRING
1. ACHIEVE CLARITY
Develop a clear business case for the project before you call in a consultant
The most appreciated consultants attend to their client's concerns, but advisers must be allowed to have all the information they need to do the job
3. ENSURE BUY-IN
It is vital to engage staff at all levels, not just the decision-makers.
Good communication among all the different stakeholders will optimise the consultancy experience
4. WORK IN PARTNERSHIP
Value flows when consultant and client are seen to be working together - although this can be tricky when the project is process-oriented rather than people-oriented
5. EXPECT FLEXIBILITY
The client should look for adaptability and freshness in a consultancy rather than the unthinking application of rigid methodologies
6. INSPIRE INDIVIDUALS
Those involved in the project must feel they, not just the organisation as a whole, have directly benefited
Copies of the full MCA/MT executive report, Ensuring Sustainable Value from Consultants, sponsored by PwC, are available free in pdf format from: firstname.lastname@example.org.