Hiring A Business Development Consultant – Mistake Or Opportunity?

I just finished searching the web for business and marketing consultants, and even as a professional Business Consultant, I was left confused and skeptical. The profession seems to be filled with those who over-promise, have little experience, and some who only want to sell you anything but knowledge based on experience. Fortunately, under the rubble, there are those who have spent a lifetime in business and who are practicing professional consultants with a great deal to offer the right customers. Since this is my business, I decided it might be time to offer my observations on why you might need a professional consultant, and how you can benefit.

I am a Business Development, Strategic Planning, and Marketing consultant. I specialized in helping small to mid-sized companies review their current activities and providing Critical Analysis, Strategic Planning and Implementation guidance in my areas of expertise. My goal is to help small business and mid-sized companies grow by understanding where they are today, where they want to go, and exactly how to get there.

With the disclosure out of the way, let me provide my guidance on hiring a business consultant, what to look for, and what to expect for your time and money.

1) EXPERTISE: The single most important reason to hire an outside business consultant is to bring in expertise that you do not already have in house.

Most people have a background in their industry, and many have experience in two or three industries. Some people even have experience with 10 or 15 products within that industry, but knowledge, experience and hands on management of a broader range of products, from over a hundred companies, and building marketing and distribution in diverse markets such as North America, Europe and Asia is experience few people have.

When you look for a consultant you want someone who has a breadth of knowledge and experience that exceeds that which you already have. Along with bringing a new or different perspective to your analysis and strategic planning, a consultant should bring knowledge that is outside the scope of your current environment.

By bringing in someone with a wide range of knowledge and experience in their area of expertise you supplement your current knowledge base. Most companies already have excellent people on staff performing their duties in the areas of business development, marketing and sales. Limitations occur because of the ‘box’ in which we work. You and your staff are running full speed ahead to keep up with the demands of your business. In many cases, you are putting out fires as quickly as they ignite (if you’re lucky). This environment dictates that you focus on the job at hand. When you and your staff meet, you are discussing real problems that need immediate solutions. There is little time to research what other companies are doing and what is successful or not for them.

A consultant should bring an ‘out of the box’ perspective to your table the moment they walk in the door. They may not understand the minutia of your business immediately, but through discussion and some research they will bring new perspective and ideas to your problem solving and business planning process. Their expanded world view will open new doors of opportunity for your organization and offer ideas that have proven successful in other environments.

2) ECONOMICS: The second most likely reason to hire an expert business development consultant is saving money.

Hiring the expertise you need for every aspect of your business development process is not only impractical, but impossible.

When we need professional expertise we either outsource or bring on new staff. Today, in this economy, hiring new staff is a luxury most small business cannot afford. Outsourcing is a good alternative, and in the case of consultants, a highly cost effective alternative.

In addition to bringing immediate knowledge, consultants bring all the benefits of outsourcing. Taxes and Benefits are the responsibility of the consultant and never carried as overhead by the company. Costs are controlled and can fit your budget. Hiring and firing are as simple as picking up the phone. No job search, no severance. Consultants are usually available when you want them and expendable when you do not. For many that description is a little uncomfortable, but a professional consultant is an independent business person (or company) who works at the pleasure of YOU.

In addition to all the benefits of outsourcing, a professional consultant brings immediate payback. Duplicating the expertise of a good consultant might require 3, 5 or even 8 different positions to be filled by experienced managers. Each position requires training and integration into the organization. One expert not only provides the knowledge-base of those positions, but also hits the ground running.

Finally, regarding a good consultant’s hourly or daily fee. My experience is that they are usually priced at the level of a senior partner in a law firm or regional accounting firm. When compared to the cost of hiring that same expertise on a long-term basis, they are almost always a bargain.

When hiring a consultant, clearly define your objectives and identify the deliverables he or she will provide. Always receive a firm bid quote. Then consider; can we do this in house? If so, what is the cost in using our own manpower, including the cost of pulling that manpower off other projects? If not (which is usually the case), then ask if the deliverables and benefits are worth the cost?

3) USABLE DELIVERABLES: You want a deliverable that can be used over a long period of time throughout the organization.

In most cases, you hire a business development consultant to help you solve a specific problem or more often help you define a plan of action for taking you where you want to go. In such cases, you want someone who can deliver in writing a road map for future activities. To do this, they must be able to guide you through a careful and thorough review process in which both you and the consultant identify what is working and what is not, and where the holes are in your present plan.

A good consultant will then be able to lead a strategic planning process in which the consultant, you and your staff collaborate on developing an expanded plan in which your ideas and wishes are combined with the consultant’s to create a plan that is much better than anyone alone could create.

Finally, a qualified expert consultant will be able to create a written plan that includes a full marketing plan and budget that can be used as a guide, a road map if you will, to take you where you want to go.

This document should not be an academic study, but a dynamic real-world document that reflects the hands-on expertise of your organization and the consultant, and is used, reviewed, and updated on a regular basis.

4) OBJECTIVITY: You must have objectivity that ensures the advice you receive is in YOUR best interest.

You want a consultant that is objective with no conflicts of interest or hidden agendas. In order to give you the valuable information you’re paying for, your consultant must have only one allegiance – you.

This doesn’t mean that the consultant you hire hasn’t, or won’t in the future, work for companies in your industry. In affect, that experience and diversity of knowledge is what gives them value. It does mean that they sign a confidentiality agreement; they do not discuss or disclose any proprietary information to anyone outside your organization; and they are not obligated to another company in any way that would degrade their work for you. ­­­­­­­

What you want is someone who has the experience to be called an expert, and professional ethics to match their expertise.

5) HANDS ON EXPERIENCE: Finally, you want someone who has experience in the field. As a small business manager or entrepreneur you need experts who understand the challenges you face, and who have had to meet and solve those challenges.

As a small businessman in my first company (a drafting and engineering company) I hired someone who had been a high level manager with a very large engineering firm. I thought they would bring expertise in how to run my business. What I got was someone who was used to managing assistants and departments, but who had no real knowledge of how to get the job done. In other words, he understood big business and big budgets, but he didn’t know how to roll his sleeves up and deal with my problems. After spending much time and money, I finally realized my mistake. After that, I made sure the advisors I hired had the hands-on experience of an entrepreneur and knew what running a small business was all about.

When you hire a consultant you want someone who has been there, built and managed companies, analyzed markets, and implemented and managed business development, marketing and sales campaigns in a wide range of markets for diverse products, for small to mid sized companies. You want a professional consultant with hands-on experience who understands your problems and can offer real world advice and solutions.

The best way to ensure you have an experienced professional that can truly help your organization is talk with them. A qualified consultant will have a history that speaks to your market, will have references, and will be able to communicate with you in a way that tells you they know what they are talking about. You will hear their competence in their answers to your questions and in the questions they ask you.

What I suggest is after you read their materials, visit their website, and complete your due diligence, call the individual(s) you think are qualified and talk with them. Ask questions specific to your business and industry, and listen carefully to the answers. If the answers are full of fluff and hyperbole know that the service you receive will likely be the same. If, on the other hand, you hear information that feels real, has substance, and reflects an understanding of the subject, you may have found someone who can truly help you shortcut the learning curve of building your business, help you reduce costs, and help you significantly move your small business or mid-sized company forward.

Some final comments about hiring a business development consultant:

Consultants may be experts, but they won’t know everything about every industry. In most cases, you will know your industry and business better than they ever will. What a good business development consultant brings to your table is a diverse range of experience that can apply to your situation. They bring new ideas, and the ability to think outside of the box, which, when combined with your specific company knowledge, catapults your organization forward. Don’t expect them to know upfront all your industry statistics or demographics, that they can obtain through research. What they will know is how to solve the broader questions of where you want to go and how to get there.

Professional consultants are full time and have been for a long time. They are not part time consultants and not ‘between jobs.’ Their expertise is born of long term work and effort, and it is displayed in the service they provide you.

The best consultants work on a fee basis, with costs quoted and known upfront. Proposals should be in writing and itemized to identify a projects objective, scope, and timeline. Transparency and no-surprises are exactly what you’re looking for.

Good luck and good marketing.

Understanding Contrarian Investing As A Viable Alternative

One of the most effective investment techniques I have observed in my several decades in the investment and financial business, is referred to as “being a contrarian.” Contrarians act in “outside the box” ways, interpreting seemingly bad news with a different point of view than conventional investors.

The Free Merriam-Webster online dictionary describes a “contrarian” as “a person who takes a contrary position or attitude; specifically: an investor who buys shares of stocks while most others are selling, and sells when others are buying.” Many years ago, I was privileged to have a client who was the definitive “contrarian.” He felt that there were terrific opportunities to succeed in investing if you use contrarian philosophy. He demonstrated this to me in the 1970′s when Washington Power was experiencing financial difficulties, and many individuals were selling off the stocks and bonds of the utility feverishly, anticipating that bankruptcy was nearing, and action was needed. My client, however, felt that the government could not afford to let the utility go under, and that even if the stock “tanked,” he felt the bonds would have to be protected. Obviously, most investors disagreed, because the bonds were selling in the mid twenties (i.e. selling at only about twenty percent of their par value). He felt that the utility would either eliminate or defer interest payments, and that would cause even more panic for many investors. However, as he said, he wasn’t looking for the bonds to pay interest/ dividends, nor was he hoping that the bonds would be restored to anywhere near par value, especially in the short-term.

His view and outlook was for what he described as the intermediate term (three to five years), and for the bond’s price to move into the fifties. Sure enough, within the shorter end of his target area, the bond price was in the mid- fifties, typical investors were once again investing in the bond, and he had an easy time selling his bonds. Of course, he particularly enjoyed the fact that he had also doubled his investment in a relatively short period. During the more than a decade that I had a working relationship with him, I witnessed numerous other examples of his philosophy working effectively. However, there is one important caveat. Contrarian investing is not simply doing the opposite. It requires an analysis of the specific situation and evaluates the downside risk versus the upward potential.

I always found it interesting when certain individuals would ask me if the should hold onto a specific investment in their portfolio. I almost invariably answered the same way. ” When you buy an investment, three things can occur. It can go up, stay steady, or go down. When you go to evaluate what you should do with a previous investment, don’t evaluate it from the standpoint of what you originally paid. Simply think – if I were investing fresh money today, would I buy this investment. If the answer is yes, buy more. If the answer is maybe, keep some and sell some. If the answer is no, sell it all. It’s that difficult, yet really that easy!”

When something becomes popular, whether a stock, bond or a commodity, should you buy? For example, we all hear about gold. A contrarian would probably not buy gold now because of the high price, preferring to buy when there is bad news. For example, a few years ago, when Tyco was immersed in controversy, many investors sold on the bad news. Contrarian style would be to evaluate the fundamentals of the company, and in this case, when the price dropped rather dramatically, purchased additional shares.

Contrarian investing is not for everyone. It is not for casual or lazy investors. However, for an individual who feels comfortable analyzing the “big picture,” this philosophy can often be used quite effectively. I strongly recommend that before anyone invests, they fully understand all aspects, including potential risks and rewards, costs, and all ramifications. You should speak to a trusted financial adviser.

5 New Business Ideas For 2010

As the economy starts to improve, many people are considering striking out on their own in the near future. Here are five ideas for a new business which you might consider:

A web-based business
With only a very few exceptions, much of your prior experience in previous businesses can lend itself to creating a web-based business to provide a source of income. Although this does still require careful business planning and research, many of the essential infrastructure features (such as shopping carts and drop shipping) have now been standardized, making this one of the easiest businesses to start successfully. It is also possible to take a hobby or other specialized field of interest, and appeal to niche audiences in ways that traditional businesses will overlook as not being profitable enough to be worth the effort. Limited inventory costs and the ability to create information products as demand requires makes a web-based component something every new business should consider.

A franchise business
Franchises have much higher rates of longevity than many other businesses which you might start on your own. One of the biggest advantages of a franchise is that the chain has already figured out many of the mistakes you might make when starting a business, and has procedures in place to prevent these from occurring. Franchises also make use of wider-scale advertising than you could manage when starting out on your own. The only downside? Franchises can be more expensive to start.

A software development business
Software development can take many different forms. Many of the newest smart phones have application stores, and so there is strong demand for a variety of programs, from games to productivity enhancing tools. For those who have the technical background, software development can be a great way to enter a high-margin business with low or no inventory requirements, and a multitude of opportunities available to the enterprising.

A consulting services business
Consulting is another field where you can re-purpose knowledge acquired in other fields, and use it to improve a different business. Some of the challenges posed in starting a consulting business are that it involves delivering an intangible service, and that it can be difficult for customers to realize how good your service is, when compared with others.

A specialty care service business
A specialty care service can range from taking care of someone’s pets or children while they are out-of-town, to a service business which helps the elderly who are not yet ready for a nursing home. Since the United States has a significant portion of its population which is growing older, these businesses should experience growth in the coming years. If your business also has specialty skills (such as first aid or physical therapy), these can be additional selling points when marketing your services.

Therefore, if you plan on starting a new business, you should consider a web-based business, a software application business, a franchise business, a consulting services business, or a specialty care business. Each is highly attractive, and should well in 2010 and well into the future.

Copyright 2010, by Marc Mays