What is Consulting and Why It Matters

Consulting is a vague term that typically encompasses a broad range of services.

Understanding what a business consultant can do, though, can help guide businesses in choosing the right one for their company.

In this article, we explain what business consulting is, what consultants can offer your company, and how to look for a legitimate advisor.

Use this article to understand what consulting means, the type of services  consultants perform, and how to find the right consultant for your business.

What is Business Consulting

Professional consultants teach, plan, strategize, and execute processes that help businesses thrive.

There are many types of consultants, and businesses should seek out a specialist that matches the needs of their company.

The five most popular types of consultants are operations, strategy, human resources, risk and compliance, and financial advisors.

Operations consultants help your business improve its internal operations and performance. Operations consultants typically advise clients on how to adjust their operating model, business processes, management systems, and value chain to build an efficient, cost-effective business model.

Operational consulting focuses on improving the processes and underlying systems across a wide range of areas such as:

• Sales & Marketing
• Supply Chain
• Sourcing & Procurement
• Finance
• Research & Development

Strategy consultants develop and execute a plan for growth based on data and market research. Strategic consultants typically audit your company’s sales, accounting, and staff structure to develop a strategy that drives revenue, sales, and employee retention.

Human resources consultants support your team with everything from building an organizational foundation and company culture to defining job titles, responsibilities, and compensation while recruiting and retaining top talent.

Risk and compliance consultants aid businesses in creating systems that address:

• Regulatory requirements
• Situations of noncompliance
• Processes surrounding information systems supporting governance, risk, and compliance (GRC)

A risk and compliance consultant helps your business manage credit, market, and operational risks through assessments, process improvements, model validations, and reviews.

Financial consultants advise your company on systems, decisions, risk-taking, and planning.

Intuit Quickbooks 2019 State of Business Cash Flow report states that the majority of small businesses (61%) struggle with cash flow, and more than forty percent of those that struggle have been unable to make payments to vendors, employees, and loan providers.

A good financial consultant offers projections and insights that help your business avoid cash flow problems while building a profitable future.

There are many more kinds of consultants to help with any business challenges, including:

• Security
• Education
• Marketing
• Health care
• Engineering
• Science

Each business consultant describes their services differently because every advisor brings their own set of expertise and strategy.

Understanding the Term “Consulting”

Understanding what consultants do before you begin interviewing potential advisors is essential, so you know what questions to ask and what to look for in an advisor.

Most consultants only need a business license to operate and aren’t required to obtain permits or certification in their fields.

Since almost anyone can call themselves a consultant and nearly all consultants charge hefty fees,  it’s absolutely crucial that businesses research potential advisors before entering into a partnership. Look for validation of their expertise and experience in the form of:

• Experience
• Education
• Reviews
• References

Proving return on investment poses a challenge for most consultants, so it’s essential that you turn to case studies, online reviews, and references to ensure that your consultant is an expert in their field.

Partnering with a Consultant

Understanding the different types of consultants can help you choose the best advisor for your business.

For example, if you’re struggling to recruit top talent, a human resources consultant can review your compensation packages, office location, and company culture to find growth opportunities that can help your company compete for the best candidates.

Businesses that find  themselves sidetracked by ever-changing government or industry regulations should look for a top risk and compliance consultant, who can help them align with compliance standards.

Companies wondering whether they should invest in a new project would benefit from the advice of a financial advisor.

Consultants provide such a broad range of services that businesses should determine where they need help before they begin searching for one.

Business Consultants Provide Valuable Experience and Expertise

Companies wanting to grow, invest, expand, or improve their businesses should look for legitimate business consultants to help them strategize and execute a plan.

Look for consultants that specialize in the areas you need help with, check their background and experience, and do due diligence to ensure they possess legitimate expertise.

If you find the right partner for your needs, your business can experience the benefits from a consulting partner.

Author

Grayson Kemper is a Content Manager for Clutch, an Inc. 500-recognized research, ratings, and reviews platform in Washington, D.C. Clutch helps businesses identify and make an informed decision about the best services and tech solutions partners to hire.