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Lessons Learned on Forming and Managing Consulting Practices


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Presented at Institut Pertanian Bogor Master of Business and Management's CEO and Entrepreneurial Development Forum on February 4th, 2014.

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Lessons Learned on Forming and Managing Consulting Practices

  1. 1. Image courtesy of Delivered at MB IPB CEO and Entrepreneurial Development Forum
  2. 2. Who Am I? 4 Februari 2014 2
  3. 3. ~ A anonymous consultpreneur 4 Februari 2014 3
  4. 4. Today’s Agenda 4 Februari 2014 4
  5. 5. Understand Consulting Requirements 4 Februari 2014 Image courtesy of 5
  6. 6. • Hard and soft Skills in expert level • In-depth and broad Knowledge • Positive and constructive Attitude • Network, network, network: client, contact, resources, partner • In the end, consultant shall provide expert advice in particular or a wide range of fields 4 Februari 2014 6 Image courtesy of Matthew Norris
  7. 7. TARGETING the Type, Segment and Industry
  8. 8. • Ideally, identify which type of consulting field where the diamond is • If not, at those early days, determine specific area(s) of consulting that at the most • Passion first, expertise (shall) follow suit • Might decide to start with general consulting • Later stage to attain clients with specific needs 4 Februari 2014 Image courtesy of Patrick van der Pijl 8
  9. 9. • Next: Which segment are we going to play? • Micro, Small, Medium, Big – we decide • Set the industry we put our priority at. Try to in-line with our background and expertise 4 Februari 2014 9 Image courtesy of Patrick van der Pijl
  10. 10. Is Consulting Firm a Necessity?
  11. 11. • Stay as a professional, self-employed, or move it forward. Cast our vote! • Comfort zone is everywhere • To grow bigger day in and day out, take the risk as long as we could manage it • Start a consulting firm right away. Period. 4 Februari 2014 Image courtesy of Accumulate 11
  12. 12. Try to Do this Exercise First • Ask ourselves once again, do we really want to become an entrepreneur? • If yes, then decide: be a single fighter or go along with co-founder(s) • Do market research by: – Scouting out similar consultants in our area – Finding out expertise and services offered – Figuring out their prices and marketing schemes • When completed, then: – What differ us from rivals: quality of deliverable, more reasonable fee, faster execution and completion (?) 4 Februari 2014 13
  13. 13. …Let’s reaffirm ourselves by programming these words until they are sublimed “You say I dream too big. I say you think too small.”
  14. 14. Upon Completion then… • Decide source of funds: bootstrapped or? • Name our business. Memorable but not tacky • Establish our company profile (objectives, goals, mission, vision, values) • Choose legal structure for our venture • Craft a business plan. Not only for us but for investor as well 4 Februari 2014 15
  15. 15. Upon Completion then…(cont’d) • • • • • Consider costs and funds for first year as a start Obtain proper licenses Start to set-up office Prepare for office supply, equipment, resources Define company policies, processes and procedures. Formalize them upon completion • Consider to form and think further of separating management from governance 4 Februari 2014 Image courtesy of Avasant 16
  16. 16. Start Too Early Only If… • Blue Ocean as Bulls-Eye • To win the mind share • Have adequate funds and persistence to struggle and survive • Able and willing to grab other projects to sustain the business 4 Februari 2014 Image courtesy of Peter Nijenhuis 17
  17. 17. Rolling out Consulting Practice
  18. 18. Market Our Service • Attend event, mingle and network with others • Actively contribute for respective organization and association • Write at particular publications • Deliver lecture, training and workshop • Speak ourselves out at seminar and conference • Obtain advanced degree, accreditation and certification 4 Februari 2014 Image courtesy of Jean Pierre Dalberra 19
  19. 19. Market Our Service (cont’d)d) • Capitalize on internet (blog, social network, any other digital channels) • Ask for referrals • Give token for leads • Offer low price services or more extremely free to build up reputation Bottom line Make ourselves and expertise heard and read (validated, acknowledged, recognized) Image courtesy of Nanagyei 4 Februari 2014 20
  20. 20. Improve, Enhance and Boost Our Expertise • • • • • • Reading Practicing Training Education Self-studying ….and many more Cutting the case: Internet and MOOC rock! 4 Februari 2014 Image courtesy of iangrieveson 21
  21. 21. Leverage Our Networks • • • • • • • Parents Spouse Relatives Friends Colleagues Children Even our former boss, girlfriend, boyfriend… 4 Februari 2014 Image courtesy of iangrieveson 22
  22. 22. Better Start with Small • Always dream BIG with our feet GROUNDED • Start off with smaller paying clients • Always eager to go for larger ones ASAP • Don’t grow too fast unless we have “solid back office” 4 Februari 2014 Image courtesy of Goutama Bachtiar 23
  23. 23. Be Pragmatic at Early Stage • Going to where the money flows • Affordable office: garage, virtual office, co-working space as options • Host meeting at our client’s office or public service • Keep a healthy working capital • Think of rolling out Stock Option Plan (Why not?) 4 Februari 2014 25
  24. 24. The Time We Sign a Client the Day We Start…Losing Them • “Difficult” client is not an option • Watch high churn rate out. No renewal = (epic) fail? • Be flexible. Do anything possible to keep them • Ad-hoc call or visit might needed to ensure things going on the right way 4 Februari 2014 26
  25. 25. We are Worth Every Penny, So Show Them the (Hidden) Money! • Don’t we ever take crap from clients; Nothing personal really • Show them NUMBERS or any other key metrics esp. financial figures e.g ROI, NPAT, etc • Bring in more money by attaining more revenue or reducing cost than “our price” 4 Februari 2014 Image courtesy of Maclufus 27
  26. 26. Well oh Well, Dress up Please… • The better we dress, the higher of consulting rate we can ask for • This is to show potential clients we are successful • Boost our confidence • Client will expect us to bring same success to their company • Try it and see the result Image courtesy of Alexander Rentsch 4 Februari 2014 28
  27. 27. 4 Februari 2014 Image courtesy of Paul Downey
  28. 28. Set Expectations from Day ONE • Document important things, particularly request for changes • Get the approval as necessary • Deliverable meets expectation = satisfied • Raise the bar by always try to exceeds them • Unrealistic expectations? Silence is not golden here. Let the clients know why • Refer other venture if needed 4 Februari 2014 Image courtesy of Andrew Evans 30
  29. 29. Keep Them Happy from Time to Time • Weekly updates telling what have you been doing and addressing any questions raised • Monthly reports. Graph and other forms of visuals is worth a try • Do follow-up by discussing it in an in-person meeting • Surveys – periodically and when project completed by drawing specific questions, both open and closed 4 Februari 2014 Image courtesy of Martin Fisch 31
  30. 30. Keep Them Happy from Time to Time (cont’d) • Send industry updates and news regularly • Go further, do anything to makes them feel special • They could be KING or PARTNER 4 Februari 2014 32
  31. 31. Our Clients are always Right, EXCEPT… • Keep “the door” opened by letting clients tell what they want • They shouldn’t tell us what we should be doing • Telling the client what is the best. We have the expertise they don’t have, right? • It’s a winding road thou. Prepare data to back up what we want to do and show how it fits at its best for them 4 Februari 2014 Image courtesy of Erik Hersman 33
  32. 32. The More We Charge, The Less They Complain • Big clients have deep pocket so big spending is no big deal • They know that if they want to continue to grow, they have to spend money • Messing up with smaller clients, most probably they don’t have enough money for “switching costs” • In most cases, the less we charge, well, it’s too good to be true 4 Februari 2014 Image courtesy of David Goehring 34
  33. 33. Clients to Pay Less For More • No bunch of case studies nor years of experience? Take it easy • Figure out what separates our consulting company from the giants • If we show we are better than the bigger ones, we will lock them in • Clients always love to pay and work with senior consultants rather than bigger firms’ junior’s 4 Februari 2014 Image courtesy of Surian Soosay 35
  34. 34. • Our strategy defines how we uniquely and persistently deliver value to our clients • It's all about them, not us. It always will. 4 Februari 2014 36
  35. 35. 4 Februari 2014 Image courtesy of BTO University
  36. 36. 4 Februari 2014 Image courtesy of Paul Downey 38