The presence of consultants in your organization is a powerful indicator of your strength or weakness as a leader.
It’s basically impossible to move through life without using a consultant. From the haircut you get to the type of shoes you buy to the grand strategy for your organization, chances are you have tapped knowledge outside your own head in order to inject perspective, organize choices and expedite success.
But, in the business world, the presence of consulting talent in an organization provides an interesting barometer on the organization itself.
The “right” consulting model
Transient talent is a useful thing for both efficiency and effectiveness. Even in the most autonomous leadership cultures, adopting temporary talent can be a make or break proposition.
Think about the merchant shipping industry. The captain of a ship is exactly that–the absolute authority at sea.
Yet, captains readily relinquish their authority to harbor pilots every day in every part of the world. The harbor pilot is a consultant of a specific kind: One who has
very specific knowledge useful in a very specific circumstance during the life of the ship. The harbor pilot is far more versed in the navigation of his specific harbor than any oceangoing captain could be.
His experience allows for safer navigation of the port regardless of conditions that might not show up on a chart or radar. And, while the captain maintains command of the ship, he or she smartly relinquishes control to the pilot as a matter of course (or, in many places, law).
Thus, the captain brings a pilot aboard to ensure effective navigation with superior knowledge and talent; but not to replace his own command or the need for talented crew members at all times. The pilot boards incoming ships as they approach the port and leaves outgoing ships as they leave.
He’s a consultant.
Such use of transient talent is the “right” model of management consulting: Specific talent applied judiciously and precisely.
But, you and I both know that isn’t always the reason or approach to retaining consultants. The way consulting talent is engaged–and the objectives for engaging it–says a lot about the executive engaging the consultant.
The interpretation is made by the organization–and that matters.
8 things your consultants say about you without using words…
First, The Good. To your organization, effective use of outside talent signals some pretty cool things; such as:
- You are seeking the right knowledge at the right time: Engaging consultants is sometimes an admission that you and your organization can’t possibly know it all. So, you hire consultants who bring sources of knowledge to renew your own.
- Your recognize that time is of the essence: You know that without augmentation, your existing staff may not have the bandwidth or tools and approaches to managed a rapidly paced project. So, you bring on management talent in a bounded manner to get “over the hump.” There’s no time to waste.
- You care about developing your organization: You believe that development matters. You recognize that your team and organization can benefit from seeing new ways of doing things. So, you provide outside support to them as a means of developing them along in their careers. They get to see by doing alongside those who have been there and done that.
- You are good at managing SG&A expense: Just as it would be impractical for every oceangoing captain to learn the intricacies of every possible port he or she will visit, no organization needs to staff against every contingency. Hiring talented consultants during peak times or against peak needs shows that you value great talent, but also solid bottom line performance. You are willing to pay a premium in the moment; but are good at getting lean and mean without having to fire people.
The consultants in your midst may say these things about you; and I hope they do.
However, there’s just as much a chance that consultants represent some brokenness around you…
Here’s the bad, along with a little more narrative on some ways to sniff it out.
Done inartfully, engaging consultants can telegraph to your organization that:
- You lack confidence: You lack confidence in your professional capability. You lack vision. The desire for “more study” and slow playing–a result of vacillating indecisiveness–is sometimes an inefficiency that consultants thrive in. Worse yet, your organization may get the sense that you require the ego-stroking presence of high profile consultants in order to make it through your day. Finally, there’s the potential signal that you lack confidence in existing staff. Consultants can feed off of a lack of confidence in very dangerous ways. If the last several consulting engagements you contracted basically confirmed what you already knew, then take a hint. If your trusted consultant (or any corporate confidant, really) spends more time massaging you than working the problem, you have a further hint that your confidence is being played.
- You lack action orientation: Bringing in a consulting team to analyze the un-analyzeable in the name of seeking cover with your senior management and board is only sometimes okay. If you are in a position to “bet the company” then taking a deep breath and seeking a second opinion is fine; but you’d better let the organization know you are choosing to over-study the situation; because risk averse navel gazing is contagious. How many times do you hire a specific consultant just because they are the one your boss or the board will listen to? To a degree that’s just good politics, but sometimes it’s politics spelled C.Y.A.
- Your talent strategy is off: It goes without saying that if you continuously engage outsiders at an arms-length premium to do recurring, especially generalist work; then you are probably missing an opportunity to upgrade your own talent base and save money to boot. When outsiders get all the sweet gigs, your inside talent base gets grumpy. Keep that in mind next time you engage a consultant to do work that could be a stretch for your insiders. Also, watch out for instances where you constantly re-engage “retired” employees you haven’t been able to back-fill. It may be an indicator that your talent strategy is bumbling.
- You have a bad place to work: This is the bottom of the barrel. You have the Las Vegas of workplaces. People may visit and try to get rich, but nobody really wants to live there because of its false front and seedy underside. How many times do you attempt to hire the consultant but get rebuffed? How many times have outsiders with a good taste of the inside of your organization voluntarily re-upped as a full time employee. Worse yet, how many of your consultants have recommended (non desperate) people to come work for you without collecting a search fee? If the answer to these questions is “few or none,” your consultants may be feeding off of an awful company environment. You might have an organization that is a “nice place to visit, but you wouldn’t want to work there.”
So, there you have it…8 things that consultants may be signaling to your organization. The good is good. The bad is ugly.
I recommend the good.
A parting thought…
As someone who has scoped, negotiated, and managed many millions of dollars worth of consulting projects and engaged consultants and advisors for millions more, I clearly believe that management consultants can provide exemplary value as hired guns aimed at specific, impact-oriented targets.
It just requires a high professional standard on both sides of the engagement.
It’s important to know what your consultant may be saying about you, if only through the words of the observers in your organization.
Watch out for the bad stuff…