Why are you here? More than a metaphysical question, many organizations may recognize the need for consultants but remain unsure about how to use them. To be sure, organizations can utilize consultants in a variety of ways. This article addresses two different consulting alternatives–traditional and milestone–as well as the pros and cons of each.
In a traditional consulting arrangement, a firm deploys a team of full-time individuals at a client site for forty hours per week, typically four days at ten hours per day per consultant. Conversely, under milestone consulting, a client employs a consulting firm to check in with them on a regular basis, ensuring that the project is both meeting its individual goals and, from a broader perspective, remains on track. A client will often utilize a hybrid consultant–equal parts project manager, techie, and application expert–to visit on site every two weeks or so. Now that the definitions are out of the way, let’s discuss each in more detail.
Consultancies typically prefer this arrangement for a number of reasons. First and foremost, traditional consulting maximizes billable time and revenue. Second, and there is more than a bit of truth to this, consultants on the ground can better steer clients in the right direction throughout the project, manage issues, and ensure an overall smoother implementation than if they were not present.
On the downside, traditional consulting tends to be the most expensive option for clients. Also, many organizations face end-user availability issues. Client end-users are often overworked and too busy to spend time with consultants. Remember, end-users on implementation teams have day jobs while consultants exclusively implement the new system. While consultants can work independently, at certain points, client input is imperative. Consultants on site are billing regardless of whether their skills are being used efficiently or not. In the rare event that a project is running ahead of schedule, rare is the consulting company that attempts to move dates up or suggests that its consultants do not need to be on site for several weeks.
Benefits of this approach include keeping costs to a minimum. Also, to the extent that the consultant’s arrival is known well in advance, end-users can focus on their day jobs during the week knowing that they will devote certain days to the new system, coinciding with the arrival of the consultant. In theory, this can be more efficient.
This method should be used judiciously, as it is rife with potential disadvantages. For one, there may be no one keeping an eye on the implementation on a daily basis, allowing goals and dates to fall by the wayside. Issues may not be broached in time to address them without impacting a go-live date. Also, the implementation’s flow may suffer. Projects that constantly start and stop often lose momentum. Projects with more interruptions have a greater chance of failure and milestone-based approaches tend to have this limitation.
Considerations: Which is Best?
Given how much consultants cost, many clients might question the need to have a team of three or more highly paid hourly resources on staff for forty hours per week. To be sure, there is more than one way to deploy consultants in a cost-effective manner. As a general rule, the quality and number of required external resources varies indirectly with the quality and number of available and experienced internal end-users. In other words, an organization with extensive internal resources and expertise needs fewer external consultants. Organizations cannot expect to successfully implement major systems exclusively with either consultants or end-users. Almost always, a combination of each is required. While not necessarily advisable, organizations are often able to handle relatively limited upgrades and enhancements in a “consultant-free” manner.
Another consideration is end-user availability. Regular employees still have to do their day jobs in order for the organization to conduct business. For example, a payroll manager cannot set up, test, and document a new payroll system at the expense of paying current employees. By the same token, the head of IT cannot configure security for one system while neglecting to fight the fires of another system. This rule can alternatively be stated as follows: If an organization wants to minimize the number of external consultants on an implementation, it must ensure that the end-users on its implementation team: 1) are devoted regularly and significantly to the implementation of that new system; and 2) have sufficient expertise in that system.
A project’s timeframe, issue complexity, and scope are also critical factors. All else equal, consultants called in to solve a discrete task with no particular due date may not need to set up show for months at a time. Assuming an organization’s documentation is sufficient, a consulting firm may be able to perform the work required using the milestone approach. Conversely, consider a client with a bevy of complex issues, poor internal documentation, and a drop-dead date of two months to resolve an issue. It’s very unlikely that the client will be able to use consultants in a limited capacity.
Minimal consultant input and resources does not mean zero. On just about every new system implementation or upgrade, organizations need to utilize external application experts, technical resources adept at installing the application, and seasoned project managers who have dealt with many of the issues likely to face the client.
Summary and Conclusions
There are too many factors to determine the best type of consulting arrangement for any given client or project. There are potential drawbacks to both the traditional and milestone consulting approaches and one size certain does not fit all. To be sure, most organizations do not have the expertise that consultancies can provide. As such, organizations benefit from knowledgeable, on-site consultants who ensure that the project stays on course, issues are reported and resolved and individual objectives are met.
Before hiring external consultants, senior management should take into consideration issues such as budget, the state of its internal documentation, end-user availability, and the timeframe, scope, and complex