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Consultants for small and mid-sized businesses

Consultants for small and medium-sized businesses

Consultants specializing in small and mid-sized businesses are different from consultants which mainly are serving large corporations. Sometimes, small and mid-sized companies seek out external expertise for other reasons than large companies because they face different organizational challenges and priorities. And there may be also different requirements and expectations towards consulting firms.

 

What are the common reasons for seeking a consultant's assistance?

While the most common reasons for seeking assistance are similar for small and medium-sized businesses, the scope and extent are often smaller than they are in large companies. Although the motivation can be varied, the main factors influencing the decision to hire external consultants are:

  1. Need expertise or resource capacities not available in-house
  2. No time to figure out on their own
  3. Need expertise gained from similar projects, other companies or industries
  4. Need methodological know-how not available in-house
  5. Need knowledge about unknown markets or to identify new business opportunities
  6. Obtain neutral, independent and objective advise and perspectives.

 

What are the key challenges and priorities small and medium-sized clients seek external assistance with?

5 to 10 years ago, key challenges and priorities for small and mid-sized businesses mainly revolved around finance and tax issues. They relied on tax experts, legal counsels, audit companies or banks for assistance. With new economic developments (globalization, growth, financial markets, etc.) key challenges have been changing though. Small and medium-sized businesses increasingly demand for consulting services which a long time have been solely relevant for larger companies, e.g.

  • Managing and optimizing the international (production) footprint
  • Acquiring new companies or selling existing businesses
  • Identifying new markets, products and/ or technologies
  • Partnering with suppliers, managing the supply chain
  • Expanding, internationalizing business activities, serving new markets, clients and business areas
  • Enforcing sales and client orientation
  • Improving efficiencies and managing costs
  • Developing the organization and improving leadership.

 

What do small and mid-sized clients expect from consultants?

How do small and mid-sized clients choose which consulting firm they will work with? There probably are some differences between small and large companies. Based on our experience in searching, evaluating and recommending consulting firms for small and mid-sized client organizations the following deciding factors gain more relevance:

  • Must have worked for other small and mid-sized clients
  • Must understand how smaller companies think and act
  • Must be able to deliver pragmatic approaches and solutions
  • Must focus on achievements, rather than "big ideas" and "buzzwords" or "consultant's talk"
  • Must bring entrepreneurial spirit
  • Must possess industry expertise
  • Must be able to build trust and avoid autonomy and assymetric power.

 

How do small and mid-sized client organizations find a consultant which is right for their business?

Small and medium-sized buyers of consulting services are more likely to value referrals and recommendations. For some project types or topics turning to personal networks is not sufficient or not helpful. In these cases finding suitable consulting firms is more difficult: Who does this kind of work? How well known is the firm? How good is their reputation? Compared to large companies, more occasional buyers of consulting services have less experience in finding alternative consulting firms and cannot draw on a sufficient set of preferred suppliers which cover their demand for external assistance. While large companies often employ professional procurement staff, smaller companies often lack the skilled and experienced employees for searching, evaluating and selecting consulting firms.

 

How to screen the consulting market and its suppliers and how to assess the quality of a consultant

To select a consultant for a particular job, clients must decide how broad they want their list of consultants to be and what consulting firms they want to include for initial consideration: Do you need a large consulting firm or a small, highly specialised consulting firm? Which type of consulting firm is suitable, e.g. a traditional management consulting firm? Or is it worth to consider additional, alternative service providers such as an advertising agency or IT service provider? What about international requirements? Do you need a consultant with international footprint or with local network partners? The decision ultimately depends on how extensive the project is and which skills and experiences may be provided by the own organization. The next step is assessing the expertise and quality of a consulting firm: Consultants vary greatly in their level of expertise. That's why, when evaluating prospective consulting firms, several questions have to be answered: What is the consultant’s special area of expertise? What is the consultant’s knowledge of the industry? What is the consultant’s “track record”? Does the consultant's expertise match with what you want the consultant to do? How do you know the consulting firm delivers what it promises?

When it gets down to the final selection some of the deciding factors are more "obvious" than others. In order to be able to deliver real value to a company, consultants should be encouraged to be creative, to make a real difference. In order to be able to "see" this value of consultant (before a project starts) a client organization must possess experience in dealing with a wide variety of consulting firms. Furthermore, since so much success depends on the personal qualities of the individual consultants, a consulting firm's track record and reputation may be an important factor in getting it on the shortlist for a particular piece of work, but clients have to make their final selection based on the individuals they meet.

If a client organization does not have experience in finding and choosing the right consulting firms and services and/ or cannot rely on word-of-mouth recommendations from friends or colleagues, turning on to the option of receiving assistance from a third-party may be optimal, since so much success and return on investment depends on choosing the right consultant.

 

How can we help you? Skills-based consultant matching process

Since its foundation in 1999, Cardea AG has been focused on optimizing the added value of employing consulting services for clients. By providing transparency in the consulting market, Cardea supports clients in making the right decisions when retaining external consulting services. Cardea has established itself as a recognized expert in all matters relating to the consulting market and the use of external consultants - across all industries and from large, international corporations to small and medium sized enterprises.

consultingsearcher®, the web-based service for searching and screening prospective consultuing firms, offers clients a comprehensive overview of relevant prospective professional service providers and enables access to previously unknown consulting firms. In addition consultingsearcher® allows its users to distinguish among different providers and compare their distinct areas of expertise.

consultingsearcher® will not replace a complete selection process and systematically assessing the prospective consultants' skills and expertise. Support in These phases are offered by Cardea with over 15 years of experience assisting clients with evaluating and selecting consulting companies.

 

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