December 08, 2000, 9:50 AM — It's one thing to be a good consultant. It's another to know how to use one. Sooner
or later you will run into a situation where you need to subcontract out some work. Or
maybe you'll need to hire an attorney or accountant. Being on the other side of the
equation will teach you the sources of discomfort for your clients and can teach you
how better to obtain business in the future. This column should also be useful for
managers considering hiring consultants.
The first step is finding the consultant. I usually only work with people I know.
Over the years I have developed a large network of consultants, and if there is a job
too large for me to handle by myself, I know whom to call. If I don't know the right
person, I look for referrals from people I trust.
The next step is to clearly identify what needs to be done. A good way to do this is
to develop a statement of work, which can often be a bulleted list of items, rarely
longer than a page. Such a statement forces you to define the job exactly and prevents
miscommunication later. It can also be easily inserted into an agreement. Now make sure
that your consultant really has the time to do your job and has not already over
committed to other clients. Ask what will happen if the job doesn't start on time. Will
the consultant still be able to deliver, or could the delay interfere with some
You will need to decide whether you prefer to pay a fixed fee or be billed on an
hourly basis. Generally, I prefer paying the consultant on an hourly basis, as this way
I am paying only for the amount of work actually done. To prevent any surprises on the
number of hours, request a time estimate in advance. If the project requires more than
one phase, request an estimate for each phase. Once the project is under way, monitor
the consultant's progress, including the progress made against the estimated schedule.
Also ask the consultant to inform you whenever anything unexpected might affect the
duration of the project. After each milestone, even if it comes before the completion
of a billing cycle, ask how many hours the consultant has used. When consultants know
that you are taking estimates seriously, they will take them seriously as well and will
report their time in an honest fashion.