During the consulting process, the consultant and the client engage in activities that are necessary for achieving the desired result or solution. These activities are known as the consulting process. The process begins when you have signed the contract and initiate your work and activities, and the process ends once the client receives your consulting report and a plan for implementation. Your process may vary somewhat, but these are the typical phases of the consulting process.
What I have outlined below is from my own experience as well as using frameworks and tools I have learnt from the excellent books Practical Management Consultancy by Calvert Markham (highly recommended), the McKinsey Mind by by Ethan Rasiel and Paul Friga and The Trusted Advisor by David Maister.
For more information and further detail about Consulting go to the Consulting section of the site.
The Consulting Framework
For a successful project you need to proportion your effort to:
- Engage the client and understand their drivers
- Identify the right people for your team and prepare them
- Develop a bid strategy, plan and schedule
- Align your response to client wants and needs, at a price they can afford
- Answer the question, add value and quantify the demonstrable benefit
- Deliver the technical solution
- Deliver the project on time and within budget
- Make an impact
- Maintain the relationship
The first part of the process in the initial contact with the client, a preliminary diagnosis of the problem, planning of initial assignments, submitting a proposal to the client, developing the contract or SOW, and signing of the consulting contract.
Identifying the Need.
Isolate the core problem facing the client. Generally, business problems are based on competitive, organisational, financial or operational needs.
Introduction to the Client
A consultant’s first contact with a client may be either in selling an assignment or starting a project which has already been sold. In either case, careful preparation is required and you should aim to make a favorable impact.
The client will be seeking to form an impression of you throughout your early contacts.
This will be from the first contacts by email or telephone, but the first meeting is when the client will be particularly able to do so. There is no second chance to form a first impression and so you should aim to make as favourable an impact as you can.
Early in a project, it is important to allow time for familiarisation. This will be necessary not only for practical matters (such as who’s who, office layout, etc.) but also for understanding the informal rules and climate of the organisation. The latter includes such items as:
- the specialised language used in the business;
- ways in which people work together (e.g., can you walk into people’s offices, or do you have to schedule a meeting first?);
- current affairs or hot topics for the organisation.
Consultants have capabilities which their clients do not have or have in insufficient measure. Conversely, the client has a whole bundle of issues or problems which consultants could help to resolve, but which have to meet several criteria before outside help is sought:
- The problem must be recognised as such, and the client must have decided that they want to do something about it. Problems may be evident (for example, when relocating an office or factory). But consultants themselves can create needs through marketing activities
- The resolution of the problem must be a matter of priority – something the client has to do something about, now.
- The client must believe the problem can be solved. Marketing by consultants can help in both meeting this and the previous criterion: the possibility that a problem previously thought to be insoluble can now be solved can make it become a matter of priority. For example, a certain level of absenteeism is accepted in all organisations, if it became known that it was easily possible to halve it, many organisations previously content would seek to do this.
- The client recognises the need for outside help – whether it is expertise, or experience, or the objectivity of a professionally qualified outsider.
Selling
Part of the process of selling a consultancy service consists of getting the agreement of purchasers that these criteria are met. In the selling situation you are trying to get the prospective client to acknowledge:
- this issue is relevant to my business and needs to be addressed;
- it merits attention now;
- the issue can be resolved … with outside help (provided by you!).
Note that the client’s perspective is from the issues that concern him. A task of the salesperson is to establish a link between these issues and the services the practice has to offer.
Preparation should ensure that you know:
- background client information;
- key aspects of their business, recent performance and so on;
- the history of any previous relationship between your consultancy and the client, and particularly any previous discussions that might have a bearing on the project;
- what the objectives of the introductory meeting are;
- what expectations the client has of the first meeting; (often you can set these yourself by a preliminary letter or telephone call
Once the client has decided to launch a project and seek outside help a consultant will need to be selected from those the client knows or who have a reputation in the required specialism. If you have helped the client to identify the issue and launch the project in the first place, you will be well placed to secure the assignment. If not, whether your firm is picked will depend on whether the client knows of you and your reputation – and this in turn will depend on the effectiveness of your marketing.
For these reasons, the attractiveness of any prospect can be ranked in the following order the least attractive first):
(i) Cold calls: here the consultant has taken the initiative. Consultant and client will be personally unknown to each other. Although cold calling is unattractive by comparison with the other sources of prospects set out below, it can still be worth doing.
(ii) Introductions to new clients. Existing clients can provide introductions;there are also connectors’ (other professional firms, banks, etc.) who can provide introductions.
(iii) Leads the difference between a lead and an introduction is that with a lead a probable need for consultancy services has been identified. Leads can again arise from clients, contacts, connectors, and so on.
(iv) Extensions: this is the further work you might conduct with existing clients. Note that one of the outcomes of doing a consultancy project
Consultancy projects rarely appear from nowhere. Wither a relationship has been built by the consultancy/you and the client or you have been through a tender process. None the less, before any assignment can be carried out, it must first be sold.
Increasingly, organisations are augmenting their own resources with consultants and becoming experienced in using them. Similarly, consultants will have spent time and effort in creating an identity for themselves in terms of general or specific capability) by marketing activities.
You need to identify a prospect profile that defines the characteristics of the sort of organisation that might be a client for the services on offer. It’s essential to match your capabilities and offerings to what the clients want.
These prospects need to be made aware of the service, which the consultancy can do by carrying out a promotional plan to publicise it. Brochures, seminars and conferences, publicity and articles in the press and so on will all help the consultancy’s service to become known.
Some organisations may express an interest in the service, thereby becoming prospects. Marketing finishes and selling begins in consultancy once a specific prospect is identified.
Opportunity Management
This moves from Opportunity Development to Management, and hopefully are results in the contract being awarded. The consultancy will therefore seek to sell its services to the prospects it has identified.
The purpose of identifying prospects is to choose which organisations you wish to pursue as potential clients. As it is unlikely to be a good investment of time, or even possible, to meet every prospect, thee needs to be some basis for selecting which you follow up.
See the Proposal and Bid management section in consulting for more detail.
The purpose of the proposal is to secure the sale. A proposal is written the terms on which it is to be carried out.
Contracting
As soon as contact is made there will be expectations and obligations created on both sides besides the formal agreement set out in the terms of reference.
(i) Expectations: a major cause of client dissatisfaction is when a consultant fails to meet the client’s expectations. These expectations relate not only to meeting commitments in the terms of reference but also in how a consultant carries out the project, e.g.:
- the consultant’s conduct
- what the consultant wears;
- when the consultant arrives and leaves client premises;
- the apparent priority the consultant attaches to the work done for the client.
Likewise, the consultant will also have expectations of the client; these will be reflected largely in the commitment the client shows towards the project.
(ii) Commitment the sponsor – the member of the client’s staff commissioning the project – will, presumably, be committed to it, but you will have to consider the commitment of others. Will the project require the cooperation of more senior or more junior staff and, if so, are they com mitted to its success? Beware of sponsors who do not appear to be committed to the project or who are carrying it out as a personal crusade.
This includes the diagnosis phase, which includes defining and measuring the problem, researching the problem, performing an analysis of the problem, then seeking client feedback on your proposed actions. It also includes developing solutions, developing alternatives, presenting these to the client, and planning for implementation.
Organising
Often missed or hastily rushed, always spend time at the start of with the logistics of a project:
- Where will you be working and with what facilities?
- What is the project plan (if this has not been included in the terms of reference)?
- What support will you be receiving from the client and what form will this take?
- Whom will you be dealing with amongst client staff?
- What have client staff been told about the project (i.e., what are their expectations)?
Once an organisation has identified a need, the problem-solving process used is fact-based and hypothesis-driven. It begins with framing the problem in a way that defines its boundaries, breaks it down into its component elements, and suggests an initial hypothesis for a solution. The next step is designing the analysis, whereby the team determines what analysis is needed to prove the hypothesis. In step three, the team gathers the data. With the data in place, the team is ready to determine if the information at hand proves or disproves the hypothesis, after which the team develops a course of action for the client.
Framing the Problem
The first step in the process is framing any business problem so that it can be subjected to a rigorous, fact-based analysis. To do so, use a structured framework that will generate fact-based hypotheses. Once you’ve arrived at your hypothesis, gather data and analyze the results to prove or disprove it. Your hypothesis will speed your research, since it provides you with a road map to guide your analysis and presentation of the solution.
In framing the problem, used a structured method that identifies its boundaries and breaks it down into its components. MECE – mutually exclusive, collectively exhaustive – will help you separate your problem into distinct, non-overlapping issues, and will prevent you from overlooking any issues relevant to your problem.
“The most common tool management consultants use to break problems apart is the logic tree, a hierarchical listing of all the components of a problem, starting at the ’20,000-foot view’ and moving progressively downward.”
When attempting to break down a problem, consultants often use logic trees, which create a hierarchical listing of all of the problem’s components. When forming a logic tree, start with a broad, 20,000-foot view, and move downward to get closer to the problem. You might start with an overview of a company’s products, move down to revenues and expenses broadly, narrow that perspective to particular sources of revenue, such as sales, leasing, and service, and then look more closely at one of these areas, such as dividing sales into the separate regions of sales activity.
“Let your hypothesis determine your analysis.”
Once you have determined the essential components of a problem by using the appropriate frameworks, you can form a hypothesis or series of hypotheses about a likely solution.
Since you don’t have many facts at this point, use your instinct or intuition to help you generate these hypotheses. Just take what you already know about the problem, combine that with your gut feelings, and imagine what the most likely answers will be. These answers may not be correct, but they are a great place to start.
To find a solution, you should start first with a structure, then apply an hypothesis. If you have defined a MECE structure, your hypothesis could simply be taking one of the options and consider it as the reason for the problem or potential solution.
The hypothesis requires first data to be verified and not additional structure. Once the hypothesis is verified, you can then move deeper in the analysis of only the particular area the hypothesis was referring to. At the same time, if you have correctly followed the process explained as answer of your first question, you would have already defined a structure when formulating the hypothesis.
Putting this together, for example in a profitability assignment, break down into revenues and costs, an ideal approach would be the following:
- Present your structure(which in your example will include both revenues and costs as potential issues, eg – to understand where the problem is in this segment I would like to consider whether we have a revenue issue or a cost issue for it)
- Formulate an hypothesison which could be the problematic area (eg – my hypothesis is that we are facing a cost problem in this segment)
- Ask for data to verify your hypothesis (eg – to verify such hypothesis, I would like to know how revenues and costs changed in the last year, do we have any information?)
- If the hypothesis is confirmedby data, continue your analysis focusing on the part of the structure that the hypothesis referred to, otherwise move to the other one. At this stage, you can go on formulating a new hypothesis (eg – since we found confirmation that there is a cost problem, I would like to structure now my approach analysing fix and variable costs. My hypothesis is that we have a fix cost problem. To verify if this is correct, I would like to know how fix and variable costs changed. Do we have any information on that?)
Designing the Analysis
To start the analysis, find the key drivers by drilling down to the core of the problem, instead of looking at everything separately. Look at how solving this problem fits into the big picture and don’t waste time trying to analyze every aspect of a problem. Determine what analyses you need to prove or disprove your hypothesis. In some cases, you may not be able to come up with a hypothesis initially because the problem seems too confusing. In that case, use your analysis of the facts to guide you to a solution.
Generally, though, your hypothesis will determine how you conduct your analysis. Get your analytical priorities straight by deciding what not to do, so you can concentrate on the most important facts to analyze. For instance, decide which analyses are quick wins, since they are easy to complete and can make a major contribution to proving or disproving a hypothesis. Don’t worry about absolute precision – you can’t be perfect at this stage. Triangulate around the toughest problems by analyzing other issues that will determine the limits of these sticky issues.
Data collection and analysis Paradoxically, you need to consider analysis before deciding what data you need to gather: you have to know what you are going to do with it when you have got it. Data gathering is time-consuming and you need to make sure you confine yourself to gathering only that which is necessary and sufficient for your purposes.
The consultant will start the project with a view of what the detailed nature of the problem is and how it might be solved. Data gathering will be initially to verify these hypotheses, and subsequent data gathering will be used to form new hypotheses or add more detail to the original ones. Data analysis will lead to possible solutions. Almost certainly you will have to be selective in your choice of data. You will also have to choose an appropriate data-collection technique. (See Chapter 5 for more on data collection.)
Gathering the Data
Now is the time to look for the facts. Don’t let people you interview tell you, “I have no idea,” which is an answer that communicates a lack of time, insecurity or just plain laziness. Instead, probe with a few sharp questions.
“The 80/20 rule is one of the great truths in business. It is a rule of thumb that says that 80% of an effect under study will be generated by 20% of the examples analysed.”
McKinsey-ites use three high-impact techniques in data collection. They start with the annual report. Next, they use computers to identify outliers, the key subjects for later investigation. Generally, these outliers are uncovered by comparing ratios or key measures like high and low performers. Finally, they seek relevant best practices to glean insights from a competitor or top-performing organization.
“Having reduced the problem to its essential components through the use of appropriate frameworks, you are ready to embark on the next step in the process of framing it: forming a hypothesis as to its likely solution.”
Before you interview anyone for information, prepare a written interview guide. Once the interview commences, use active listening and guide the interviewee to stay on track. Some other tips for successful interviewing are to interview in pairs, use the indirect approach in asking questions, and don’t ask for too much. Avoid sensitive subjects at the beginning of the interview and recognize where the interviewee may have a conflicting agenda like a job that is threatened by cost-cutting measures.
Interpreting the Results
Once you have your data, you must understand what it says and decide what steps you should take based on your results. Assemble these findings into an externally directed end product that provides a course of direction for your organization or client to follow.
A chart that identifies the three most important things you learn each day will help to focus and direct your thinking. Be receptive to facts that prove you wrong. If the facts don’t fit your hypothesis, be ready to change it. Don’t try to change the facts to fit what you think is the likely solution.
“When it comes time to prove your initial hypothesis, efficient analysis design will help you hit the ground running. You and your team will know what you have to do, where to get the information to do it, and when to get it done.”
Remember the 80/20 Rule: 80% of the effect you are studying will result from 20 percent of the examples you analyze. This rule was originally propounded by the economist Vilfredo Pareto, who found that a small fraction of the elements in any study usually account for a large fraction of the effect.
“Interviewing is part of every McKinsey engagement, as it not only generates primary data but can also identify great sources of secondary data.”
In creating the end product, tailor your solutions to fit the needs of your client. Look at the results through the client’s eyes and ask how your recommended solution will add value. Respect the limits of your client’s abilities to ensure that your solutions are realistically actionable based on the client’s current skills, systems, structures, staff and budget.
Diagnosis
Diagnosis will lead to a more detailed understanding of the issues and the ways in which they might be addressed, both substantiated by the data collected. Diagnoses might be represented by a series of conclusions and provides the bridge between the data collected and the formulation of suitable interventions.
Intervention
By ‘intervention’ is meant the culmination of the project when the consultant engages with the client on the topic of the issues to be addressed. Most often, the intervention will consist of recommendations. In making your proposals they have not only to be technically ‘right’ but also acceptable to those responsible for authorising their implementation.
During the project you should develop an idea of what is or is not acceptable, and devote effort to ‘pre-selling your preferred solution. Your proposals should also be feasible, that is, the client must be able to implement them. No points for making technically excellent recommendations, which the client embraces enthusiastically, and then finds cannot be implemented because the resources or complacency to do so are not available.
Proposals should therefore also include recommendations for how they might be implemented in practice.
Prewire
The key to successful presentations and getting buy-in (in order for your audience to accept your recommendations) is prewiring.
In its essence, prewiring means taking your audience through your findings before you give your presentation. This allows for people to trust you, ask questions you may not have thought about to avoid surprises, and then during the presentation say yes and support you among others who may be more sceptical.
Presenting Your Ideas
You must present your solutions in a way that your client understands and can accept. To do so, make your presentation clear and convincing. Use a structure that your audience can easily understand and follow.
The team communicates the solution to the client and gains the client’s acceptance. The presentation must be clear and concise in order to generate buy-in for the solution.
Recommend keeping it organised and simple, tell a story to a end goal. Use a structured series of steps that present your idea clearly. Use the elevator test, which means you should be able to explain your solution clearly and precisely during a 30-second elevator ride.
Keep any charts simple – communicate a maximum of one message per chart. Think of your charts as the basis for getting your message across, not an art project.
“Send the interview guide (or a version of it) to the interviewee well ahead of the interview. Post-interview follow-up also adds to the interview process. It gives you a chance to confirm what you heard and to ensure you understood what was said.”
This presentation, however, is only a tool, not an end in itself. Think of your presentation as selling your solution. The greatest presentation is worth nothing if the organization rejects your recommendations or fails to implement them.
Your only goal in making a presentation should be getting buy-in to your recommendations. To this end, pre-wire everything by walking the relevant decision-makers through your findings in advance, so there are no surprises.
This includes implementation of strategies requiring action, and performing training and finishes on closure and termination of your consulting project. This consists of submission of the final report, briefing final plans for follow-up, collecting payment, disengaging, and setting the stage for future consulting.
Handover
Often Strategic teams pass on to delivery teams, for the implementation of the solution. Ensuring that the project delivery teams understands what the client required, what was bid, and what recommendation was selected, provides the framework for successful future delivery.
The handovers should be at a level appropriate to the project team’s involvement within the bid preparation, as the project team may or may not have been involved during the bid phase. Ideally the team that is going to deliver the project should be fully involved at the bid and problem solving stages, in which case the handover will be straightforward.
Mobilisation and Planning
Mobilisation is a critical stage of the project to ensure the project is set up with full understanding of the contractual requirements. Nominated key project roles are filled in accordance with contract requirements. Contractual requirements are reviewed and aligned across the project team.
Project Team are clear on the individual requirements for delivery. Mobilisation shall also ensure the project has the appropriate other infrastructure in place before commencing (e.g. facilities, equipment etc). Key items to consider include:
- Project start-up meeting should be planned and held once the relevant resources are in place to clearly communicate the project scope, deliveries, contractual requirements, structure and reporting drumbeats
- Benefits should be Identified and documented as part of the project management document set
- Initial project organisation chart should be produced and communicated to all staff on the project
- Key client contacts should be identified
- The communication strategy should be planned and documented as part of the project management document set
- Stakeholder management should be planned and documented as part of the project management document set
- The project budget should be allocated appropriately and staff made aware of their individual budget on the project
- Any required work package management should be identified and put in place
- Any external constraints or requirements should be identified and addressed
- Verify those briefed have understood requirements particularly when working cross-culture or with external participants
- Ensure specific security and data protection requirements are communicated and understood.
Delivery of the Solution
Once a solution has been identified, the team must dedicate sufficient resources to the organisation, and the organisation must respond in a timely way to any obstacles to implementation. All tasks related to implementation must be completed in a timely manner, and the organization must develop an iteration process that leads to continual improvement. To this end, the team must reassess the effectiveness of its implementation and make additional changes as necessary.
Managing Product Delivery process acts as the link between the project manager and team managers where the emphasis is on accepting a Work Package, executing a Work Package and delivering a Work Package.
The objective of the Managing Product Delivery process is to ensure that:
- Products assigned to the team are authorised and agreed upon.
- The team is clear about what has to be produced and understands the effort, time and cost.
- The planned products are delivered to the expectations and within tolerance.
- Accurate Progress information is provided to the Project
Key activities are:
- Accept and check Work Package from the Project Manager.
- Get the products developed (executes the products).
- Demonstrate that products meet their quality criteria. (Tip: Use Quality Review Meeting.)
Obtain approval for each product. - Deliver the completed Work Packages to the Project Manager.
Withdrawal
Transfer
Transfer means leaving the client with the ongoing capability to maintain the changes and systems you have introduced as a result of your work Transfer therefore includes:
- training client staff;
- setting standards and procedures;
- establishing systems and records;
- providing manuals.
Remember these are a major chunk of your legacy to your client on this project and therefore should be provided to a high standard. It may be appropriate to provide ongoing help after the project is complete, for example through servicing visits. As well as the obvious benefit to the client, this allows the consultant further rights of entry to the client that might reveal opportunities for extension sales.
Extension or disengagement
Withdrawal may mean the end of this particular relationship, but there may be extension work – other projects you can carry out to the benefit of the client.
How you treat this final stage depends on how you see the relationship between you and your client. Ideally, you are one of your client’s specialist advisers to whom they will arn whenever there is a problem you can help with. But whilst working with this client you have the chance to find other areas where your practice can help develop the client’s business. Hopefully, you can turn these opportunities into extension sales.
If you cannot extend, you disengage. This is not the end of the relationship; you and your client will have better knowledge of each other, and you should keep in touch. Remember that past clients are the best sales prospects for the future.
Completion
The ending of a consultancy project is as significant as its launch; quite apart from the commercial aspects of completion, the consultancy practice needs to make sure that other aspects of valuc are also drawn from the experience of conducting this project.
Remember that some of the value of an assignment consists of the corporate experience gained by conducting it, it might also provide a reference for future work. It is important, therefore, even when no formal evaluation is
conducted, to assess the value of an assignment and what the consultancy has learned, which will benefit it for the future.
You may also wish to conduct a formal evaluation of the project. This consists of comparing what actually happened with the original terms of reference and as they were subsequently amended, if appropriate).
You should keep the terms of reference to hand throughout a project and refer to them frequently to ensure that the work you are doing remains relevant (it is easy to go on interesting, but time-consuming, digressions).
Ideally, all clients will be satisfied at the end of an assignment, but when they are not, it is frequently because you had different expectations at the outset rather than through any failure of operating. It is thus essential to make sure that the terms of reference are clear throughout.
Central Principles
Central to the above framework, the following three elements are key through all processes:
Leadership
This model requires strong leadership from the head of the organisation. This leader must express a strategic vision and inspire those in the organization who will implement the solution. He or she also must make the right choices on how to delegate authority to make the implementation happen.
Managing Your Team, Your Client, and Yourself
Assembling a problem-solving team and keeping them motivated, is the key to success. Individual team members must be able to balance their lives and careers so they can meet the client’s expectations without burning out. This is critical if the team is to keep the client informed, involved and inspired.
Management of the problem-solving process entails managing your team members, managing the client and managing yourself.
“When interpreting your analyses, you have two parallel goals: you want to be quick and you want to be right.”
Successful team management starts with good team members with the right mix of skills. Establish good communication, which is critical to effective team functioning. Keep the information flowing by making your messages and meetings brief and focused.
In managing your client, the three areas to consider are obtaining, maintaining and retaining your clients. Use an indirect approach based on building relationships to get new clients, and only promise what you can really accomplish. To maintain clients, keep them involved in the process and get their buy-in. To retain them, meet and exceed client expectations.
Finally, for successful self-management, delegate around your limitations, make the most of your network and respect your own time limitations to avoid burn out.
Intuition
“Forget about absolute precision. Business, for the most part, is not an exact discipline like physics or math.”
When you apply this model, you’ll often find a tension between your intuition and the data. Generally, it’s impossible to have all of the relevant facts before you reach a decision, so like most executives, you need to make your business decisions based partially on facts and intuition. A good decision requires being able to balance both.
Since you should form your hypothesis at the start of the problem-solving process, you have to rely less on facts (you won’t have done most of your fact gathering yet) and more on instinct or intuition. Take what you know about the problem at hand, combine it with your gut feelings on the issue, and think about what the most likely answers are.
Executives make major strategic decisions based as much on gut instinct as on fact-based analysis.
Intuition and data complement each other. You need at least some of each to have a solid basis for your decisions. The key to striking the balance is quality over quantity.
Take-Aways
- When presenting ideas or solutions, always develop a line of reasoning for your solution, backing up points with logic, and showing the positive aspects of the business by adopting the new way of working vs the negative aspects of the of the way of working. This is a fact-based method of problem solving and management and critical on how you structure your analysis and recommendations.
- Problem-solving includes identification of a business need, problem analysis and presentation of a solution.
- The critical first step is understanding the company’s context, culture, and underlying situation.
- Always frame the business problem so it can be subjected to rigorous, fact-based analysis.
Highlights
- Most consultancies focus on the mutually exclusive, collectively exhaustive (MECE) approach which separates problems into distinct, non-overlapping issues. This easily allows you to drill down to problem areas and avoids duplication of effort.
- After distilling the essential parts of the problem, form a hypothesis for the solution.
- Determine what types of analysis you need to prove or disprove your hypothesis.
- In your analysis, look for outliers, boundaries, consider best practices and what’s happening in the industry. Never work in a vacuum without understanding external factors.
- Prioritise. The 80/20 rule says that 80% of the effect you are studying results from 20% of the examples you analyze.
- If the facts don’t confirm your hypothesis, don’t change the facts, change your hypothesis.
- When presenting your solutions, keep it clear, focussed, structured with a story, and simple.