Tuesday, 15 May 2012

Modern Consulting vs. Classic Consulting: The Sequel!

Previously, on the Mad Grapher
(Or maybe I should start off with "today, on a very special Mad Grapher..."

Ah, the things you can get away with on the internet!  But really, every post on this blog is very special!  And not in a patronizing kind of way, either.)

Last time, I described BHS Consultants as an "IT/technology consulting firm".  I also stated that it's a bit of a challenging label for the business.

In this post, we'll continue investigating the differences between what I call "classic consulting" and "modern consulting" by way of a (fairly short) thought exercise.

The situation we're considering is as follows:
  1. You are in charge of a large project to implement a new business process that is to be heavily automated.
  2. You have a fixed budget and deadline.
  3. You currently do not have the expertise or staff to undertake and complete the project.
  4. You want to make as big (read: positive) an impression as possible.
We are going to consider three options to accomplish this, as described in the previous post.

Let's start with option 1 (seems to be the most logical starting point).

Option 1

Find and take on an internal staff (either full-time or contract) including both SMEs (Subject Matter Experts) and implementors.

If you've ever had to hire and grow a staff, you know that it takes time to field the right people for the team--a long time.  Time, effort and money has to be spent tracking down those people (job postings, recruiters, etc.), not to mention screening and managing them (sure, you could always hire managers--and you'll probably have to for a sizable project--but that's yet another line item in your budget).  Headhunters can also charge a small fortune and their success rate varies at the best of time.  Tack on to that annual salaries, the cost of benefits, vacation days, sick days, turnover, etc. ad nauseum.

Yes, you'll likely have a greater degree of influence and control (some will also argue that your employees will "care" more and are more likely to provide buy-in; I don't necessarily agree with that point), but you'll have a lot of extra costs to carry (even for contracted employees which have similar costs associated with them).

If your office infrastructure is anywhere near capacity (or even if it's running at an optimum rate), adjusting for an influx of staff can add serious costs here, too.  

So on top of the pressure to complete your project, you have the added pressure (and time and cost) in hiring your own staff.

(From 20th Century Fox's Office Space)
Plus you might end up with this guy.  Poor Milton...

Let's summarize what we've seen with this option:

  1. Greater control and influence over resources.
  2. Possibly greater buy-in/"caring" for the project and its success by your resources.
  3. Makes some degree of sense for longer-term projects that require ongoing support.
  1. Lead time and spin-up time to get the team fully staffed and firing on all cylinders.
  2. Significant overhead costs.
  3. Dealing with HR-related issues (sick days, turnover, etc.).
  4. Possible infrastructure costs to accommodate new/growing staff.
I state point #3 in the "Pros" section because it does hold some water; however, this can be a difficult determination to make without doing some analysis in terms of the projected lifespan of the project (and its support) versus the cost of upkeep.

For companies engaging in longer-term projects that are close to its set of core competencies, this option does hold some merit.  But in an ongoing attempt at trying to improve bottom-lines everywhere (not to mention meet ever-tightening deadlines often created by the impression that technology magically speeds everything up), this option isn't as attractive as it once used to be.

Option 1 is a typical situation where a consultant will try to introduce himself/herself to help advise and guide the project along in the attempt to make the process as smooth as possible.  We'll see in the coming posts how a consulting firm engaging in modern consulting compares to the firm engaging in more traditional classic consulting.

Next Time...
...we'll investigate Option 2 where we see how a classic consultant would improve upon Option 1.

See you next time!

1 comment:

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