by Lisa
D. Lowe, SPHR
Budgets
are tight, and many HR departments have become a bit …
"leaner" …recently. Choosing the best way
to work with limited resources is a challenge faced everyday
by human resource professionals. The jobs of most human
resource personnel have become more complex and never more
critical than now as organizations struggle to maintain
productivity and profitability with smaller workforces.
Often the resources and expertise needed to accomplish the
goals of an organization simply are not available internally
and using an outside consultant is necessary.
The
selection of an external consultant can be a challenging
process and this is particularly true for human resource
functions. There are so many to choose from, the price range
of services varies greatly, and their marketing is often
difficult to comprehend. Do they really understand your
objectives, industry and culture? Can they meet your deadline?
Can they be trusted? Would it be more effective to stretch
skills and resources and provide the service in-house? Will
the need be an on-going one or is it short term or process
related?
While
separating the wheat from the chaff in the consulting world
can be difficult, there are concrete steps you can take
to ensure that your search is successful.
·
Be certain your rational for using
a third party is clear. Not every problem requires
outside expertise. The issues that human resource organizations
face, however, are often perfect candidates for outside
assistance. For instance, you may have day-to-day line management
of your HR staff completely under control, but need help
rallying your refinery operation's supervisors to become
better motivators. How do you solve the problem? Can you
articulate why you need someone "outside" and
quantify the cost/benefit analysis? In this case, you may
be seeking the breadth of experience brought by a consultant
with hundreds of clients who has faced similar challenges.
You might choose to use a third party to deliver compliance-related
training to bring instant credibility to the topic- sexual
harassment training for instance. Likewise, while you may
do 95% of your misconduct investigations in-house, if your
executive vice president of HR is the accused, you may find
it beneficial to bring in an outside investigator for neutrality
and objectivity. Understanding why you are searching for
a consultant is as important as knowing what job you need
completed: the "why" often drives the choice of
consultant and will assist you in narrowing the candidates
significantly.
·
Clarify your objective. Whether
you are sorting out the specifics of a number of employee
benefit options or trying to train every member of a 15,000
person staff on the intricacies and subtleties of the principles
of diversity, understanding your intended outcome is imperative.
Fuzzy objectives or objectives that change mid-stream will
not only frustrate a potential service provider (and waste
your time and money), but also will confuse the issues and
decrease the likelihood of success. Clarity of your goals
and objectives will allow you to communicate effectively
and with specificity with potential vendors. In turn, clarity
will help vendors provide you with better information regarding
their services and better estimates regarding their costs.
·
Know your budget. The cost
of HR consulting services can vary tremendously. Before
you begin to explore alternatives, know your budget. Armed
with common sense and concrete figures, you are better prepared
to request and sort through proposals and quotes. Communicate
with your vendors openly about the price range you believe
is fair as those parameters will often weed out consultants
who are unable to work within your budget. At times, your
estimated budget may not reflect the market cost for the
services you need. In these situations, your flexibility
with how the services are delivered may overcome this obstacle.
For instance, a severely limited training budget may require
shorter classes and more employees per class, utilizing
videos instead of live training, or relying on licensed
materials that are taught by in-house personnel. Once informed
of your parameters, many consulting companies will do their
best to meet your needs while accommodating your budget;
however, this is impossible to do without the required information
regarding your budget expectations. Again, communication
with a prospective vendor is crucial to meeting your organization's
needs.
·
Determine your timeline. Consultants
have business and work planning issues very similar to their
clients. A potential client who communicates as much information
as they can - especially their sense of urgency and their
time frame - will likely receive better proposals and better
pricing. Minimizing the guesswork required by a consultant
in as many areas as possible literally pays off.
·
Search for the best vendors, and then
solicit proposals.
The rules that apply when you are looking for any other
service provider still apply when you set out to select
a vendor for human resource consulting services. First,
ask for referrals to consultants from internal colleagues
and other professional contacts. SHRM and local HR organizations
are also good places to search out options. The Internet
is a rich source of consulting information, although the
choices can quickly become overwhelming if you do not keep
your search narrowly focused. Explore the potential vendor
websites to gather as much information as possible before
talking directly with a vendor. Interview each vendor telephonically,
and then send out formal requests for proposals to the top
candidates. Formal RFPs assure that you receive uniform
information from each consultant. Always include a request
for current references for whom they have delivered similar
services, and, most importantly, contact those references.
·
Make preparations to work efficiently
and effectively with the third party. Managing a
relationship with a consultant is not altogether different
from managing a relationship with an internal employee.
Designating a primary internal contact who is readily available
to the consultant, establishing regular communication with
the consultant that includes feedback - both positive and
negative -- and keeping the consultant informed of any organizational,
process, or budgetary changes that might affect their work
are all vital to an optimal working relationship.
·
Measure the effectiveness
of the service. Ultimately, results matter. Metrics
are a hot topic of conversation in HR circles these days,
and rightly so. Organizations require a strong business
rationale for all expenditures -and consulting fees are
often very heavily scrutinized - so quantifying the return
on investment for services is key. Whether it is a year
over year reduction in the number of harassment and discrimination
complaints due to your training initiative, a reduction
in litigation expense related to effective complaint resolution
through outside investigation services, a decrease in costs
of benefits due to effective outsourcing, or the lower recruiting
cost from implementation of an effective relationship with
a staffing service provider, a focus on specific outcomes
and return on investment help you understand if you got
what you paid for, and help you demonstrate program effectiveness
to upper management in a language they can understand.
While
working with consultants can be challenging, the benefits
can be enormous. Successful relationships with third parties
enhance organizational effectiveness, bring fresh perspectives
to your most troubling issues, mitigate conflicts, provide
a neutral voice during disputes, and augment in-house talent.
The most effective consulting relationships are virtually
seamless, largely due to great client commitment and communication.
A consultant is only successful long-term if they can make
you, the client, more successful, the very definition of
a win-win opportunity.
