Managing Consultants
"An expert is someone who lives more than
50 miles out of town and wears a tie to work." - Bryce's Law
INTRODUCTION
The need for outside contract services is nothing
new. IT-related consultants have been around since the computer
was first introduced for commercial purposes. Today, all of the
Fortune 1000 companies have consultants playing different roles
in IT, either on-site or offshore. Many companies are satisfied
with the work produced by their consultants, others are not. Some
consultants are considered a necessary evil who tackle assignments
in an unbridled manner and charge exorbitant rates. For this type
of consultant, it is not uncommon for the customer to be left in
the dark in terms of what the consultant has done, where they are
going, and if and when they will ever complete their assignment.
Understand this, the chaos brought on by such consultants are your
own doing.
IT consultants offer three types of services:
Special expertise - representing skills and proficiencies your company
is currently without, be it the knowledge of a particular product,
industry, software, management techniques, special programming techniques
and languages, computer hardware, etc.
Extra resources - for those assignments where in-house resource
allocations are either unavailable or in short supply, it is often
better to tap outside resources to perform the work.
Offer advice - to get a fresh perspective on a problem, it is sometimes
beneficial to bring in an outsider to give an objective opinion
on how to proceed. A different set of eyes can often see something
we may have overlooked.
Whatever purpose we wish to use a consultant for,
it is important to manage them even before they are hired. This
means a company should know precisely what it wants before hiring
a consultant.
ASSIGNMENT DEFINITION
Before we contact a consultant, let's begin by
defining the assignment as concisely and accurately as possible;
frankly, it shouldn't be much different than writing a job description
for in-house employees. It should include:
Scope - specifying the boundaries of the work assignment and detailing
what is to be produced. This should also include where the work
is to be performed (on-site, off-site, both) and time frame for
performing the work.
Duties and Responsibilities - specifying the types of work to be
performed.
Required Skills and Proficiencies - specifying the knowledge or
experience required to perform the work.
Administrative Relationships - specifying who the consultant is
to report to and who they will work with (internal employees and
other external consultants).
Methodology considerations - specifying the methodology, techniques
and tools to be used, along with the deliverables to be produced
and review points. This is a critical consideration in managing
the consultant. However, if the consultant is to use his/her own
methodology, the customer should understand how it works and the
deliverables produced.
Miscellaneous in-house standards - depending on the company, it
may be necessary to review applicable corporate policies, e.g.,
travel expenses, dress code, attendance, behavior, drug test, etc.
Many would say such an Assignment Definition is
overkill. Far from it. How can we manage anyone if we do not establish
the rules of the game first? Doing your homework now will pay dividends
later when trying to manage the consultant. Assignment clarity benefits
both the customer and the consultant alike. Such specificity eliminates
vague areas and materially assists the consultant in quoting a price.
SELECTING A CONSULTANT
Armed with an Assignment Definition, we can now
begin the process of selecting a consultant in essentially the same
manner as selecting an in-house employee. Choosing the right consultant
is as important a task as the work to be performed. As such, candidates
must be able to demonstrate their expertise for the assignment.
Certification and/or in-house testing are good ways for checking
required skills and proficiencies. Also, reviewing prior consulting
assignments (and checking references) is very helpful. Examining
credentials is imperative in an industry lacking standards. For
example, many consultants may have a fancy title and profess to
be noted experts in their field but, in reality, may be nothing
more than contract programmers. In other words, beware of wolves
in sheep's clothing.
Ideally, a consultant should have both a business
and technical background. True, technical expertise is needed to
perform IT assignments, but a basic understanding of business (particularly
your business) is also important for the consultant to adapt to
your environment. This is needed even if you are using nothing more
than contract programmers.
In terms of remuneration, you normally have two
options: an hourly rate or a fixed price. For the former, be sure
the work hours are specified, including on-site and off-site. Many
clients are uncomfortable paying an hourly wage for an off-site
consultant. Under this scenario, routine status reports should be
required to itemize
the work performed and the time spent. However, the lion's share
of consulting services are based on a fixed price contract. Here,
the role of the methodology becomes rather important. Whether you
are using "PRIDE" or another Brand X methodology, it is
important the consultant and client both have a clear understanding
of the project's work breakdown structure, the deliverables to be
produced, and the review points. From this, an effective dialog
can be communicated in terms of managing the project. Further, the
methodology becomes the basis for the preparation of estimates and
schedules.
After examining your candidates, it now becomes
necessary to balance the level of expertise against price. Sure,
a senior person can probably get the job done in less time, but
perhaps the costs may be too high for your budget. "Expertise"
versus "expense" becomes a serious consideration at this
point.Whomever is selected, it is important that a written agreement
be prepared and signed. The agreement should reference the Assignment
Definition mentioned above and any other pertinent corporate verbiage.
Very important: make sure it is clear that the work produced by
the consultant becomes your exclusive property (not the consultant's).
Further, the consultant shouldn't use misappropriated work from
other assignments. Finally, add a clause pertaining to workmanship;
that the consultant will correct at his/her expense any defects
found; e.g., defective software, data base designs, etc.
MANAGING THE CONSULTANT
The two most obvious ways to manage consultants
is by having them prepare routine status reports and project time
reports. Such reports should be produced on a weekly basis and detail
what the consultant has produced for the past week and detail his/her
plans for the coming week. You, the client, should review and
approve all such reports and file accordingly. A methodology materially
assists in tracking a consultant's progress. As a roadmap for a
project, the methodology takes the guesswork out of what is to be
produced and when. Without such a roadmap, you are at the mercy
of the consultant. Along these lines, I am reminded of a story of
a large manufacturing company in the UK who used one of the large
CPA firms to tackle a major system development assignment. The system
was very important to the client, but lacking the necessary in-house
resources to develop it, they turned to the CPA firm to design and
develop it. Regrettably, the client didn't take the time to define
the methodology for the project and left it to the discretion of
the CPA firm. The project began and the CPA firm brought on-site
many junior staff members to perform the systems and programming
work. So far, so good. However, considerable time went by before
the client asked the senior partner about the status of the project
(after several monthly invoices). The senior partner assured the
client that all was well and the project was progressing smoothly.
More time past (and more invoices paid) with still nothing to show
for it. Becoming quite anxious, the client began to badger the consultant
as to when the project would be completed. Finally, after several
months of stalling, the consultant proudly proclaimed "Today
we finished Phase 1....but now we have to move on to Phase 2."
And, as you can imagine, there were many more succeeding phases
with no end in sight.
What is the lesson from this story? Without a methodology
roadmap, it is next to impossible to effectively manage a consultant.
The project will lose direction almost immediately and the project
will go into a tailspin. The only person who wins in this regard
is the consultant who is being paid regardless of what work is produced.
Instead of vague generalities, you, the client, have to learn to
manage by deliverables.
CONCLUSION
My single most important recommendation to anyone
considering the use of outside consultants is simple: Get everything
in writing! Clearly define the work assignment, get a signed agreement
spelling out the terms of the assignment, and demand regular status
reports.I am always amazed how companies give consulting firms
carte blanche to perform project work as they see fit. Abdicating
total control to a consultant is not only irresponsible, it is highly
suspicious and may represent collusion and kickbacks.There is nothing
magical in managing consultants. It requires nothing more than simple
planning, organization, and control. If you are not willing to do
this, then do not be surprised with the results produced. Failure
to manage a consultant properly or to adequately inspect work in
progress will produce inadequate results. So, do yourself (and your
company) a favor, do your homework and create a win-win scenario
for both the consultant and yourself.
Tim Bryce is the Managing Director of M. Bryce
& Associates (MBA) of Palm Harbor, Florida and has 30 years
of experience in the field. He is available for training and consulting
on an international basis. He can be contacted at: timb001@phmainstreet.com
Copyright © 2006 MBA. All rights reserved.
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