Management Consultants: Waste of Time or Invaluable Asset?

Businesses of all shapes and sizes are feeling the pinch right now. That’s reality, and we must face it! The aftermath of the pandemic and the current cost-of-living crisis has some business owners returning to the drawing board to adapt to economic changes. Business owners must assess their methods, strategies and practices to protect their financial margins.

Unfortunately, this isn’t a simple problem with a simple solution. COVID-19, Brexit and other world events have added complexity to the modern business landscape that could overwhelm some business owners. Many small and medium enterprise business owners are facing daunting decisions over the future of their businesses. Options like diversification, outsourcing or scaling down certain business operations are just a few possible paths. However, deciding which option to take and to attempt while predicting the outcomes and pitfalls of each is easier said than done!

So what can you do if you’re stuck in a rut and feel like burying your head in quicksand?

Outsourced Management Consultants

Many business leaders are turning to outsourced management consultancy firms in hopes they can solve issues, create value, maximise growth and improve overall business performance.

You might be familiar with the “Big 4” management consultancy firms KPMG, Deloitte, Price Waterhouse Cooper (PWC) and Ernst & Young (EY). These big leaguers only like to play ball in the large corporate world, making them beyond most SMEs' grasp. So where can you turn if you need a management consultant as an SME? Plenty of management consultancy firms are experts in handling SME cases, so help is available.

However, before thinking about who can help, it’s worth considering if a management consultant would be the right solution for your business in the first place!

I’d encourage all business owners to consider what they expect a management consultant to deliver before taking the potentially costly plunge. There’s no denying a fresh set of eyes, and the experience of an expert consultant can make a business more efficient, but it isn’t a “save all” process. Unfortunately, even the best consultants don’t possess magic wands that’ll whip every failing and stagnant business into shape.

Instead, you should take a few steps to decide whether a management consultant fits your business.

Step One: Identify and define the problem. This step may be more in-depth and reflective than you initially thought. I invite you to reassess your operations and processes with an open mind, tasking yourself to challenge your beliefs about how your business should be run. Whether it’s to consider hiring a management consultant or not, this alone can bear fruit and is a healthy practice for business owners to engage with.

Step Two: Are the problems easily identifiable? If so, a management consultant may not be required. From here, it is your job to change practices and operations and implement the necessary steps to better your business's success. By doing this yourself, you will no doubt save time and money in some instances.

Step Three: Struggling to find out what’s going wrong? If you’ve tried earnestly to identify the problem(s) in your operations and are still left scratching your head, now might be the time to consider a review from a management consultant. A management consultant may be able to identify better where improvements can be made and recommend what actions to take next.

If you’re a business owner and find this process particularly painful, I can assure you you’re not alone. For many business owners, their businesses are their babies, to which they are emotionally connected and analysing processes and operations with decision impartiality can be impossible.

Still unsure if a management consultant could help your organisation?

Allow me to give you the lowdown on what to expect, so you can make a more informed decision before committing. After all, forewarned is forearmed!

How Management Consultants Work

Disclaimer!: Management consultancy firms will differ from one to the other depending on the way they operate. They’ll use different processes and techniques to support you and to differentiate themselves from the competition.

Generally speaking, though, you can expect most to follow a model that looks vaguely like this:

Discovery Phase: Your consultant will learn about your operations to define where the problem(s) lies. They will need to understand what changes have previously been implemented and their effects so far.

Data Collection and Analysis: From here, your consultant with collect and analyse data to identify the root cause of the problem.

Design and Ideate: Your management consultant will compile a literature review and a collation of best practices, including possible solutions to address the cause of the issues.

Implementation: Here, a final report is produced, and the recommended solutions are discussed.

Support and Education: Your management consultant will then help to educate and support wider management throughout the implementation to encourage success.

If this process sounds like something your organisation would benefit from (let’s face it, most businesses probably would in some capacity), then a management consultancy firm could be of service. But if time and resource allows it, I’d encourage you to attempt your own version of this process first!

How much do management consultants cost?

The all-important question on the tip of your tongue is likely, “how much will these business saviours cost?”.

A guru who can rescue you from your woes certainly sounds appealing, but it goes without saying that it can’t break the bank in the process. I’d love to provide an exact figure, but unfortunately, as with many services, the cost can vary wildly depending on various factors. These include the number of employees you have, the industry you work in, your turnover and the amounts of support you require, for example, if it’s onsite or remote.

Your best option is to engage with a few consultancy firms to see what packages they can offer. One thing’s for sure; the management consultancy market is a strong one, and for a good reason. These firms have proven track records of real-world business wins that may be what your business is after. But always proceed cautiously, and do your research to ensure the firm in question has experience in your industry. You should ask for case studies of previous projects, and don’t be scared to hold initial meetings with multiple firms before deciding which would be the best fit.

Moving Forward

Hard times befall the best of us, and there’s no shame in asking for help when you need it. Being able to properly assess the current situation of your business and what may have gone wrong will put you in the best position to move forward.

If you’re a business owner considering using a management consultancy firm OR you’ve used one before, I'd love to hear from you whether your experience was positive or not!

Drop me a line to continue the conversation - who knows; we may finally crack the code on management consultancy firms and discover if they really do what they say on their tins!