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Hire a management consultant

Why hire a management consultant?

Management consultants offer a range of qualities which are valuable to managers

Knowledge: Consultants usually specialise in one or more areas such as strategic planning, process improvement, or supply chain management. They may also practise in a specific industry, such as food processing, utilities, or tourism.

Experience: Consultants tend to have both subject matter and managerial expertise.  Together with their consulting experience, this makes them highly valuable as advisers.

Objectivity: Consultants can bring to your business an objectivity based on their independence and their exposure to a range of organisations.

When should you use management consultant?

As New Zealand industry and commerce become more competitive, the business community and the public sector need better analysis for decision-making in a more complex environment. The pace of change, whether in business, technology, society at large, continues to increase.

Sound decision-making calls for adequate information and a balanced view of the issues. Increasingly this requires a wider range of skills and experience. Specialised knowledge becomes more important. In many instances this expertise is not available within the organisation, or it may not warrant long-term acquisition. At times an independent view is needed.

In these circumstances the matter is often best managed by calling on outside assistance. Management consultants offer professional services specifically designed to meet this need. By using a consultant, the organisation is provided with additional resources. If they are selected and used well, they will make a significant contribution to the organisation's performance.

What can management consultants do?

Help instigate and manage change

The business environment is in a constant state of change and only those on the alert for favourable opportunities will stay ahead of the pack. Because change can be threatening to many people, the change process must be planned and managed carefully. A consultant can help.

Help resolve issues

Business issues can be very complex. Often a whole range of diverse but interrelated factors are involved in an issue, and the web of connections may not be readily apparent to the untrained person.

Consultants can help you deal with questions such as these:

  • How do we build staff morale?
  • How do we overcome behavioural problems to work?
  • What computer system is needed to support the business?
  • How do we introduce quality assurance programmes?
  • How do we turn around a fall in sales?
  • Why has there been a decline in productivity?
  • How do we overcome our cash-flow crisis?
  • What strategic direction should our information systems take?

Identify opportunities

Management Consultants can help identify favourable opportunities for your business:

  • What new product lines should we adopt?
  • What is the best way to improve our productivity?
  • What new production techniques should we adopt?
  • How do we maximise the benefits of the effective integration of people and technology?
  • How do we identify key success factors for penetrating overseas markets?
  • How can we become internationally competitive?

Help with strategic and business planning

Planning is an essential function in the running of any business and is the driving force behind competitive workplace change. Any planning activity should take into consideration certain factors, such as your competitors' and your company's strengths and weaknesses.

Consultants can help you identify your strategic advantages, using the latest management techniques, to realise the full potential of your business.

What can management consultants do?

Consultants' charges usually comprise two parts: a professional fee, and any direct out-of-pocket expenses associated with the project.

Fees may either be a fixed fee representing the value offered by the consultant or they may be based on the time spent by the consultant on the project. In some cases, the total fee quoted is an estimate because the project, being a joint effort by the client and the consultant, is not completely under the consultant's control. Moreover, the exact amount of work cannot always be quantified at the beginning. In some cases, the consultant can quote a fixed charge, or a fixed basis of charging for the work done.

The timing of payment of fees will vary depending upon the nature of the service and the duration of the assignment. A very short assignment may typically be invoiced on completion while other assignments may have an initial fee followed by payments based either on delivery milestones or on a regular schedule such as weekly or monthly.

To ensure that the comparison of consultants' fees does not overwhelm the selection process, you may ask for proposals to be submitted in two parts, that is, with the fee component in a separate sealed envelope. This enables you to review the essential merits of a proposal without cost considerations clouding the issue.

Management consulting fees are similar to those of other professional firms which employ staff of high calibre. Consulting firms have to provide attractive remuneration for top-level staff, as well as substantial research, training, and information services to ensure that their capabilities are equal to the best international standards.

​It is not possible to provide high-quality professional services at a low fee. Experience shows that apparently cheap professional services very seldom give value for money. An unsuccessful consulting project is expensive at any price.

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