Hiring a consultant can be very risky. Nearly anyone can get a tax ID number and a company logo and claim to be an independent consultant. Because of this, it is very important to verify the legitimacy of any firm before you hire them. In addition, it’s important to do your own assessment before taking the plunge and investing time and money in a consultancy contract.
The first step would be to determine whether you actually need external help or if it’s an issue that can be handled internally. Define clearly what the problems are, and then walk yourself through a checklist of potential issues. Some companies need a restructuring of their organizational hierarchy. Some need a more fluid chain of communication such as open-door policies instead of static weekly meetings.
Another important thing to examine about your business is whether a consultant is something you can even afford. Start-up companies are at their most vulnerable during their first three years, which is also when many growing pains occur. Examine your budget – not everyone can afford a tier 1 consultancy firm like McKinsey. Fortunately, there are many other options if you decide to go ahead.
Make sure you know exactly what you want the consultant to do by making a list of existing problems and how you imagine a successful outcome. Does success look like a higher profit margin? Increased brand recognition? Longer turnover between employee hires? While it may be difficult, it’s important to be honest about what is wrong and what might need to change. This is not a time for egos to get in the way. Be ready to hear recommendations and be open to change.
There are many ways to put a company or independent contractor through a vetting process. Look at the age of the “firm” and ask about previous contract durations. Check a consultant’s track record by asking for and checking references personally. One good thing about using a firm is that they have done the vetting phase in advance. Online freelancers are also vetted through sites like Upwork. In addition to formal checks, it also helps to check google reviews with a simple web search.
During interviews, look for red flags to watch out for. A good sign of a vested party is if they ask you intriguing questions including the relationship you are hoping for, any challenges along the way, and the short- and long-term goals you wish to achieve. A consultant should be there to find out as much as possible in order to come up with a custom-made solution just for you. If they appear to be fitting you into a pre-fabricated one size fits all solution, they are not the right consultant for you. Lastly, make sure you get your contract in writing and stay in touch with the consultant throughout the process.