As printed in the MANAGEMENT REPORT Consultants Directory 1994

“A consultant is a

knowledge broker. We

advise and assist our

clients, but they remain

responsible for their

decisions

Wherefore The Consultant?

- An Interview with Angelo Kehayas, council member of the Institute of Management Consultants -

Nobody knows everything. All too often our

own interests, our limited skills and the

immediacy of our problems cloud our ability to

make sound judgements, or even to see a

solution. That’s where a consultant can step in

and provide an answer. Independent and

objective consultants offer expert knowledge,

experience and raw talent, at a price. In this

emerging era of partnerships and competition,

it’s likely you’re going to need a consultant

sooner or later. Massive macro forces of

change are sweeping through every market and

every industry. New social pressures, new

economic dependencies, a new political

landscape and the powerful effects of a rapidly

globalising and technology

driven world economy are

forcing every business to re-

think its roots.

A consulting relationship is

something very special. It only

works if you’re brutally honest,

and painfully open. Yet, how

can you do either without an

absolute assurance of trust?

You can’t. Working with a

consultant is an intimate and

demanding affair, for both you

and your consultant. The good

news is there are rules to the

game, and they apply to both

sides. The bottom line – you’re

accountable for whatever you

decide; your consultants are

accountable to you for the

quality of the advice they give

you.

Defining Jelly Fish

What exactly is consulting? Angelo Kehayas,

a council member of South Africa’s 380

member Institute of Management Consultants

says: “It’s a professional service provided by

objective, independent, qualified persons in

identifying problems concerned with policy.

Organisation, procedure and methods,

recommending appropriate action, and helping

to implement their recommendations.”

But Kehayas warns there is often a blurring of

definition between a contractor and a

consultant. “A consultant must be able to

transfer skills.” The difference, he says, lies in

the kind of service the party provides, and how

they charge for it. “Consultants take an

external, independent view. A contractor

replaces existent or perhaps non-existent line

functionality.” But Kehayas emphasises that

he’s not saying that consultants cannot

contract, or perform functional work for a

client. When they do, “independence must be

checked. The client must determine that there

is no conflict of interests.”

Consulting roles are

changing, as is every

business. “The market is

integrating vertically, forward

and backward. Vendors are

getting into consulting, and

consultants are getting into

vending” says Kehayas. “It

all comes down to the

dependence on revenue.”

Free form knowledge and

unconstrained creative input

may not always be what you

get from a consultant, nor

perhaps what you want.

Many consultants have a pet

product – a methodology or

model – they prefer to apply

to solving a problem. The

great benefit is the structured

manner of approach it

provides. The risk is that the

model may not be absolutely

applicable to the task at hand.

“A model or methodology should be flexible

enough to accommodate a client’s specific

requirements,” says Kehayas. “And the

consultant and client concerned should be

honest enough to acknowledge needs of

modification. Beware of using a pet tool as a

fix-all. Creativity suffers.”

As printed in the MANAGEMENT REPORT Consultants Directory 1994

A Question of Accountability

Perhaps the most interesting question in the

client-consultant relationship is the one of

accountability. Two levels to the problem

exist – the consultant’s accountability to their

client, and the client’s accountability for the

decisions taken as a result of the consultant’s

input. “A consultant is a knowledge broker.

We advise and assist our clients, but they

remain responsible for their decisions,” says

Kehayas.

At the heart of the issue is a core requirement

for ethical conduct. Around the world

institutes and organisations representing the consulting profession have formulated codes of

ethics. In South Africa the creation of a

similar code tops the Institute’s agenda.

“Confidentiality and a consciousness of

potential conflicts of interests are critical,”

says Kehayas. With little or no statutory

enforcement possible, the industry must be

mostly self-policing. The reference nature

with which much of its business functions is in

itself a form of ethical control.

There are defined and dependable ways of

working with a consultant. At the heart of it

lies a terms of reference – a document that

defines the roles and responsibilities, the

expected outcome, the points of measurement,

and the definition of the problem to be solved.

Agreeing upon the content of this document is

a critical first step to a successful relationship.

But Kehayas warns that managing the terms of

reference is in itself a task of managing

change. “Definitions will need constant re-

evaluation as the environment changes,” he

says.

With the environment and terms of reference

changing dynamically, on-going re-evaluation

is crucial. Says Kehayas: “Regular

communication should happen, going both

directions.” In a large assignment, audit and

quality assurance committees might be set-up

by both parties to ensure the work is being

done correctly. And when all’s finished,

perhaps one of the most important steps in the

whole monitoring process – the post

implementation evaluation. “It only happens

18 months or more after the job is finished.

But it’s crucial to both the consultant and the

client that it’s done,” says Kehayas.

From a charging perspective few guidelines

exist. “I don’t know of any organisation of

consultants anywhere in the world with a fixed

fee structure. Market forces will determine

what works to a large extent,” says Kehayas.

The Client Carries The Can

Kehayas keeps coming back to the fact that the

consultant’s sole role is to act as a knowledge

input for the client. The clients remain

responsible for their decisions. It’s a tough

definition to swallow, but a logical one.

Measuring value for money falls back to the

need for on-going re-evaluation of the terms of

reference and the status of the job against its

defined goals. If an audit group is set-up, it is

crucial that it be truly independent.

“Phase zero is when the consultant scopes the

assignment. It’s probably advisable to allow a

reasonable time and materials budget for this,”

says Kehayas. “It’s after this that the client

and the consultant should come up with the

terms of reference together.” Kehayas advises

clients strongly to formulate for themselves a

definition of the consultant’s role, and an

outline of the expected achievements.

“It’s important to keep distinguishing between

a consultant and a contractor,” says Kehayas.

It’s for these reasons he believes the on-going

review meetings are so important. “The

consultant’s role is to provide advice, and

perhaps to perform very brief tasks. That’s

quite opposite to acting as a line manager,” he

warns. If contractor type work is required, the

terms of reference and the accountability will

need fundamental re-evaluation. “In a

consulting relationship, the onus never falls off

the line manager,” Kehayas emphasises once

again.

“At the post implementation review, the client

should be going back to the terms of reference

and determining whether the job cost is what

was expected, whether the objectives and

expected outcome were achieved, and what the

impact on the business was.”

One core issue is the decision of the type of

consultant to use. The choice is really between

large established firms, and smaller – perhaps

even one man – operations. It’s all really a

balance of risk and reward. “The client needs

to balance the perceived risks of using

individuals against the cost of using a major

firm, and benefiting from the security they

deliver,” says Kehayas. Quick resource

replacement is an issue.

As printed in the MANAGEMENT REPORT Consultants Directory 1994

Instituting Credibility

South Africa’s Institute of Management

Consultants (IMC) was established to help

formalise the consulting issues. “We have

fairly stringent set of rules,” says council

member Kehayas. “These help ensure that our

members qualify in terms of our definitions.”

While the council does not actively monitor or

measure the Institute’s members’ performance,

Kehayas says it can act as a “watch dog” body,

providing quality control and arbitration

services.

For the client, the Institute provides a check

list and reference point. “We would be quite

happy to nominate a member to perform a

quality checking role,” says Kehayas.

With international reciprocity, the IMC offer

consultants a link to compatriots around the

world. It also offers a benchmark on

international standards. Accredited training

can be done through the IMC, allowing

consultants the benefit from the association

and acceptance of their peers.

Openness to change is a fundamental principal

of business survival. Consultants provide a

crucial source of external expertise. But

working with consultants is a delicate and

demanding process. Responsibilities, roles,

measures and definitions are vital. South

Africa’s IMC provides a crucial back-bone to a

relatively unstructured industry.

STEPS TO A CONSULTING

RELATIONSHIP

• Assignment Initiation • First Client Contact • Identify and Define Client Need • Explore Readiness for Change • Explore Potential for Working Together • Identify Benefit • Understanding The Problem and Scope

(Terms of Reference)

• Expected Products and Outcomes • Roles and Responsibilities • Schedules and Accountability • Estimates and Fee Arrangements • Change Management • Project Management • Objective Setting • Work Planning • Documentation • Interim Reporting • Quality Assurance • Closure of Assignment • Post Implementation Evaluation

• Arbitration and Expert Monitoring