Management Consulting Firms
Management consulting firms help organizations improve performance and reach critical growth targets. But management consulting firms aren't all the same and finding the right firm can be a challenge for first-time clients.
Management consulting firms help small and medium-sized businesses achieve growth through performance improvements and strategies designed to address operational, financial or project management objectives.
In today's business climate, knowing how to find good business consultants for specific problems is a valuable skill. While some organizations hire management consulting firms to provide assistance for very precise, short-term projects, others employ management consultants to facilitate organizational change over a longer period of time.
As a business owner or executive decision-maker, it's important to understand the basics of management consulting as well as the criteria that is commonly used to select the best management consulting firm for your business.
Management Consulting Basics
Management consultants offer several advantages to a company or project, not the least of which is information about a particular industry or business area. In small and medium-sized companies, business consultants fill knowledge gaps that might otherwise limit growth or lead the organization off course.
It's common for large companies to maintain groups of internal consultants capable of offering project management expertise to various stakeholders within the organization. But internal consultants lack one of the key benefits associated with hiring an outside management consulting firm: Objectivity. Whether you need your consultants to facilitate a change process or to provide specific industry expertise, the objectivity of a third-party outsider sheds light on organizational blind spots.
Management consulting firms employ highly qualified consultants across a range of specialties and industries. However, it's not unusual for consultants in young or smaller firms to have multiple areas of focus. Investors and investment firms often serve as management consultants to the companies in their portfolios. For everyone else, the cost of management consulting varies depending on the reputation, expertise and experience of the firm.
Choosing the Right Management Consulting Firm
A good consulting firm can lay the foundation for growth and long-term success in your business. The trick is choosing the right management consulting firm and ensuring that your consultants are truly capable of delivering the outcomes you hope to achieve from the engagement.
The first step in selecting a management consulting firm is to define the nature and scope of the project or problem the consultants will be required to address. Once the issue has been clearly defined and articulated, you can begin to develop a search process that includes the following selection criteria:
- Consulting Experience. Running a successful business is one thing; teaching someone else how to do it requires a completely different skill set. Since proven business leaders aren't automatically good consultants, you'll need to evaluate each firm's actual consulting experience. It's especially important to make sure the firm's consultants are experienced in the desired area or discipline (e.g. Change Management, Strategy, Technology Implementation, etc.).
- Industry Expertise. Some management consulting firms market themselves as experts in every possible industry and market segment. Don't believe them -- the best management consultants intentionally cultivate expertise in specific industries and can back up their claims with references from recognized organizations throughout your field. At the same time, your business consulting firm should have experience in more than one industry in order to bring cross-industry expertise to your company.
- Senior Consultant Involvement. In some management consulting firms, senior level consultants are very involved in selling the firm to new clients, but then hand off the actual work of the engagement to less experienced colleagues. Although not every consulting scenario requires the direct involvement of a senior partner, it's worth discussing how involved senior level consultants will remain over the course of the project.
Business owners who are brand new to the management consulting concept should seek the advice of their peers before they commit to a consulting arrangement. Business networks can be a great source of referrals for prospective firms and if necessary, can suggest alternatives like forming a small business advisory board or recruiting an industry mentor.
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