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Jack and Patti Phillips have fully updated their authoritative work to put you in the best possible position to sell your services to clients who demand proof of unmistakable financial value. On the flipside, this book helps clients determine the validity of prospective consultants' promises and track progress after hiring.
The Consultant’s Scorecard offers simple data collection techniques for measuring the value of a project in six key areas:
In addition to enabling you to measure your contribution, this process provides a framework you can use to focus on results throughout the consulting intervention.
The key concept in any consulting project today is "accountability." Senior managers are being held more and more accountable for the consulting fees they pay out--so they're requiring more accountability from consultants. The Consultant's Scorecard helps both parties involved in the process form rocksolid measurements of the value of any project.
PRAISE FOR THE PREVIOUS EDITION OF THE CONSULTANT’S SCORECARD:
"Jack Phillips's unique approach to measuring the return on investment of consulting makes The Consultant's Scorecard a must-read for anyone involved in the consulting process." -- Stephen R. Covey, author of the bestseller The 7 Habits of Highly Effective People
Consulting clients are demanding more and more assurance that the large fees they pay will bring measurable results to their organizations. The Consultant's Scorecard is the tool you need to create effective impact and ROI statements for every project proposal you submit. Consultants and ROI experts Jack and Patti Phillips show how to measure and report value,
results, and impact to dramatically expand your business. The Consultant's Scorecard includes:
THE CONSULTING BUSINESS has enjoyed tremendous success during the past two decades, with its growth exceeding that of many professions. According to most estimates, the consulting industry is predicted to grow in the range of 15 to 2 0 percent each year. Whether in restructuring, implementing systems, developing staff, changing procedures, buying new companies, or bringing out new products and services, consultants are being asked to assist in a variety of ways. Companies are fervently seeking consultants for their external perspectives and expert opinions, hoping they can provide solutions that will improve business. Unfortunately, clients are often disappointed when products and services fail to deliver anticipated results, leaving both the client and the consultant frustrated over the outcome of the project.
Trouble in Paradise
While some have regarded the consulting profession as a highly desirable occupation, others have characterized it by the lack of effectiveness of consultants and the consulting industry. The problems facing consultants, although varying with the industry and the type of consulting activities, generally fall into three major categories: lack of accountability, tarnished image, and excessive costs. Each of these brings a cloud over the industry, causing some to question the contributions of consulting projects. This chapter explores the current status of consulting, examines the causes behind the accountability crisis, and suggests ways to overcome this problem.
Lack of Accountability
Perhaps one of the most damaging reports about the consulting industry was presented in a major book focusing on large consulting companies. Dangerous Company, by James O'Shea and Charles Madigan, illustrates how consulting powerhouses are inflicting damages on many organizations. The opening paragraph best summarizes the concerns for accountability:
A secretive and elite army of management consultants is at work deep inside corporations everywhere, from the giants of the Fortune 500 to middle-sized and smaller companies. It is also expanding its influence all over the developing world, wherever economies are coming to life. And it has become partner to government, adviser to heads of state, and confidant to countless interests eager to exploit the promise of a growing world economy. It collects top dollar for its work, sometimes delivering all the sparkle and success it promises, and sometimes falling so remarkably that its clients seem more victim than customer. A relative newcomer to the world of business, management consulting has escaped all but the most cursory of levels of scrutiny. It has only good things to say about itself. But there is a growing sense of unease about this exploding and occasionally explosive enterprise, a feeling that it is a palace built on a foundation of shifting sand. From a distance, it glistens like alabaster. Up close, a different image emerges. It centers on a key question: "Whose interest is being served?" All too often, the answer is that it is not the best interest of the client.
It would be unfair to label all consultants and consulting firms as incapable of producing results or supplying a useful product or service. There are many success stories recounting how consulting firms have enhanced organizations and even turned them around. However, in far too many cases, the results are just not there. And sometimes, the process itself causes a breakdown in accountability.
Consider, for example, the following consulting project for a regional financial institution. A well-known and respected consulting firm was engaged to analyze areas where efficiency could be developed to add immediate bottom-line value to the organization. The consultants pored through financial records, analyzed operating reports, and interviewed dozens of managers and specialists. In the end, the consulting firm seized the ideas and suggestions of the operating managers, taking projects that were already under way or in the planning stages and presenting them as recommendations to improve operating efficiencies. When the senior staff of the firm objected to the consultants' report, the CEO, who had hired the consultants previously, praised the work of the consultants and suggested their recommendations be adopted. The staff resisted in every way and ultimately did nothing with what was originally planned. The recommendations were never implemented by the senior staff. In a reference check by another organization seeking consulting advice, the CEO praised the report and gave the consulting firm very high marks for its efforts. Privately, he said, "Although we did not implement all the recommendations and some were already in planning, it was a good exercise for the organization."
From most perspectives, this scenario represents a failure in the consulting assignment. Although the project was completed, recommendations were made, and the primary client-the CEO-was satisfied, the assignment fell short of what should have been accomplished-and, more importantly, what could have been accomplished. The problem involves a breakdown in the processes that led to the consulting intervention and its ultimate result.
Many consultants agree with this assessment and have developed a new approach. According to Robert Schaffer, in his book High-Impact Consulting:
Most management consultants subscribe to a model of consulting that is inherently loaded against success. This consulting paradigm, followed throughout the world by external and staff consultants alike, is unnecessarily labor-intensive, long in cycle time, and low in return on investment. It locks both clients and consultants into a fundamentally ineffective mode of operation. In this, the conventional consulting model, there is a clear divide between the parties: The experts are accountable for creating the best possible solutions and tools, and the clients are accountable for exploiting those solutions and tools to improve organization results. In too many cases, however, clients do not or cannot implement the consultant-developed solutions in ways that yield significant improvement.
Beyond the flawed issues surrounding implementation and support are the problems of a lack of clear definition up front, focus on specific objectives, and emphasis on obtaining results throughout the process. While many consulting projects do yield results, they often fall short of the significant results they could achieve, and in far too many cases they produce no results at all. This book presents the tools and processes needed to measure the success of consulting projects, ensure that consulting projects are properly initiated (with the end in mind), and place the necessary emphasis on results, including various feedback mechanisms to keep the project clearly on track. When implemented, this process will ensure that a consulting project not only produces results, but also produces the significant results that should be expected from major interventions...
Part 1: Setting the Stage; Chapter 1. The Need for Consulting Accountability from the Client Perspective; Chapter 2. What's in it for Me: How Consultants Can Prove the Value of their Work to Clients; Chapter 3. Initial Analysis and Planning; Part 2: The Six Measures; Chapter 4. Was it Useful: How to Measure Reaction and Satisfaction; Chapter 5. What Did the Client Org Learn: HT Measure Skill and Knowledge Changes; Chapter 6. Was the Intervention Planned Properly: HT Measure Implementation, Application, and Utilization; Chapter 7. What Was the Impact: HT Capture Business Impact Data; Chapter 8. HT Calculate and Interpret ROI and other Measures of Financial Payoff; Chapter 9. HT Capture and Report the Non-Financial Benefits; Part 3: Key Issues with the Measures; Chapter 10. Separating the Consulting Impact from Other Factors; Chapter 11. How to Convert Business Measures to Monetary Values; Chapter 12. How Much Did It Cost: Monitoring the True Costs; Part 4: Challenges; Chapter 13. HT Build a Business Case for the Consulting Expense; Chapter 14. HT Provide Feedback and Communicate Results to Clients; Chapter 15. Overcoming Resistence and Barriers to Measuring Consulting ROI