Perchthold and Sutton think that consultants can benefit companies in many ways while saving them from having to pay massive fees. Their book, Extract Value from Consultants: How to Hire, Control and Fire, features relevant strategies and outlines how companies can get the most from consultants. It is based on their long experience in the consulting world; Perchthold and Sutton were initially employed by technology firms and then global consulting firms, working their way up the ranks of such brands as Accenture and Deloitte Consulting.

Over the years, they have written for various relevant publications and spoken at trade industry events. In 2006, they set up a niche management consulting firm, The RFP Co. in Hong Kong, and then tried their hand at writing a book. Contingent Workforce Strategies Managing Editor Subadhra R. Sriram caught up with Sutton and talked with her about the book, global consulting and what the future holds.

CWS: What made you decide to write this book?

Jenny Sutton: It began when we started the RFP Co. Its mission is to help companies make strategic choices. And for us, that means helping them make decisions at an operational and strategic level, which often results in them having to do a project of some scale.

The topic really interested us because we’d been consultants ourselves, and we’ve had the opportunity to see how our clients thought about using consultants. We were able to get into their heads a little bit. And we were also in a position to see how other consultants approach their marketing, sales and delivery relationship with their clients. We thought that there was a huge gap sometimes between the capability of the client who selects the consultants and the marketing sophistication of the consulting firm. So we decided to write the book.

Why did you decide to be a consultant as opposed to an employee?

Actually, I’ve done both. I was an employee in a company probably for the first 10 years of my career. Then I moved into consulting … and I found that I liked the variety and constantly being challenged and having to get up to speed on a topic or on a client very quickly.

And do you see any differences between the two? Does it really matter?

Any time you put a consultant and an employee side-by-side, there are going to be differences, but let’s compare an employee and consultant working on a project side by side, because that’s generally how consultants are used.

The employee probably is going to have some good access to information and he or she is going to know where to go to get information. He is going to understand the political landscape of the company, and bring some credibility to the project.
The consultant may have done the same project before at a different company, which the employee probably won’t have done. So the consultant is going to bring a lot of previous experience and know-how to the project. I think those are the major differences.

From our perspective — and that’s one of the key messages in our book — you need both types of resources on a project.

Does the employer have to be careful as to when they bring in an employee or a consultant?

I think with projects that are going to make some sort of dramatic changes in a company, it’s useful to have an external perspective — somebody, like a consultant, who’s been on the journey before. A person who can sympathize with people along the way, but who also knows that the end-goal is attainable.

And I think if there’s a lot of politics and perhaps different camps with different ideas about how to get things done, consultants can help cut through some of the politics. They can
be objective.

Your book talked about trying to manage internal stakeholders who try to sway decisions for their own reasons. Each camp wants their own trusted vendor or consultant. So how does a hiring manager deal with that?

That’s a challenge in every single project and has been on every single one that I’ve worked on. It’s really important right from the beginning to make sure that you’ve understood everyone’s perspectives and their objectives for the project and to try to get everybody in a room if necessary and resolve any issues and expectations or misaligned objectives.

One of the big problems we see is that companies skip the stage in a project of getting all their stakeholders aligned. They go off and employ a consultant and then the consultant is getting instructions from different people. The process could just end up being a waste of the company’s money.

It really requires a lot of changed management activity upfront to understand who all the stakeholders are, understand any preferences they might have and for what reason. And then to bring them along through the process, not surprise them with a long list or short list of consultants. Make sure they’re involved in the selection process.

What attributes would indicate the consultant’s capability to deliver?

It really depends on the project. So you’re obviously looking for this specific skill associated with the project that you’re doing, whether it’s in technology or whether it’s an area of business or if it’s a particular industry. Make sure the consultant has certain areas of expertise. Then look into how deep that expertise is, how many times he or she has done this kind of project before and how successful he or she has been in doing that?

Companies need to look at an individual level for each specific resource proposed on a project. Is this individual going to make a positive contribution to the project based on his or her previous experience? If a consulting firm was bringing in a number
of individuals, you would need to look at the firm as a whole.

Certain questions need to be answered, like whether there are additional resources that you could call in if the consultant resigns, becomes sick or just isn’t a good fit. The track record of the consulting firm and the depth of its expertise need to be examined. And all this scrutiny should extend beyond just the few people that might be assigned to your particular project.

What are some specific consultant capability assessment activities?

Regardless of the kind of project under way, there are some things that need to be done. One technique is interviewing prospective consultants as if you were interviewing them for a job. Further, if it’s a big project and it requires some creativity in execution or sequencing, then it’s useful to get the consultants into a workshop with you and make them demonstrate their capability to plan the project. This helps you gauge how you’re going to work with them on the project, and also their knowledge.

The book mentioned how managers can help legal counsel to ensure that the required business outcome is in a contract when it comes to consultants. What did you really mean by that? And how can a manager help the legal department?

When companies hire consulting firms, it’s different from hiring individual consultants. But when they’re hiring consulting firms they often accept the firm’s contract. And that really sets the client at a disadvantage right from the beginning because the desired terms that the consultants have are already embedded in their contract. So that’s the first issue.

The second issue is the contracts tend to be very focused on recourses if things go wrong, covering things like who can sue whom under what circumstances, which court would they use, and what is the limit of the liability. It’ll cover things like confidentiality and intellectual property, but the contract will seldom outline the project that’s being undertaken. Issues like what the business reasons are for getting the project done, what is the expected business outcome, what milestones need to be reached, what resources are to be supplied and so on are not touched upon.

We believe that the proposal of what the consultant is going to do should be in the contract supplemented by all the legal needs.

What advice would you give when it comes to using consultants globally?

That’s an excellent question. We have a whole chapter in our book dealing with hiring consultants in Asia because Asia in particular has some unique challenges. Our first piece of advice usually is don’t assume that you can hire one consulting firm on a global basis. A consulting firm that is capable in North America within the banking industry won’t necessarily have the same capability in every jurisdiction, every country in the world.

So you really have to almost conduct a selection process within each country and be prepared to use multiple consultants because you’ll find that in some countries there are consulting firms that have better strength than the one that has the strength in your home market. Especially when you get to Asia, you can’t rely on the global brand name and the big well-known consulting firms. You really have to look at each market separately.

You also talked about managing consultants as you would any direct report. What about co-employment?

I understand that distinction and I understand that many consultants do not want to jeopardize their status in terms of whether they’re an employee or a consultant. So we’re not talking about it from an HR or a legal perspective. We’re really talking about it from a communication-monitoring perspective. Just because “;consultant”; is on a person’s business card doesn’t mean that the manager should just leave him to his own devices and let him do what he wants or work for a long time without any sort of monitoring.

Many people come in and assume because they’ve hired a consultant that the consultant can work independently and doesn’t need a lot of guidance. It may be true, but the consultant could make some wrong assumptions with regard to the project’s direction and take a wrong turn without anybody realizing it. So in terms of operational management issues, managers should use the same approach with consultants as they would with their own employees.