June 4, 2022

Hiring a consultant can help businesses improve performance and make necessary changes to achieve success.

Business consultants help companies overcome challenges, increase revenue and grow.
It’s essential to work with business consultants who have experience and previous success with companies like yours.
Business consultants may charge by the project or hour, or you may need to pay daily or monthly retainers.
This article is for entrepreneurs and small business owners considering working with a business consultant.

Running a small or midsize business is challenging because of the sheer number of tasks it takes to succeed. From accounting to human resources to technical support, it’s almost impossible for business owners to do it all themselves. But, thanks to the ease of hiring consultants, they don’t have to figure out everything on their own. We’ll explore what a business consultant does and how one can help your business thrive.

What is a business consultant?

A business consultant is a professional with a wide array of skills who assists business owners with their endeavors. Consultants are knowledgeable because of their education and previous experience.

Additionally, business consultants provide management consulting to help organizations improve their performance and efficiency. These professionals analyze businesses and create solutions while helping companies meet their goals.

Business owners should consider hiring business consultants when they need help or perspective on their chosen path, or a catalyst for change in their companies.

Why hire a business consultant?

There are several reasons business owners should consider hiring consultants. Consultants offer a wide range of services, including the following:

Providing expertise in a specific market
Identifying problems
Supplementing existing staff
Initiating change
Providing objectivity
Teaching and training employees
Doing the “dirty work,” such as laying off staff
Reviving an organization
Creating a new business
Influencing other people, such as lobbyists

What does a business consultant do?

Generally, there are three stages of a business consultant’s process: discovery, evaluation and implementation.

1. Discovery

The first step for any business consultant is the discovery phase, where the goal is to learn about your business. A good business consultant takes the time to learn as much as possible about a business from the owner and employees. The consultant will do the following things:

Tour your facilities.
Meet with the board of directors and employees.
Analyze your company’s finances.
Read all company materials.

During the discovery phase, the business consultant will uncover the details of your company mission and current operations.

2. Evaluation

Once the business consultant has developed an in-depth understanding of your company, they enter the evaluation phase, with the goal to identify where change is needed. This phase includes identifying your company’s strengths and weaknesses as well as current and foreseeable problems.

Examining established problems and identifying new problems: The consultant should study problems that owners and management have already identified. Because of their objectivity, consultants can also pinpoint new or unforeseen issues.
Finding solutions: A business consultant should strategize solutions to the problems they identify and outline ways to capitalize on opportunities to grow the business, increase profits, and boost efficiency. For example, say your company has a particularly strong sales department but a weak marketing department. This is an opportunity to increase your marketing resources and capitalize on your sales staff.

There are two crucial elements to focus on during this process: communication and feedback.

Communication: During the evaluation phase, your entire team must maintain clear, open communication with the consultant.
Feedback: You and your team members should take the business consultant’s advice as constructive criticism. The consultant’s feedback isn’t meant to be personal. While you and your employees are personally close to the business, this lack of wider perspective can hinder positive change and growth; the consultant brings objectivity and a fresh viewpoint. Of course, you should offer your own feedback and opinions to the business consultant, but keep your mind open to new ideas.

3. Implementation

Once your company and the consultant agree on a plan, the consultant should enter the third phase: the restructuring stage, or implementation of the plan. In this phase, the consultant builds on your assets and eliminates liabilities. They also monitor the plan’s progress and adjust it as needed.

Types of business consultants

There are various types of business consultants specializing in different business aspects.

Strategy and management consultants

Strategy and management business consultants can bring industry expertise to your business to help you scale, acquire new opportunities, and drive revenue.

Consultants with a focus on strategy and management can help your business do the following:

Expand into new markets or increase awareness in your current market.
Reorganize your business model to create a cost-effective strategy.
Increase your business’s capabilities.
Acquire a new business venture.
Merge with another business or change your business’s structure.
Stand in as middle management during a transition period.

Operations consultants

Business consultants who specialize in operations can help you improve day-to-day processes. These business consultants take inventory of your current business model and figure out the best way to produce the same high-quality results at a fraction of the cost and time. These consultants also help through quality control and understanding how to tweak and optimize your production for better results.

Financial consultants

A financial consultant can show you the broader scope of the your business’s financial health. They mainly assist in investment decisions and help you find the best way to handle your business’s assets and debts. Financial consultants may have even further specializations, including financial planning and advising your business on taxes, daily expenses, and the best retirement plans.

Human resources consultants

The best HR outsourcing companies and independent HR contractors can assist you with your HR functions. These consultants can take over your day-to-day HR tasks, such as recruiting and retaining employees, processing payroll, performing administrative tasks, and managing employees’ performance.

Marketing consultants

Marketing consultants help businesses identify their strengths as a brand and expand upon them to create brand awareness and exposure. Whether your business needs a new logo or a social media strategy, a marketing consultant can be an asset in expanding your business’s reach.

What about consultant firms?

While you can hire an independent professional, you can also engage the services of a specialized firm for your consulting needs. Big firms like McKinsey & Co. and BCG wouldn’t necessarily fit a small business’s needs and budget, but a local firm might work well.

To start, run a Google search on your pain point and location – such as “Seattle brand strategy firm” – and examine your results. The search will likely bring up firms you’ve never heard of before, but a closer look at their projects and client reviews can help determine if they’d be a good match. Additionally, hiring a local firm means you have a better chance of finding someone you know or previously crossed paths with on their client list.

These are some pros of a consulting firm:

Extensive resources
Multiple professionals’ expertise
An established brand with hundreds of references

These are some pros of individual consultants:

Affordability
Flexibility in scheduling and location
Ability to dedicate their full attention to your case

Whether you should select a consulting firm or individual depends on your business needs and preferred work style.

How to choose a business consultant

Choosing a business consultant who fits your business needs can be a daunting experience. Whether you’re looking for someone to help with your high-level strategy needs or a niche, solution-oriented specialist to improve your SEO or product-sourcing processes, it’s essential to know where to begin and take it one step at a time. If you are in need of a female business consultant expert tap here.

1. Find the right business consultant.

Finding the right business consultant may be the most challenging part for the owner or management. The consultant should have a passion for their work, a drive for excellence, and an eye for organization and detail. It’s essential to find a consultant who has expertise in your industry or experience with the kinds of problems your business faces.

Leverage your existing network. Start your search for a business consultant by leveraging your existing network. A recommendation from a colleague, partner or other business owner who was in a similar position is often more reliable than generic reviews or accolades. Ask your contacts if they know of any experts in the field who can assist with your specific problem.
Explore dedicated marketplaces. Explore dedicated marketplaces that can help you find consultants by topic, budget and location. Popular sites include Catalant, Graphite and Business Talent Group. Don’t hesitate to utilize social platforms like LinkedIn as well. Numerous recommendations are usually a good indicator of a potential consultant’s expertise. Search for keywords relevant to your issue, and take a close look at the top results.
Visit freelance sites. If you’re looking for a niche specialist, consider exploring popular freelance sites like Upwork, Dribble, Fiverr and Freelancer. Note potential consultants’ popularity, engagement levels and reviews from previous clients.

2. Vet your potential business consultant.

Ask questions. If you rely on a personal recommendation, ask detailed questions about your colleague’s experience, the consultant’s process and, most important, the results of their consulting work. Your colleagues can give you a unique insight into the long-term impact of following the consultant’s recommendations rather than just their short-term gains.
Learn about the consultant’s background and qualifications. Look at the consultant’s resume, educational background and certifications relevant to your industry. It’s a good sign if they seem willing to explore new learning opportunities and keep their skills updated.
Ask the consultant about their hands-on experience. Hands-on experience is significant in the business world. If someone came directly out of college labeling themselves as a consultant, do they know anything more than you? Consider looking for consultants who have successfully owned or run small businesses, enterprise organizations or specific departments.
Ensure their experience applies to your business. A former bank CEO may seem impressive, but do they have the knowledge and experience to turn your cupcakery into a profitable small business? They might, but if you’re also considering a former restaurant owner who now makes a living successfully helping small eateries grow, this consultant may be a better match for your business. Look for consultants who have worked in your industry and with businesses that match yours in style, size, needs and goals.
Check out their website. You should also vet the consultant through their website and materials. Look for professional images and well-documented information about their services, and thoroughly review contracts and consultancy fees.
Examine their consulting track record. You don’t just want a consultant with the right experience; you want a consultant who has demonstrated success with companies like yours. Ask for a portfolio or list of brands the consultant has worked for, and request references. Look for a consultant who has helped businesses overcome the types of challenges you’re facing or who has grown businesses very similar to yours, and reach out to those companies to find out if they were satisfied with the services.

3. Decide if they’re the right consultant for the job.

If your potential consultant’s references are excellent and they’ve proven to be reputable and effective, meet with them to ensure they’re the right person for the job. Clearly outline your pain points and expectations, and see if you’re comfortable with their style and personality. If the consultant checks all your boxes, it may be time to move forward.

Designing a business consultant agreement or contract

Once you’ve found an excellent consultant, done your due diligence and vetting, received satisfying and verifiable references, clearly outlined your pain points and expectations, and made sure you are comfortable with their style and personality, it’s time to confirm the arrangement.

Consultant agreements or contracts are typically drawn for three to six months with the option to renew. Agreements usually include details like the names of the responsible parties, consulting parameters, fee structures, payment schedules, outlined deliverables and established deadlines.

A defined and confirmed deadline ensures that your consultant has sufficient time to deliver the promised results while prompting timely progress.

If your business is struggling in any of these areas, it’s a good idea to seek out a business consultant who’s a verified expert. If you note any declines in profits that you can’t explain, this could be another sign that it’s time to hire a business consultant who can pinpoint potential reasons for the decrease and suggest ways to remedy them.

Original Post: What Is a Business Consultant?

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