Tech Consulting = Higher Profits + Lower Risks

Very often firms, even the small ones, will pride themselves on hiring the smartest brains on the market, just to submit them to a life on the shelf, performing mundane tasks, often with bad outcomes. The prevailing thought is

Hire the best.

Everything else will fall in place.

As a small business consulting company owner, I frequently hear this argument from prospective clients along with other key deal-breakers that are truly misunderstandings on their part.

In this context, I want here to spend some time to share with you my short list that I refer routinely to deconstruct these myths.  This is my top 10 reasons why you should pick up the phone and call a small consulting company today:

1. Increased protection to intellectual property

That can look contradictory but it is much more likely that your company secrets will be better preserved when hiring a consulting company than full time employee.

Face it, at the point when your employee tells you he/she is leaving, they already spoke with at least five competitors of yours. If he/she is an entry level employee, chances are they will try to make up for the lack of experience by flood-telling them all the bits they can possibly put their eyes and ears on.

Even if employee’s contracts have hefty penalties for disclosure and even if there are explicit laws in that can impose harsh crime indictments, they are almost never used. The shame of having its secrets disclosed on this overreacting, social media frenzy times can irreparably damage a company’s reputation.

Trading companies, in particular, want to pass the image of security. Having your secrets regularly stolen by employees is a bad way to convey this image.

In comparison, small consulting companies will offer strong provisions of confidentiality, which are much more enforceable than an actual person, which is often protected by labor laws, unions, the ACLU and the government itself. It is not a David-Goliath battle anymore. It’s Goliath vs Goliath in the public’s eyes even though one Goliath is much smaller than the other.

Small consulting businesses will always be there, prepared to hold their contracts, their word, their reputation. Their allegiance does not finish after the project ends (by analogy, with a pink slip or leaving notice).

2. Lower R&D costs

Small consulting businesses do their own training on their spare time. They invest in technology and being abreast of the latest and greatest technologies.

3. Higher productivity

Small consulting businesses typically work more hours than regular employees and they usually will not charge for those hours. If a project fails to meet requirements, they will typically not charge you for the time lost, in fear of losing their reputation.

4. Increased flexibility

Unless your firm is a behemoth like P&G, there will be times of plenty and times of soft business. In these cases employees are fixed costs that will burn money regardless of how external conditions. You cannot lower or renegotiate salaries, unless on bankruptcy court.

Small business consulting services are project-oriented by nature so you always have a budget to back those developments without burning through the company’s cash reserves.

5. Better PR results

Firing employees is always a bad hit on a company’s reputation, regardless of its merit. It also increases the chances of lawsuits which can skyrocket very easily on costs and spill over social media.

With a consulting company, there is a clear understanding that work is finite in time. It allows for a healthy relationship that is always at hand when you need it most.

6. No additional employee costs like pension plan

Small businesses pay their own pension plans, paid vacation leave, maternity leave, health and disability insurance. You will not have to worry about any of these.

7. No hiring dead times

When hiring a consulting company, there is typically no project dead times as the company will try (and often succeed) their best not to lose the contract. As a bonus, you will not have to create contention with your competition nor settle for a lower quality hire due to time pressure.

8. No recruiter fees

Additionally to the cost savings cited above, small consulting companies will go at you at their own expense. They will not charge 25% extra for your project and they will not force you into a retainer contract.

9. Advanced Knowledge at a Cell Phone’s Distance

Unless a company is a large hedge fund, they will not have a continuous workflow for a highly specialized PhD out of a MIT/Berkeley at all times.

The result can be two-fold damaging: (a) the employee gets bored and quits (or even worse, goes on a mad crusade against the company) or (b) the company is forced to lay him/her off.

Because they can operate several contracts at once, small consulting businesses can afford to keep very sophisticated staff and effectively use their skills.

10. Smaller Overhead

Unlike big consulting companies like KPMG, McKinsey or Delloite, there are no egos involved if you are a small business trying to thrive and stay afloat. The owner will be the researcher, his daughter will do the accounting for a allowance money and his son will assemble PC machines for a Best Buy gift card. This is an obvious exaggeration, poetic license to make a point.

You will not have to contribute to 7-figure bonuses for that handsome looking football athlete that is your contact point. You will not be paying for beauty or hype – you will be paying for results.

Final Remark

I am a consultant. I spent about one hour on this piece and none of my clients were charged for it.

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