In the Fortune 500, Big Four business consultants are often brought in with relatively little thought given to cost. Pricing for Big Four consulting engagements is more an exercise in organizational psychology than an actual representation of value. The significant exploration of applying artificial intelligence to conduct analytical functions traditionally performed by business consultants is a testament to this dynamic. Starting salary for a Harvard trained business consultant straight out of school is $175,800.
But for mid-market companies (say, in the $25M to $500M range), the stakes are higher. Owners and leaders need to know they’re getting value for money. They still need strong advice from external experts, but the budget is less abstract—it’s real money. Sometimes even family money. So if you represent a mid-market company shopping for business consulting support, here are six things to keep in mind that can help identify strong, value-added consulting partners:
1. Look for specialized sector expertise
Back in the day, the consulting game was all about talent arbitrage. Bring in bright, 20-year-old experts who spend their whole day problem solving and let organizations access their skill set on a pay-by-the-drink basis. But these days, access to skills alone is not enough. Mid-market organizations these days are more dynamic, with more social capital and access to talent. They no longer want to pay for someone, no matter how skilled, to scramble to learn their industry. Seek business consultants who can bring existing sector knowledge to the game, and duck out of paying for the process of learning on your dime.
2. Ask about metrics when hearing success stories
Every good consultant has success stories. When you’re experiencing them, ask how they specifically moved the needle with Key Performance Indicators. Then ask for references you can reach out to, confirming key information. It’s a simple and obvious way to get past feel-good fluff to find out how, exactly, they’ve helped past clients.
3. Insist on engaging the A-team throughout
Another way to ensure value is to clarify up front who, exactly, you’ll be working with throughout the engagement. Sometimes consultancies parade a big-gun pitch team in front of clients to win your business. Then, when you actually come on board, they assign a team of consultants with less experience to do the actual work. Which leads us to our next bit of advice.
4. Invest in people, not organizations
This may seem counter-intuitive advice coming from a non-Big Four consultancy, but focus on assessing the actual individuals who’ll be helping you. If you’re not sinking money into a Big Four consultancy, don’t waste your time trying to determine small consultancy value. Instead, ask about the individuals who will actually be participating in the engagement. This is a perfectly reasonable way to kick the tires and will make it easier for your team to determine the relevance of past professional experience, certifications, education, etc.
5. Run with listeners, not actors
There is an acknowledged element of theater in business consulting. A recent article by Alaric Bourgoin and Jean-Francois Harvey in the Harvard Business Review titled "How Consultants Project Expertise and Learn at the Same Time" calls this challenge "learning-credibility tension." The consultant is trying to portray expertise, while scrambling like crazy in the background to learn your business. There’s a bit of this in all consulting engagements. But rather than judging consultants on how well they project credibility, it’s a useful exercise to judge them instead on their Socratic skills. Asking intelligent questions that can bring illumination and context often brings more value than someone who just “really seems likethey know what they’re doing.”
6. Discuss expectations up front
The tricky thing about scoping consulting engagements is that you’re not always sure, specifically, what the problem actually is until you get engaged. But you should still discuss your expectations with as much specificity as possible up front. Making assumptions can lead to costly missteps and miscommunications.
There’s a lot at stake when a mid-market company engages a business consultant. But at least these six tips can help get you started on a shortlist of firms you can feel good about.
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