A business consultant is an expert in a specific field who’s willing to counsel and support others professionally. Consultants often have industry-specific knowledge and business acumen that can guide executives struggling with strategy, planning, and execution. These consultants are often paid to find solutions for problems within another organization.
Whether you’re launching your first startup or celebrating your 10th year in business, there may come a time when you’ll need to hire a business consultant or consultancy firm. Keep reading to learn more about business consultants.
The Difference Between a Business Coach, Advisor, Mentor, and Consultant
Before diving deep into business consulting, it helps to know 3 of the other related roles that sometimes blur the expectations of a business consultant: coach, advisor, and mentor. While similar, there are subtle differences between these 4 terms.
- Business coach: A business coach serves more as a guiding light for executives. Their main objective is to assist with clarifying and setting strategic goals—they’ll typically ask a lot of questions and can provide your business with a new perspective. A business coach won’t actually execute any work for you, but they can help you to rethink your approach and strategy.
- Business advisor: A business advisor and consultant are very similar, with the main difference being the lifespan of the relationship. An advisor is usually brought on early in the life of a company and assists mostly in a leadership or strategic capacity. Advisors are often called upon for high-level decisions and typically bring extreme credibility in the space. New tech startups will often hire advisors from large enterprises to serve on their board and assist with big-picture goals.
- Business mentor: A business mentor is someone with more experience in your field who has agreed to help guide or advise you—usually free of charge. Mentors have already “been there, done that” and are able to help you avoid some of the mistakes they’ve made. Mentorship in business is becoming much more popular thanks to the ease of access via social media, email, and video calls.
- Business consultant: Like the 3 examples above, a business consultant is someone who has—and is willing to share—expertise. Unlike a business coach, however, consultants are usually more hands-on and play a crucial role in executing strategic plans. Consultants and advisors typically have similar expertise, but a consultant is usually hired to solve specific short-term problems and is not directly invested in the long-term success of the business. Finally, a consultant and mentor differ mostly in that the consultant is paid and has a contractual obligation to help.
Types of Business Consultants
There are many types of business consultants, and you could technically hire anyone you believe can add value—for example, a professional athlete to help with team building or a chef to help with time management.
However, most business consultants fall into the 5 following categories:
- Operations: If your business is struggling with production issues or needs help vetting vendors, hiring a business consultant who specializes in operations within your industry could be a wise investment. If you watch Shark Tank, you’ll often run across businesses that talk about the struggles of scaling. “We have to turn clients away because we can’t meet demand.” Operational issues can cause bottlenecks in your business, limiting your ability to scale. If this sounds like your company, it may make sense to hire an expert to review and optimize your operational processes.
- Management: Businesses are only as good as their leadership—and business consultants who specialize in strategy and management can be excellent resources for growing companies. Whether you need help pivoting, expanding your portfolio, entering a new market, or acquiring a business, hiring a business consultant who has experience with strategic management can make that process smoother.
- Technology: IT consultants are on the rise as innovative solutions continue to streamline systems within organizations. Looking to automate your invoicing? Want to migrate your legacy systems to the cloud? Automation and software solutions are making businesses more efficient—so if you want to explore technological options for your company, consider working with an IT business consultant.
- Human resources: The average turnover for companies across all industries is 17.8%, so if you’re facing difficulties retaining quality talent, you could have an issue with your human resources department. Working with HR professionals is a great way to improve current employee satisfaction and increase your chances of recruiting better-qualified staff in the future.
- Marketing: Many small businesses struggle with digital marketing, so hiring a marketing consultant to build a website, set up local SEO, optimize social channels, or develop an email marketing strategy can pay huge dividends. Marketing consultants can help with branding, sales, and other marketing strategies both online and off-.
What Does a Business Consultant Do?
As you can see, there are several expertise areas for business consulting—so narrowing down exactly what a consultant would do for your company can be difficult. In general, you can expect a business consultant to provide some of the following services:
- Insight into and expertise from an industry or specialty
- Ability to identify and resolve problems
- Competency beyond current staff
- Fresh perspectives and ideas
- Onboarding and training
- Leadership and project management
- Hiring and firing employees
- Negotiating with vendors
- Scaling processes and new systems
- Quality control
- Motivating employees and increasing company morale
Hiring a Business Consultant
There are numerous benefits to hiring a business consultant, especially if your company is growing quickly. The sooner you’re able to integrate a consultant into your business, the easier it is for that person to drive genuine, lasting changes. Unfortunately, change is hard—but, the only way to grow is to face these challenges head-on. That’s really when business consultants bring the most value.
If you’re looking to hire a business consultant, consider the following steps:
- Determine the type of consultant you need.
- Search for consultants within that field or concentration by perusing search engines, networking groups like LinkedIn, and colleague recommendations.
- Take the time to vet candidates thoroughly: talk with references, check credentials, and bring on your top possibilities for a test run.
- Structure the business relationship. How many hours a week will the consultant work with you? What are their project areas and KPIs?
- Measure your return—and be objective.
Business consultants can serve as excellent resources for owners of businesses both large and small. If you’re on the fence about hiring a business consultant, consider beginning the process and talking with some prospective consultants.
Working through this relationship slowly can also create a great opportunity for you to evaluate your own management and systems. Ultimately, you may or may not decide to move forward with a business consultant—but the fact that you’re willing to consider growth opportunities is a mentality that will drive your business further, regardless of your decision.