Hire a business advisor
Finding a great business advisor or business consultant is difficult. Business advisors are typically only needed when there is a large, complex problem to solve but finding the right consultant can often seem harder than solving the problem itself. This article examines the six key mistakes people make when hiring an advisor and offers a roadmap to avoid common pitfalls.
Who uses Business Advisors
This article is for CEOs, C-Suite executives, line managers and business owners. Essentially anyone in a leadership position tasked with finding a business consultant for the company.
This article is intended to de-mystify the process of hiring a business advisor and help executives identify exactly what they should be looking for to find the management consultant who can best support them to realise their strategic goals.
This is the article that most other consultants don’t want you to read. The reason is that most business advisors like to think of themselves as something akin to magicians, somehow holding the secrets of how to make a struggling business into the next billion dollar unicorn. Many business advisors use complex technical jargon and terminology to intimidate and mystify their clients, making their services seem more complex than they actually are.
Business Advisor Mistake #1 – Believing consultant marketing hype
A quick google search for business advisors and you will be inundated with business advisor websites promising to grow your sales by 10 times or triple your bottom line. These are strong red flags that this advisor should be avoided. No reputable consultant will ever promise that they can multiply your sales or profit, particularly when they don’t yet know about your business or business challenges. Just as you would avoid snake oil salesmen promising to cure illnesses, you should steer clear of consultants who promise to magically turn your business into a money-generating machine.
Business Advisor Mistake #2 – Buying a “system”
Many business advisors will promote that they use a patented system to improve your business or solve your problems. This can seem highly appealing for business managers looking for a fast, prepacked solution to their problems. Unfortunately, this is a mistake. Every business is different and the challenges that it faces are unique. A good business advisor, like a good GP, will use a range of diagnostic tools to deeply understand the challenges being faced and will work to find the correct prescription to help a business owner achieve their objectives.
Business Advisor Mistake #3 – Not checking consultant qualifications
Whilst the prerequisites to be a lawyer or engineer are particularly stringent, almost anyone can call themselves a business advisor. But clients regularly forget to do the appropriate amount of due diligence around the qualifications of their chosen management consultant. The bare minimum set of qualifications that your business advisor should have are undergraduate and post-graduate business related degrees from top tier universities and at least 8 years experience working at a brand name consulting firm – either big 4 or strategy house. This should eliminate those consultants who call themselves business advisors but who have little or no substance.
Business Advisor Mistake #4 – Being too quick to call the “big 4”
There is an old adage that no one ever got fired for hiring the big 4 – and there is some truth to that fact. They saturate the market with their branding and are ubiquitous in corporations across Australia. With that said, they typically leave clients underwhelmed with exorbitant fees, overreliance on junior staff and generic cookie cutter solutions. Is that an over generalisation? Yes of course it is. Of course, in amongst the 30,000 odd employees of the Big 4 in Australia there are no doubt a few genuinely excellent consultants. But an increasing level of public backlash against the Big 4 is beginning to take the sheen off these market behemoths. In a survey of 1,600 respondents only 7% had a positive view of the big 4.
Business Advisor Mistake #5 – Using remote advisors
The world is undoubtedly becoming more virtual, but executives that opt for remote business advisors are typically disappointed with the outcomes that they are able to achieve. Managers and owners seek out management consultants to solve big, complex, hairy business problems. Such problems are multifaceted, they are the result of interactions between legacy systems, cultural challenges, clumsy processes and unclear competitive positioning. Understanding the nuances of those interactions is something that it is almost impossible to do remotely, great consultants spend extended periods of time at onsite to breath the problems of their clients and find innovative solutions which may not necessarily be obvious from a 2-dimensional teams call.
Business Advisor Mistake #6 – Going big, early
The larger the project the larger the potential for failure – and remember, 70% of projects fail. Signing up a large consultancy agreement with an untested business advisor brings with a huge amount of risk with little or no upside for the client. Seasoned executives know to start small, bringing in an advisor on a limited scope allow both client and consultant to feel each other out, getting a sense for where a business advisor is able to add the most amount of value. Approaching a consultant engagement in the same way you might go about dating a potential before getting married, has a lot to be said for it.
Closing Thoughts
Hiring a business advisor can be a strategic move to manage complex challenges and achieve organisational goals. However, navigating the consultant landscape requires careful consideration to avoid common pitfalls. By avoiding the six mistakes outlined in this article, leaders can make informed decisions and find the right advisor to partner with. Remember, a successful consultant relationship is built on trust, alignment, and a shared commitment to driving positive outcomes. Read more on finding the right business advisor.
Frequently Asked Questions
The answer is, it depends. The truth is, it’s not a matter of how much a business advisor costs as much as it is what kind of business support you need and what is your budget for it?
Saying the word ‘business consultant’ is like saying the words ‘football player’. A football player could be someone in the AFL or in the under 10s. Technically, they are both football players.
The same applies to a management consultant.
You should expect a good business consultant to be charging you a similar amount to what a lawyer would – as they both has similar pedigrees and experience. In a similar way if you are looking for some basic advice that can be provided in under a week you should be expecting a cost of around $5,000; if it is more in-depth like a business plan or feasibility you should be expecting closer to $15,000. Strategic projects that last months or longer then become a function of how much value the project is expected to generate.
When seeking a business advisor, start by identifying your specific needs. Pinpoint the areas where you require guidance, such as marketing, finance, or operations. Determine the level of support you need, whether it’s one-time consultation or ongoing advice.
Look for someone who has exemplary qualifications, has worked for a brand name consulting company and can offer credentials of similar engagements they done with comparative companies. Leverage your network by asking other business owners for recommendations.
Ultimately, trust your instincts. Choose an advisor with whom you feel comfortable and confident. Consider a trial period to see if the advisor is a good fit.
A great business advisor someone who is able to act as a trusted partner to their clients. This requires that they are simultaneous experts in their field but also have with practical experience in advising businesses. Dealing with executives is not an easy task – getting them to listen to you is harder again. This requires exceptionally high levels of emotional intelligence accompanied with a strong dose of humility.
Beyond their technical abilities, they are empathetic and understanding, able to relate to their clients’ unique situations. They provide targeted and bespoke guidance that is highly actionable and evidence-based.
Luke Ingles
Managing Partner
luke@barcley.com.au
Sanuri Da Silva
Senior Consultant
sanuri@barcley.com.au
About Barcley Consulting
Barcley Consulting is a boutique management consulting firm focused on helping market leading companies with Strategy, Innovation and Execution. For more information on other publications please visit www.barcley.com.au