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| Welcome |
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Whoever
coined the expression “you gotta start somewhere”
was right on target. Often, getting started is the biggest
hurdle to getting something finished. So this month,
we’re focused on getting you started. Whether
it’s starting a project, a client sales opportunity,
a marketing program, or even a new consulting practice,
we’ve got something to help.
We
also asked consulting industry watcher, Fiona Czerniawska,
to clue us in on the latest trends in marketing, pricing,
and delivering consulting services.
July
is a big birthday month across the world as over thirty
nations celebrate birthdays, including the United States.
Happy Birthday to all!
Enjoy
the issue. And send me an email
if you have comments.
Mike
McLaughlin
Editor, Management Consulting News
___________________ SPONSORED LINK ___________________
Only
three times a year, Alan Weiss presents this unique
career development opportunity for a select handful
of people. Click
here for photos, testimonials, agenda, qualifications,
and registration.
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| Interview:
Fiona Czerniawska |
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Fiona Czerniawska, one of the consulting industry’s
keenest observers, has some answers about why rates
are not keeping pace with demand for consulting services.
In our interview, we discuss this trend, and others,
including the reality of value-based pricing, the emergence
of new consulting services, and the outlook for the
industry.
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| The
Writing on the Wall, by Alan Weiss |
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 If the Client Doesn’t Need It Then You Don't Want It Bad Enough
Of
all the objections that we hear, three primary ones
make zero sense to me: We have no money; we have no
time; and we don’t need what you have.
Everyone
has money, and everyone has time. The real issue here
is that they are choosing not to give you the money
or provide you with the time. (Anyone who says “I
don’t have the time to see my kid’s soccer
game” is really saying “I choose not to
see my kid’s soccer game.”)
Objections
involving “no time” and “no money”
are not really about scarcity, they’re about priorities.
You haven’t provided enough value to gain status
on the priority list. Believe me, if your value proposition
was powerful enough for that buyer (and this only applies
to buyers, not gatekeepers trying to preserve their
budgets) both time and money would flow.
The
question remains, “What if the buyer really doesn’t
need what I’m offering? In that case, I can’t
climb the priority list.”
As
rainmakers, it’s our job to create need (or unearth
it, or identify it, or dust it off). All buyers know
what they want, but very few know what they
need. If that weren’t the case, no one
would ever sell an insurance policy or a time share
(I jest, but not by much).
The
difference between want and need is what I call the
“value distance.” That is, the more profound
the need you demonstrate, moving away from merely the
“want,” the more valuable you are and the
more you can charge, because the ROI is so dramatically
higher. (This is why hourly billing is moronic as well
as unethical. It’s a set rate irrespective of
value, and it only pays well if you act counter to the
best interests of the client—taking longer to
resolve the issue rather than doing it quickly.)
If
the need you demonstrate is merely an inch or two away
from the “want,” then there isn’t
much value distance. The trouble is that most consultants
never even try to establish the need.
The
best and fastest way to discover true need is to ask
a very difficult question which you may want to make
a note of: “Why?”
If
the buyer says, “We want a sales training program,”
don’t dash to your PowerPoint slides to demonstrate
your six-step program. Instead, ask, “Why do you
think you need one?” Buyers are apt to reply that
they have to replace high client attrition, or morale
is down, or competitive technology seems superior, none
of which is exactly a clarion call to initiate better
sales training. There may be a much larger and more
efficacious project here, aimed not at the “want”
of sales training (an arbitrary alternative), but rather
at the “need” to improve competitiveness
or reduce attrition or gain market share.
This
is entirely within our power to control in the sale
process. But that requires the confidence to believe
that you have value to offer and the diagnostic skills
to determine what the actual issues are. Too often we
act as order takers, obsequious beggars with our hat
in our hand, hoping we’ll be chosen. We should,
of course, position ourselves as independent and objective
experts, peers of the buyer, who can provide ideas,
provocation, and new perspectives on the spot.
Underlying,
legitimate needs such as safety, repute, and comfort
can often only be identified through this process. Someone
who merely “wants” his house painted may
seek the lowest bidder—commodity shopping. But
someone who realizes that properly painted, the house
will require less maintenance, have a higher resale
value, and impress visitors more may not be interested
in lowest bid but rather in best fit for those needs.
No
one needs a Mercedes-Benz merely for transportation
from point A to point B. But they certainly need a car
which is safe, reliable, and represents their idea of
their station in life. (An automobile is the largest
“life style” purchase that most people make.)
If
you’re not adept at helping prospects determine
the real needs behind their wants, you’ll never
be successful in creating large projects, high fees,
and enduring relationships. Satisfying a “want”
is non-differentiated; satisfying a “need”
is an emotional triumph.
You
might “want” clients who pay you decent
fees and the ability to pay your bills. But what you
“need” is a sustainable, branded, high-repute
consulting business which enables you to realize or
exceed your goals and aspirations for family, community,
and personal growth. Think about that the next time
you question whether a developmental activity makes
sense for you. You’ll tend to work hard to attain,
and pay more to secure, help which satisfies true needs.
The exact same dynamic applies to your prospects and
clients.
You
may not want to believe it, but you really need to listen
to me!
`````````````````````````````
Alan
Weiss, Ph.D. is the author of twenty-five books, including
Million Dollar Consulting,
which appears in seven languages. He runs the unique
Million Dollar Consulting™ Colleges three times
a year. You can reach him at www.summitconsulting.com,
where you can also download hundreds of free articles.
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| Memo
to IT Consultants |
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Recently,
CIOs have loosened up the purse strings to fund a range
of projects, from new software applications, to compliance
systems and patches, to legacy systems. The market outlook
for IT consultants should be strong for the foreseeable
future.
What’s
the key to grabbing a piece of this emerging market?
Address
the underlying concern that IT projects almost always
fail. Consulting giant Accenture reports that only 29
percent of IT projects are considered successful. The
average cost overrun of an IT project is 56 percent,
and the average project delay is 84 percent of the original
project plan.
With
such a disastrous track record, IT consultants should
offer a compelling story—along with proof—about
how their services help clients avoid becoming more
IT roadkill. Many consultants already emphasize a record
of on-time and on-budget projects, but consider taking
a further step. Offer specifics about how that performance
was achieved and how your project approach mitigates
risk.
A
compelling offer combined with a solid strategy for
keeping a project from spinning out of orbit will find
a receptive audience.
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| Crucial
Confrontations: Bridging the Gap |
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Bridging
the Gap between Performance and Expectation
by
Kerry Patterson and Eric Patten
Not
long ago, we worked with a large software maker that
was having a hard time getting products out of a department
it had created two years prior. The department was formed
by merging several product lines and divisions into
one.
The
leaders had thought that if they simply redefined the
org chart, the necessary changes would occur and the
unit would start producing. After two years, they realized
how wrong they were: the new unit hadn’t produced
a single product.
Our
team’s job was to find out why.
Read
the article
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| Pay Rates for Consultants |
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Abbott,
Langer & Associates, Inc. has released Compensation
in Consulting Firms, 11th Edition–2006.
Based on 1,900 respondents, the report sheds light on
the total cash compensation for various categories of
consulting jobs.
Annual
nationwide (US) pay rates for eight jobs included in
the report are:
| Senior or Executive Vice Presidents |
$155,000 |
| Vice Presidents |
$140,005 |
| Branch Managers (supervise 10-24 consultants) |
$123,600 |
| Chief Financial Executives |
$ 96,000 |
| Principal Consultants |
$ 82,618 |
| Senior Consultants |
$ 80,500 |
| Consultants |
$ 58,240 |
| Junior Consultants |
$ 46,010 |
Keep in mind that these numbers are aggregated across
geographies, firm size, and type of firm.
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| Coming
Attractions |
|
 “The
professional career path is strewn with the bodies of
those who meant to get around to marketing someday.”
– Ford Harding
Can
you teach someone how to be a rainmaker? Yes, says Ford
Harding, consultant and author of the re-released classic
book, Creating Rainmakers.
Next
month we’ll ask Harding what he suggests we do
to make it rain.
Look
for the next issue of Management Consulting
News on August 1, 2006.
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Despite
quite a booming market, some firms are not doing
very well and I think that’s because they
don’t have the right kind of service mix.
