The past several years have seen a growth in outsourcing and an increase in the number of consultants of varying types. The bad economy has spurred the growth of entrepreneurship as people realize that jobs just aren't there and start their own businesses instead. The government and many companies see outsourcing as a way to reduce overhead costs and purchase services as needed.
The interesting thing is that there is no certifying body or job qualification to becoming a consultant. You're a consultant if you say you are and if someone is willing to pay you for your services.
So with all the money being spent on consultants, it begs the question, "Are they really worth it?"
Contractor or Consultant?
An educated consumer is my best salesperson. However, many people don't really know what they are buying when they hire a consultant. I personally make a distinction between contracting and consulting.
Contracting involves the performance of a specific task and is characterized by an emphasis on deliverables and hourly rates. For example, the contractor may be asked to develop a specific plan or report or provide training. While there are exceptions, most of this type of work involves tasks that are well within the capability of the client organization. In essence, the contractor is doing work that the client could be doing but cannot do because of lack of time or resources.
The problem with contracting work is that it is focused on a predetermined deliverable. Further, the deliverable can usually be developed by any competent contractor. This means that the contractor has very little latitude for creativity and hence must compete on the basis of price rather than expertise.
Consulting is something quite different. As a consultant, my goal is to improve my client's condition. My focus is not on specific deliverables but on the end result the client wants to achieve.
Let me give you an example of what I mean. A client decides that his or her company needs an emergency plan and decides to hire a consultant. A contractor approaches the project by studying the requirements of the plan and estimating the hours required to produce the plan. A consultant realizes that the actual output is not the plan but increasing the company's ability to respond to an emergency.
This can be a hard sell sometimes. I once lost a potential contract because the client felt that I was asking their organization to do some work. They just wanted someone to revise a plan to meet an administrative requirement.