The dictionary meaning of consultancy is to provide professional or expert advice. Consultants are professionals who have an expertise over certain area of work such as management, accounting, human resources etc. and provide expert advice to firms based on their knowledge. However, generally, they only have an influence over the decision, but not the autonomy to take decisions. As consulting guru Peter Block defines, a consultant is “someone who has influence over an individual, group, or organization, but who has no direct authority to implement changes”.
WHY HIRE A CONSULTANT
Following are some situations when a firm needs a consultant:
Expert opinion: A firm looks for a consultant when it does not have the necessary expertise over the area where it needs advice and hence searches for someone who has in-depth knowledge over the subject. The area of work might require certain niche skill which is unlikely to be readily available within the firm. The company leverages the knowledge of the subject the consultant has in order to improve upon its various areas of work like sales, human resource, IT etc. Cost effective: When the cost of building the knowledge base in the company, or the cost for implementing an organization wide change is higher than hiring someone to provide the needed expertise, it is wise for the firms to go for hiring consultants. Unbiased and fresh view to problems: When a firm needs an unbiased and a first-hand approach to its existing problems, it can hire a consultant so that he/she can provide a completely new insight into the matter and explore areas which were not looked at earlier. Political cover: Sometimes, companies might have to take decisions which do not make all parties equally happy. In such cases, companies hire consultants so that they get sufficient political cover for the decisions taken. Best practices: Consultants are the best way to bring best practices to firms from across sectors, since consultants have...