Virtually all projects require consultants and subject matter experts (SME). Often, our experience clouds our judgement when qualifying and evaluating consultants. Biases may stem from pre-conceived notions regarding the need for a consultant or the preceived value that a consultant is expected to deliver.
Implement a clear and objective process when selecting a consultant. This is a three-step process. The first step is establishing a clear need for outsourcing a set scope of services and the second step is evaluating a short-list of qualified consultants based on technical competency. The final step is weighing the value of prospective consultants against their cost. Value is not the same as price. The low-cost consultant does not always offer the best value to the project.
Once we have established a need for a consultant and demonstrated that the project benefits from outsourcing a specific function, we can start with technical evaluation. This usually boils down to relevant project experience, trusted references, qualified resources, and availability of said resources. At this stage, we verify the consultant’s success on similar projects. Once we have established a short-list, we can obtain cost proposals under various formats, depending on our organization’s requirements or the Owner’s criteria. If the project scope is sufficiently clear, we may elect to secure lump-sum pricing. When scope is less clear, we may want to obtain hourly rates, possibly accompanied by a maximum total price.
If we are the prime contractor or owner, and the consultant works directly for us, we must take care to ensure that the compensation structure of the consultant is aligned with the project’s goals. I once worked on a technology integration project for a large systems provider. As the project manager, I realized that the testing process was completely skewed against me because my company had to deliver the project on a lump-sum price contract. BUT the Owner’s consultant was being paid by the hour. Not surprisingly, the testing phase took twice as long and was filled with difficulty and contention.
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