Projects with Consulting Firms

Consulting firms manage projects differently than large corporations. How so?

A client files a request for a project with a specified budget and timeline (all mentioned in the  PO) and sends this out to all consulting firms. The sales team from the consulting firms receive this PO and handle it in one of two ways:

a) Consulting firms sales team ‘feel’ they have a small window to negotiate the budget and timeline, so they accept the PO as is and  sign a deal lickty split speed and BAM! The engineering team is handed down the project to make miracles happen on budget and time.

b) Consulting firms sales team engage with the engineering team (usually those in leadership roles) to find out if the scope, timeline and budget are realistic, is there sufficient information on what the client is actually wanting to be done (detailed definition/description of scope and requirements) and have the leads check to see if they have the right resources on board that can work on this or hire someone with the technical capability to do this (at the pay rate they can afford). If there are concerns or request of clarity on scope/timeline/budget/etc the sales team communicates this back to the client before anything is signed…

Young and budding consulting firms have been caught to fall in the first trap of signing a deal without fully being aware of how unrealistic the scope, budget  and timeline is or even checking to see if they do have the right people working for them for the job. They end up delivering a project that is okay….not great.

Now before I start, I should mention that some of these young and budding firms have sales team with a technical background that can assess the project without engagement of the team and make a good hypothesis if its feasible. But some…do not.

When you are a young firm, having a good reputation is the key to success. This is what will help you stick around, get better projects and expand your client pool.

What happens when you take approach (a)
Signing a deal fast without assessing the project’s scope, budget and timeline is a dangerous move. Why? Well for starters you could fall into an easy trap of filling change requests (CR) in order to get more funds and time for the project because the person who signed the deal didn’t clearly understand how complex the work is and how much time is required to work on it. And let’s not forget the resource. Budget is tight, so the firm ends up hiring junior level staff members and expect them to ramp up super fast. They don’t  take into account that a project they need to work on may require them to do some research in order to become familiar with the technology they need to use or implement to get the job done (this of course is billed on company time).

Firms fall in the nasty trap of filing multiple CR’s because of this oversight on their part and they take it is being very normal. They also have a high probability of their client coming back to them because of glitches (or bugs) in the system which should have been caught before they handed the project over. This leads to a bad reputation and a lowering the odds of a return client or exciting projects in the future.

This firm is cheap. Mind you, some of the consulting firms do quite alright taking approach (a) and get by working on small projects.

What happens when you take approach (b)
Signing a deal with caution and fully understanding the asks with a realistic timeline and budget limits road bumps that can be encountered during development. The number of CR’s are limited and will be mostly initiated by the clients request to add additional features to the product and hence extending the timeline and budget respectively.  This is normal and  does not affect the firm’s reputation in a negative manner. In fact, it makes the firm look good because they are listening to their customer and being flexible to provide them with what they want. As mentioned, this can enhance the firms reputation in a positive angle and can help open the door to further projects and potentially bigger lucrative deals.

Consulting firms that have a name and reputation in the industry usually go by decision (b) in order to stay in the pool…

I personally have worked with consulting firms that practice with both method (a) and (b). Glad to say, I have had more brush ins with firms that practice method (b) over (a) but it was my encounter with a colleague that worked with a firm practicing the first method that inspired this article.

How does your firm work?