Or have you left them to their own devices under the assumption that they care about your consulting business?
Your consulting business is growing. It’s going great guns.
With more opportunities than you and your existing team can handle, you need to take on resources. And fast.
Naturally, you turn to the contract market.
I've used hundreds of contractors throughout my consulting career and many of them are very good. However, a lot of them are, quite frankly, a pain in the arse!
But is that their fault and your problem?
Or is it your fault and their problem?
Every consulting business makes use of contractors from time to time, and in this article I share with you my own experiences. I also share what I believe are the things you should do to get the best outcomes for your consulting business, your contractors, and your clients.
A Nice Problem to Have
A perennial challenge in a consulting business is one of resources.
You’ve either got too many and they’re ‘on the bench’, or you’ve got too few and your scrabbling to meet project demands.
I once had a boss who always said to me,
Having too few resources for the work at hand was a nice problem to have.
This used to irritate the hell out of me.
That was until I ran my own consulting teams and I realised just what a great problem it really is to have!
But problem it is, nonetheless.
And as a consulting business owner, it’s a problem you need to address.
Everything is Urgent
The first thing you must do is to be aware that for every client in the land, since the beginning of consultancy, their project is urgent.
It’s always urgent.
Right up until the point they have to sign-off on the proposal.
Then things tend to slow down.
That is, until they do sign the proposal, then everything returns to being urgent!
For the uninitiated this can cause you to take on resources before you’ve secured the work AND a start date!
Don’t do that. It’s bad!
But what do you do when you’ve secured the work, and agreed a start date (or at least an expected start date), but have yet to find the resources?
Of course the quickest solution is to take on contractors.
If you’re lucky you have a pool of known contractors that you can turn to. And if you’re really, really lucky, they’re available. But, invariably, good people are in demand and in contracts.
That means you have to turn to recruitment agencies to find you the people that you don’t already know.
This is where the problems often start.
In your urgency to find resources - amongst the many other urgent things you’re already juggling - you see a beacon of hope.
A knight in shining armour.
A contractor with the right skills, who is available, and who is affordable. The holy grail!
But in your focus on meeting the client’s demand to the get the work started; and on meeting your need to get someone on-board; you neglect the contractor’s needs (beyond agreeing a rate with the agency and a start date).
If you’re really up against it, you have a quick telephone interview.
Maybe you meet them over a coffee (you should ALWAYS meet them in person beforehand, even if the agency already has).
And boom. They're on client site.
They might never even set foot in your premises (if you even have premises!).
You’ve Created a Monster!
A frequent challenge is that very few contractors have worked in a consultancy environment.
They don’t get the whole ‘client’ thing.
And what happens?
Simple. They just see you as another recruitment agency.
They have no loyalty to you, to your business, or to your brand.
And why should they?
You’ve done nothing to earn it beyond awarding them another contract.
As a contractor, they're used to recruiters taking a margin of between 5%-25%.
They might begrudge it because they think contracts grow on trees and are simply harvested when needed.
But if they knew that you were getting a 50% margin they'd blow a gasket!
They wouldn't make the connection between the tens of thousands you might have spent on marketing to even get the opportunity.
They have no understanding or appreciation of what it takes to win a consulting engagement. The time that is invested. The money that it costs.
They get paid weekly. They don’t have to wait 90 days to get paid after the invoice is submitted, which is only after hitting a successful project milestone!
And to top it off, they don’t really have much liability.
If they do a bad job your firm will lose a lot more money than the contractor ever will.
But in fairness, is it their job to know all of this?
Would it make any difference if they did?
Does the contractor need to understand you and your business model, or should you invest a bit more time and effort in getting to know the contractor?
Is There A Better Way?
As I said, there’s some great contractors out there. And when you come across a good one, it’s worth taking the time to build a long-term relationship (not that I believe contractors should ever be hired for years on end with contiguous contracts).
Here are 5 things I always I do when taking on contractors to create a mutually beneficial relationship.
01 Make them feel a part of your team
a) Get them branded
Your contractors are a part of your business, but because we often pack them off to client site without so much as a by your leave, it’s very difficult for them to feel a part of your team.
Nothing says they’re not a part of your team more than a business card with a different business name on it!
So get them a business card on day 1. Brand them, if you like.
If you don’t do business cards, then ensure the contractor doesn’t give out his own business cards.
Request that the contractor show himself on LinkedIn as working for your firm.
You might choose to make this part of your contract, although I think it’s better to simply have a gentlemen’s agreement.
The client’s always going to look on LinkedIn at your team to confirm to themselves that they’ve made a good investment decision.
b) Get them access
Nothing makes you feel more like an outsider than….being outside!
Make sure they have the access that they need to do their job. For instance:
- Door/barrier entry cards at the client and/or your offices
- Systems access to email, document management systems, and any other relevant systems to do their jobs
c) Tell the team
Send round a firm-wide, or at a minimum team-wide, communique announcing their arrival.
Do it with gusto! Big them up. Shout about the value they’re bringing to the team and the project.
This introduction is especially important if your team members will have to report in via a contractor. Some of them may take umbrage with that.
So many times I’ve been on client site and in meetings where a consultancy team didn’t even know that the guy on the other side of the table was part of their team!
c) Get them to join in
Invite them to your regular team meetings.
Now they might be reluctant to do this if you expect them to do it unpaid. They are contractors selling their time for money after all! Albeit they’re probably not aware, but they essentially “pay” for their marketing and sales via the agency margins.
(If there is no agency involved, then their rates should reflect that as you’ll not be benefitting from the cashflow benefits of an agency).
Don’t just make them feel part of the team, make them actually be part of the team. Invite them along to your team meetings.
Chances are they have a ton of valuable experience and knowledge that they could impart on your business and team members.
02 Make it crystal clear what their job is!
Contractors are used to landing on a project and just getting on with it. But they need to know the boundaries within which your business works, and within which you want them to work on the project.
For example, if you have budget (days/hours/expenses/etc.) make sure the contractor is aware.
Make sure, also, that they let you know as soon as they feel that the budget might be exceeded. Don’t allow them to wait until it has.
It’s an old sales adage, but tell them, and tell them again!
I once had a contractor on a project who burned a ton of time way beyond what was expected, whilst at the same team achieving far less progress than expected. He was firmly of the belief that what he was doing was right, because that’s how he’d always done it.
But that project was a fixed fee engagement. Whilst I’d thought I’d made that clear, the reality was that the contractor didn’t really understand the notion of fixed fees. He simply worked hours and billed hours. Period.
03 Respect their role in the project and in your organisation
I would never visit a client site without letting my on-site team know, regardless of whether they’re permies or contractors. It is common decency to let a team member know if you’re meeting with the client team on the project they’re working on.
There might be some important information they need to share with you beforehand, so it’s in your interests to let them know. But most importantly, it shows respect.
It’s also an opportunity to say hello to your team member and to thank them for the work that they’re doing.
04 Introduce them to the client
Most clients with experience of using consultancies know that contractors are sometimes used. It serves no benefit trying to hide this. A quick LinkedIn search will usually tell a client all they need to know!
You need to ensure that the client is comfortable that you still have the project under control and that you’ll remain contactable throughout. It is not appropriate to simply pass the client off to a contractor, neither is that a wise thing to do!
By introducing the contractor to the client you are showing both that you are delegating your authority - that makes the contractor feel valued and respected - whilst also giving the client the continued ability to reach out to you directly if required.
05 Show them that you care
a) Treat them to a weekly one-to-one
When you run consulting teams they are often dispersed all over the place. It can be difficult enough keeping in touch with the permanent staff, let alone contractors. Especially if you have your own billable work to contend with.
But that really is no excuse. It’s your team afterall!
At the very least, you owe it to yourself and to your client to keep in very regular contact with contractors to make sure everything is going well on your project.
Ideally you’d do this face-to-face, but if not then video call, or at least make a phone call.
Seek feedback from the client beforehand and tell them how they’re doing too.
A number of times I’ve had contractors who painted me a rosy picture of the project and how they were getting on, only for the client to subsequently ask me to remove them from site!
Always be sure to share any feedback, whether good or bad. As consultants we can only improve if we know where we’re weak in the first place.
b). Make sure that they’re being paid in a timely manner
Sometimes in the rush to get someone on to a project the finer details get missed!
Make sure it’s clear whether or not you need your contractor to fill out a timesheet. If so (and I can’t think of a situation for why you wouldn’t!) make sure they have the correct, working access to any systems, and that they know how to use it.
You don’t want them finding out it doesn’t work last thing on a Friday, after everyone has gone home for the weekend.
So There You Have It!
Contractors are an integral part of most all consultancies.
In the employee world you often hear the expression:
Look after your staff and they’ll look after your customers
This can be easily translated in to the consulting business world to mean:
Look after your contractors, and they’ll look after your clients
It doesn’t take much. But if you get it right, you might just have opened up a new route to market!
The contractor may know people and clients that he can introduce you into. They might also be excellent in identifying further opportunities with your existing clients. You can even incentivise them to do so (more about that in another article).
So look after your contractors and in return they should look after you and your clients!