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computers, consulting firms usually need only a small office staff at the headquarters. The smaller the staff, the more its members need to be versatile and willing to help in any part of the daily work.

In a small unit the following staff may be employed:

●administrative assistant (who may also act as the manager’s secretary and/ or office manager);

●accounts clerk/cashier (to keep time and other records, invoice clients, pay salaries and expenses, purchase office supplies, etc.);

●receptionist/telephonist/typist (who would help in typing correspondence and reports);

●one or two more secretaries/assistants if necessary.

It is logical that larger units will require more office staff. At some point the establishment of an administrative service unit, headed by a senior administrative assistant or office manager, will be justified.

Bookkeeping and accounting. In organizing bookkeeping and accounting the consultant is faced with several alternatives. Many single practitioners do their own accounting, not only to save on administrative expenses but in order to keep control of their financial position and of the efficiency of their operation. Even a consultant whose main field of intervention is production or personnel may find it useful to do his or her own accounting.

In small consulting firms, routine bookkeeping may be done by an accounts clerk or administrative assistant as mentioned above, while financial and tax reports would be prepared by one of the consultants, or by an external accountant employed on a part-time basis. Many consultants have all bookkeeping and accounting (including tax returns) done by an external accountant.

35.3 IT support and outsourcing

Management consultants who do not use the best available technology are not likely to inspire their clients and are losing an opportunity to learn and to gain IT efficiencies for themselves. Consultants are expensive knowledge workers and investment in IT is relatively easy to justify if it saves their time or improves their effectiveness. Consultants, like the managers of any other business, should ask themselves the fundamental questions outlined in Chapter 13: why? what? which? how? The answers will depend on the individual business and will change as technology develops, but there are certain characteristics of all consulting firms that give some clues to IT needs.

A consulting firm needs IT applications and equipment that suit the sector of professional services in general and of its own business in particular. It should therefore not hesitate to seek the advice of an IT consultant or software supplier who is familiar with the field. The choices made should reflect the critical characteristics of a consulting business.

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Consultants are mobile and communicate

The first critical characteristic is the nature of consulting work. Today’s consultant stepping onto an aircraft to go to the next assignment is likely to be carrying, at a minimum: a laptop computer with peripherals, a personal digital assistant (PDA) or electronic organizer, and a mobile telephone, as well as a few metres of connecting wires and an assortment of adapters for different electricity supplies and telephone sockets. These separate pieces of equipment may be combined in the future but the need for messaging, information storage, and information presentation will remain. In the office, the consultant will probably want to plug the laptop into a docking station and connect to the office network. The goal is to have the same information and the same connectivity wherever one is in the world. Technology for mobile workers is developing rapidly and consultants should monitor it carefully and experiment to find the most appropriate. This does not necessarily mean “most powerful”. It is generally better to use a reliable system, which clients and other collaborators are using, rather than to have a fancy leading-edge system that is non-standard.

Mobile consultants must keep in touch with their clients and their own firm all the time. Email and voicemail are essential. Access to some kind of teleconferencing facility is becoming increasingly important. The quality of communication can be much enhanced by the use of multimedia applications and possibly virtual reality. This is an area that is likely to develop rapidly in the next few years.

Generally speaking, consultants should have easy 24-hours-a-day access to their firm’s information and knowledge base, including information on clients and assignments, skill inventories, brochures and press releases, templates for presentations, proposals, contracts, learning materials, internal manuals, guides and bulletins, reports, and so on.

Some kind of contact database is essential for every consultant. Firms will often regard these data as a corporate asset and will want to centralize them. Individual consultants may want to keep them to themselves. Disputes over who owns the data or who has access are less important than the quality of the data and the ease of retrieval. Some of the client management systems on the market seem overly complicated, while some consultants manage quite well with a simple electronic address book. A simple system that works is a lot better than a complex one that doesn’t.

IT support to management and administration

The second characteristic is the nature of management and administration of consulting firms. The system chosen should allow consulting assignments or projects and other kinds of activities (such as training or research) to be planned and controlled, and should link the time records of individual consultants with overall control of operations, billing, bookkeeping, accounting, budgeting and budgetary control, cash-flow management, knowledge management, and other areas of management and administration. Such systems are on the market, but

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may not always suit the firm’s profile despite the vendors’ promises; hence cautious selection is warranted. System compatibility and integration need to be kept in mind to avoid costly and ineffective solutions that respond to partial needs rather then to the overall needs of the whole firm and its consultants.

Both hardware and software support need to be standardized throughout the firm to avoid incompatibility and conversion difficulties, and facilitate upgrading and scaling. Simplicity and user-friendliness are key, since even IT-literate consultants are not necessarily IT technicians.

Professional service automation (PSA) solutions offered by some IT providers integrate critical processes such as customer relationship management (CRM), assignment management, project management, resource management, time and expense capture, billing, support and knowledge management. The offer of integrated systems for professional service firms, covering key management functions and reflecting their mode of working with clients, is likely to continue to expand.

Outsourcing

IT solutions for consulting firms can be Internet-based and outsourced in the same ways as any other business and management services. Management and IT consultancies have been actively promoting outsourcing to their clients, and the large consulting firms are therefore well placed to identify which of their own internal services could be performed better and more economically by external providers. Deciding what to outsource may be more difficult for small firms, most of which have long outsourced their bookkeeping and accounting (not through the Internet, however), but may hesitate to outsource other functions and services using the Internet, perhaps with the exception of Web site design and maintenance. Like many small firms in other service sectors (see section 24.6), turning to a specialist for advice on Internet-based IT and business services may be the wisest solution.

35.4 Office facilities

Headquarters accommodation

In all circumstances, headquarters accommodation should reflect the fact that consulting is predominantly a field operation and not a head-office activity. While a “good address” can enhance the firm’s image and has other advantages, such as the proximity of many clients, the total office space required can be relatively small.

The accommodation needed for the internal administrative and support services is self-evident. The reports library may start in a small way with a few lockable filing cabinets, but in time may need a room of its own. At the beginning it may share this room with the reference library of books and other documentation files, but with the growth of the unit more space will be needed.

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As for consulting staff, the partners and other senior staff members involved in supervision and practice development need office space at headquarters. Operating consultants and associates need at least a desk each (though not individual offices). In addition, it is useful to have a meeting-room, space for training workshops, and some small rooms for receiving clients and other visitors.

A large number of consultants sitting at their desks instead of working with clients is generally considered to be a signal that something requires examination!

Sole practitioner’s office

A sole practitioner may be able to operate from home without renting office space. However, this is not always desirable from the client-relations viewpoint. In some countries, an office in a town centre or business area may be essential. To avoid excessive accommodation and administrative costs, sole consultants and other professionals often share an office, and a secretary or assistant, with other independently operating colleagues.

1See, e.g., D. B. Norris: “To be or not to be – a partner”, in Journal of Management Consulting (Milwaukee, WI), Vol. 7, No. 3, Spring 1993, pp. 46–51; and H. Ibarra: “Making partner: A mentor’s guide to the psychological journey”, in Harvard Business Review, Mar.–Apr. 2000, pp. 147–155. While a partnership is essentially a business form in English-speaking countries, other legal systems generally offer similar types of vehicles.

2The term “corporation”, as used in this section, encompasses various types of business companies recognized by individual legal systems. For example, a number of countries recognize so-called joint-stock companies or companies limited by shares (e.g. the French “société anonyme” or “SA” and the German “Aktiengesellschaft” or “AG”) as opposed to limited liability companies (e.g. the French “société à responsabilité limitée” or “SARL” and the Dutch “Besloten Venootschap” or “B.V.”), which usually have a simpler structure and are subject to lighter regulation, but are not best suited to raising large amounts of finance. Tax treatment may also differ. It is recommended to seek specific advice on the types of companies permitted in the jurisdiction in which you are planning to engage in business.

3For a discussion of the problem see, e.g., “Partners in pain”, in The Economist, 9 July 1994, pp. 63–64; and V. E. Millar: On the management of professional service firms: Ten myths debunked

(Fitzwilliam, NH, Kennedy Publications, 1991), pp. 39–44.

4See, e.g., E. Biech and L. Byars Swindling: The Consultant’s legal guide: A business of consulting resource guide (San Francisco, CA, Jossey-Bass/Pfeiffer, 2000), pp. 111–124.

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