What to focus on when all you’re doing is renting brains
Starting a business is a thrilling, sometimes scary undertaking. It requires hard work, unwavering commitment, and a bit of luck to turn your one-in-a-million idea into a profitable venture.
What about starting a consulting business? Or establishing a consulting practice within an existing business?
Like any business, hard work, commitment, and luck are essential, but what else do you need to focus on when you’re not selling anything except your expertise and know-how?
Since 2016, I’ve been fortunate to helm the startup of a technology consulting practice where we provide strategic planning and advisory services in the geospatial technology space. This has been a significant departure from the firm’s traditional software consulting services and has required a different sales and delivery mindset.
Growing from a single-person consultancy (me) to a nationwide team of consultants in seven years — while focused exclusively on the esoteric discipline of strategic advice-giving — I’ve learned a few things about what it takes to build a business where all you’re doing is renting brains.
Here are my seven keys to building a consulting business that lasts:
Your first job when starting a consultancy is to figure out the services you’ll provide. You’re probably getting into consulting because you have expertise you think people value. But are your skills scarce enough, and is demand for them high enough that you can realistically entice a paying customer? The key is to identify a consulting offering that checks both boxes.
In my case, I was tasked with starting a consulting practice that provides strategic planning for the geospatial technology industry.
The geospatial sector is well stocked with developers and platform implementers but has long lacked professionals with the skill and experience to bridge the gap between the needs and constraints of a business and the potential of the technology. This has become especially important as geospatial technology integrates ever more tightly with other enterprise systems (e.g. ERP, CRM, BI) and is regarded as a central technology for many high-profile strategic initiatives (smart communities, digital twin). Essentially, the supply of strategic consultants focused on the geospatial industry is low compared to the demand for this expertise.
People hire you as a consultant because you have expertise they lack, but before they sign you on, they need to know you have a way of applying that knowledge in a way that will help them. Codifying what you know into structured tools and frameworks makes it easier for customers to understand your capabilities and gives them confidence that you have a process that will yield results.
The strategy consulting business is full of tools and frameworks for this very reason. You’re constantly dealing with messy information and need to show you have a way through the mess. It also shows you have a tried and tested method of addressing the customer’s problem. You’re not just a smart person with experience; you have real tools to apply!
In my practice, my team and I have spent the better part of 6 years developing tools, frameworks and methodologies that support geospatial strategy development and related topics (e.g. IT and data governance, workforce development). We showcase these tools during pre-sales activities to explain our approach and provide a high-level education on what we do. Then we use the tools during projects to help formulate strategies and develop plans. In this way, they function as both a sales and project delivery device.
Building a consulting business is a lot like building a product company. You identify a customer problem to solve, design a solution and then sell it as a product offering. The difference is you’re not selling a tangible product; you’re selling advice. But you still need to package that advice into an offering, so people are compelled to buy your services. One way is to “productize” your services.
You do this by considering the major elements of a product and then casting them in services terms. I break a product offering down into three elements: the features, the benefits and the terms. For each of your core consulting services, describe the following:
- The features including a description of the service, your approach, and the specific activities you will perform.
- The benefits including the results and outcomes delivered to the customer and how your services are different or better than the competition.
- The terms including the price, the charging model (fixed or time and materials) and the duration (how long the engagement will take).
The more you can productize your services, the better. It clarifies to your customers what to expect from hiring you as a consultant. If you don’t do this, your customers will perceive you as selling “black box” consulting, which is a service with arbitrary or unclear parameters.
One way I overcame the black box stigma in my practice is to introduce a packaged service called a “strategy on a page,” where the key elements of a strategy are boiled down to a single page and used as the primary deliverable. An example of a strategy on a page is provided upfront during the sales discussions, and the precise process, timing and price are itemized in the services contract. The customer has all the information they need to make an informed and confident decision when they hire us to do the work. It’s been one of our top sellers!
Most businesses have a try-before-you-buy option for their products or services. For example, software companies offer you a 7-day trial, fast-food counters at your local food court have samples to try, and mattress sellers let you try a mattress for 30 days free of charge. People like the comfort of knowing what they’re getting into before committing to a purchase.
Consulting is no different. But how do you do this without giving away a ton of free services? (it’s a business, after all). This is where thought leadership comes in.
You need to demonstrate your expertise by giving it away. Write articles, create videos, publish podcasts and develop case studies that showcase your knowledge and provide tangible evidence of your experience solving problems relevant to your customer’s needs. You need to show that you have an original and insightful perspective — one that people will pay you for! We’ve spent considerable time on thought leadership over the last seven years, creating articles, e-books, newsletters, podcasts and presentations. I credit much of our success to this (ongoing) activity.
Generating leads and converting them to paying customers is a particularly gruelling aspect of consulting. When starting out, you’ll often live project-to-project, and when one engagement ends, you’re back to looking for the next gig. This can create a lot of stress when you have mouths to feed (yours, your family’s, and your staff’s) and nothing lined up.
To avoid project gaps, you need to treat lead generation as an ongoing, continuous activity. That means carving out weekly time to focus on two key aspects of lead generation: securing new clients and leveraging existing ones.
For new clients, I rely heavily on our published thought leadership content as a source of leads. At the end of articles, videos and newsletters, I’ll provide a direct line to contact me to discuss relevant issues. I also provide a 1-hour free consultation offer that helps (see bullet 4 — give away what you know). This generates a decent number of leads over time — especially if your content is evergreen.
I also leverage my network for new opportunities. Internally, that means connecting with account managers who have regular contact with customers. I meet with them regularly to review emerging strategic planning opportunities and work to schedule a pre-sales meeting with the end customer. I also work with the account managers on their annual account plans to proactively understand where future project opportunities lie and set the wheels in motion for an initial meeting. Externally, I work my network of “partner” organizations. These are mostly consulting or software firms offering complementary, non-overlapping services. For example, I’ve developed a healthy set of relationships with IT strategy consulting businesses that lack a geospatial-specific focus. We partner with these firms to round out an IT strategy engagement when there is a specific need for geospatial expertise.
For existing clients, it’s about staying in contact once a project ends and following up with offers of additional support. This could be a free couple of hours to review progress on key consulting recommendations (I do this all the time for strategic planning work). It could also involve positioning a follow-on service that naturally extends from a previous engagement. For example, we’ve developed services around establishing a geospatial governance model, which is often a logical first step in a strategic plan for customers low on the geo-maturity scale.
The point is to stay on top of lead generation. You can’t rest on your laurels — even if it seems like you’ve got too many opportunities in the cue. It’s amazing how many of those will be delayed, deferred or outright cancelled. If you feel like you’ve got too much work coming in, that’s a good thing! Keep it up!
The well-established three Cs of consulting are competence, contribution and credibility. You demonstrate to potential customers your competence in your area of expertise. This affords you the opportunity to contribute to their needs through a paid engagement, which in turn brings you credibility as a trusted adviser. Of the three Cs, this last one — credibility — is the big one.
Your reputation is everything in consulting. You’re making a promise to help a customer address a difficult problem, and they alone determine if you are successful in that mission. That means the “quality” of your work — all else being equal — should take precedence on most projects.
What I mean by this is that every project — consulting or otherwise — operates under the constraints of budget, schedule and scope/quality. Customers want a good result for a reasonable price, and consultants want to make a profit. But assuming things haven’t gone off the rails and you’re not bleeding the project budget dry, ensure the work you deliver is of the highest quality — even if that means spending extra time outside the project to get things done.
I’ve seen too many projects suffer because the contract letter was followed to the “T” in terms of budget and schedule, and the customer got an average result. Sure, it’s what they asked for on some level, but it didn’t wow them. And since they are the judge of success ultimately, our reputation as experts suffered. If we had only spent a bit more time doing some more analysis and shoring up the quality of the consulting deliverable, our credibility would have been strengthened. And as I said — reputation is everything in consulting.
If there’s an opportunity to make your work a bit better and it’s not going to break the bank — do it! Consider it an investment in your reputation.
If you’re a successful solo operator, at some point, you’ll have more work than you can handle. You’ll need to scale up, which means building a team of great consultants.
This is one of the most challenging yet rewarding aspects of building a consulting business. Until now, it’s been about you, your vision, and your capabilities. Running your business has largely been a function of managing your own time and effort. Once you add your first consultant, your focus shifts from leveraging your own abilities to leveraging the talents of others; this requires you become proficient at hiring and, more importantly, developing consultants with the requisite skills to deliver on your vision.
From my experience, finding people with the precise mix of technical and interpersonal skills required for consulting can be difficult. You’ll almost always land on individuals whose profile fits with some but not all of what you’re looking for — you’ll need to develop the rest.
In my business, I looked at our core services and asked: what are the critical technical and interpersonal skills and industry experiences required to 1) support a consulting engagement and 2) lead a consulting engagement? This distinction is key because I recognized the importance of providing a pathway for junior or transitional professionals who might not yet have lead-level experience but could support a project. And, for lead consultants, I recognized that mentoring junior staff is a key function of the job.
The result was a progressive onboarding and development program for new consultants based on their leading v. supporting status. We have a strategic planning toolkit and project reference material for new consultants to review in their first few weeks. We identify “soft-skills” development areas and provide training opportunities to help with the interpersonal side. And for all consultants (even new “lead” consultants), we start them in a supporting role on a small assignment to help get their feet wet before jumping into more complex projects.
It’s a tailored and progressive process that recognizes the unique talents of each consultant and helps them grow quickly in the right way.