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Defending the Enterprise
Friday, October 27, 2006
Volume 1: Issue 1
How to Hire a Consultant
Not sure you know what questions to ask? Are you afraid of making a costly mistake? You are not alone.
With ever-tightening budgets and less staff, managers are looking to outside consultants to fill the gap.
However, no one is satisfied if expectations are not carefully managed and executed by both the client
and the consultant.
Here are some tips to follow when hiring a consultant.
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Points to Consider |
Determining a skill set: Hiring a consultant to manage or work on a
project is not the same as hiring a full-time employee. When you are hiring a full-time employee, you are—or should
be—looking for a wide-range of skills and experiences that fit an established job description, requiring a minimum
amount of training.
When hiring a consultant, you are looking for someone with specific skills to match one specific project. Unless
there is a methodology or system specific to your organization, no training should be required.
By first developing a project description for this specific work effort, you can focus on the exact experience
and skills that you will need for this particular project.
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How does this help? |
It can be expensive to hire people with highly
specialized skills. By narrowing the skill sets you need, you can avoid hiring an overqualified consultant.
For example, project managers are expensive. If the job requires a lot of data entry, ask yourself the following
questions: Do I really need a project manager? Is a project administrator sufficient? Do I need a combination
of both?
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Develop a project description not a job description:
Besides helping you select the best consultant for your needs, having a detailed
project description will help you to both control costs and manage the project. A good
project description will have the following information:
- Overview/scope of work
- Staffing and reporting relationships for entire project
- Which position you are looking to fill
- Measurable deliverables with identification of sign-off authorities
- Schedule, which includes predefined sign-off points
- Budget
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Having this information helps:
- To select the correct people to work on the project.
- To eliminate “scope creep,” which may negatively impact the project’s schedule and budget.
- To ensure a faster startup for the project.
- To provide measurable results and sign-off points.
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Anticipated Roadblocks |
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Fixed price or hourly? If you are going to require someone to be onsite 40 hours per week, you will often have no choice but to go the more expensive route of an hourly salary.
However, if you develop a well thought out project description and do not require the consultant to be onsite full time, most consultants will work on a fixed-price contract.
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Hourly salary contracts can encourage both sides to be a little slack about controlling “scope creep" and will almost always cost you more than you had anticipated.
A fixed-price contract, on the other hand, encourages both sides to more closely manage the project and almost always costs less than an hourly salary contract. |
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Product or process? You first need to determine which is more important for this project: products or process. If you are hiring someone for process, then you need that person onsite every day to interact with your staff, customers, and/or systems. It also means that you will maintain strict daily/weekly management of that person’s progress.
However, if you are hiring someone to produce a product, you are measuring his or her success based on well-defined measurable deliverables, not the number of hours he or she was in the office. |
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Not requiring the consultant to be onsite full time will allow the consultant to use his or her time more effectively and will reduce the overall cost of a project.
Trips to the office will be more effective and travel expenses will be reduced.
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One project or several? All consulting agreements should have a definite start and stop date. Most projects should last no more than 6 months. If there is a need for more effort, then in most cases it would be wise to break the project down into two or more separate contracts.
Many projects can be logically grouped into several sub-projects. It will not take much effort to determine which of these sub-projects could be combined into discrete contracts.
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Having separate contracts often makes it easier for management to approve what you want to do, since the budget and deliverables can be more accurately managed.
Doing this will also limit your risk if, for some reason, you are not satisfied with the results that you are getting. You are then free to renegotiate the next phase/contract, hire another consultant, or even perhaps complete the work in-house. |
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Summary
The bottom line: Take the time to plan before you hire any consultant. Work with the consultant to develop
well-defined, measurable deliverables. Do not pay for exclusivity unless your project really calls for that
type of commitment.
Taking the time to plan properly upfront will ensure that you not only get the products or services you
need but that you will get them at a reasonable cost.
Contact us for support: newsletters@bennettgrp.com
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