Your first reaction might be to discard the idea of hiring a consultant. However, in successful relationships, consultants help businesses beat the market, scale more profitably, and achieve goals more quickly. What is the difference between these successful consulting arrangements and the others? How you manage the relationship.

How do I ensure I get results?

The biggest mistake many businesses make when hiring consultants is to not outline specific outcomes desired from the relationship. Instead, the relationship is often built around doing a set of tasks intended to help manage some function better.

It is very appealing to look at a consultant (or even a new hire) as a way to clear some of your workload but there are a number of reasons why you should manage your relationship with consultants based on achieving set outcomes instead of tasks:

1. Establishing the desired outcome before hiring a consultant helps you evaluate the business need and hire the right person,
2. You can evaluate the cost of consultants based on the benefit received from expected achievement of the outcome (whether it be cost savings or revenue generation),
3. Both you and the consultant have a clear evaluation metric for success to shoot for (and hopefully exceed).

Always make sure that you and the consultant are in complete alignment on the criteria from which you will evaluate the consultant’s performance.

What is the best way to structure a deal?

Setting up the right relationship with a consultant will help ensure the consultant’s success and the most efficient use of your budget. There typically are two methods for structuring a consulting arrangement:

1. Project: A project based consulting agreement has a start and end date, stated outcomes (deliverables, results, etc.), and a set fee. This arrangement is most appropriate in circumstances where one specific outcome is desired. A project based consulting arrangement is often easy to manage because of the simplified structure.
2. Retainer: A retainer pays a consultant a set fee per month (or other regular time period) to work on a set of outcomes that may be a series of one-time projects or ongoing management of a specific outcome. Retainers usually do not have and end dates and instead include termination clauses and renewal dates. Retainers are most appropriate when there is more than one desired outcome over a period of time expected. Retainers are more difficult to manage but the best retainer relationships have built in measurement, evaluation and outcome re-assessment periods.

What other considerations do I need to take into account?

There are a number of other considerations to take into account when hiring consultants:

• Contracts: Do not engage a consultant without a contractual agreement. The contract is not only where you outline the objectives, dates and fees, it is also where you outline dispute resolution policies, acceptance criteria for work provided by the consultant, termination clauses and other important items should the working relationship not be as successful as agreed upon.
• Expenses: Make sure you have a clear agreement upfront on which expenses and how much you will reimburse your consultant for. Items like travel, dining, cell phone and other equipment are important to agree on upfront so that there are no surprises later. You may also consider outlining your reimbursement procedure upfront to avoid confusion on processing expense reports.
• Integration: If the consultant is going to work with other team members at your company, be sure that your organization is prepared to be as productive as possible working with the consultant. Your organization should understand the desired outcome from the consultant, your expectations of their involvement and generally be prepared to help the consultant achieve the desired outcome.