Spend More Time with Your Consultants

Published on Tuesday, 11 February 2014 06:05:03    Written by Marc
I often find myself chatting or discussing with consultants from various fields, real estate brokers, energy specialists, experts in just about any fields ranging from environment to structure. One question I ask repeatedly is about how business is going in general and what projects they are working on. These two casual questions generally bring back interesting answers not only about what they are doing, but also about the relationship that they have with their clients.

consult_types_centralimageIt may not come as a surprise if I say that consultants in general seem to be struggling always to keep their clients. In a world were companies will shop around all products and services to get the best price, consultation services is no exception. People will shop around for the best price possible for consultation services. If they need an environmental study, they will start by asking a few prices from a number of consultants. Same thing if they need to do an energy audit or find a real estate broker to look for new office space. Therefore, consultants of every field are constantly working to win the next bid. This may seem like a good way for companies to save money, but it is really benefiting the company in the long term? I personally highly doubt it.

During the last twenty some years I have worked with thousands of consultants from many fields of business and came to the conclusion that constantly getting pricing for consultants not only reduces the quality of the services you will get, but that it increases the costs as well. Moreover, this applies to just about any type of consultant. By spending more time with your consultants and keeping them for repeat work instead of constantly seeking out the lowest priced consultant, you will gain in the long term.

Take a real estate broker for example. On the surface, most real estate brokers look alike. They offer practically all the same service and for a similar fee. You can select a broker and have him or her start working on a project in no time. However, if they know very little of your business, how can you really expect them to know what you really need? If you are looking to lease an office, commercial or industrial space, it pays to have a broker that knows your business, knows what you need in general and even how your company operates internally. Once your broker has a good understanding of these elements, he or she will be much more efficient in finding the proper space for your company. In addition, chances are, if you have additional needs a few weeks or months later, if you use the same broker there will be less information that you will need to provide. In time, that broker will know exactly what you need, at times even adding some elements you might not even have been thinking about yourself. This is when the added value of the long-term relationship starts to kick in.

The same goes for just about any other consultant. Need to maintain your roof? You would normally use the services of a roofing consultant that knows every ins and outs of roofing. They may perform physical tours, infrared scans and keep logs of the overall status of your roofs over time. If you go for tender each time you have a need for new roofing services, you are bound to lose much of the historical information your previous consultant was keeping.

Nevertheless, if the examples above are so obvious, why are companies constantly going back to tender each time they need a consultant? Is it a lack of trust or genuine attempt to save hard-earned money?

I talked with an energy consultant a few days ago and he made a comment that every three months he needed to start all over in searching for contracts. I was surprised by the comment and was thinking that I did not clearly understand his comment, so I asked him to explain what he meant.

I was curious, so I asked, "Are you saying that each three months you need to find new clients? What about the clients you have now, don’t they give you some repeat business?"

"I do have clients," he replied, "but they still go out to tender with every new job, so there is absolutely no guarantee for us to get more work once our existing contracts are done."

I followed up, "So you are telling me that you finish a contract with a client now, the client is happy with your work (hopefully) and if he/she has another similar work for you, he is going to tender it anyway?"

"Yes, that’s exactly what they do," he insisted.

"But for what reason, why would they do this if you’ve done a good job? To save money?" I inquired.

His response was equally baffling, "Maybe, to see if they can save money, get a better price elsewhere, and make sure that our price stays competitive."

I was still shaking my head, but in all fairness, not surprised. I have lived this during the past decades in every company that I worked. While I always worked to try to develop the consultants we worked with, I have too often witnessed people going back to tender with each new work, at times even taking proposals from one consultant and handing it out to other consultants to see if they would provide a better pricing. This practice is not the most ethical way to do business but unfortunately, it is still a popular and easy way to validate pricing.

However, pricing alone is not the solution. In addition, many companies, which have tried to reduce the amount they paid for services at all costs, are now starting to realize that pricing is only one element of the entire puzzle. A classic example are the call centers which have been transferred to low wage countries in order to save money, often without a clear understanding of the added value that customer service provides. Ever lost your luggage with all your suits and needed to call to trace your bags, only to speak to someone in Mumbai, which has absolutely no idea of what to do, other than give you a reference number and ask you to call later? Alternatively, have problems with your internet connection and being told by the customer service that they never had this kind of problem, so here is a reference number and please call later…. No comment. Some companies have gotten the message and are now bringing back closer to home their customer service and providing them with greater liberty in answering their client’s needs.

It seems like common sense to train your consultants and keep them for the long run, without constantly having them engage in bidding wars to gain your business. After all, this is exactly what happens when companies hire people. At first the employee needs some time to understand the company, how it works, what is the culture and the needs. The employee’s performance during this time is relatively low, due mainly from the lack of information about the company. However, the employees do not pass interview to be rehired each Monday morning. Companies know that there is a learning curve and that over time the performance of the employee will increase and he/she will become more autonomous, knowing how to do the work with little guidance from his/her superiors. Yet too many companies do the exact opposite of this when treating their consultants.

Consultants should be the extension of your knowledge. They should act as you would, only if you had the experience and know-how that they have in the specific field you are hiring them. Therefore, in order for them to act in your best interest, they need some time to get to know you and your company needs. Spend time with your consultants and do not shop them around like your shopping for a phone. It is OK and even encouraged to validate pricing and keep them in line from time to time. In most cases; however, if your consultants know that you will be faithful to them, they will not only provide you with best pricing, they will also surprise you by the services they can render, at times thinking about some of your needs you may not have even pointed out to them. In time, they will only need snippets of information from you in order to get the work done properly. This is where the added value really kicks in. Spend time with your consultants, in the end it will be a good investment.