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- Herausgeber: John Wiley & Sons
- Kategorie: Fachliteratur
- Sprache: Englisch
The new edition of bestselling real-world guide to consultancy success, from the "Rock Star of Consulting" Alan Weiss The second edition of The Consulting Bible: Everything You Need to Know to Create and Expand a Seven-Figure Consulting Practice remains the most comprehensive and practical guide to the consulting profession, from launch to high growth, from marketing to implementation. Legendary consultant, speaker, and bestselling author Alan Weiss shows you how to create an independent or boutique consulting practice and take it to seven-figure success. Step-by-step, this invaluable resource guides you through attracting clients, maximizing your value, and achieving your career goals. In the decade since the first publication of The Consulting Bible, an array of significant developments has dramatically impacted the consulting profession: shifts in social consciousness, the Covid-19 pandemic, tele-consulting and virtual meetings, the globalization of the economy, the growth of social media, and many more. This exhaustively revised new edition provides specific approaches and techniques for mastering the new consulting environment and turning volatility and disruption into unlimited opportunities. Designed to help you become the authority and expert that organizations turn to again and again, this book is your one-stop resource for: * Building a strong global brand that draws people to you * Marketing remotely to reduce costs and allow for higher fees * Mastering the latest implementation techniques * Forging strong relationships with the buyers of a new generation * Selecting the consulting methodology that best fits your requirements * Writing proposals and creating testimonials and references * Using advanced technology to sell and deliver your services Written for newcomers and veterans alike, The Consulting Bible: Everything You Need to Know to Create and Expand a Seven-Figure Consulting Practice, Second Edition, is essential reading for every solo consultant, entrepreneur, and principal of a small consulting firm.
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Seitenzahl: 455
Veröffentlichungsjahr: 2021
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Table of Contents
Cover
Title Page
Copyright
Dedication
Introduction to the First Edition
Introduction to the Second Edition
Other Works by Alan Weiss
Section I: Genesis: Consulting as a Profession
Chapter 1: Origins and Evolution
The Role of a Consultant
The Ongoing Need
Various Forms
Examples of Success
The Future
Notes
Chapter 2: Creation
Legal
Financial
Administrative Support and Resources
Emotional Support and Resources
Two Available Structures
Notes
Chapter 3: Philosophy
Hydraulics: Raise Fees and Reduce Labor
Identifying True Buyers
Conceptual Agreement
Leveraging
Notes
Section II: Exodus: Consulting as a Business
Chapter 4: The Journey
Creating Gravity and Attraction
Reaching Out Effectively
Viral and Social Media Implementation
Creating an Accelerant Curve
Shameless Promotion
Technology Strategies
Notes
Chapter 5: Presence
Creating and Nurturing a Brand
Expanding Products and Services
Considering Alliances
Referral Business
Advisory Business (Retainers)
Global Work
Notes
Chapter 6: Celebrity
Thought Leadership
Authorship
Value‐Based Fees
Subcontracting, Franchising, Licensing
Reinvention
Creating Communities
Notes
Section III: Deuteronomy: Consulting Methodology
Chapter 7: The Perfect Proposal
Assuring Success
Conceptual Agreement
The Nine Components of a Great Proposal
How to Submit
How to Close and Launch
Notes
Chapter 8: Implementation
Occam's Razor
The Key Stakeholders and Influence Points
Avoiding Scope Seep
Midcourse Corrections
Note
Chapter 9: Disengaging
Demonstrating Success
Obtaining Referrals
Obtaining Repeat Business
Creating Testimonials and References
Long‐Term Leverage
Notes
Section IV: Acts of the Apostles: Implementing Consulting Methodologies
Chapter 10: Interpersonal Methodologies
Coaching
Facilitating
Conflict Resolution
Negotiating
Skills Development
Notes
Chapter 11: Teams and Groups
Leadership
Succession Planning
Career Development
Teams Versus Committees
Communications and Feedback
Notes
Chapter 12: Organization Development
Strategy
Change Management
Cultural Change
Crisis Management
Innovation
Notes
Section V: Proverbs: Consulting Success
Chapter 13: Ethics of the Business
When Bad Things Happen to Good Consultants
Financial Follies
Protection and Plagiarism
When to Refuse Business or Fire Clients
Doing Well by Doing Right
Notes
Chapter 14: Exit Strategies
Building Equity
Licensing Intellectual Property
Achieving Life Balance
Finding Successors and Buyers
Transitioning
Notes
Chapter 15: Payback and Reinvestment
Mentoring Others
Advancing the State of the Art
Participation in the Evolution
The Future
Note
Chapter 16: Consulting in Crisis Times
The Nature of Volatility
Disruption as a Weapon
Revelations
Note
Physical Appendix
Sample Proposal
Subcontractor Agreements
Virtual Appendix
About the Author
Index
End User License Agreement
List of Illustrations
Chapter 1
FIGURE 1.1 Relationship of Skills and Content
FIGURE 1.2 Value Distance
FIGURE 1.3 Content, Processes, and Trust
Chapter 2
FIGURE 2.1 Risk/Reward Ratio
FIGURE 2.2 Where Do These Paths Intersect?
FIGURE 2.3 Consulting Model
Chapter 3
FIGURE 3.1 Reach Out Versus Gravity
FIGURE 3.2 Consulting Model
Chapter 4
FIGURE 4.1 Market Gravity Wheel
FIGURE 4.2 Trust Pyramid
FIGURE 4.3 Consulting Marketing Model
FIGURE 4.4 Accelerant Curve
Chapter 5
FIGURE 5.1 Requirements for a Powerful Brand
FIGURE 5.2 Networking Your Brand
FIGURE 5.3 Brand Pyramid
FIGURE 5.4 Market Priorities Quadrants
FIGURE 5.5 Client Maturity
FIGURE 5.6 Expansion Potential
Chapter 6
FIGURE 6.1 When Value Follows Fee
FIGURE 6.2 Buyer Commitment and Fee
FIGURE 6.3 The Success Trap
FIGURE 6.4 Configurations of Growth Stages
Chapter 7
FIGURE 7.1 Consulting Model
Chapter 8
FIGURE 8.1 The Thermal Layer
FIGURE 8.2 Building Skills
Chapter 9
FIGURE 9.1 Options at Conclusion
Chapter 10
FIGURE 10.1 Job Components
FIGURE 10.2 Organizational Education Tied to Strategic Business Goals
Chapter 11
FIGURE 11.1 Succession Planning Scenario
FIGURE 11.2 Committee Versus Team
Chapter 12
FIGURE 12.1 Strategy Quadrant
FIGURE 12.2 Sentient Strategy Analysis
FIGURE 12.3 Sentient Strategy Strategic Factors
FIGURE 12.4 Time Utilization and Effectiveness
FIGURE 12.5 The Ambiguous Zone
FIGURE 12.6 Problem Solving Versus Innovation
Chapter 13
FIGURE 13.1 Factors for Ethical Effectiveness
Chapter 14
FIGURE 14.1 Maslow's Hierarchy of Needs
Chapter 15
FIGURE 15.1 Market 3‐D Bell Curve
FIGURE 15.2 Diversity and Client Maturity
FIGURE 15.3 Reach Out Versus Gravity
Guide
Cover
Table of Contents
Begin Reading
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THE CONSULTING BIBLE
SECOND EDITION
HOW TO LAUNCH AND GROW A SEVEN‐FIGURE CONSULTING BUSINESS
ALAN WEISS
Copyright © 2021 by Alan Weiss. All rights reserved.
Published by John Wiley & Sons, Inc., Hoboken, New Jersey.
Published simultaneously in Canada.
No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning, or otherwise, except as permitted under Section 107 or 108 of the 1976 United States Copyright Act, without either the prior written permission of the Publisher, or authorization through payment of the appropriate per‐copy fee to the Copyright Clearance Center, Inc., 222 Rosewood Drive, Danvers, MA 01923, (978) 750‐8400, fax (978) 646‐8600, or on the Web at www.copyright.com. Requests to the Publisher for permission should be addressed to the Permissions Department, John Wiley & Sons, Inc., 111 River Street, Hoboken, NJ 07030, (201) 748‐6011, fax (201) 748‐6008, or online at http://www.wiley.com/go/permissions.
Limit of Liability/Disclaimer of Warranty: While the publisher and author have used their best efforts in preparing this book, they make no representations or warranties with respect to the accuracy or completeness of the contents of this book and specifically disclaim any implied warranties of merchantability or fitness for a particular purpose. No warranty may be created or extended by sales representatives or written sales materials. The advice and strategies contained herein may not be suitable for your situation. You should consult with a professional where appropriate. Neither the publisher nor author shall be liable for any loss of profit or any other commercial damages, including but not limited to special, incidental, consequential, or other damages.
For general information on our other products and services or for technical support, please contact our Customer Care Department within the United States at (800) 762‐2974, outside the United States at (317) 572‐3993 or fax (317) 572‐4002.
Wiley publishes in a variety of print and electronic formats and by print‐on‐demand. Some material included with standard print versions of this book may not be included in e‐books or in print‐on‐demand. If this book refers to media such as a CD or DVD that is not included in the version you purchased, you may download this material at http://booksupport.wiley.com. For more information about Wiley products, visit www.wiley.com.
Library of Congress Cataloging‐in‐Publication Data:
Names: Weiss, Alan, 1946‐ author.
Title: The consulting bible : how to launch and grow a seven‐figure consulting business / Alan Weiss.
Description: Second edition. | Hoboken, New Jersey : Wiley, [2021] | Includes index.
Identifiers: LCCN 2021006034 (print) | LCCN 2021006035 (ebook) | ISBN 9781119776871 (paperback) | ISBN 9781119776895 (adobe pdf) | ISBN 9781119776888 (epub)
Subjects: LCSH: Business consultants. | Consultants—Marketing.
Classification: LCC HD69.C6 W4588 2021 (print) | LCC HD69.C6 (ebook) | DDC 001—dc23
LC record available at https://lccn.loc.gov/2021006034
LC ebook record available at https://lccn.loc.gov/2021006035
Cover design: Wiley
Cover image: © Ekely/Getty Images
This book is dedicated to all those who have ever entered this profession, improving the condition of their clients, and thus improving the lives of those around them.
Thus, this book is dedicated to YOU, and to your success.
Introduction to the First Edition
This is a book conceived and created for the independent consultant and boutique consulting firm principal. Having established that, let me point out in the second sentence of the introduction that the strategies, concepts, methodologies, and experiences described herein are equally valid for the partner and practitioner in a larger firm. My seminal work on consulting practices, Million Dollar Consulting, has been read by over half a million people since the first edition was published in 1992.
So a logical question is: “How will this book be different?”
This is my most comprehensive book on consulting; that is, it tackles the profession from establishing a practice through seven‐figure success, from acolyte to star. It will be updated and revised as needed, but there will also be continuing and organic additions through the online Virtual Appendix, available to you immediately at http://summitconsulting.com. Simply go to the site's bookstore, select this book, and click on “Appendix.” There is no charge to access this at any time.
My latest thinking is incorporated here, including such recent intellectual property as the Million Dollar Consultant® Accelerant Curve; the role and creation of thought leadership positions; an expanded Market Gravity™ Wheel; the Market Value Bell Curve; and how to become an object of interest (OOI). Naturally, these are all incorporated into the context of societal, technological, and economic conditions and likely trends. And I'll be demonstrating how to establish a success equilibrium in ongoing periods of volatility, and how to create your own volatility.
Finally, one of the critiques of my earlier works I'm happiest about (and laugh at) is that I don't explain how to evolve into a large firm with employees, assets, and infrastructure. Those critics don't get it.
I'm a solo practitioner, I have no staff, and my margins are 90 percent—I keep what I make. This is a bible to lead you to that land, where you are totally independent, are reliant for victory or defeat on yourself alone, and can invest in your own future, your profession, and your legacy, because you are creating the greatest wealth of all, discretionary time. You'll find advice herein on how to build a firm as one of two viable business models. But keep in mind that you don't want to spend 40 years wandering to try to find the perfect model. You deserve to be successful along the way.
I've given this book a noble name because ours is a noble calling. Whether you are a newcomer or highly experienced, I will show you how to become superb at attracting and helping clients, so that you can enrich your life and the lives of those around you.
But first, you have to believe.
—Alan WeissEast Greenwich, RIMarch 2011
Introduction to the Second Edition
Since the first edition of this book 10 years ago, we've seen vast social injustice protests, the COVID pandemic, two U.S. presidential elections, a highly polarized society, impeachment proceedings, terror attacks, violent natural disasters—from fire to floods, hurricanes to tsunamis—LGBTQ rights demands, #MeToo, Brexit, climate change and alternative energy priorities, pervasive growth of social media, autonomous vehicles, artificial intelligence breakthroughs, face transplants, tele‐health, and Hamilton.
We've seen both Apple and Amazon grow to over a trillion dollars in value, GE fall precipitously from its lofty perch, scandals hit Volkswagen, Wells Fargo, McDonald's, Theranos, and Penn State University. We've suffered through Bernie Madoff, Martin Shkreli, Roger Ailes, Bill Cosby, Jeffrey Epstein, and the college admissions cheating scandal.
Just another decade, right?
Well, that's true. Many of us suffered through the 9/11 attacks, the Viet Nam war, the AIDS epidemic, and even the Cuban Missile Crisis.
Stuff happens.
Through all of this—and I'm obviously omitting a lot of the good news and great breakthroughs—there has been the need for clearer heads and intelligent direction and effective solutions. There continues to be a need for expertise and talent, for insights and direction.
That's where you and I come in. This book is meant to help you understand the consulting profession, from launch to high growth, from marketing to implementation. We talk a lot about “smarts” and “big data,” but we don't focus enough on knowledge and wisdom.
I'm hoping to share that knowledge and wisdom that I've been fortunate to gain over my career with you, so that you can share it with others. That's not a job, or career. It's a calling.
And that's why this is The Consulting Bible.
—Alan WeissEast Greenwich, RIMarch 2021
Other Works by Alan Weiss
Alan Weiss on Consulting
(interviewed by Linda Henman, Aviv Shahar)
Best Laid Plans
(originally
Making It Work
)
Getting Started in Consulting
(also in Chinese)
Fearless Leadership
Good Enough Isn't Enough
(also in Spanish)
Great Consulting Challenges
How to Acquire Clients
How to Establish a Unique Brand in the Consulting Profession
How to Market, Brand, and Sell Professional Services
How to Sell New Business and Expand Existing Business
How to Write a Proposal That's Accepted Every Time
Legacy
Life Balance
Lifestorming
(with Marshall Goldsmith) (also in Korean, Indonesian, Turkish)
Managing for Peak Performance
(also in German)
Million Dollar Coaching
(also in Portuguese)
Million Dollar Consulting
(also in Portuguese, Russian, Polish, Chinese, Korean, Arabic)
Million Dollar Consulting Proposals
Million Dollar Consulting® Toolkit
Million Dollar Launch
Million Dollar Maverick
Million Dollar Referrals
Million Dollar Speaking
(also in Chinese, Portuguese)
Million Dollar Web Presence
Money Talks
(also in Chinese)
Organizational Consulting
Our Emperors Have No Clothes
Process Consulting
The Business Wealth Builders
(with Phil Symchych)
The Consulting Bible
(also in Portuguese)
The DNA of Leadership
(with Myron Beard)
The Global Consultant
(with Omar Kahn)
The Great Big Book of Process Visuals
The Innovation Formula
(with Mike Robert) (also in German, Italian)
The Language of Success
(with Kim Wilkerson
)
The Resilience Advantage
(with Richard Citrin)
The Son of the Great Big Book of Process Visuals
The Talent Advantage
(with Nancy MacKay)
The Ultimate Consultant
The Unofficial Guide to Power Management
The Power of Strategic
Commitment (with Josh Leibner and Gershon Mader)
Threescore and More
Thrive!
Value‐Based Fees
Who's Got Your Back?
Section IGenesis: Consulting as a Profession
The origins, evolution, and basic requirements of successful consulting. Some realities are self-evident and eternal.
Chapter 1Origins and Evolution: From Whence We Came
The Role of a Consultant
One day, somewhere in the mid‐Pleistocene Epoch, after the last glacial period, a man was trying to create a stronger point on his stone spearhead so that he could better hunt and slay the peccaries that fed his clan and protect himself from dire wolves that fed on his clan. He did this in the only way he knew how, which he learned watching his father—he laboriously abraded the sides of the point on a larger rock.
On this day, however, a stranger happened by who might have been seeking more interesting surroundings, or was exiled from his clan, or, one could readily assume, simply was lost. Observing the work on the spearhead, the stranger demonstrated that the point had to be ground on a harder rock, not a softer one, and indicated how to choose them. Not just any rock would do. And, indeed, his method worked and the hunter fashioned a sharper spearhead more quickly. The stranger was offered thanks, provided with food, and bestowed with a lion's tooth. He then went on his way once again, well fed, and with a talisman.
Consulting had been born.
The Gospel
The role of a consultant is to improve the client's condition.
It may or may not have happened that way, but you can't prove it didn't. Consulting—advice, counsel, suggestions—has been around since people began living together. Claims of “the oldest profession” have been misapplied to another career, though some would claim that consulting can also be somewhat meretricious if performed with poor motives or lack of skills.
Our job is to improve the client's condition. Doctors are consultants, and one of the first things they learn in medical school is primum non nocere (first to do no harm). When we walk away from a client, the client's condition should be better than it was before we arrived, or we've failed. (That “we” may mean both the client and we have failed, but we share in the failure in any case.)
It's that simple.
However, we are engaged in management consulting as solo practitioners and small firm principals (or consultants and partners in large firms). And that pursuit did not begin when sloths as large as a tree waddled about the earth. It began and then flourished within some of our lifetimes.
The first management consulting firm was A.D. Little, founded in 1886 by a professor from MIT. It was mainly a technical research firm at the outset. Booz Allen Hamilton was founded by Edwin G. Booz of the Kellogg School at Northwestern University in 1914 and was the first to serve both industrial and governmental clients. (It wasn't until after the Great Depression's onset that these independent consultancies expanded to embrace more professionals and offices.)
Many, perhaps most, chroniclers of management consulting trace the origins to Frederick Winslow Taylor, the famed guru of time‐and‐motion studies in the early 1900s who purportedly spawned the industrial engineers and consultants who measured efficiency. There are two things wrong with this simplistic Genesis. First, it was governmental regulation combined with the exigencies of World War II that established consulting as we know it. And second, Taylorism was based on a great lie—Taylor fudged his numbers. In measuring efficiency (say, of a man shoveling coal), Taylor would calculate the size of the shovel, the distance to be traversed, lifts possible per minute, and so on. But he never did calculate the fatigue factor inherent in virtually all physical labor. People tend to get less efficient the more they work. When this became apparent, Taylor simply made up numbers out of thin air to accommodate this inconvenient reality. His work was discredited during his lifetime.1
From those beginnings2 management consulting grew dramatically, primarily in the United States. The egalitarian nature of U.S. democracy was conducive to the belief that even senior people could use help (as opposed to, say, the European belief that high office was to be held by family ties, school connections, nobility, or bestowal by absolute authority), and that it was a sign of strength and insight and not weakness or incompetence to ask for help.3 Only after the global transformation as a result of World War II was management consulting transported overseas from the United States.
Prior to the war, however, governmental regulation actually promoted independent consulting. As opposed to the shop mentality of Taylor, management consulting was more focused on dealing with organizational structure—bureaucracy, if you will. The outside experts (see Figure 1.1) were accountants, engineers, lawyers, and similar professionals who worked for merchant banks.
FIGURE 1.1 Relationship of Skills and Content
In the mid‐1930s, New Deal legislation such as the Glass‐Steagall Act prohibited banks from engaging in nonbanking activities, so they could no longer employ and bill out the experts. Yet the banks continued to urge their clients to utilize experts to protect their loans and investments and ensure effective management.
Hence, independent management consulting was boosted by Depression‐era government regulation.4 James McKinsey, for example, assiduously pursued banking relationships to secure the consulting business that the banks themselves had once provided for their clients.
The war also represented seismic shifts in demographics and learning, most relevant for our purposes because of the large movement from an agrarian to an urban culture, and the introduction of mass training for people who had never been developed in such a manner before, nor so quickly, including women in manufacturing jobs. World War II actually necessitated the creation of the training “industry,” for both military and domestic requirements. After the war, management consulting clearly had two components, shifting from merely specific, content‐related expertise to also embrace processes that consultants mastered that were applicable in a variety of public and private enterprises.5
You can view the relationship in Figure 1.1. A consultant who is strictly a content expert (brake pads, air traffic control, medical malpractice) and has no processes to apply or transfer to the client may be thought of as an expert witness at a trial. His or her expertise is sought in a specific area for a finite duration. If there were no brake pads or air traffic control, the consultant would be irrelevant.
On the horizontal axis is the ability to apply processes and to transfer them to the client. If that is purely what's done, and there is no content expertise at all, then we have the equivalent of a facilitator, who can run group meetings and prevent mayhem, but who brings no intellectual capital or property to the table.
I submit to you that the diagonal represents the power in consulting: the consultant who can apply and transfer skills and who also has an impressive ability to tackle content areas. That person becomes a collaborator with and partner to the client, and is far more valuable (can demand higher fees) than either colleague at the maximums of the other axes. And that person more readily can become a trusted advisor, an ideal role for a consultant which we'll return to later on.
Recent phenomena have included the move of traditional audit and accounting firms into more generalized management consulting. The trust placed in them in dealing with company finances was simply transferred to other areas of the operation, albeit with mixed results—the audit mentality has resulted in time‐based billing, which I'll discuss at length later as unwise, unethical, and unforgivable. There have also been abuses in such transfers of trust, as we saw with the collapse of Enron and the subsequent crumbling of Arthur Anderson's consulting business at the time (since resurrected as “Accenture”).
Finally, bear in mind that IBM derives the greatest percentage of its profit not from hardware and not from software, but from its consulting operation. That should tell you a great deal about the future. No one really knows how much revenue is derived by the total management consulting profession, but at this writing I'd guess it's over $500 billion.
The Ongoing Need
We've established that our role is to improve the client's condition. That client is the person who is authorizing our payment out of his or her budget. I call that person the economic buyer. The buyer is our client, not the organization. A client is a human being, not an inanimate entity.
I know you prefer to list Bank of America or Microsoft as your client, and we all do such things. But very few buyers have the authority to hire you on behalf of the entire organization, and even those that do—CEOs, board chairs—are almost always hiring us for a limited scope of action. Your allegiance is to the economic buyer, the person whose condition is to be improved. (Only if you find that the buyer in ethical or legal conflict with the organization should you abrogate that allegiance.)
“Need” for the buyer comes in three flavors:
Preexisting needs
.
These are age‐old, traditional, and valid needs now and tomorrow, and may include such areas as customer relations, market expansion, strategy, conflict resolution, innovation, and so on. Even the pharaohs had team‐building needs, but they chose to take care of them with whip methodology.
Needs you create
.
All clients know what they want, but few know what they need. No one knew they needed a belt‐mounted device connected to headphones to play music, but Akio Morita at Sony created the need with the Walkman (despite internal advice not to pursue it because no one wanted it). That was the grandfather of the iPhone, which is one of the most popular consumer products in history. Today we have tele‐health and 3‐D printing. Don't forget, a luxury, once used successfully, quickly becomes a necessity! The COVID pandemic created the need for remote meetings, work‐at‐home protocols, workplace safety parameters, and so forth.
Needs you anticipate
.
Globalization, increased volatility, changing societal mores, technological advances, and other waves of change should enable any consultant to predict future needs for the client, such as the need to manage remote teams that never see each other, to outsource some services while insourcing others, and to create new levels of internal computer security. Disruption and volatility are offensive weapons not threats to be defended against.
The Gospel
All clients know what they want. Few know what they need. That difference is your value‐added.
You can see in Figure 1.2 that your value distance is the difference between what the client states is wanted and what you demonstrate is really needed. That's often accomplished merely by asking this complex question: “Why?”
“We want a leadership training program. Can you design one?”
“Yes, but why do you want such a program?”
“Once people get to district manager, our attrition rate goes way up. They are obviously not prepared for the job.”
“That's one possibility. But the increased travel, management pressure, and dealing with administrative requirements might also be causing tremendous stress and unhappiness, right?”
“Well, yes.”
“Then shouldn't we investigate, ascertain the real reasons, and formulate appropriate responses? Training might not accomplish enough.”
FIGURE 1.2 Value Distance
One of the primary flaws of unsuccessful consultants is that they accept client wants as the real need. The need is almost always beyond and above the stated want. If you simply satisfy the client want (no value distance) or advance it slightly (small value distance), your value is not very great.
However, if you demonstrate to your client that the real underpinnings of the issue need to be addressed, you can broaden the project, best delight the client, and, not surprisingly, charge the highest fee.
This concept of need is critical to consulting success. No one, but no one, cares about your mission, or vision, or values, all of which are now monotonously pontificated on countless consultant web sites:
“We believe in the highest level of integrity and ethics.”
Oh, too bad, I was looking for an unethical consultant.
Your own beliefs and value and firm history are irrelevant and hugely boring to buyers. What fascinates them are their own history, values, and beliefs. The more you cater to what's in it for them, the more successful you'll be in holding their attention. And always bear in mind that buyers have two sets of needs: professional and personal.
Thus:
Never settle for what a buyer claims is wanted (even if the word “need” is employed). Probe to find out what conditions prompted the initiative to scratch that particular itch. Ask “Why?” to raise the lever of the decision.
Always seek professional needs (e.g., greater market share) and personal needs (e.g., I want to stop acting as a referee between teams and between team and client).
No matter what type of consulting you're undertaking, these facts are immutable. However, the various forms do have some distinctions.
Various Forms
Everyone today is a consultant. There is no barrier to entry, which is the blessing and the curse. When I wrote Million Dollar Consulting in 1991, I found that a palm reader on the boardwalk of Atlantic City has to pass more tests and conform to more regulations than any independent consultant. (I found that she has since retired, having sent her kids to college.) I would bet that's still true today, though no one claims to be a palm reader in an attempt to cover up that they're in fact between jobs, as the actors like to say.
Let me create a fundamental schism right here:
A consultant is someone who improves the client's condition by providing skills, behaviors, content, advice, experiences, and other factors unique to that individual over a designated time. The consultant is a peer of the buyer and creates assignment parameters in consultation and agreement with the buyer. The consultant provides conceptual capital, often in the form of intellectual property. Outstanding consultants charge fees based on value.
A contractor or subcontractor is someone who performs work for the buyer at the buyer's direction and discretion, acting as a temporary employee, helping to implement work assigned by the client. A contractor is, in fact, a temporary employee, and is almost always paid by the time unit, usually hourly. They are peers of other, internal implementers. They bring no unique intellectual capital in most cases, nor is that what the buyer is paying for.
Many of you are having a case of the vapors or have gone to have a shot of Scotch, and I hope it's the aged stuff. But that's my story and I'm sticking to it. A consultant is a “brain,” a subcontractor is another “pair of hands.”
As some of you are thinking, many people calling themselves consultants simply are not. My educated guess over the past 30 years of good economies and bad ones is that there are only half as many true consultants as are claimed.6 If we eliminate those between jobs just claiming to be consultants to save face, and those who are really subcontractors who are not sharing consulting DNA, we may have about 200,000 consultants in the United States, and perhaps twice that number globally.
And I believe only about 50 percent are sustaining decent lifestyles without additional support (their spouse's income, the oil well in the back yard, Aunt Tillie's bequest), and perhaps 20 percent are making high six‐figure and seven‐figure incomes. But that's a story for later in the book.
You may also have noticed, to your horror, that perhaps 90 percent of people calling themselves information technology (IT) consultants are, in reality, just paid help without the benefits.
The Gospel
If you are a pair of hands and not a brain, then you're not a consultant. You're probably a very inexpensive employee.
FIGURE 1.3 Content, Processes, and Trust
I've personally mentored IT consultants all over the world, and have helped them to become true consultants, peers of their buyers, and charging for their value. But this is a tough sell. Most IT resources are simply performing tasks—writing code, fixing bugs, testing new relationships. They are not bringing their own intellectual capital or serving as partners and advisors to the chief information officer or chief technology officer (who should be their buyer).
Thus, the actual world supply of consultants is smaller than believed and the need is constantly growing, meaning that your potential to be in that top 20 percent is pretty high if you approach the profession with at least the diligence of a palm reader. That potential is growing as companies reduce residual talent. The greatest creator of net, new jobs in the U.S. (and in most countries) is small business. Large corporations reduce jobs through automation, attrition, and layoffs.
I've reproduced an earlier graph with more detail in Figure 1.3.
I advocated the diagonal approach earlier, and you can see that it's based on three factors, not just two:
The degree to which you bring useful content to the client.
The degree to which you bring useful processes to the client.
The degree to which you create trust with the buyer.
Content: The client is already immersed in content, which is often the problem—they are breathing their own exhaust. (I once had to remind officers at Mercedes‐Benz that they had auto experts falling out of the rafters, but that wasn't solving their customer service problems.) However, your ability to apply best practices from content you've been involved with elsewhere (and it doesn't have to be identical content, just analogous content) is highly valuable. The degree to which you move up the vertical axis depends on your interaction with the client, from sitting in a room by yourself to casual contact to public representation.
Process: You can superimpose processes that are universally applicable and that the client may be missing or simply not very good at. Most content‐heavy clients are not adept at the processes of conflict resolution, or priority setting, or strategy, simply because their time is overwhelmingly devoted to content matters. As you move along the horizontal axis, you once again move from “back stage” to “front stage.”
Trust: This is the key factor to propel you to the top right and become a true partner with your buyer. You can swiftly and efficiently build trust by:
Being introduced by a peer of the buyer.
Having a commercially published book(s).
Creating proprietary intellectual property and models.
Behaving and dressing like a successful businessperson.
Offering value early and frequently.
Being in the “public square” and known widely in the field.
Let me define trust: It is the honest‐to‐God belief that you're acting in the other person's best interest. That means that I'll accept even criticism well, because I know it's meant constructively. But if I don't trust you, I'll be wary even of compliments, worried about some hidden agenda on your part.
Consulting can take many forms, and it has in popular jargon. But I'm rejecting those who simply use the title because they are looking for full‐time work and those who are merely implementing as part‐time employees. That may sound elitist, but consulting is a noble profession, and we need to set some standards, since no one else seems to be doing so.
Let's see what success looks like.
Examples of Success
It's easy to talk about “new levels” and “great success” and “turbo‐charge your career,” but what do those metaphors really mean? Do they mean more clients, more money, more time?
First, let's describe what constitutes a successful consultant, generically. He or she can be recognized by the following attributes:
A track record of helping improve clients' conditions over several years.
Buyer testimonials in writing and on video attesting to the specific results the work generated.
Working for firms and people beyond a narrow niche (and ultimately, as broadly as possible).
Working globally, even if solely remotely.
Delivering value by virtual and alternate means beyond physical presence.
Sufficient income to sustain one's desired lifestyle, including appropriate savings and planning.
A brand and presence in the market creating widespread knowledge of who the consultant is in that market and immediate credibility with prospects.
Peer respect and a place in the profession where the consultant is recognized and cited.
Intellectual property encompassing print, audio, video, and electronic distribution channels.
A personal life in sync with one's professional life and the discretionary time to pursue one's interests continually.
Regard as a “thought leader” with a strong brand.
One of the consultants I began mentoring about 15 years ago was making about a half million dollars at the time and working almost constantly, the stereotypical one‐man band. Today, his business is about $10 million; he uses five subcontractors on a regular basis, turns down business that doesn't interest him, has a pipeline extending out two years, and takes 12 weeks of vacation each year. Some of his typical vacations include swimming from one Caribbean island to another, and taking a month‐long private air tour of a dozen world sites.
You may not need millions of dollars of income7 or three months of vacation, but you get the idea. You should be able to attain what you reasonably desire in life, and even beyond that. If I had ever had a business plan and created even stretch aspirations 30 years ago, I never would have imagined or predicted I'd be where I am today.
Never.
The Gospel
A market plan will move you forward. A business plan will kill you, because you'll hit it.
Success means having an evolving marketing plan that you tend to daily. Since many aspects of it are passive, you can take long vacations and still have it work for you. But success doesn't ever mean having a business plan, since these are notoriously inaccurate and become dismal, self‐fulfilling prophesies.
If you plan to increase your revenues by 20 percent, or bring on four new clients, or expand your virtual presence, you may just do that—at the expense of having done much more! You don't want to increase revenue by 20 percent; you want to maximize revenue, maximize new client acquisition, and expand your web presence.
When I was being interviewed by the then‐CEO of State Street Bank for a $350,000 assignment, he said to me, “We've increased net new revenues by 22 percent compounded annually over my watch, the last five years. Why do we need you?” In the next three seconds I was going to make or not make a third of a million dollars for me.
I said to him, “How do you know it shouldn't have been 34 percent?”
He thought for just a moment, smiled, and said, “You're hired.”
Let's return to a familiar refrain: Real wealth is discretionary time. Money is merely fuel for that wealth. Ironically, many consultants chasing after success are like dogs chasing cars. They probably aren't going to catch the car and, if they do, what are they going to do with it? Ironically, too many people are busy earning so much money that they are actually eroding their wealth.
Now couple that premise with another tenet—TIAABB: there is always a bigger boat.
The point isn't to have the most; it's to have what you need for your purposes, assuming those purposes will grow as you do. Families, interests, philanthropies, friends, and other involvements usually demand more and elevated support as one matures. That's natural and expectable.
When we vacationed in St. Barth a few years ago, every major slip in the inner harbor was occupied: six yachts that had to be worth $25 million each tied up bumper to bumper like Hondas in a supermarket parking lot. Out in the bay were a dozen more that couldn't fit in the inner harbor, and couldn't be seen or appreciated.
There is always a bigger boat. The point is to be able to acquire the right boat for you at any given time and move on to new ones when appropriate for your needs, not someone else's needs or ego challenges to you.
I raise these attributes and philosophies of success early so that you can assimilate them as you learn the strategic and tactical approaches that follow in the chapters ahead. These are the generic parameters of success that I've observed and enjoyed over decades in this profession. The specific ones will depend on your lifestyle, your interests, and your intentions.
Finally, the best way to achieve success by any measure in the consulting profession is to be a generalist, not a specialist. The hackneyed refrain “Specialize or die” sounds like New Hampshire's license plate motto (“Live free or die”). Surely there is a middle ground!
My refrain is “Generalize and thrive.” It's a simple equation: The more prospective buyers you have, the more opportunity you have to close business. The more appealing you are to the more people, the more you will be sought.
Once you start adding adjectives to your value propositions, you continue to narrow your field until it will fit on the head of a pin. Which of these two value propositions is more appealing to more people?
We accelerate sales closing time while decreasing costs of acquisition.
We accelerate sales closing time while decreasing costs of acquisition in the New England, middle‐market, mortgage‐lending space.
The first will still interest the mortgage bankers. The second will interest only them.
The Future
Usually, future trends and projections are saved for the final chapter in a book. I'm changing that here, because if you're going to, in essence, prepare for the future in the chapters ahead, perhaps it would be a good idea to agree in advance on what the future might hold! As Socrates pointed out, “If one does not know to what port one is sailing, no wind is favorable.”
So how do we tell the good winds and stay away from the doldrums?
Anyone who makes projections in a snapshot such as a book can be in serious trouble, since events can change so quickly. However, I'm going to mitigate that problem in two ways.
First, I am providing an appendix that is electronic on my site (http://summitconsulting.com), which means I can update it regularly and you will have ongoing access to it. Second, I'm going to focus not on the price of gold or the future of alternative energy, but rather on processes and systems that will influence our clients and, hence, us, in very broad areas.
Trend 1: The Transience of Talent
Organizations will be porous and non‐porous. That is, they'll have residual talent among a relatively small group of people, and transient talent depending on the priorities and initiatives at any given moment. Some people will work in the office, some at home, some will rotate; some will be W2 (permanent) and some 1099 (temporary).
This will also become global, just as you might talk from Lansing, Michigan, to a credit expert for Visa who's in Kuala Lumpur.
Trend 2: HR Becomes the Incredible Shrinking Function
Human resources (HR) departments will continue to attenuate. Their transactional functions (benefits administration, relocation, and so forth) have been outsourced successfully over the past two decades. That leaves the transformational functions (change management, organizational redesign, succession planning, and so on), which, by and large, HR has been excruciatingly awful at fulfilling, following every loony fad and buzzword written by every academic and training company guru. If you don't believe that, then consider the market in front of you and around you. It's not being satisfied within the organizations that need you. And at this writing, I can't think of one HR executive promoted to CEO in a Fortune 500 company over the past decade. It has become a dead end. (That is a consistent fact since the first edition of this book.)
What it means for consultants: We are cost‐effective responses to transformational needs. We come, we improve, and we depart, with no benefits package, no vested political interests, and no intent on a corner office or retirement fund. Change management and organizational development skills will be in great demand, often best delivered by solo practitioners, rather than by outside firms descending with 50 people and creating a pseudo‐HR department!
Trend 3: Emerging Markets
I believe that Africa and some South American and Asian markets will grow tremendously. This includes technological advances, communication advances, remote learning and coaching, and English as a common language. There is a growing middle class and a growing appetite for entrepreneurial success and small business development. Fewer people view large corporations as “safety nets” in view of recent developments.
These emerging markets will be served far better by agile, independent consultants than the mammoth firms that want to descend on clients with 300 junior people who have to learn the business over months.
The Gospel
You don't grow in the consulting profession by getting better at what you've already done yesterday. You grow by anticipating tomorrow.
Trend 4: Volunteerism
We're going to see major increases in volunteering because of retired people with time on their hands, the American ethic about helping others (much stronger here than in Europe, where government is expected to provide such help), and companies lending executives to nonprofits, community organizers, and other social movements. However, as I've said on every board on which I've ever served in the arts and charity, “Nonprofit doesn't mean nonprofessional.” The excuse “I'm just a volunteer” doesn't compensate for sloppy management, wasted money, and a disappointed constituency.
What it means for consultants: The nonprofit world, bereft of government funds and corporate donations for years compared to historical giving, and hurt badly during the COVID crisis, has managed to survive to the extent it has through volunteers and intelligent management of resources. But tens of thousands of these organizations have disappeared. There will be a growing need to educate board members, staff, and management on how to acquire, train, evaluate, and retain volunteers. A poor volunteer is worse than no volunteer. And the money will be there, through donors, sponsors, patrons, and fund‐raisers.
Trend 5: The Importance of Communities
I didn't say “just‐in‐time,” which invokes a frenzied dash to me. I'm talking about individual professionals and corporate employees having access to a variety of platforms that can generate information immediately, from where a certain movie is playing to the best insurance rates for a newly married 28‐year‐old airline pilot. These will be accessible to both the buyer and the seller. But there can be too much access, so how do you narrow down what you need without winding up on Facebook for 20 hours in a row?
What it means for consultants: The concept of communities will flourish, where people are attracted by the value of (1) the organizer, (2) the other participants, and (3) the environment.
There will be simultaneous need for you to create your own communities as well as advise clients on how to create theirs. A complaint, don't forget, is a sign of interest. It's better to be expressed in the community, as are ideas and suggestions for other communities, which create buying trends.
Let's turn now to setting up your business and getting ready for action. If you already have a business, use these guidelines to validate that you're organized in an optimal manner for your own success.
Notes
1.
See
The One Best Way
by Robert Kanigel (Viking, 1997) for a fascinating biography of Taylor and his work.
2.
These were one‐person shops at the outset, solo practitioners, even the legendary James McKinsey.
3.
As evidence of this, the first management consulting conference was organized in 1888 by the German Post Office. According to records, nobody came.
4.
Christopher D. McKenna of Johns Hopkins University and Oxford University has written extensively on these governmental factors that promoted independent consulting.
5.
Edgar Schein is probably the preeminent authority and originator of the term process consulting. See his book
Process Consultation Revisited
(Prentice‐Hall, 1998) and my book
Process Consulting
(Jossey‐Bass/Pfeiffer, 2002).
6.
That number is often claimed as about 400,000 by various sources, but I've never seen an authoritative report or calculation.
7.
Six of my books have titles using “Million Dollar” because (trust me) a hundred thousand dollars is not what it used to be.
Chapter 2Creation: How to Establish and Dramatically Grow Your Business
Legal
Incorporation
There are three basic options for incorporation or creating a legal business entity. You will occasionally hear from people who will tell you that you don't have to incorporate. Shun them—they are fools. You will, rarely, hear from a lawyer who will tell you that it's not necessary to incorporate.
Call the ethics committee of the bar association!
You incorporate to create a legal entity that can protect your personal assets, form a firewall to protect you, independently borrow money, create certain tax advantages, and enable you to do business with major clients.1
Always use an attorney and tax advisor who are profoundly well versed in small, professional services firms. Do not use someone who has helped close on your house, done your will, and is related to you in any way closer than seventh cousin, twice removed. (If it's illegal to marry them in your state, you shouldn't use them as advisors.)
Three types of entity:
Chapter C
. This is the standard corporation in the United States, like Microsoft or United Airlines. I once favored it because there were benefits and tax advantages, but later laws have removed them. Since you have to empty a Chapter C corporation of all cash before year‐end or risk being taxed twice on the same revenue (once in the corporation and once when you take it as salary or bonus), it's no longer the best alternative for solo practitioners or small firms.
Subchapter S
. In this form, all company revenues flow through your personal tax return. It is neat, simple, and efficient. There is no need to empty accounts, though you should maintain separate business and personal accounts and keep careful records of paper trails. One of my clients was a $1.5 billion, privately held construction company that was a Subchapter S corporation.
LLC
. Limited liability companies (LLCs) are best for partnerships within a corporate structure, but in some cases a one‐person LLC may be allowed. Owners here are members of the LLC and take shares, which do not have to be equal. It is a very popular and effective form, and is often used when one entity rents or leases to another (e.g., office space).
Your attorney and tax advisor can tell you what your options are for your state, personal objectives, amount of business, and benefits. Make sure that you maximize in your company's bylaws the kinds of deductions that are permitted because you want to pay for everything you legally can with pretax, not after‐tax dollars. If you take the risks of entrepreneurialism, you ought to reap the rewards. Making $250,000 as a solo practitioner can be the equivalent of making $350,000 on someone else's payroll and tax structure.
Possible deduction examples:
Noninsured medical expenses
Certain club memberships
Home office
Business equipment
Communications devices
Professional development
Travel accessories
Remote technology
Specialized clothing
Certifications and licenses
Board meetings (which could be you and your partner)
The Gospel
This is a litigious society. That may be unfortunate, but it's true. Failure to protect your intellectual assets is the same as leaving your house unlocked and the newspapers piling up at the door, inviting a robber into an empty home.
Protection
Anything original that you write is automatically covered by copyright protection laws. You should, however, indicate that protection with either (but not both) of the following forms:
© Alan Weiss 2021. All rights reserved.
Copyright Alan Weiss 2021. All rights reserved.
You do not have to register copyrights with the federal government.2 The reason to do so is strictly for lawsuits and trying to collect punitive damages. Without such government notice, you can sue to remove plagiarism and violation of your copyright, but cannot collect punitive damages or damages for any business lost. If you have filed with the government, then you can sue to collect such monies. In 35 years and with tens of millions of words written, I've never filed with the government for further copyright protection. I have successfully shut down a half‐dozen plagiarists.
For certain phrases, models, and materials (extensions of your intellectual property) you can apply for trademark (™) and service mark (SM) protection. If they stand up to investigation and challenges (for prior use) you will be granted registration (®), which is the highest form of protection.3
