Three Ways That Management Consultants Can Help Small Businesses
You may not know the term 'management consultant' yet but don't worry. It was new to me when a dear client (now friend) of mine told me that I would make a great one someday. That was a few years ago now and here I am, doing just that.
What the heck is a management consultant?
According to a recent Indeed article, a business consultant and a management consultant have similar duties but slightly different goals.
Business consultants offer high-level operational analysis and betterment that a business can use immediately
Management consultants work on a longer-term basis to create positive change in workplace culture, risk management systems and more
Because of this difference, Business Consultants tend to work more with young companies and startups though either can work for a company of any size. My experience as a Business Consultant with the SBDC was a good example of that. Though we could serve medium-sized and more established businesses, many clients sought us out because they were just starting out and needed help. This role provided a lot of insight for me but it also showed me why Management Consulting is more my speed. The article also goes on to point out another distinction between the two.
Business Consultants tend to take on more short-term projects
Management Consultants take on longer-term projects
Now that I have painted a picture for you, I want to explain why small businesses (both for and nonprofit) should be seeking help from Management Consultants, too.
1. MANAGEMENT consultants can help improve the business culture
Because culture is central to the future of a business, it only makes sense that businesses would sometimes seek help to manage its culture. Culture shifts happen for a number of reasons such as a change in leadership, growth or shrinkage of the business and even external social events (I'm looking at you, 2020). But no matter what the cause, culture is very tough to change and can take a lot of time. Leaders that understand this should not hesitate to seek assistance when they are unable to utilize individual influence enough to change their business culture. Bring in neutral outsiders that do not have a deeply personal stake in how the situation turns out. You will be glad that you did.
2. management consultants can help develop business leaders
This can be achieved on a one-on-one or group basis. It is helpful because a major part of the process entails Management Consultants taking inventory of the business through what is sometimes called 'discovery and analysis'. This can include interviews of employees of the business from all levels, evaluating business documents (including financial statements), observing meetings and collecting data. All of these activities provide the Management Consultant with what is needed to get a big picture understanding of the business which is referred to as the 'current state'. Essentially, this is the starting point on the roadmap to the change that the business is seeking through either solving a problem or reaching a new goal. An understanding of the current state is also a glimpse into the leadership, just like the culture is. Once the Management Consultant has a handle on where to start, the journey can begin with leadership and flow downstream throughout the business.
3. MANAGEMENT consultants can help businesseS to manage risk
Now that leadership is on board and the current state is revealed, the road to the 'future state' begins. The future state is derived from the discovery and analysis which informs the Management Consultant on what the outcomes of the engagement should be. As Management Consultants are guiding the implementation toward the future state, there will be risks that arise along with risks that have already been identified. The benefit of having a neutral outsider helping to manage risk is very valuable as they are often able to see things that employees of the business are not willing to or able to see because of their blindspots. Also, members of the business may know their respective industry but Management Consultants are able to use their vast knowledge of various industries to make connections where the business cannot. These connections are often what lead to innovation and creative solutions to long-standing problems. It's no wonder why the world's largest businesses use management consulting firms like McKinsey, BCG, Bain, Deloitte, KPMG, PWC and EY for these exact issues. They have a lot to lose if problems persist.
Management COnsultants can be the bridge to the next level for your small business
Taking all of the above information into consideration, utilizing management consultants should be a no-brainer if you are leading a small to medium-sized business. This is why I decided to blog on this topic. There seem to be too few small businesses capitalizing on the opportunity to invest in this type of growth potential instead of perhaps marketing or advertising. They all have their significance, of course. However, the added benefit of deep discovery and analysis, solid leadership development and impartial risk management can save so much more in the long-run. Consider hiring a Management Consultant if your business is:
on the verge of or in the midst of scaling very quickly
experiencing unexpected major media attention (positive or negative)
considering major expansion into new local sites, cities, states or countries
planning major marketing and advertising campaigns
losing leadership/gaining leadership
considering a rebrand
planning a new product/service launch
in litigation or being threatened with litigation
Though this list does not cover all bases, it is a good variety that can serve as a starting point. If you have any questions about whether or not you should hire a Management Consultant, I would be happy to discuss that with you. Provide your contact information here to send a message to Intentional Professionals.
Sincerely,
Melinda