What Happens Once You Diversify and Optimize Your Consulting Providers’ Panel?
“The core of the consulting business is going in and essentially making yourself indispensable by eating the brain of the organization, meaning consultants go in and assume key functions in the organization.” – Matthew Stewart
You might or might not have an official list of preferred suppliers, but most likely you have consulting firms that you work regularly with. We will refer to them as your panel, just to simplify things. So now, let’s see how to upgrade and prepare the right panel for your future challenges.
Most Companies work with consultants to access their skills and experience that are not available In-house.
One of the main procedures to do is a Performance Diagnosis, that will allow you to measure the Performance of each of your suppliers and identified the high- and low-performers.
Rationalizing Your Panel –
#1- Let Go of Low-performers –
This is a no-brainer. You don’t want to work with Consultants that are not delivering the results expected. Get rid of the companies that are consistently underperforming.
When the feedback is alternating from good to bad, try to identify a pattern.
The poor feedbacks are on the same type of projects. They don’t have good results when they work in a hostile environment. Or they don’t really do well with very operational teams. Maybe you shouldn’t consider them for these projects in the future.
Only one of the Consulting partners has low-performance. Why not ask to work exclusively with the partners that have positive feedback?
Create Value Through Consulting
Looking at your Consulting Spend as a whole doesn’t always bring enough information to identify trends and patterns.
#2 – Lack of Bench Is Not an Issue –
It’s best to avoid tying yourself to only one supplier on your strategic needs. Think Supplier Risk management and apply the same sound principles than for other purchases.
Besides, each Consulting Firms have a different DNA profile and a different portfolio of projects at which they excel.
Find 2 or 3 different Consulting Firms for each strategic need. You might end up with the same supplier for several needs, and that is fine. And competition will keep all providers on their toes.
#3 – Identity Rising Stars on Your Team –
You will probably realize that you need to find new Consulting Providers for some strategic needs. When you are screening for new profiles, don’t forget that you only want high-performers. Ask for references and check them or ask a third-party to do so (when references are with competitors, or if you want to remain anonymous). Make sure they have done projects that are relevant to the said strategic need.
#4 – Diversify and Expand Your Sourcing –
Lack of actual knowledge of the current Consulting market leads many Executives into sourcing locally for their Consulting Projects. It’s also a fact of life that most sourcing is based on word of mouth and personal networks.
But you need to know that the Consulting Industry is not one homogeneous block. There some regional specificities, including on the capabilities. If you are looking for Operational Excellence Experts, you might have a look at Europe where companies are more mature in that field. For Leadership capabilities, on the other hand, you should explore the other side of the pond, where North American firms are more numerous and experienced.
Besides, you might need Consultants in locations that are on the other side of the globe. Will you have your Consultants travel thousands of kilometers to work on a project? Or should you just find Consulting Firms in any part of the world, when they best match your project’s needs? You know the answer.
#5 – Hunt for Freshness of Ideas –
Another key winning component is the freshness of ideas. Independently from the performance of your existing Consulting Providers, you might want to bring in new blood and fresh ideas. The Consulting Industry is constantly evolving, and new concepts are emerging. To stay current on the innovation trends disrupting your market, for instance, you want to look at the emerging players to test them out on projects.
Focus on Developing Synergies –
An interesting insight of the portfolio of projects is the potential synergies between different groups or business units, in particular for smaller projects.
For instance, you might find that you bought several times more or less the same project in different parts of your organization. Depending on the feasibility, you might consider grouping these needs in the future and organize a joint competition.
You might also realize that the same Consulting Firm sold more or less the same project in different business units. Putting all the projects together would have helped you to increase your bargaining power and get better prices.
Last, if one part of your organization has a high-performer of a specific type of Consulting Project, while its neighbor had a low-performer, you probably want them to share the love (while you take out the low-performer from your panel).
So, we just described a best-case scenario, the steps, and the approach you can take.
The results will be worth the effort! As extra value and savings are generated, you will be jumpstarting your transformation.
This is the most efficient way to win the buy-in of the stakeholders and to fund the desired transition.
The next step is to hire a data scientist, get started on crunching the numbers, add a pinch of artificial intelligence and a good dose of machine learning. Cool trendy techniques are fun but don’t forget classic methods can be very efficient also.
Do you have a List of Preferred Suppliers for Consulting? How did you build it?
Or do you want a little boost to get started? Don’t hesitate to reach out.
Share your opinion, and if you need our perspective, we love to debate.