02 – Is Business Consulting Right for You?

Introduction

The preceding module examined the business consulting landscape, highlighting the growing reliance on consultants and subsequently increasing their demand. However, as demand escalates, more consultants emerge, augmenting not only the supply but also competition among existing consultants.

This module has involved extensive reading and research across multiple types of sources. This is because there is no text book for the subject. Consequently, I have departed from standard referencing in several areas, particularly where the reference is in a book. Even when direct quotes have not been used, you may see page numbers added. This is simply to assist me to find the reference in future should I need to do so. I think I will employ this in future when referring to books as it will save a lot of time when going back to refer to particular content.

Furthermore, the module observed that while the consulting landscape expands, it simultaneously fragments and specialises in various distinct areas. Notably, the digital and artificial intelligence sectors exemplify this trend due to their specialised and emergent nature. It is anticipated that growth will persist in mature markets such as Australia, with the gig economy potentially fostering increased demand and expansion. This is because it affords individuals opportunities to enter the market and undertake short-term projects aligned with their specific lifestyles.

When examining the suitability of business consulting for oneself, it is essential to consider the various definitions of consulting. These definitions, derived from scholarly literature and attributed to specific authors, provide a basis for drawing a conclusion.

• Kubr (2002, p. 8) [^1] states that “Consulting is a temporary service” which is also supported by Stroh (2016) [^2]
• Consulting is regarded as a functional process where the consultant does not have “direct control over the implementation” (Block cited in Kubr 2002, p. 3) [^1]
• Consulting, but its very nature is a specialist area and not everyone has the requisite skills to offer. (Biech 2019b [^3]; Block 2011 [^4]; Zipursky 2018 [^5])
• Consultants provide a professional service to organisations on a contractual basis that involves independent advice and perspective (Block 2011; [^4]; Kubr 2002 [^1]).
• Consulting involves the transfer of knowledge from the consultant to the client which in turn adds value for the client (Kubr 2002)[^1]
• Consultants will ordinarily create and transfer knowledge, skills and expertise to clients during a project (Biesch 2019b [^3]; Block 2011 [^4]; Kubr 2002 [^1]) .

Stroh (2019, p. 3) provides a detailed definition which states that:

“a consultant is someone who either advises a client on the desirability of taking some action, or who assists the client in making a decision and then helps the client in planning or implementing action as determined by the client.”

The bottom line is that business consulting is a business where a professional is paid to transfer their knowledge to others in their capacity as clients.

The Work of the Consultant

In the realm of consultancy, Beech (2019-A) concisely delineates the profession as encompassing four distinct activities. Primarily, consultants are tasked with problem identification, followed by ascertaining its cause. Subsequently, they must determine an appropriate solution and ultimately implement it.

It is essential to concentrate on problem identification momentarily. Frequently, individuals may perceive the cause of an issue as its effect, stemming from a deeper underlying cause. Thus, it is crucial for consultants to persistently inquire about the causal factors to ascertain the root of the problem and subsequently devise the appropriate solution.

Biech (2019a p. 1) [^6] states that, “a consultant is a professional who provides unique assistance or advice to someone else, usually known as the client”. Biech (2019a p. 1) [^6] goes on to say that, “the assistance is usually advisory, strategic, or tactical in nature. The work is defined by the consultant’s expertise”.

Another definition from Block (2011 p.1) is “A consultant is a person in a position to have some influence over an individual, a group, or an organization but has no direct power to make changes or implement programs.”. This definition would appear to be at odds with Biech (2011a) above in the context of implementation of projects.

Figure 1: The Consultant’s Role

Kubr (2002, p. 10) goes on to define management consulting as:

… an independent professional advisory service assisting managers and organizations to achieve organizational purposes and objectives by solving management and business problems, identifying and seizing new opportunities, enhancing learning and implementing changes.

A common thread noticeable through all these definitions is the use of the words, advise, expertise, knowledge, independent and specialist. Additionally, a consultant needs to be an expert and active listener to ensure they pay strict attention to the client and the problems being faced.

Block (2011) [^4] expands on the evolving role of consultants, particularly regarding their influence on clients. Historically, consultants conducted research, devised solutions, and presented them to clients for implementation. In contrast, contemporary consultants frequently participate in project execution, likely to guarantee seamless implementation of their recommendations.

AIB (2019) took the definitions listed above and determined a collective view on consulting:

Consulting is a knowledge transference service in which the consultant is qualified with a high degree of expertise that can be transferred by temporarily assisting, advising or influencing the client or through the implementation of new knowledge to the client’s enterprise(s).

Block’s (2011) [^4] expansion into the implementation phase of consulting challenges the traditional view that a consultant’s project is time-limited and primarily focused on knowledge transfer rather than direct implementation within the business (Kubr 2002) [^1]. As a result of its time-limited nature, the service is often referred to as a project, aligning with the definition of a project as constrained by time.

The level of assistance provided by consultants is advisory and contingent upon their expertise in the specific domain (Stroh, 2019) [^2 ]. Biech (2019b) [^3] posits that this expertise stems from the consultant’s accumulated knowledge and experience, which can vary depending on whether they operate as a generalist or specialist within their industry.

Stroh (2019, p. 3) states that:

• Consultants work with clients
• Consultants assist these clients to achieve goals defined by the clients, not the consultant
• Consultants provide a specialised skill or expertise that the client/organisation is unable to provide on their own.
• Although consultants may influence decision making, by virtue of their knowledge or expertise, consultants usually have little power or authority to make changes. A consultant may recommend changes, but the client ultimately retains the ultimate authority over whether and which changes are implemented.

A Changing Industry

Numerous enterprises possess employees who possess adequate problem-solving skills required within the organisation. Nonetheless, occasionally an external, impartial perspective is necessitated, potentially from an individual possessing a higher degree of expertise than an internal employee. Contemporary businesses increasingly explore opportunities within the gig economy, engaging consultants for finite durations to undertake projects rather than employing full-time specialists in that domain.

It is crucial, however, to observe the potential overreliance on consultants to either assume or evade responsibility by employees, necessitating vigilant monitoring by organisations to prevent such occurrences. That said, according to Biech (2019b), a consultant can bring a different perspective to a project.

The consulting industry necessitates consultants remain current with developments in their serviced landscape. They must be cognisant of economic, political, and social trends that may influence their client’s business (IBISWorld, January 2019). As consultants facilitate knowledge transfer between themselves and clients, it is imperative that this information is up-to-date, consequently reducing costs, augmenting revenues, and enhancing the value of their advice. This presents a potential opportunity for consultants to develop an email newsletter to apprise clients of evolving industry environments (Stroh 2019) [^2]. Consultants are consistently required to reinvent themselves and innovate in order to maintain the relevance and value of their expertise.

Figure 2: Business Consultant Skills

In summary, a business consultant is fundamentally engaged in the knowledge transfer domain. As a result, it is prudent for them to be involved in knowledge management to efficiently monitor and transfer their expertise. Block (2011) [^4] and Kubr (2002) [^1] emphasise that effective knowledge transfer necessitates outstanding interpersonal skills, which would encompass clear communication and adept listening abilities.

Internal vs External Consultants

The following tables, reproduced from Stroh (2011 pp. 9 & 11) [^2] demonstrate the differences between the two types of consultants.

Figure 3: Differences between internal and external consultants

Figure 4: Advantages and disadvantages of internal vs external consultant

Models of Consulting

Three distinct models of consulting have been identified. Firstly, the expert model involves a consultant possessing specific expertise which they impart to the client in order to address a particular issue. Secondly, the doctor-patient model entails the client seeking assistance from the consultant to diagnose a problem and subsequently propose solutions and implementation processes.

The third model, referred to as the process model, focuses on assisting clients in identifying issues within their operational processes. In this approach, consultants devise implementation strategies, advise on execution, and conduct periodic evaluations to ensure satisfactory progress. This model is typically ongoing to guarantee client satisfaction in the targeted area.

Additional approaches and models

A business consultant identifies clients and subsequently offers their expertise, experience, and advice for financial gain. Typically, a consultant possesses a specific discipline such as accounting, IT, or engineering; however, they may also engage in generalist consulting as opposed to specialist consulting.

In the consultant-client relationship, both parties maintain consistent communication while the consultant develops a project proposal that meets the client’s satisfaction. Upon agreement, the client signs a contract outlining the project scope, which is binding for both parties. The consultant completes the project and receives payment either through interim instalments or upon completion, depending on negotiations.

Process consulting, as described by Sibbett and Wendling (2018, p. 72) [^7] is defined as:

…a kind of relationship where the consultant isn’t coming in with answers, but instead focuses on helping design and facilitate a process where the organization itself could develop its own solutions in a way that is specific to the needs and capabilities of the organization.

Regarding projects, each assignment has a goal, is time-limited, and includes detailed costs and pricing. Additionally, projects outline resources allocated for completion, processes and methods utilised, systems deployed, objectives pursued, and any constraints present due to performance, time or cost factors.

Kubr (2002) [^1] contends that if someone is entering the consulting industry, they need to have an understanding of the role they will play in working with clients. Below is an image from Kubr (2002, p. 21) demonstrating the work of the consultant:

Figure 5: Phases of the Consulting Process

Consulting Activities

The video below is self explanatory from the title. It relates the story of quite a large project for a major consulting firm so may not be relevant if you servicing SMEs. There are still points however, that can be noted regarding process which could be useful in developing checklists.

Scoping activities

Stroh (2019)[^2] asserts that prior to composing a project brief or proposal, consultants must develop the project’s scope to comprehend its requirements. It is crucial to identify the specific aspects of the project while also considering its broader implications and potential impacts. Establishing key deliverables and timeframes is essential, as is obtaining a list of stakeholders, including critical staff and their involvement levels, from the client.

Moreover, understanding areas of expertise, key decision points, timelines, and relevant KPIs aids in crafting a comprehensive project scope for the client. A common issue with scoping is an excessive focus on the client’s perceived problem, which may not be the actual issue. Thus, consultants must independently diagnose the problem and discuss any discrepancies with the client. If necessary, the scope may require expansion to address the root cause and ensure that the project effectively resolves the underlying issue rather than merely addressing its effects (Block 2016 [^4]; Kubr 2005 [^1]).

Diagnosing problems

Kubr (2002) [^1] posited that certain conventional methods of scoping and diagnostics may prove both time-consuming and resource-intensive. Instead, he proposed alternative strategies, such as:

• The Six Thinking Hats [^8] (Kubr 2002, p. 219)
• Uniqueness of Principles – no two problems are the same. Do not fall into the trap of treating similar problems with the same solutions. Ensure the context of the problem is considered also.
• Purposes Principle – this refers to focusing in on the purpose in an expanding manner that is beyond the surface observations to a far deeper level. This focus can result in a more comprehensive understanding of the problem and set the direction for finding solutions.
• Systems Principle – every problem sits within a problem eco-system and resolving one can lead to creatingor exposiong another. Ensure the problem is understood within the framework in which it exists.

Discussion on the Uniqueness, Purposes and Systems principles can be found in Kubr (2002, p. 14). [^1]

Change Activities

A crucial aspect for business consultants involves managing change, wherein they aid clients in navigating organisational alterations. In this discussion, three distinct types of change requiring a business consultant’s assistance will be examined.

Firstly, developmental changes arise due to modifications within the organisation instigated by others. For instance, personnel may be reassigned, resulting in the necessity for some staff members to acquire new skills or assume additional responsibilities. A consultant can facilitate the navigation of such a landscape.

Secondly, volitional changes pertain to those made consciously by individuals or organisations. For example, a company may engage a consultant to mediate a strategic planning session, or adopt an attitude aiming to enhance performance levels through mindset alterations, training, and other methodologies.

Lastly, situational changes are driven by events entirely beyond an organisation’s control. These alterations often stem from external factors such as economic fluctuations, governmental policies, legislative amendments, societal shifts or extreme weather events. Consequently, organisations must adapt rapidly to maintain operations in the face of these unforeseen circumstances.

What are the key elements for consulting to be effective?

Turner (1982) [^9] despite being a rather old article, has built a hierarchy of advice for a consulting practice. This is in support of his article entitled, “Consulting is so much more than giving advice”.

Figure 6: Hierarchy of consulting purposes

Consulting purposes one to four are traditionally considered the legitimate functions of a business consultant. Number five, as mentioned earlier, is increasingly debated regarding whether consultants engage in the implementation process. If so, this tends to be more in a process-type consulting arrangement rather than the traditional expert or doctor-patient model. Turner (1982) contends that goals six to eight are increasingly integrated into consulting projects, making it part of the overall project to build consensus and commitment, facilitate client learning, and improve organisational effectiveness while addressing the issues for which the consultant was initially engaged.

Turner (1982) also argues that superior consultants view their work not only as recommending solutions but also assisting in implementing enhanced management processes and organisational standards. By comprehending this broader range of objectives offered by consultants, managers can engage them more effectively and anticipate greater value. Consequently, the project brief will not be confined to a singular purpose.

Top ten consulting challenges

Méndez and Yerkes (2008) argue that consulting frequently poses difficulties and enumerate several challenges associated with consulting assignments, irrespective of whether they are undertaken by internal or external consultants within an organisation. These issues warrant consideration in any project.

Figure 7: Top 10 Challenges in Consulting

Assessing where you fit in consulting

The image below came from the LinkedIn Learning series that was recommended. McGannon, B 2018, What does it take to be a consultant?, LinkedIn Learning video, viewed 1 September 2021. It may require a subscription to view the video.

The Case Interview

The video below outlines the process that large consulting firms such as McKinsey, BCG and Bain may go through when considering the employment of a consultant. As a result of watching the video, it would appear a long process and one that is highly competitive.

Working as a consultant

In the realm of consultancy, resilience is often discussed as a crucial attribute due to the market’s fluctuations that appear to correlate with the economy. While this may have been traditionally accurate, a consultant specialising in troubleshooting and problem-solving within businesses could potentially experience consistent demand throughout economic downturns as well. During periods of economic growth, it is perceived that consultants thrive, as numerous enterprises possess the necessary cash flow to employ consultants whom they consider a luxury rather than a necessity in various instances.

In support of the above statements, Charles Stein (cited in Biech 2019b, p. 5), from the Boston Globe once said:

“Once upon a time, consultants were like dinner guests: they came for a brief visit, gave advice and went home. Now they are like a guest who comes for dinner, moves into the spare bedroom, and stays with us for a year or two.”

Biech (2019b, pp. 5-6) cites the Workplace 2025 report which outlines several reasons why people are choosing to engage in consulting and adopt an agile lifestyle:

• It’s a better fit with my lifestyle – 68%
• Working as a consultant or agile makes me a more qualified employee – 63%
• Working as a consultant or agile makes me more money – 56%
• Working as a consultant or agile provides me with better career growth than working as a permanent employee – 48%
• Working as a consultant provides more job security working as an agile than working as a permanent employee for someone else – 38%

Client needs

Biech (2019b, pp. 7-8 ) further lists and expands on the reasons that clients need consultants:

• Lack of expertise within the enterprise
• Lack of time from teams within the enterprise
• Lack of experience or trained employees
• Staffing flexibility
• Objective outside opinions
• New ideas as a result of greater exposure in industry
• Speed and efficiency
• Assessment of the problem on an objective basis
• Resolution of conflict and differences from within or a merger/acquisition situation
• Compliance requirements with regulatory bodies.

Consultant needs

Biech (2019b, pp. 8-10) lists an extensive array of reasons why people wish to become consultants including:

• Be my own boss
• Eliminate a set schedule.
• Availability of greater opportunities. 
• Do my own thing.
• Take advantage of technology. 
• Freedom. 
• More money
• Out of work
• Greater good
• Security
• Creativity
• Travel
• Challenge
• Self-preservation
• Location

Problem solving skills

A crucial skill for consultants is problem-solving, as it forms the basis of their engagement. The efficiency and methodology employed in addressing issues are of utmost significance to clients. Problem-solving can be acquired and refined through persistent practice, ensuring prompt identification and implementation of suitable solutions. The video below feature Brian Tracy, well known author and business specialist discussing problem solving.

Your impact and presence

Impact and presence constitute crucial components of a successful consultancy practice. Evidently, to excel as a consultant, one must make a significant impact and ensure that their presence is acknowledged. The significance of one’s brand and reputation cannot be overstated.

An impact can be achieved through external documentation and digital media that represent the consulting firm. The brand image holds paramount importance in various platforms, such as websites, LinkedIn profiles, and other social media channels where interaction occurs within the digital sphere, as well as the telephone and video conferencing mediums.

Impact and presence holds particular relevance in the gig economy and the consulting sector since clients typically engage with individuals rather than purchasing goods. Consequently, consultants must effectively market themselves to prospective clients. A widely-accepted perspective suggests that people operate on a four-step principle: know, like, trust, and buy.

Authenticity is highly valued by clients, alongside a consultant’s ability to adapt in dynamic environments subject to change. Confidence is undeniably essential since it is contagious; however, enthusiasm and passion are equally important contagious qualities for consultants to embody.

Building your personal brand

Intending to pursue a consultancy career necessitates cultivating a personal brand to effectively market oneself in the professional sphere. This involves informing the wider audience of one’s expertise and capabilities. A concise personal positioning statement, featured on platforms such as LinkedIn, should convey one’s passions and motivations, with the aim of captivating potential stakeholders’ interest based on the presented information.

Building a brand for consulting

In any commercial endeavour, it is crucial to distinguish oneself in order to create an impact and consulting is not exempt from this principle. Constructing a distinctive brand requires significant investment in time, finances, and effort to develop a persona that generates client interest and inquiries for your consulting practice. Effective branding can lead to speaking engagements, presentations, and webinars, increasing exposure to your target market and creating business opportunities. Alongside your consulting business brand, it is essential to establish and maintain a personal brand, which differs from the former.

A personal brand concerns one’s reputation and the perception others have of them as an individual. It embodies the manner in which one upholds their ethics, integrity, authenticity, and interactions with the world. In contrast, a consulting brand represents the business itself and is separate from the personal brand. While there is only one personal brand, multiple business brands may exist depending on the number of organisations or enterprises one is involved with.

As a consulting business provides services rather than products, its branding focuses on the value proposition offered to clients. Building recognition of this value encourages potential clients to engage with your services due to their identification with the established brand. Consequently, a consulting brand must encapsulate your promise to clients, methods of achieving results, service provision, and differentiation from competitors.

To effectively establish a personal or consulting brand, it is advisable to begin by defining oneself and the business through a positioning statement.

Conclusion

In conclusion, this module has examined multiple definitions of consulting, the services offered by consultants, and delved into these aspects through relevant literature. Essentially, a consultant is an autonomous individual providing objective and impartial specialist advice, possessing significant experience in their field along with pertinent qualifications and memberships, if necessary.

Ultimately, a consultant is a problem solver who must possess skills in their respective areas and adapt to the rapidly changing environment. With the increasing integration or potential incorporation of artificial intelligence into businesses, many organisations will seek guidance in assimilating this technology. Consequently, there is considerable opportunity for consulting businesses at present, particularly those focusing on strategic planning, growth, establishing objectives, and building sustainable competitive advantage through the implementation of new technology.

Extra Activity

As a final activity for this module, I needed to write a Position Statement for my consulting business. Many people find it difficult to promote themselves and this task proved no exception. However, the following is the prociess followed:

“At Ric Raftis Consulting, we cater to small and medium-sized enterprises, non-profits, and community-based organisations. Our services encompass various areas; however, we possess particular expertise in strategic planning, artificial intelligence (AI), and its implementation and integration into businesses adapting to changing environments. Additionally, we specialise in governance for community organisations and not-for-profit entities. We are dedicated to delivering our services with passion and purpose, underpinned by the conviction that integrity, ethics, and authenticity must form the backbone of my business.”

I then asked ChatGPT if it could improve on my version with the following prompt:

The Prompt
“Act as a business consultant to a business consultants. I have written a positioning statement for my business and seek your advice on how it could be improved. Here is the Postioning Statement: ” “

(I then pasted in the above positioning statement)_

Here is ChatGPT’s answer:

Certainly, I’d be pleased to offer my insights on your positioning statement for Ric Raftis Consulting. A positioning statement is a critical tool for establishing your brand’s identity and value proposition in the marketplace. It should be concise, clear, and compelling, effectively communicating who you are, what you do, and why you’re different.

Your Original Positioning Statement
“At Ric Raftis Consulting, we cater to small and medium-sized enterprises, non-profits, and community-based organisations. Our services encompass various areas; however, we possess particular expertise in strategic planning, artificial intelligence (AI), and its implementation and integration into businesses adapting to changing environments. Additionally, we specialise in governance for community organisations and not-for-profit entities. We are dedicated to delivering our services with passion and purpose, underpinned by the conviction that integrity, ethics, and authenticity must form the backbone my business.”

Observations

1. Target Audience: You’ve clearly identified your target audience, which is good.
2. Service Offerings: You’ve outlined your areas of expertise, but it’s a bit broad and could be more focused.
3. Differentiators: You’ve mentioned your dedication to integrity, ethics, and authenticity, but these are somewhat generic and could be strengthened.
4. Grammar and Structure: There are a few grammatical errors and the sentence structure could be more streamlined for better readability.

Revised Positioning Statement
“At Ric Raftis Consulting, we empower small to medium-sized enterprises, non-profits, and community organizations to thrive in a dynamic landscape. Leveraging our specialized expertise in strategic planning and artificial intelligence, we offer tailored solutions for seamless technology integration and effective governance. Our commitment to ethical practices and authentic relationships sets us apart, making us the trusted partner for organizations seeking meaningful change.”

Changes Made

1. Empowerment: Changed “cater to” to “empower,” which is more proactive and implies a transformational relationship with clients.
2. Specialized Expertise: Clarified the areas of expertise and how they are applied.
3. Differentiators: Made the ethical commitment more specific by tying it to being a “trusted partner.”
4. Grammar and Structure: Streamlined the language for clarity and corrected grammatical errors.

I hope you find these suggestions beneficial. Feel free to adapt them to better align with your brand’s voice and mission.

Result

I find the revised version from ChatGPT to be very suitable and better worded than my original versions. It has encapsulated my ideas and generated a brand based value proposition for clients. I have now added it to my website, Ric Raftis Consulting, on the front page.

References

[^1]: Kubr, M 2002, Management Consulting: A Guide to the Profession, International Labour Office, Washington, SWITZERLAND, viewed 27 August 2023,  http://ebookcentral.proquest.com/lib/aibus/detail.action?docID=529940.
[^2]: Stroh, LK 2019, The Basic Principles of Effective Consulting, Second, Taylor & Francis Group, Milton, UNITED KINGDOM, viewed 30 August 2023,  http://ebookcentral.proquest.com/lib/aibus/detail.action?docID=5675688.
[^3]: Biech, E 2019b, The New Business of Consulting: The Basics and Beyond, John Wiley & Sons, Incorporated, Newark, UNITED STATES, viewed 27 August 2023,  http://ebookcentral.proquest.com/lib/aibus/detail.action?docID=5764120.
[^4]: Block, P 2011, Flawless Consulting: A Guide to Getting Your Expertise Used, Center for Creative Leadership, Hoboken, UNITED STATES, viewed 30 August 2023,  http://ebookcentral.proquest.com/lib/aibus/detail.action?docID=661497.
[^5]: Zipursky, M 2018, Consulting success: the proven guide to start, run and grow a successful consulting business, Consulting Success, Place of publication not identified.
[^6]: Biech, E 2019a, The New Consultant’s Quick Start Guide: An Action Plan for Your First Year in Business, John Wiley & Sons, Incorporated, Newark, UNITED STATES, viewed 27 August 2023,  http://ebookcentral.proquest.com/lib/aibus/detail.action?docID=5764121.
[^7]: Sibbet, D & Wendling, G 2018, Visual consulting: designing & leading change, First Edition, Wiley, Hoboken, New Jersey.
[^8]: De Bono, E n.d., ‘Six Thinking Hats – De Bono Group’, Six Thinking Hats, viewed 1 September 2023,  https://www.debonogroup.com/services/core-programs/six-thinking-hats/.
[^9]: Turner, AN 1982, ‘Consulting is more than giving advice’, Harvard Business Review October 9, Vol. 60, No. 5, pp. 120–129, Harvard Business School Publication Corp.
[^10]: Mendez, YB & Yerkes, L 2008,‘Tools and Techniques for Effective Consulting – Asia Pacific’, in PMI® Global Congress 2008—Asia Pacific, Sydney, NSW, Australia, viewed 1 September 2023,  https://www.pmi.org/learning/library/tools-techniques-effective-consulting-asia-7047.