Can We Talk About Consultants?

Yes, there is a little bit of “fire in my belly” about this racket…. One has to be a bit skeptical about the “experts from afar.” MVI and I often fall into this group as well. Of course, there are good ones, but the bad/mediocre far outnumber the good. Before you perceive that I am “downing” all consultants, let’s get clear about this…I use expert consultants. Heck, I am going to use anyone or go anyplace I think can help me get to where I want or need to go! But not out of pride or ego. Rather, because I believe that we are mandated to become “the best people we can be.” That means that if we are in a leadership positon, we need to be using the best known practices if we are working from a position of integrity.

NOTE: MVI has avoided the use of the word “consultant” as it has the baggage of being associated with high-fees/low value in so many cases. We are Teachers, but the term “consultant” is sometimes necessary as it is a term that people understand more easily.

Here are some pointers when considering the use of consultants:

• Try not to use consultants that “need” your money. If consultants need your money, most will not tell you the truth of your situation. Most are compromised by the need to feed their family. However, the “few” would rather starve than to mislead, lie, exaggerate or give “candy-coated” counsel. I realize that consultants have to start somewhere. But the consultant needs to draw clear lines before working with clients about what would compromise their integrity.
• For business consultants, ask to see how well THEIR organization is operated including profit margins and the retention of clients over at least the last 3 years. IF the consultant doesn’t have any staff or enough staff to justify the growing “business,” then I have to question whether he or she knows how to actually grow much and if he or she actually knows how to manage people. Some will say “I only want to work by myself.” Fine, but you had better find a way to demonstrate that you have sat in the driver’s seat and have done the work experientially, not theoretically. What is the turnover rate of the consulting organization? What is the profit margin? A lot of folks think that consulting is something you do when you “retire” or are unemployed. Consulting on a resume certainly looks better than “unemployed.” After retirement, there is usually a great deal of experience to be shared at that point in a person’s career. But consulting should be more than a hobby or something you do for extra cash. Building a new consulting organization based on your name and reputation and involving employees is a bigger deal than a hobby that you run out of QuickBooks. In MVI’s case, you might ask for our Model. Call any of our staff about it and ask how the companies are operated. Kick our tires and test our system! You should be able to do this with any of your consultants or vendors.
• Beware of ANY consultants that have a “broad array” of services. This almost automatically means that the consultant’s services are mediocre at best. You cannot be extraordinary at everything! “Yes we have billing services, we can be your back office, we can help with documentation, we can help you with feasibility studies, we can tell you how to be profitable, we can…we can…we can……………   Please!    The less an organization does (in terms of subject matter), the more focus it can bring to the topic of their claimed expertise.
• Don’t use a vendor or consultant that refuses to be benchmarked! This is a sign of weenie-ism or lack of confidence. Our Benchmarking System allows you to see the actual rather than the “hyped” performance of Hospices that use vendors. IF YOUR VENDOR OR CONSULTANT DOES NOT COME UP IN THE SYSTEM YOU MUST BE SUSPICIOUS. “The numbers aren’t right” or “We are different” are the common excuses when vendors face their performance in the MVI Benchmarking Application. FACT: If a vendor has confidence in what he or she does, why not let the client results be subjected to objective scrutiny? Especially when everyone is graded the same and the same methodology is used for all? I have received threatening letters from unconfident, prideful and suspect vendors and consultants. Beware IF the vendor or consultant is NOT in the MVI Benchmarking…there is a reason… either the vendor or consultant does not have sufficient market share to register on our radar OR they are fighting us and don’t want to be graded among their peers due to insecurity.
• Hired Guns – There are some consulting firms that use “hired guns” that charge big fees for a broad array of services. These hired guns often have dissimilar ideas and the “insight” often lacks an overarching cohesiveness from a consulting standpoint. You can hire 5 consultants from this type of firm and get 5 different directions! I have seen these “guns” flash their egos and KILL perfectly legitimate deals costing clients millions while leading Hospices down popular but low-value paths. Hired Guns usually have ego issues and are thus amateur consultants. “Wow, I’m now a consultant! And I get paid to tell folks what to do!” It is more about them than the client… 
• Beware of business academics. In the business area, I have hired and have witnessed academics come into businesses (including Hospices) and virtually destroy them. We have a couple of clients that have never quite recovered from these situations. It is one thing to “theorize how to run a company” – it is quite another to spill blood by getting rid of a long-tenured, popular but ineffective leader or making a courageous call to extract the Hospice from a bad business deal or change compensation to a performance system. Even the academics that actually consult with businesses do not qualify as this is still not real-world experience because the academic is not faced with acute Accountability if a recommendation fails.
• Ask basic/direct questions about the consultant’s expertise.  I am surprised that before a consultant is engaged, how many fundamental questions are not asked. I have cleared the room of “experts” in minutes many times with a few direct questions such as:
  • How many Hospices have you worked with?
  • What were the results of the organizations you worked with?
  • Are you successful? How do I know this? Why would you ever trust a business consultant unless the consultant is massively successful in what they are consulting about? 
  • How would you manage “X”? [Choose something that you know the answer to and see what their response is.]
  • IF they are a business consultant, ask them what the national median or average cost is for the area within their expertise as well as a few other areas like Pharmacy or Direct Labor Costs. This will tell you if you are working with a professional or an amateur. [Again, you need to know the answer to these questions before you ask them.]  
• Don’t do deals with consultants that want a long-term contract. Don’t do business with a consultant or consulting firm that insists on anything other than a month-to-month deal. To me, this shows lack of confidence/low-integrity in their promises. Why hide behind a contract? A contract is good business as it establishes the scope of work and manages expectations of the relationship. It is not something that allows a consultant or vendor to do a crappy job and still get paid! If you are ever unhappy with a consultant, you should be able to fire them!

Actual experience is usually necessary in my book to be a consultant. It is one of the reasons I usually hold a position with a Hospice or two while doing my MVI duties. Sometimes folks forget that I have been a Hospice CFO for 8 Hospices for 17 years, averaging profits of 19% for the NFPs and 31% for the FPs over the last 15 years if you want to categorize them by tax status. I also have been the interim CEO on a number occasions, but only until the Hospice was moving in a good direction. With this said, sometimes I will pick people or consultants that lack experience but appear to be incredibility intelligent, with high energy and high integrity. I am betting on their problem-solving capabilities in this case. 

There is a reason I PERSONALLY still do Model Workshops. I have visited hundreds and hundreds and hundreds of Hospices. I can field MOST situations. I care that the advice is the best known at that time. Does this limit MVI’s revenue in this area? YES! So be it!!!!!  Perhaps in the future we will develop a couple of folks that will be able to do the workshops better than me! I believe this will happen as more intelligence will come from those that follow! 

I hope this piece helps our clients. Our job is to share what we know…the best we know at this time. I recognize that I have referred to MVI and myself a few times. I do this not to promote or from an ego-position but only because it is the basis for so much of our knowledge. I also don’t want to discourage new consultants with this piece either as the world absolutely needs top talent to assist in the development of organizations. Just recognize that people will trust you and put faith in you…do not let them down.   

Serving from a place of Love for all ~ Andrew