by Peter Parkes

Pitfalls with consultancy projects

Consultants are people who borrow your watch and tell you what time it is, and then walk off with the watch.

Robert Towsend, Chairman of Avis (car rentals), ca 1975


Common pitfall

Possible remedy

We were sold a generic model that didn’t fit our business. One benefit of working with consultants is that the guy before you paid for the lessons learned and got the prototype. A principal consultancy skill, however, is listening, so they should tailor or co-create your solution. On the other hand, most companies fall into the trap of thinking that everything they do is unique, whereas it is usually less than 10 per cent that is different from the other guys, so use ‘off the shelf’ where you can, as customisation is very expensive, particularly over the full life-time of a solution.
The project dragged on for ever and cost us a fortune. The big accountancy/consulting firms have a business model based on the accountancy practice of maximising billable days; in other words, their motivation is opposite to yours. Incentivise your partners to work in the same direction as you by agreeing fixed-price deliverables where you can, or at least a sharing of risk and reward. If they are not prepared to carry some of the risk, then pick another firm who are more comfortable with their own ability to manage the risk.
We paid top dollar, but only saw young guys in suits. The partnership model for the big accountancy/consulting firms involves partners ‘qualifying’ the work of a small army of juniors. If this model doesn’t suit you, then don’t use the big brands and you will have more chance of actually seeing the guy you did the deal with.
They had burrowed into us like some kind of parasite. Relationships are great, but don’t let them become dependencies. Where you have an ongoing need, such as in delivering projects, stipulate knowledge transfer as one of your required outcomes.
The board were impressed, but the guys on the ground did not seem too happy with the consultants. It is not too hard to impress a board. The guys on the ground will have been able to see a lot more of what went on ‘under the bonnet’. On the other hand, consultants often have a barrier put around them, either by themselves or by the firm. Try to build inclusive teams. This will help with knowledge transfer as well as trust.
The advice seemed reasonable, but we were left on our own to implement it, and it never happened. The accountancy-based firms tried to restrict their risk by only offering qualified advice and staying out of delivery. This had some consonance with advice that you should get people/firms to change themselves. Now, interventionist approaches are usually adopted for transformation projects, and the increase in IT-based projects means that more consultancies are getting involved in delivery aspects.
Prior to getting the contract, the consultant only ever met supporters of the project. If a consultant is really to understand the situation and be able to provide a realistic proposal, he must be exposed to the whole story. Indeed, when the consultant knows the whole story, he might just know an innovative solution from elsewhere that would not otherwise have occurred to him.

Some people like my advice so much they frame it upon the wall instead of using it.

Gordon R Dickinson

Warning signs

A consultancy project will seldom go off the rails without any warning, so you need to be looking for any signs that things are not quite right. Aside from the regular reports, also look for more subtle signs such as

  • The consultant seems harried
  • He is late for meetings or finds some reason not to be there
  • He avoids calls or does not return messages or emails
  • There seems to be a lack of optimism about the project
  • Work is below the expected quality and the consultant does not seem to care.

If the warning bells are ringing in your mind, call a meeting immediately to find out whether or not this is a real problem situation. State your thinking to the consultant and agree a way forward. Initially, this should be done in good faith, but the project is important, so don’t hesitate to call on the dispute procedures in the agreement. That is what they are there for: to protect you.

It is worth bearing in mind that you may even have to scrap the project. What are the implications of this? It is in this situation that the agreement and SoW are crucial.

If a larger project goes wrong, you may even need to call in other consultants to help put it right, either by taking over or by managing the project through to completion. If the project is vital, these specialist costs may well be worth every penny. See Where to get help.