Navigating Both Sides of the Consulting-Client Equation

14th June 2016 (Last Updated July 18th, 2018 10:53)

John Schultz, JRS Clinical Consulting, LLC, provides insights into why some consulting relationships seem so easy and why others fall short

Navigating Both Sides of the Consulting-Client Equation

I recently set up a consulting business after spending the vast majority of my 28-year career on the "client side" of the equation. This is my second stint in consulting - the first being a six-month bridge while I transitioned out of one start-up and into another. That was straightforward; only two clients and well-defined start and stop dates. The encore is a very different story and it got me thinking about the various aspects of the consultant-client relationship. For instance, why is a company's experience with one consultant so productive and so poor with another? And why does a consultant perform so spectacularly with one company and can't get anything done at another? We frequently attribute these scenarios to greatly over-simplified clichés without fully understanding the true reasons behind successful and failed consulting relationships. My thoughts below may or may not be applicable to your specific situation but I've provided some insights that might help both sides of the equation.

There are many pros and many cons to the "consulting side" of the equation. The reasons behind why an individual chooses to consult over taking a full-time job can be quite varied and in many cases, very personal. Starting a business is both exhilarating and terrifying, and because such emotions can be involved, they are likely the foundation of consultant-client relationship challenges. What was the impetus for consulting? Was it the result of a prospective, well-executed business plan or was it because finding a "real job" was proving difficult? Many clients point to "outrageous" hourly rates for consultants, believing "they're in it for the money". And that may be true for some. Others may like the freedom of being their own boss or working from home. Most often, it is a combination of these factors. Many consultants talk freely and honestly about why they consult; others are less forthcoming, which can potentially add to the challenge.

On the flip-side, clients often have their own bias toward consulting. Some cannot function in an environment without the structure of an organizational chart, a regular paycheck, and resources like IT, Accounting and HR. The thought of setting up a business and dealing with self-employment taxes and professional liability insurance, cause them to shy away from consulting. I recently encountered a hiring manager flabbergasted because a consultant wouldn't jump at a well-paying, full-time job when offered. I simply see that as two people on opposite sides of the client-consultant equation; both equally happy with their chosen path.

There is sometimes a stigma associated with being a consultant; that the individual "couldn't hack a real job." This might lead the consultant to have a proverbial chip on their shoulder. Conversely, we've all seen consultants revered for their insight and experience and only with their blessing does an internal employee's idea gain credence. Is that consultant really that much smarter than the internal employee? Previous experience with consultants and prejudices that were formed by those previous experiences are part of the equation. In some cases, there may be little that can be done to overcome the preconceptions of both parties. I'm a fan of the Harvey Mackay quote: "Learn from the past but don't live there." This is where well-designed consulting agreements can help. Structure agreements to avoid getting burned by the same flame twice but discuss any issues with your potential partner. Work with your legal advisor to tailor the agreement for the specific situation. A template should be used as a starting place, not as a set-in-stone mandate. And make sure requests for changes are explained to both parties - in the absence of information, people are not beyond inventing some to fill the void. Make sure both parties know the reasons behind the changes. Said another way, assumption and presumption are the death knell of relationships, so do not let them get a foothold.

I frequently talk about the "why" behind the "how" and this pertains to the consulting world as well. Most consultants get hired by referral, someone they've worked with previously, or someone they know. That doesn't guarantee success. Just as employers and candidates have interviews, clients and consultants need to spend time getting to know each other. Find out what they do but also why they do it. Very simple questions can reveal a lot of information: "Why did you become a consultant?" "Why did you start this company?" I sat down with one prospective client for just two hours and we got to know each other a bit while brainstorming ideas surrounding their company and product. From the consultant standpoint, I found it very productive. This can help provide insight into the motivation behind both company and consultant and may also identify early warning signs that the relationship might not work. Just because you meet with someone doesn't mean you have to sign a contract with them. If the fit is not right, don't force it. Being honest at this stage saves everyone time and money.

Even if the first meeting goes well and an agreement is signed, it does not cement the relationship. The type of relationship sets many boundaries. Is the contract long-term? In-house? What is the consultant's availability? Do they have several clients or just one? What is the company's timeline? Are there budgetary constraints? Does the consultant manage personnel or have decision-making responsibilities? These elements affect client-consultant interactions, potentially including external entities, such as clinical sites. Clearly communicating and defining these elements, either contractually or in some other form of documentation can save many future headaches. Make sure that expectations are updated and documented as the project(s) progress as well.

Maintenance of the client-consultant relationship is based on performance and communication. Quite often, communication is the barometer of performance. When consultants are not in the office on a regular basis and miss out on things like hallway conversations and impromptu meetings, this can lead to the absence of information mentioned above. And when things need to happen quickly, there is nothing more frustrating than when a consultant or a client doesn't (can't) respond to an urgent request. Frustration is the seed of resentment and resentment leads to damaged relationships. If you take nothing else from this article, do not underestimate the power of simple, regular communication. Periodic updates to your client can go a long way to eliminating assumptions/presumptions. And brevity can be valuable. Communicate project progress and/or identification of any unexpected hurdles. Even if you're in the office every day, don't assume your client knows your status. Provide an assessment of whether or not you are on schedule and if you are behind schedule, include a plan for getting back on schedule. Give the client an idea of the money they've spent to date and what they are getting for that investment. Even an e-mail saying nothing happened can lead to a client response with new information or that last piece of data you need for your report.

Remember, the two sides of the client-consultant equation are different but equal. Employ frequent communication to thwart the intrusion of assumptions and presumptions to maintain that equality and treat the other side of the equation with respect.