Category Archives for "Consultancy Services"

What’s the Difference Between a Consultant and a Contractor?

I was having lunch with friends at the weekend – as it was a sunny Sunday afternoon, we were dining al fresco! – and invariably the conversation turned to our businesses and careers.

As I talked about what I’ve done this year and what’s still on the horizon, a question came up which gave me the idea for this post.

“What’s the difference between a Consultant and a Contractor?” my friend asked. “Aren’t they one and the same?”

And that got me wondering how many people out there in the marketplace share that opinion.

Having worked in both capacities, I can confirm that there are differences in expectations once in a business

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On the surface, the terms and roles may appear interchangeable. But having worked in both capacities, I can confirm that there are differences not just in the roles, but in terms of expectations once engaged in a business.

I’ve listed four of those differences below:

Influence

A consultant is expected to routinely engage with, influence and provide a steer to senior management regarding their project, and the business as a whole. While a contractor may also wield some influence, strategic decisions tend to be are made without their involvement. Decisions are cascaded for information and implementation (whereas the consultant plays a key role in shaping those decisions). There is less flexibility for the contractor, as the client pre-determines the scope of the project and the boundaries of their role, which limits the ability to influence the project or decisions taken.

Expertise

Consultants tend to possess a level of skill, expertise and experience that does not exist in the client’s business, from which the client benefits for the duration of the engagement. In general, those specialist skills, experience and intellectual property come at a premium, when compared to the investment required to engage a contractor.

Resource Backfill

Contractors are typically brought in to perform a very specific role on a project or programme, for a set period of time. Contracts usually run for a minimum of three or six months with the possibility of extension afterwards, depending on what remains to be done on the project. Contractors serve as a backfill for permanent resources, and are based at the client’s location. Consultancy engagements tend to be shorter. It is not uncommon to have a consultant on-site to perform specific tasks – such as a review, workshop or an implementation – for a set number of days in the week or month. With office and desk space being in high demand, it has become more common for consultants to work remotely, and just go on-site when face-to-face meetings are needed.

Independence and Objectivity

In a previous post, I highlighted this as a key asset of a consultant, and it's worth doing so again. Particularly in scenarios where it is crucial to the success of the client’s business, consultants are better equipped to go into a business, and give objective recommendations on how to improve. While such reviews and recommendations can form part of a contractor’s role, it is more challenging to do this effectively if they do align with the interests of their department or boss.

As always, there can be exceptions to these “rules”, and it’s not to say that consultants cannot work as contractors when the occasion presents itself. Hopefully this helps clarify the nuances between these two roles. It could make a difference the next time you decide to recruit resources to support your business goals.

So many highlighters, so little time...

5 Assets an External Consultant Can Bring to Your Business

“What’s s/he got that we haven’t?”

This thought might have popped into your mind, if you work in a department or organisation where the need for a consultant’s services has come up.

Staff – and even senior management – can sometimes feel slighted, redundant and under-appreciated when news of a consultant’s impending arrival breaks. There can even be a real fear that employers consider internal resource to be dispensable.

However, viewing external resource as a threat is a common mistake, and one of the first things a good consultant does is to allay such concerns.

Apart from the fact that s/he brings certain unique assets into a client’s business when engaged, one useful way a consultant can douse suspicion and build relationships is to highlight that success cannot be achieved without those things intrinsically possessed by internal teams: knowledge of the internal company landscape, and relationships with stakeholders and experience.

Internal and external resources both have their purpose, and are far more complementary than you might realise.

Staff can feel under-appreciated - and even slighted - when news of a consultant's arrival breaks!

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So, what are the five unique assets an external consultant can bring to your business?

A Fresh Voice

It can be invaluable to your project outcome to have someone new with professional authority, who is not beholden to stakeholders or legacy systems. That freshness is often needed to effect significant change and achieve different results; it could be just what your business needs to make the jump from good to great!​

Expertise

A consultant often has skills that may not exist in your business. For instance, running a successful accountancy practice does not necessarily mean you or your team are equipped to identify redundancies in your existing processes, and then re-engineer them for better results. A specialised skill set is required to achieve the results you want, and it is well worth sourcing those skills externally and bringing them into your business, for a time.

A Different Perspective

In scenarios where the skills do exist within your business, you still can’t underestimate the value of bringing in someone free of the company history and preconceptions; someone who does not have any allegiance to "how we've always done it". Only then can you expect to reap the rewards of creativity uninhibited by such constraints, and benefit from ideas and solutions unrestrained by company culture and tradition.

Objectivity

A huge benefit of engaging a consultant is that s/he can be neutral. With no obvious skin in the game (beyond getting paid!), a consultant is best placed to review your business with impartiality, recommend relevant solutions and implement them, regardless of departmental or company politics.

Best Industry Practices

By virtue of their mobility and as a way of ensuring they remain in demand, you will find that consultants are obliged to keep abreast of best practices and changing trends. While your internal teams cannot always prioritise professional development, this is something consultants must do continuously to stay competitive! You can ensure your business benefits from this, by availing yourself of the services of a consultant.

These five assets could well make the difference between the success and failure of your next initiative.

I Don’t Need a Consultant in my Business, Do I?

What do you think of when you hear the word “consultant”?

Does it conjure up images of suits, running around an office putting together flashy PowerPoint presentations that run into an unconscionable number of slides? Spotty associates re-gurgitating information you’ve given them, unable to produce anything truly original?

That’s certainly the stereotype!

Needless to say, while this has been the experience of many, it hardly does justice to the true expertise the majority of consultants have.

Before I address the question in the post title, why don’t I tell you who I consider myself to be as a consultant?

I see myself as an independent expert with a specific set of skills, which I put to good use on behalf of my clients. In my case, those skills relate to business analysis and efficient change management, and my use of those skills has a valuable impact on my clients’ organisations, and helps them achieve their goals in a variety of ways.

Those ways usually involve one, or a combination, of the following: identifying opportunities to grow and improve their businesses; making relevant recommendations with respect to those opportunities; creating new business processes or re-engineering existing ones; modelling the business’s operations, either with a view to making them more efficient or assessing how incoming changes of any kind could have an impact; facilitating the smooth implementation of new projects, systems or ways of working; to name a few.

So who are consultants, really, and what do they bring to the party?

In his book The Management Consultant: Mastering The Art of Consultancy, business adviser Richard Newton defines a consultant as an independent advisor who adds value by helping managers identify and achieve beneficial change appropriate to their situation. I won’t attempt to de-construct it in its entirety, but the definition highlights a number of qualities you may find useful in your business at one point or another.

Independence

Never underestimate the value of a perspective which comes from an external and independent source, particularly when you need to address and resolve existing issues within your business. It’s natural for you and your team to become engrossed in running your business, but being that involved is also a weakness when it comes to having the objectivity to diagnose problems and finding solutions required to solve them.

Adds Value

The main reason to bring in a consultant is so they can add value. As part of agreeing terms upfront, you as the client may decide that the value be measured in monetary terms (e.g. additional sales of £2.5m); as a percentage (e.g. a 10% uplift in leads generated); or an outcome (e.g. new reporting system implemented and embedded by 31st December at a cost of £500,000; or a feasibility study delivered by a certain date).

Beneficial Change

It stands to reason that not all change is beneficial. The consultant’s role here is to, by virtue of his / her independence, objectivity and skill, ensure that any projects proposed or changes to be made in a particular area, will have actual benefit to the client’s business. Some businesses fall into a cycle of continually changing things; a consultant can help caution and point out the futility of a particular approach or initiative.

Still think you don't need a consultant in your business? These are just a few reasons why you might want to re-consider.