How to select a consulting firm

Having discussed and agreed the underlying value you’re seeking from consultants, what kind of process should you follow to ensure that the consultants you choose are best suited to the job?

Create a brief for the consultants

It’s unrealistic to expect consultants to guess your mind, so the first stage in any purchase process has to be to develop and agree internally an outline of the project for which consulting help is sought. This brief may vary from a few paragraphs to a highly detailed specification, stretching over volumes, but, whatever the length and level of detail, good briefs will all include clear statements on the following:

  • The aims of the project

  • How the consultants are expected to help realize these aims

  • The reasons for bringing consultants in – the added value they are expected to provide which the client organization cannot supply itself

  • Expectations about the process the consultants will undertake

  • The key deliverables

  • Who will be involved in the project from your side and in what capacity

  • Anticipated time scales

  • Expected costs

  • How the consulting firm will be rewarded – eg method of payment, link to results and risks, etc.

Some of these – the objectives and time scales for instance – are obvious and incontestable: some are more contentious. Many organisations are wary of spelling out their budget for a project in advance because they believe that doing so will encourage the consultants who are bidding for the work to increase their price and it will therefore iron out any price differential across all those firms bidding. While there’s some merit in their suspicions, this attitude also has some serious drawbacks. First of all, it often results in clients and consultants wasting time, because the consultants propose a process which doesn’t match the client’s expectations – it’s either much too expensive (too much as been included) or not expensive enough (too little has been included). It’s much better to put the consultants in a position where they compete on their value for money, rather than their absolute cost – in other words, by making them demonstrate just how much of a contribution they can make for a given amount of money.

Send out the brief to a long-list of consultants

Many clients find it tempting to go back to the same firm again and again. Although this is often on a rather grudging basis (‘better the devil we know’), there are some advantages in doing so, especially where:

  • The project is high-risk – where using a new, less familiar consulting firm might raise the overall level of risk involved to a point where the project becomes untenable

  • The time scales are tight, and the time taken in putting the project out to competitive tender will be prohibitively long

  • A very high level of internal knowledge about the client is required

But in all other cases, it makes sense to cast your net widely (a long-list should contain the names of around ten consulting firms). The consulting industry is a rapidly changing one with new firms coming (and going) all the time. By inviting consulting firms you’ve not worked with before, alongside more familiar competitors, you’ll get an up-to-date and broad set of perspectives on your problem. Even the consultants you choose not to put on the subsequent short-list may make helpful suggestions you can incorporate in your second iteration of the consulting brief. Moreover, it’s important here to be clear about just how specialized your problem is. If specialist knowledge is important, then firms you’ve worked with in the past (on other issues) may not be those best equipped for this particular work.

First phase of contact with consultants

Once the brief has gone out, a period of contact follows with the consulting firms bidding for the project. Like the brief itself, this can take many forms. It may consist of one formal meeting (typically a presentation) in which the consultants talk through their proposed approach to a committee. At the other end of the spectrum, the process may be much more iterative, with many, far less formal meetings that become a dialogue between clients and consultants. There is no right or wrong approach, but it is important to find one that suits you and your organization (something which is discussed in greater detail later in this chapter). That being said, there’s considerable value in making use of the consultants’ expertise as much as possible. They should have experience of working in the area you’re looking at and they will almost certainly have a better understanding of what consulting projects succeed or fail, so it makes sense to try and tap this expertise wherever possible. However, whatever form it takes, this is a critical period because it helps you develop an impression of the consulting firms.

Internal consultation on brief and short-list

The initial period of contact with the consulting firms also provides you with an opportunity to validate your and your colleague’s views about the project as a whole and the involvement of consultants in it. This is useful because it can be difficult to develop a consulting brief in abstract, especially if the project is in an area with which you’re unfamiliar. As a result, many briefs become the lowest common denominator of internal discussions: they’re woolly, bland and provide little of the precise guidance that consultants require if they’re to be effective.  Having refined the brief, you can now decide which of the long-list of consultants initially approached should be put on the short-list.

Second phase of contact with consultants

With a more specific brief, greater internal consensus within your organization and a smaller number of previously vetted consulting firms, you should now in a position to have a far more meaningful dialogue with the consultants you've short-listed. Once again, this period can be long or short, an informal dialogue or a more formal process. And, once again, although there is no black and white rule about which way of working you should adopt, it’s sensible to bear in mind the comments made earlier about the potential value of having an interactive relationship with the short-list of firms. However, just as your brief has been refined, you should now expect the consulting firms to prepare much more comprehensive statements (in the form of proposals and/or presentations) describing how they plan to approach the project. The consulting firms should also be able to supply you with:

  • A number of client referees, whom you can contact directly in order to gauge the extent to which the firm has relevant experience relevant and a track record of success

  • A list of the people who, subject to you’re giving the go-ahead for the project within a reasonable amount of time, will be guaranteed to work on the project (you need to ensure that what you see – experienced consultants selling their services – is what you get – the same experienced consultants actually doing the work).

Internal consultation on the decision

Having refined your brief and examined the refined response of the short-list of consulting firms, the moment of truth has arrived, to choose one or two firms who will be the preferred bidders for the project. It can help here to ask everyone involved in the decision to rate their views according to a set of pre-defined evaluation criteria, but such criteria often put a spurious scientific gloss on what is, in fact, a gut reaction. As that’s the case, it can be much more productive to discuss those impressions openly – otherwise you run the risk of not taking on board the reservations of individuals and that can have a highly detrimental effect on the subsequent consulting process. As to whether go forward with one or two preferred bidders, that decision is largely dependent on the kind of project envisaged. For complex, large-scale projects, where many detailed issues have to be finalized during the negotiation of the contact, it’s good commercial sense to involve two firms in the process, in case one has to drop out at a later stage. This is rarely necessary for smaller-scale projects.

Negotiations with a couple of preferred consulting firms

The brief prepared for the consultants and the proposals/presentations elicited from them will almost never be sufficient to cover all aspects of the contractual relationship between a client and a consulting firm. For comparatively small-scale projects, most consulting firms have set terms and conditions which cover the most obvious points – confidentiality, duty of care, intellectual property rights and liability. They should also have an outline of the escalation process, describing what happens if, for any reason, you’re dissatisfied with the service you receive. For larger projects, these aspects often form part of a customized contract that will cover issues such as the use of subcontractors.


This is an edited extract from Fiona Czerniawska’s The Intelligent Client, published by Hodder & Stoughton.



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