A Guide to Consulting

A BEGINNERS GUIDE TO CONSULTING “To become a consultant is a life long learning process. It’s about adaptability and flexibility and endless study. If you don’t have a sense of humor and the tenacity to stick with it then don’t do it – get a proper job!”- Anonymous Consultant Primer Guide I. What is a successful consultant? A. B. C. D. E. Abilities Traits Project management Time management Efficiency II. Getting started A. B. Determine your market Marketing III. Elements of the proposal A. B. How to communicate ideas Budgeting IV. Advertising and promotion A. B. C. D. Creating a marketing plan Marketing products and services Marketing tactics Promoting your business V. General tips VI. The most rewarding and most difficult aspects of consulting A. Perspectives from three different consultants What is a Successful Consultant? A consultant provides clients with advice and/or services. A consultant is an expert in the area that they are working in due to experience and training. According to Weiss (2003) a consultant is someone who provides value to clients through specialized expertise, content, behavior, skill, or other resources to improve the status quo in exchange for compensation. Consultants are often recruited when there is an unfamiliar issue or when people encounter a problem they are unable to solve on their own. A consultant can be brought in to identify a problem if the company is not experiencing the results that were expected. If the client is aware of a problem, but the cause is unknown, a consultant can be brought in. Consultants can also make suggestions on how to handle organizational problems and implement change to solve the problem. To be successful, consultants need to find their niche by offering clients a specific area of knowledge or talent. However, this knowledge or talent is not the only thing a consultant must possess. There are basic skills that all consultants should have in order to be effective. Consultants provide advice or services to people they may not be familiar with. In order to work with various people it is important that a consultant have good communication skills; oral communication, effective writing, and a clear presentation style. Personal Traits of Successful Consultants Getting Started in Consulting by Alan Weiss           Humor and Perspective Influence Confidence and Self-Esteem Fearlessness Rapid framing Value generation Intellect Active Listening Instantiation Responsiveness         Developing a Consulting Practice By Robert O. Metzger Empathy Energy Ethics Positive thinking Self-motivation Team player Self-fulfillment Mobility Essential for Successful Consulting Responses from Various Consultants              Business acumen Commercial flair Positive impact Communication Interpersonal Skills Knowledge of your chosen sector Credibility in your area Active listening Building strategic working relationships Meeting leadership Analysis Building trust Facilitating change         Developing a Consulting Practice By Robert O. Metzger Diagnostic ability Problem solving skills Specialized knowledge Listening skills Writing skills Presentation skills Marketing and selling abilities Business sense                  The Consultant’s Quick Start Guide by Elaine Beich Prospecting and Marketing Diagnosing clients needs Identifying mutual expectations Dealing with paper work Pricing projects Dealing with paperwork Analyzing business data Designing materials Solving problems Building relationships Communicating with others Writing proposals & reports Conducting training Facilitating meetings Coaching managers Knowledge of intervention models Knowledge of process The purpose of this guide is to inform individuals of the various issues associated with consulting. These issues should be taken into account when deciding what area of consulting to enter. Project Management (Randolph & Posner)  Set a clear project goal- Planning for a project begins by determining the end result. What is the goal when the project is completed?   Specific- The project goal should be well defined and clear. Anyone who is involved with the project should understand what you are trying to accomplish. Measurable- Every project goal should be measurable. If the goal is not measurable how can the project team check progress? Without measurable goals it cannot be clearly determined that things are moving in the right direction.   Agreed Upon- The project team and the client must agree that the end result will solve the problem or is desirable for the organization. Realistic- The goals of the project should be achievable given the resources, information, and time available. Consultants should not take on a project in an area they have no knowledge.   Time-framed- It must be clear how much time and how much money you have to accomplish the goals of the project. Determine if there is flexibility in the time or budget. Determine the project objectives- Project objectives focus on the details of accomplishing project goals. Indicates what specific people need to accomplish to reach project goals. It is important to remember how each objective contributes to the goal.  Establish checkpoints, activities, relationships, and time estimates- Establish checkpoints to mark the progress of the project. Identify the activities that will get the project done. Draw relationships between the various activities. Create time estimates to complete each activity. This will help to keep the project in a reasonable perspective.  Draw a picture of the project schedule- Graphically representing the project helps convey a clear message. A time line can be expressed within a bar chart. A flow chart will help communicate the relatedness of various activities.  Direct people individually and as a project team- Be aware of what each member of the project team contributes to the project. Make sure individuals are aware of their responsibilities along with the group as a whole.  Reinforce the commitment and excitement of the project team- Create challenging possibilities by providing the big picture and promoting the meaningfulness of their work. Inspire a shared vision within the project team. Increase the visibility of the teams efforts by providing visual feedback. Empower people to use their intelligence and natural drive. Be sure to thank and encourage team members often.  Keep everyone connected with the project informed- Make sure that you are communicating clearly with team members. Keep people posted of changes or problems. Make sure the listener knows why the message is important. Increase your listening skills, so that others can effectively communicate with you.  Build agreements that vitalize team members- Conflict within a project team indicates that the individuals care about the outcome. Conflict is something that should be managed, not eliminated. A certain level of conflict helps create the best possible outcome. The objective of negotiating is to reach an agreement that satisfies both parties.   Empower yourself and others on the project team- Help the project team find a greater sense of purpose and worth within the project. Encourage risk taking and creativity- Projects often require ingenuity to accomplish project goals. Encourage project team members to take a fresh perspective on a product or service. Build time for creativity into the time you budget in your proposal or contract. Five Ways to Work More Efficiently with Clients Gregg 1. Clarify details at the outset. This prevents time-devouring miscommunication and confusion later. Discuss specifically the purpose and scope of the assignment, the resources required, the time frame and budget, your responsibilities and the client's expectations. Confirm the results of this conversation in a memo to the client. For example, if you are brought on board to implement a new system, find out up front if you are also expected to coordinate employee training. 2. Identify the decision-makers and stakeholders. Know who "owns" the project on the client's side, and their position in the chain of command. If you are helping a fast-growth firm expand its accounting department, for example, you need to be able to communicate directly with the people who make final hiring decisions. 3. Analyze your client's culture. Understand your client's work style so that you can communicate effectively and integrate seamlessly with full-time staff. The time spent initially identifying the strengths of key employees will save considerable hours later on, particularly when helping a firm with a complex and critical undertaking, such as a merger or acquisition. 4. Manage meetings. Unnecessary or unfocused meetings can undermine time management efforts. To keep meetings on track, use a detailed agenda and stick to it. Specify an end time in advance and honor it. 5. Update clients regularly and solicit feedback. Make sure to have a primary contact with whom you can discuss questions and concerns. Give frequent progress reports so the client can provide additional direction. Actively solicit feedback - you will be able to quickly adjust your schedule when unforeseen problems arise. Best Time-Management Practices Gregg  Spend more time on top priorities. Create daily and weekly to-do lists and rank tasks and assignments in order of priority. Give the lion's share of time to those items deemed most important.  Focus your attention and energy. Once you start working on a specific project, become completely engaged. Shut out all distractions, including those in your own head (doubts, anxieties, irrelevant thoughts). Often, you will realize afterward that you did your best work in less time than you thought you needed.  Make full use of timesaving technology. The Internet is a revolutionary time-saver for conducting research of any kind, from learning about a company's business to getting up-tothe minute news to launching a job-search. E-commerce opportunities on the Internet can also be used to your advantage. For example, searching for, evaluating, testing, pricing and purchasing new financial software for a client's accounting department can be done online, saving hours of legwork. Use email more effectively. Keep outgoing messages concise a nd organize incoming mail into electronic file folders for easy retrieval and reference.  Make downtime productive. When stuck in traffic or commuting to a distant client site, use the opportunity to check voice mail or return phone calls. When a client engagement requires travel, request a laptop to bring along. You will not have to sacrifice productivity during airport delays or layovers.  Use shortcuts for routine, repetitious tasks. Use speed-dial to call clients and macros or templates to generate invoices. Order stamps by phone or on the Internet. Do not open unsolicited mail. Scan business, trade or client publications during lunch. The minutes saved can add up to hours in the course of a month.  Invest in planning tools. Personal planners and organizers can help plan your day and prioritize lists, keep track of contact names and numbers, manage your schedule, and more. If a handheld electronic organizer best suits your needs, choose one that will not require an inordinate amount of time to learn to use. You could lose more time than you gain.  Consider a staffing service. The administrative and marketing aspects of consulting can eat into time spent doing what you do best - consulting on senior-level finance and accounting initiatives. A staffing or consulting services firm can serve as your 'talent agent,' securing projects and handling the administrative burden.  Keep education and skills up-to-date. If you try to learn new software applications while on a project, you are heading for a time-management disaster. During slower periods or in between projects, cultivate a working knowledge of the software systems most commonly used by your clientele. Take online courses to update skills and learn new ones. You will save a great deal of your own time and theirs. Getting Started The following questions are things you should ask yourself before you get into consulting. These questions will help identify your specific goals for consulting. In identifying your specific goals you will be better able to choose a consulting firm that fits your personal goals, or develop an action plan for starting your own independent consulting firm. What is your target market?  Government  Large Corporations  Small businesses What size of the regional market are you targeting?  City  State  Country  International Do you want to target a specific type of business?  Sales/Merchandising  Factory  Restaurant/Food Service  Academia  Etc. Do you want to offer a specific service or product to organizations?  360 Feedback  Job Analysis/Performance Appraisal  Test Development/Administration  Survey Development/Administration  Etc. Once you have determined what market you want to focus on, research the needs and wants of that market. Identify services or products that address the wants and needs of the market. If you want to offer a specific service or product, then figure out what type of market would have greatest opportunity for success. The research you do on your target market will give you an edge when it comes time to advertise your services and create proposals for potential clients. Get acquainted with the buzzwords that are used, this helps when communicating with clients in the future. Advertising and Promotion Creating a marketing plan        Analyze the present by constantly conducting market research. Create a systematic approach to keeping client needs up to date. How are you perceived in the marketplace? Clarify your strategy for where your business is heading. Set measurable goals for the next six to twelve months. This allows you to determine if you are on track. Select marketing tactics to accomplish your goals. Identify various resources for marketing. Resources include, but are not limited to: money, professional contacts, and previous clients. Develop an annual marketing activity calendar. This helps to break marketing down into smaller, more manageable activities. Implement the marketing plan and maintain it, especially during busy times. It is important not to get so caught up in a large project that the marketing plan falls apart. When the large project is over there may not be a project waiting if you failed to continue marketing.  Monitor the results of you marketing plan and make adjustments as needed. Marketing products and services     Determine what products and services you will offer. Define critical products and services in terms of what clients want or need. Describe the strengths of the product or service along with what conditions it will reduce or eliminate. Marketing materials should include and explanation of who you are, your core services, your approach to providing services or products, and your areas of specialization. Promoting your business       Develop a seminar for your target market Author articles in journals, magazines, or management texts Author a popular book that can reach a large and diverse audience Give presentations and speeches at conferences Offer to assist organizations with minor activities for little or no cost Present a free seminar for the local Kiwanis or Rotary Club Elements of the Proposal A request for a proposal is when a potential client expresses a need for a specific service and gives consultants a chance to bid on the job. The proposal is the time that you need to differentiate yourself from your competition. When you prepare the budget of a proposal, budget for slightly more than you need. You don’t want to have to inform the client that the project will cost significantly more due to poor budgeting. Being the proposal with the lowest bid is not necessarily a good thing. The amount of money you charge is a projection of your expertise. If your budget is the lowest of all proposals submitted your capability may be perceived as low also. “I never lost a bid for a project because I asked for too much money.” –Independent Consultant. The table on the following page provides the basic elements contained within the content of a proposal. Basic Elements of a Proposal Cover Letter Include a cover letter with your proposal. The cover letter should be written on your company’s letterhead. This helps the client why the proposal was developed and who requested the proposal. The project title should appear with the client’s name and city. The cover page should also include your company name, address, and phone number. It should be easy for the client to contact you. This section describes your understanding of the organization and expresses the specific issues you plan to address. Incorporate the client’s terms and acronyms. Include titles and names of specific people you communicated with in order to personalize this section. This section is the focus of the proposal. It clearly states what you will do for the organization and what will be the deliverables at the end of the project. Organize this section in sequential steps whenever possible. Indicate who will be affected in the organization and how much time will be needed from each person. It is important that you provide the client with an idea of your unique approach, but do not tell them how you will implement the idea. In order to protect your ideas, tell the client what you will do but leave out specifics. Budgeting for project differs depending on whether you work as an independent consultant or within a large corporation. Determine whether you will charge for the amount of time you spend on a project or if you will charge a flat rate for each phase of the project. When working for multiple clients at the same time it is necessary to keep track of the hours you worked so you can justify it to the client. Provide a graphic display of what activities will occur and at what time. This helps organizations determine when time needs to be freed up for staff to assist the consultant. The timeline also gives the client an idea of when to expect the final product. When planning a project make sure you take the client’s vacation schedule and times of high volume into consideration when planning the timeline. If multiple people are working on a project include a brief description of each person. Include their expertise, experience, and their role in the project. Proposal Cover Page Project Background Project Description Project Budget Project Timelines Project Staffing General Tips         Create a good filing system. Completely date everything. Add copyrights to all original documents, processes, and products. Set up an initial meeting with the client to discuss the problem. This meeting should be faceto-face and free of charge. Make follow up with clients your top priority. Bill all completed work immediately. Send an invoice to the client within twenty-four hours of completing the project or a phase of the project. When working for smaller companies it may be necessary to request a retainer. A payment plan of 1/3 upfront, 1/3 midway through and 1/3 when the project is complete. Read what your clients read (New York Times, Wall Street Journal, Forbes, Business Week, Harvard Business Review, etc.) this will enable you to communicate more effectively. It will also allow you to stay current with issues that are coming up in the business world, allowing you to predict areas of need. Most Rewarding and Most Difficult Aspects of Consulting For every career there are positive and negative aspects of the job. The positive and negatives that are associated with consulting vary by what type of consulting you do and whether you are an independent consultant or you work for a consulting firm. The tables on the following page contain quotes from consultants about the rewards and difficulties of consulting. The responses come from a consultant from a large international consulting firm, a consultant from a smaller international consulting firm, and a consultant who does independent consulting in addition to a full time job. Each consultant offered a different perspective, which helps to show that consulting is a career that has many different forms. There is no one way to be a consultant, but there are certain things that are necessary to be successful. “When you start working as a consultant, you won't be working 100% on the work you love to do. Plan on 1/3 new business development, 1/3 administrative work, and 1/3 doing the real work. The more help you can get with the first two, the more time you will have for the last third.” (http://www.thiagi.com/email-consulting101-tips.html) Consulting opportunities are effected by the economy. When organizations have extra money, they can afford to hire consultants to solve problems or provide advice. However, when the economy is slow, organizations are less likely to spend money on outside services that do not directly contribute to profits. Due to this reliance on other organizations for business it is important to plan ahead. “Cash flow is everything when it comes to the long term survival of your business. If possible, save enough money to cover 4 - 6 months worth of your basic expenses and always keep refreshing that reserve after you find you have to dip into it.” (http://www.thiagi.com/email-consulting101-tips.html) Most Rewarding Thing About Consulting Corporation “Having a positive impact on the lives of our clients and helping them achieve their business objectives/strategies.” Small Business “When you are perceived as an expert in your field adding value to the customer.” Independent “In consulting you are able to examine different areas and do things that interest you. Consulting provides an excellent opportunity for applied research.” Most Difficult Aspect of Consulting Corporation “For me, traveling and being away from home.” Small Business “As an independent consultant going into a new account. The speed that you must learn the business language (departments, products, process, system names, etc.) and the three letter acronyms that are specific to that environment.” Independent “The cycle of feast or famine. If your only income is from consulting then it can be very scary when business slows down. This feast or famine forces consultants to market themselves more than they might want.” Resources Biech, E. (2001). The Consultant’s Quick Start Guide: An Action Plan for Your First Year in Business. Jossey-Bass/Pfeiffer. San Francisco, California. Braksick, L.W. & Smith, J.M. (2001). Marketing behaviorally based solutions. Handbook of Organizational Performance: Behavior Analysis and Management.347-365. Gregg, C. (2001). Time Management Tips for Consultants. http://finance.pro2net.com/x18954.xml Katcher, B. & Mead, J. (2002). Tips on Consulting. www.spconsultants.org/tips.htm Randolph, W.A. & Posner, B.Z. (1988). Effective Project Planning and Management: Getting the Job Done. Prentice Hall. New Jersey. Metzger, R.O. (1993). Developing a Consulting Practice. Sage Publications, Inc. Newbury Park, California. Tips for consulting. http://www.thiagi.com/email-consulting101-tips.html Weiss, A. (2000). Getting Started in Consulting. New York. Weiss, A. (2003). Mission Dollar Consulting: The Professional’s Guide to Growing a Practice. McGraw-Hill Companies: New York.