Recessions have a significant impact on businesses. Companies whose revenue is negatively affected must sometimes cut deep as they try to close budget gaps. As the market recovers, they find they need help running operations or with project expertise, but they may have reservations when it comes to hiring soon after such uncertainty, which is where consultants can be a tremendous benefit.
“Some companies struggle to effectively reach their performance, project or critical initiative goals after a staff reduction,” says Beth Thomas, executive vice president and managing director of Consulting Services at Sequent. “That’s where consultants come in. They offer a point-in-time solution to a problem, often transcending office politics, without adding to overhead.”
Smart Business spoke with Thomas about how consultants can help companies solve immediate problems and be better prepared to handle them in the future.
What’s wrong with how some companies view the role of a consultant?
Not all consultants provide quality work, which can give consultants in general a bad reputation. ‘Squatters,’ as they’re sometimes called, are consultants that charge too much and don’t transfer actionable insights. Often they come from companies that send in teams of inexperienced people that lack the experience to solve the problem they were brought in to address.
They give a bad name to the consultants that have been practitioners — business owners and high-level executives — and bring that experience to their consultative roles.
How can qualified consultants help companies that aren’t in a position to hire additional staff?
Experienced consultants have the expertise needed to solve problems quickly, which saves companies money. Experienced consultants have learned lessons that can save their clients weeks and months of analysis. They know what works and what doesn’t.
Being an outsider also means consultants are able to stay out of internal political feuds that can stall initiatives with personal and not empirical problems. An external change agent creates a political safe zone for ideas to be heard and considered. It can be hard for people within a company to do what’s right in an environment of layoffs and major operational or strategic shifts as they may withhold what could be considered an unpopular opinion for fear of losing their jobs.
Consultants can operate with sufficient political cover. They are objective and can say what’s wrong with a business without the consequence of getting fired.
Employees and even executives can become deaf when they’re hearing the same things over and over. Consultants offer a fresh perspective. Whether he or she confirms or criticizes an approach, that objectivity can get people to listen.
Staff augmentation is a welcome service consultants can provide. Sometimes a company just needs an extra hand in the short term. Consultants plug holes left after a company downsizes or has lost key contributors. This can be an inexpensive and safe solution compared to hiring a full-time staffer, especially if the company isn’t confident it has successfully weathered the economic storm.
While consultants can fill gaps where a company’s internal knowledge base is insufficient, they can also help build expertise in a company. For instance, a company lacking project management expertise can work with a consultant to train people, building up knowledge so it’s not necessary to hire consultants in the future.
What are the signs it’s time for a company to bring in a consultant?
Bring in a consultant before a critical initiative kicks off. That’s the time to evaluate resources and ensure the company has the talent to meet its objectives.
It’s better to know before the outset of a critical project that there is a talent gap than to lose momentum because there aren’t enough horses to pull the cart. And companies that are unsure they’re headed in the right direction can use someone from the outside to validate or challenge a plan so the company has the confidence to move ahead full force.
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