Know-How Exchange : Strategy

The word 'Audit' sounds like it's going to look for what they've done wrong in the past, when they feel they are really employing you to develop new things for the future. We'd describe your audit phase as the 'learning phase' (or 'background and groundwork phase') where we're trying to get to know the client's business.

You might also structure it differently. Start with documents and one-on-one's and visiting the operations. Then run a customer experience workshop - who is the customer, how do they find about the client's product, what are they looking for, how does the client communicate to them, how are things measured. Then go to customers to find out what their experience really is. These parts will give you a set of gaps that you can communicate back to the client as an initial deliverable to show progress and use as the first building block for the strategy.

Your clients don't care how you make the sausage. You're giving them TMI about your process/work plan.

And I would re-name the "audit" and call it a "Situation Analysis" that you expect will identify opportunities for them.

This is no different than a process re-design project. You have to determine "as-is" and then start moving toward "future state" after you lay out the transition plan. Having the "as-is" also is a base level where you started, including metrics, so you can evaluate the success you've made (or, unfortunately, if poorly designed or implemented, then the impact). Take the JCPenneys example: they could have quickly retreated from the new plan if they quickly assessed how poorly it was doing.

You wrote: "I do actually want to show the client all the analysis i have done so they understand where the strategy is coming from and where the time is going."

There are at least two problems with this statement:

1. What YOU want doesn't count. It should be what the CLIENT wants, needs and expects. If all they want are the relevant findings from your analysis, why drag them through all the dead ends and non-findings? It sounds like you're trying to demonstrate how smart and thorough you are, rather than how much value you can bring to the client.

2. The client doesn't care "where the time is going" unless they are paying you by the hour. And if you're billing by the hour (or the day) you have a strategy that is destined to lose. Is your deliverable worth less if you come to the solution quickly? Is it worth more if you drag it out and it takes a long time? I don't understand why any good consultant would sell time instead of know-how.


You also wrote: " if you charge a client $10k - $20k for a marketing strategy, they want you to justify the costs."

If this is the case, then you have not done a good job of setting expectations up-front. The client (and the consultant) should be focused on the BENEFIT and the VALUE of a solution that will work. If you're delivering a project that will generate $100,000 to the client's bottom line, why would they question a fee of $10-20k? And if the value of what you are going to deliver is less than $10-20k, then they shouldn't be hiring a consultant for the project at that price.

Too many consultants are more focused on the process (and their fee) than on the value of the deliverable to the client. Good consultants are not hourly workers, but profit centers for their clients.

Dina,

Please understand that I am not chastising you with my remarks above. Rather I'm using the opportunity to rail against a practice that demeans professional consultants -- hourly or per diem billing.

I've been consulting for more than 30 years now, and I've yet to see a time-based-fee client relationship work. The client is constantly faced with a "meter is ticking" angst, so s/he doesn't spend the time required to fully brief the consultant. The consultant, meanwhile, is motivated to work inefficiently and take as long as possible to deliver the project. It's a recipe for dissatisfaction on both sides. And if the consultant is really good and works very efficiently, and delivers the project early, s/he is punished with a lower fee. How is that fair for anyone?

The solution is a project-based fee that forces the consultant to think through what will be required in advance, and what the deliverable should be worth to the client. If the project is worth more than what the consultant will charge, then both sides win. If not, then it's not going to work. This takes the focus off the fee and the billing arrangement and places it on the benefit to the client and the value of the deliverable. The consultant and the client have the same objective, not a zero-sum game.