- Posted by jbehrendt on January 28, 2010
In terms of project work the year started slowly, since major projects were completed as of end of 2009. Not being pressed by high amounts of running cost, and feeling a little bit tired from the last year in which, in addition to the work provided by my staff, I personally completed around 200 consulting days in projects, I am not unhappy about this slow pace. Normally, consultant companies calculate the rates of their staff in a way that a paid capacity usage (project work) between 60% and 80% is required - the 60% being more the European, the 80% rather the Turkish value. For partners and consulting managers, however, this rate is normally lower. since they basically form the "marketing and sales department" of a consulting company that has to spend significant time for marketing, and for getting new projects.
So how does sales & marketing work in a consulting company? You normally do not see TV spots of consulting companies when you watch your favorite evening series, consulting companies are not the most active users of electronic media, and especially boutique consulting firms you will probably never encounter in any media. For the big firms, you can basically expect to see an ad here and there, but in case these companies - like the big four - provide audit services, tax advice or legal advice as well, they are not allowed to use regular marketing tools for promoting their business. So how do consulting companies, and especially newly established, small- to mid-sized ones get customers at all?
The honest answer is that, in most cases, the founders, owners or partners already bring some customers with them from their previous businesses. Consultants may be former operations managers changing sides but still maintaining good business relations (and a consulting contract) with their former employers, or they may have worked in another consulting firm beforehand, and their customers move to the new consulting company along with them. In general, the most relevant marketing tool for consulting companies is networking - and, if they are willing to spend a little bit more money, public relations ("PR"). Participating in networking events like conferences or sectoral association meetings, being a speaker in seminars, even being part of a talk show or providing an interview to a famous business newspaper or magazin are among the typical unpaid activities of senior consultants involved in the marketing and PR work - and since consulting is people's business were nearly everything depends on trust between client and the individual consultant, normally ALLl partners of consulting firms are involved.
The second area where time is to be spent is sales activities. Marketing and PR activities are successful if they lead to contacts, and if these contacts lead to meetings with customers - either first introduction meetings in which the consulting company presents itself and its abilities, or already project-specific sales meetings, in which not only the consulting company introduces itself but in which the potential customer provides a short briefing about a possible project for which they are interested to work together. The most difficult part comes after these project-specific sales meetings - an offer has to be submitted by the consultant company to the customer. Consultancy offers can not be very standarized, since no project is like the other. So the main components of a consulting offer already contain the roadmap for the project - in which stages will it take place, what exactly will be done in which stage, how long will each stage take, how many resources of which type from the consulting company and from the customer are needed at which time for how long, what will be the rates for each consultant's day, etc. etc. Although normally the time estimates provided in such offers are not binding, it becomes more common that the customer puts caps into the offers (a maximum amount not to be exceeded without unforeseeable reasons and a mutual agreement) or even negotiates about fixed-price contracts or contracts with a success-based remuneration. But even if this is not the case, and the contract foresees a remuneration linked to the time spent by the consultants, every good consultant should foresee the necessary efforts - and therefore the work to be done - as detailed and as exact as possible, otherwise it will not only be his first and last project with that customer but "word of mouth", another relevant marketing tool of consulting companies, may not work for but against him for future customers and projects.
In the end, providing a detailed, well-thought and comprehensive offer is the key to a successful project and a satisfied customer. The only problems one may encounter is that such a careful preparation is very time consuming, that not every offer becomes a project (which means significant amounts of lost and unpaid consulting time spent for the offer preparation), and, last not least, that the well-prepared offers of consulting firms are sometimes used by customers as a roadmap to finally running the project inhouse or with another, cheaper but less professional consulting firm. Unfortunately, I did not find another meaningful way without providing detailed offers for offering consulting services, for getting interesting projects and for preparing the ground for successful and customer-satisfying work. This means the "slow start" of this year applies maybe to projects but not to the other, unfortunately unpaid, work of a consultant. In the end, times with less project pressure have to be used efficiently for marketing and sales purposes, otherwise the nice consulting startup will sooner or later disappear from the market.
