JOHN COCKAYNE: Proper foundation crucial to consultant-client relationship
Understanding the key elements of each other’s role is a paramount consideration
My experience has shown that to be successful, any relationship between consultant and client must be established on the “right” foundations. Understanding each other’s role is a paramount consideration and too frequently relationships stumble at this first hurdle.
A consultant is a sharp instrument used to address key issues. To use these services for mundane administrative tasks, unless they are an essential part of the brief, will waste the cutting-edge value that the consultant can bring.
In terms of the financial arrangement, a retainer is like a membership subscription. To use a golf members’ analogy, at its most basic level, it does not entitle the paying member to anything other than right of access to the facilities and/or the “attention” of the club.
The payment of the subscription allows the member to pay to play (at a preferred rate), buy drinks at the bar, hire a golf cart, hold a handicap, and so on. These prices will be at rates preferential to those charged to the public, but there are no free drinks or rounds, just because they are a member.
My preferred definitions for a retainer are: “Fee paid to a person or firm to secure the privilege of obtaining services as and when required.” Alternatively: “An amount of money you pay to someone so as to be sure that that person can work for you when you need them to.”
Therefore, a retainer is a prepaid service and provides the client with access to the consultant’s services. From this base, any time then spent by the consultant is billed to the client at the pre-agreed rate.
There is also a prepaid contract relationship. This is similar to the season ticket or playing fee used at many clubs, which allows the member to prepay for a number, or all of a year’s rounds at a preferential rate on a “use-it-or-lose-it” basis.
Any retainer, which includes a specific amount of actual time and expected inputs (other than the consultant’s attention) is not, in fact, a pure retainer, but rather a retainer with a prepayment for a pre-agreed amount of time included.
When the nature of the final working agreement is confirmed, to work effectively there needs to be complete clarity in the following areas. Though all of these areas should be of mutual interest, for ease of reference I have divided them into three — mutual, the client and the consultant:
Mutual: The Brief: Will be the key first step and will explore the challenges faced and what the client believes to be its needs. The consultant will then analyse the perceived needs against the facts. He or she will then refine the original inputs, present an overview and devise an appropriate strategy and/or corrective measures to address the identified issues.
Transparency: No relationship can hope to prosper, if either party withholds key information from the other. The client must give the consultant all of the relevant intel required — effectively a “warts and all” scenario.
Conversely, the consultant must be permitted to give an uncensored version of what he or she finds, during the process of evaluating the business’ weaknesses, challenges and problems.
Expectations: Defining mutual expectations, to help to ensure that the client is getting what it needs, will also require that the consultant be remunerated commensurately for these inputs.
Time frames & outcomes: It will be necessary for both parties to understand the fees and payment schedule, the anticipated results and the time frames within which the work is to be completed.
The latter is particularly important as most inputs are within time frames that require the opportunity for the inputs to mature to be effective. While quick wins can sometimes be achieved, this is generally not a sow and reap immediately environment.
A consultant is not a magician and there are, under most circumstances, no miracle cure or silver bullet. What a consultant brings, above all else, is a fresh perspective. This, backed by the ability to analyse effectively and experience, will help to provide a fresh view of the challenges being faced by the particular client’s business.
Working with the management team will then ensure the input of the required corrective processes, new products and or services.
Communications/reporting line: A key element to ensure that a) The information is “heard” and processed effectively and b) It is in the hands of those who will implement the recommended initiatives and or remedial actions.
The very wise CFO of a client once commented in terms of point a): “It is a great pity that people are willing to spend so much time evaluating the ‘tone’ in which a message is being delivered, or analysing the deliverer, instead of paying attention to what is actually being said.”
• Tomorrow will complete the feature with part 3 of the Business of Golf.
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