Red Zebra Business Centre -Management Memos
October, 2009. Making Measurably More For Your Business Since 1985!

What Happens When Clients and Consultants Clash?

Max Williams, Principal Consultant

Harvard Business Review case studies for managers are legendary, and in one of them,  this question was the central issue. 

The scenario outlined a case in which a consulting firm was called in to assist a new client.  The consultant accepted the assignment, even though the fundamentals of the situation were far from clear.  Inevitably, client and consultant were both unsatisfied with progress, and the developing conflict sat brooding like a dark cloud over the future of the project.

One of the several recognised world authorities asked to contribute an analysis and make comment on the case study, was Robert H. Schaffer, author of an important consulting reference book, "High Impact Consulting".  In this book, dedicated to achieving significantly improved results from consulting assignments, Schaffer outlines five principles for highly leveraged consulting that yields recognisable benefits early in a project, and produces results that stand the test of time.

This approach sets out to ensure close collaboration from the outset, rather than fixing the differences in understanding after problems have become apparent.  This method of working keeps client staff informed of the project progress and outcomes, uses their particular insights into the way the business works, and keeps them involved right through the whole process.

Significantly, the principles outlined in the Schaffer book turned out to be the five principles embodied in the Consulting Charter  that directs all this Practice's relationships with its clients.

What are the five points of the Consulting Charter? Every client gets a copy of the Charter, but here they are again, just for easy reference.

  1. We define your consultancy in terms of specific performance goals that will be attained.
  2. We determine the scope of the consultancy to suit what you are willing and able to do.
  3. We establish milestones, so you can measure results along the way, as the consultancy proceeds.
  4. We work in partnership with you through every step in the consultancy.
  5. We involve you and your people so that everyone keeps in touch throughout the consultancy.

It is good to know that the key drivers in your business, whatever that business is, are in line with global thinking, and global approaches. We are delighted that our drivers are indeed, just like that!

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ow that the GFC appears to have begun to fade into the background - more quickly in some countries than others - the question arises about the best way to take full advantage of the recovery. While there had to have been some staff rationalisations in recent times, now is the time to start building new productive capabilities!

Attitude Changes to a Growth Mindset!
"Change management", "Downsizing" and other words to denote a focus on cost cutting have now fallen out of favour. But managers of Small and Medium Enterprises (SME's), having seen the prospect of a serious recession arise, and then fade, now realise that the new economy needs us to develop continuously improving profitability and company value. Now the emphasis has moved to getting performance from the workforce.  This means adding staff, and making sure that they're fully qualified.

For most small businesses, the question of downsizing has sometimes seemed to be irrelevant, except that the faddish behaviour of big companies retrenching large numbers of employees has spawned a number of competitors to existing small enterprises.  Nevertheless, this change in corporate behaviour has some valuable lessons for operators of small and medium enterprises (SME's).

The first effect of the decline in downsizing activities is shown in reducing unemployment, and reflected in increasing shortages of skilled labour.  Labour and skill shortages are always important to small businesses, increasing labour costs, reducing labour flexibility, and increasing training costs.

As larger enterprises cease firing and begin hiring, SME's find themselves in a bidding war for good quality labour.  They need to prepare for the inevitable increase in labour costs that follows.

In the long run, increased labour costs can be supported only by increased productivity, or increased value added per unit time.  This places significant demands on the management skills of operators of SME's.

Second, the trend to outsourcing of components and processes will slow down.

As large corporations reassess the long term significance of activities once slated for closure during the downsizing era, more activities will be kept in-house.

For SME's  geared to supplying more of the needs of "downsizing" companies,  there is the emerging need to show substantial positive long term benefits to the new face of corporate customers.  The challenge to operators of SME's is to increase the value they add to their customers' whole process.

For example, a metal machining company that does nothing more than supply machine time and labour to the production process, will come under increasing pressure as the pool of potential customers decides against "downsizing" and "outsourcing".

By contrast, the metal manufacturing company that adds design, scheduling, delivery and process improvement becomes increasingly valuable to its customers, expanding its business base and increasing its profitability.

The successful SME has increased the rate of success by building its own organisational capability. So the question is, what extra value can your enterprise add to for its customers. Retail customers usually need more support services, and business customers usually need more productive inputs to their own internal processes.

Keeping up with these evolving changes in management strategy and technique has never been easy for operators of SME's.  Getting ahead will now be even harder.

The Red Zebra Management Program is a useful addition for any manager who wants to increase organisational capability, and improve both the profit and the value of the business.

If you'd like to find out more about how to make measurably more in your business right now, talk to us, or ask us a question here! Remember, there's no charge or obligation.

This same offer applies in New Zealand. Click Here!

McNicol Williams Management & Marketing Services is a Small Business Advisor listed with the Small Business Victoria, and has presented The Red Zebra program under its auspices. This listing requires that the first hour's consultation is always free. So when we say "No charge or obligation", we mean it!