08 May Is Your IT Consultant Costing You Money?
“Of course my IT consultant costs me money,” you may be thinking. “Consultants aren’t free.”
No, they’re not, but they also shouldn’t be wasting your company’s hard-won budget on inefficient systems. A great IT consultant should be finding you ways to improve efficiency, lower costs (and monetize your investment), thereby providing value to your organization far greater than the fees they charge.
You know – that ROI stuff we keep talking about.
I use the same starting point for selecting a consultant that I would for hiring a new employee. Don’t look for an expert, look for a student. Experts claim to know it all, a subtle way of saying that they don’t do a whole lot of listening. A student seeks information, from you and other sources, using their expertise to develop the best possible solutions.
From there, it’s a business decision.
Making Smart IT Investments Means Questioning Everything
If you follow the philosophy of marketing guru Mark Stevens, you should be examining every expenditure against the revenue it generates. In other words, rather than buying every latest new, shiny object for the sake of innovation, make IT investments that make sense for your company. As Stevens suggests, you should be making sure that every investment:
- Is aligned with strategic business goals
- Is part of a strategic roadmap that ensures that the tools and strategies you invest in are mutually supportive
- Generates a return on your investment
So, when considering new investments in IT, ask yourself the following:
- Will it save you money? Can it be monetized?
- Do you have ‘shiny new object’ syndrome? In other words, are you doing it just because it’s the latest trend and everyone’s doing it, or are there gains in efficiency or other benefits to be gained?
- Is the proposed solution really what you need? If you’re considering upgrading your phone system, for instance, do you really need all the bells and whistles of the most advanced offering in VoIP, or is there a simpler (and cheaper) option that adequately meets your needs?
Let’s look at a large healthcare client for example. The IT department had come up with an expensive plan to build a new datacenter, consolidating operations with perceived savings based in large part on economies of scale. We suggested a more comprehensive view, adopting a totally new infrastructure utilizing software-defined methodologies. It wasn’t exactly radical thinking (the financial industry has been employing similar architecture for years), but the revised approach is expected to save more than 30% on datacenter construction costs, improve up time, make internal IT staff more efficient, and turn the expenditure into a profit center by allowing the hospital to lease excess capacity to other businesses. Extreme IT, maybe. Smart investment, definitely.
These are, of course, questions you should ask regardless of whether an investment is proposed by your in-house IT department or by your IT consultant. But if your IT consultant recommends investments that don’t pass the litmus test above, it might be time to evaluate whether your consultant is serving your company’s best interests.
What Makes a Great IT Consultant?
The right solution isn’t the same across the board for every organization. And IT consultants have different past experiences that play a role in the solutions they recommend to clients. So, what makes a great IT consultant, then? There are a few important things to look for in a top-notch consultant:
- Experienced – It goes without saying that an IT consultant needs to have a vast experience vault that they can draw from to look at each client’s situation objectively and advise on the solutions offering the most benefit (and biggest bang for the buck). Great ideas come from past experiences.
- Practical – A good IT consultant has strong opinions and asks a lot of questions to get the necessary information to make informed recommendations. But a good consultant should also be willing to be questioned, willing to consider different perspectives, and able to think on their feet when challenged. Questions can often bring new considerations to light that may change predicted outcomes. At the same time, a great consultant knows how to convey the benefits of a solution they believe in as the right (the best) option for a client.
- Passionate – The right consultant is one who is as passionate about producing revenue-generating results for your company as you are. Enthusiasm is a must; consultants play an important role in gaining buy-in from key stakeholders – and you’re going to need that buy-in to move your project forward.
- Resourceful – A good IT consultant doesn’t necessarily know everything there is to know, but they should have the resources to fill in the gaps (see Lesson #1 above!).
- Visionary – Consulting is as much about seeing the big picture as it is the small details. A great consultant can visualize the big picture while also analyzing the minute details to consider how every investment will impact team members across all departments, not just IT. It’s the impact across departmental lines that can make or break an IT investment (spending millions on the latest IT innovation is worthless if it adds so much complexity to the day-to-day activities of front-line staff that they don’t – or can’t – use it).
A great consultant will conduct a comprehensive business assessment and challenge company leadership to examine not just the system, but the people who will use and maintain the technology – and sell them on the benefits of their proposed solution. All of these concerns should be factored into the decision without rushing to select the next new shiny object.
And that’s THE THING. Too often, poor IT investments result from a rush to judgment. As an executive, it’s easy to leave the technical decisions to the technology experts, but IT is not a commodity, it’s a strategic imperative. If your IT consultant isn’t bringing practicality, experience, resources, and passion to the table and addressing both big-picture and small-picture details, you might be making poor strategic investments. And if that’s the case, your IT consultant is most definitely costing you money, and it’s time to reevaluate.