When looking at hiring a consultant, a lot of people do a double take when they see the fee being charged.
"What? £450 an hour? Isn't that a bit much?! Surely we could do it cheaper!"
(I mean, it's not quite the £40k an hour that Brexit Boris gets for speaking at a magazine company, but it's still a lot right?)
However, before you fling that proposal away in a huff, consider the following points.
5 reasons why Management Consultants might be worth the money
Do you have a project that has just been sitting on the sidelines for months and months? It's probably really important too, but maybe no-one knows what the first step is, or you just don't have the resources to tackle it.
Or instead, you might have particularly ineffective board meetings that drag on but don't lead on to anything.
Consultants can be an effective way to outsource some functions in the business instead of hiring more staff, or waiting to train current staff. Not only can you pick the consultant with the most relevant experience, meaning they'll be the most efficient option, but they could even be the most cost- and time-effective option.
Remember, you're only paying for a few hours of work at a time. Conversely, hiring a new senior member of staff includes recruitment costs, their salary, their pension, their benefits and the possibility that they aren't a good fit after all....
2. Long-term value for money
Not only are consultants a cheaper option than hiring full-time staff, but if they've done a good job they will boost your profits and reduce your inefficiencies.
In the long term, the money they save you and create from successful projects will almost certainly add up to be a lot more than the cost of hiring a consultant. The short-term costs may be more than you think, but you should always consider the long-term benefits.
Consultants are consultants for a reason. They have experience to offer that you do not have in-house.
Again, this relates back to the point above. You could get a full-time senior member of staff with the same amount of experience, but they would ask for their salary to reflect that. If you aren't ready to hire a full-time post, or can't afford to yet, a consultant is a brilliant intermediary.
4. Non-chargeable items
Un-billable time for administration, buying office equipment, networking, marketing. It's all stuff that needs to be paid for... (I'm part of this package at Alembic, and I'm worth it!)
Independent consultants or small consultancy companies need to be especially careful to factor these expenses into their fees as fewer staff means fewer projects to cover these overheads.
So is this part of the fee valuable to you, the client? Maybe not directly, but I would argue that a functioning consultant is better than a disorganised one....
5. Impartial, outside view
Finally, one of the most important reasons for hiring a consultant is that they will be impartial, which has many benefits:
- They have no self-interest in the matter and so will make well-formed decisions based on rationale and research.
- They are not emotionally entangled in the project or the politics and so are able to take a step back and see the big picture.
- They will be able to gather information and listen to everyone’s views and ideas without bias.
- They will have an outsider’s view point and be able to question organisational habits and procedures that are not effective.
This impartiality is extremely valuable for delicate matters, for example succession planning and creating bonus schemes. Consultants can be used to make sure that everyone involved is happy with the end result and that they feel the process has been done fairly.
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