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Engaging a Management Consultant

Most effective high technology organizations have critical cross-organizational tasks that the executive team may not be able to effectively address while at the same time dealing with the complex demands of running a high technology business.

manandterminal.jpgMoreover, in these cases it is not likely that a consensus exits across the management team even though each executive will have good ideas related to addressing the critical tasks. This situation sometimes persists because no member of the team has the time to organize a coherent integrated view of everyones ideas, draw out the hidden assumptions, and help work through conflicting views. If this situation is chronic then the organization may need to look for additional permanent senior resources. However, it is often the case that an effective consultant can help complete these tasks without the expense of searching for and hiring a new senior executive and/or an unsupportable burden on the current management team.

Scope of Effort

Develop clear general ideas about what you hope to achieve by engaging a management consultant and discuss these ideas with the consultant and the key members of the management team. It is unlikely that the management consultant will be effective if the key executives do not understand the purpose of the engagement and how their responsibilities relate to the engagement. These ideas will rapidly evolve into specific activities as the engagement proceeds and everyone develops a better understanding of what the organization needs. Management consulting generally entails a time and materials relationship and it is rarely necessary to make a work level or term commitment. Management consultants are most effective when they are engaged for one or, in some cases, several short term intense activities. In any case, it is important that you have the ability to stop incurring costs whenever the situation warrants it or if you are not satisfied with the consultant's performance.

Engagement Vehicle

The best way to engage a management consultant is with a contract. Both the company and the consultant are protected with a contract that provides a clear description of what their obligations are (taxes, liability, billing, payment, etc.). On the other hand, a management consultant is not a contractor that is engaged for a particular skill set (e.g. C++ programming, RF circuit design, etc.) over, what may be, a significant period of time with various milestones and performance terms and conditions.

Confidentiality

To be effective a management consultant is very likely to require access to information that the organization considers confidential and proprietary. Because of this, it is always a good idea to have a non-disclosure agreement in place with the consultant. It protects both parties, defines protected data, specifies inadvertent disclosure actions, and the remedies available to both parties. Non-disclosure agreements do not have to be complex. A well structured agreement should suffice for most cases.

Rates and Billing

The price that management consultants charge for their efforts is always an area of concern for the engaging organization. Woman at DeskThe actual dollar rate is important but so are the understandings about billable time and expenses. An effective management consultant will require wide discretion about the activities that are undertaken to accomplish a given task. Moreover, it is very likely that the objectives will evolve, often dramatically and rapidly, as the organization develops a better common understanding of what they need to accomplish. On the other hand, it is equally as important for the engaging manager, as well as the executive management team, to be satisfied that the time billed is consistent with the work that is being accomplished.

 

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