As CMO of Fulfillment IQ, Harshida Acharya is a full-funnel marketer for tech startups, enterprise brands and supply chain companies.
Key decision-makers in various industries, including brands, retailers and third-party logistic providers (3PLs), frequently face challenging decisions and obstacles when aiming for growth and digital transformation. The common solution? Engaging external consultants or large consultancy firms, which now represents a $132 billion industry.
The formula goes: Hire high-IQ specialists with innovative ideas, at a premium, to optimize operations and drive measurable return on investment (ROI). These outsiders will cost an arm and a leg, and they often don’t stay long, but the hope is that ROI can be measured easily with all the improved efficiency they will bring to the organization. However, many experts are now arguing that outside consultancies are lacking in their supposed “expertise” areas and also preventing companies from developing in-house capabilities and becoming more self-sufficient.
As a decision-maker, what are some of the top considerations to make when bringing on a consultancy? Consider the below:
1. Establish a clear statement of work.
Be sure to start off any potential partnership with a clear statement of work. This should include objectives, goals, expected results, current problems, solutions that may have failed and timelines. The more thorough the project brief, the more accurate and pointed the project proposal will be. If the consultant comes back with a general proposal after sharing such a detailed statement of work, this should be the first sign they won’t be the right partner.
2. The proof should speak for itself.
During the initial vetting period, companies should request case studies that can prove measurable improvements to processes. In these case studies, look for quantitative metrics that can prove the partnership will be worth the budget. These results should go beyond just a deck presentation shared at the end of an assessment but should show actionable business results. Did their architecture help scale the e-commerce business to process more orders? Were they able to accelerate a launch timeline?
3. Niche down.
While the big-three consultancies may impress your team, opting for a niche consulting firm with specific supply chain and logistics experience could yield better long-term results. When selecting a firm, ensure they have worked with companies in your industry and possess clear expertise in operational excellence and best practices. A valuable test might be to inquire about their familiarity with methodologies like Six Sigma, Lean or the Toyota Production System and assess their ability to discuss in-depth supply chain optimization strategies and complex logistics processes.
4. Ensure consultants fit within the company culture.
Although consultants are not full-time employees, they should still follow the company’s mission and ethos. Choose partners who understand change management and can facilitate the adoption of new tools and technologies. Smart consultants should use design thinking, interview all stakeholders and have an Empathize stage that informs the company about functional tech.
The Empathize phase is a part of the design thinking journey where you empathize and have a full perspective or picture of what all stakeholders are going through and why they are going through it. During this phase, consultants get an objective point of view of the organization before they start evaluating and offering strategic guidance.
5. Guarantee the partnership ends with clear action items.
While any consultancy might be eager to secure more budget and additional projects, a truly valuable partner will provide you with actionable next steps and a clear path toward self-sufficiency. The approach should consider the long-term future and product road map and encompass more than just a presentation deck and vision. A consultancy that goes beyond strategy and can also build the tech solution offers a significant advantage, as it ensures that their proposed strategies are grounded in the reality of what can be effectively developed and implemented.
By leveraging external supply chain tech consultancies, you can access valuable expertise that might be unavailable in-house. Following these guidelines can help ensure a meaningful ROI and equip your organization for long-term self-sufficiency.