While the specific tasks of a business consultant depend on his job role, his core responsibility remains the same: Assess weaknesses and recommend solutions.
Whether you’re a veteran entrepreneur or a startup company, it makes sense to have an outsider’s perspective to assess any weakness and gap in your business, and then recommend solutions to address them. This is where the role of business consultants comes into play.
In a nutshell, a business consultant is responsible for improving your company’s operation by pointing out its weaknesses to create long-term solutions. They are generally involved in a specific department or operation like marketing, general management, finance, human resource, purchase, etc.
Oftentimes, business consultants are independent contractors who handle multiple clients, although they can also work as an in-house employee. Regardless of their work arrangement, they provide valuable information and guidance that will benefit the upper management in making their operation more cost-effective, productive, and competitive.
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Most business consultants are independent professionals who possess a specific set of knowledge and skills to improve business operation, especially during “disruptive events” like rising local and global competition, the advent of new technology, and public health crisis (e.g., COVID-19 pandemic).
While almost all industries can benefit from hiring a business consultant, the practice is most common in the following sectors:Â
- Retail
- Technology
- Insurance
- Publishing
- Telecommunications
- Engineering
- Manufacturing
- Defense
- Education
- Health care
(Note: Some consultants also work for government agencies handling defense, environment, and criminal justice.)
Business Consultant's Responsibilities
The list below explains the “general” responsibilities of a business consultant. Depending on the nature of the industry he works in, he may provide other services not included on the list.
- Plan and organize projects.
- Scrutinize projects related to budgeting, payroll, marketing, advertising, production, etc.
- Collect information about the clients' industry, their competition, their target audience, the current consumer sentiment, etc.
- Communicate with clients to understand their needs, goals, and challenges.
- Conduct research through surveys, interviews, shadowing, reports, etc.
- Provide recommendations to improve business operation.
- Create detailed business plans.
- Identify the project's key performance indicators or KPIs to meet the objectives.
- Track KPIs and prepare a comprehensive report.
- Train key employees.
A business consultant with valuable knowledge and experience is one of the most significant investments you can make in today’s cutthroat, saturated market.Â
Nowadays, most business consultant work as independent contractors; thus, they are paid based on the project completed rather than on an hourly basis.
Unbiased Insight
Because business consultants have a more objective insight, the management is most likely receptive to their critiques. Also, their unique position makes it easier for them to be meritocratic; thus, their recommendations occasionally lead to “positive” disruption such as promoting high-performing employees, demoting inept ones, or even trimming staff to address redundancy and ballooning overhead cost.Â
Contrary to popular belief, hiring a business consultant is not just for startups and growth companies. Some old iconic brands also need an “outsider’s perspective” to make sure that they continuously adapt to the changing business landscape and the shifting customer sentiment and behavior, especially during “disruptive events.”
Some well-established companies just chug along and rely on their products and services that have allowed them to stay afloat for decades. However, this complacent mentality has caused the death of iconic brands such as Toys R Us, Blockbuster, Nokia, Compaq, and Tower Records.
Valuable Knowledge and Resource
The core responsibility of all business consultants is to ensure that the business stays relevant. This means that your product and service should adapt to people’s growing and changing needs, lest other companies will fill in the gap and make you “obsolete” in the market.
To put this in perspective, in the early 2000s Lego was in huge debt, with sales down by 30% due to growing competition from other toymakers. But in 2004, the family-owned company hired an “outsider” from management firm McKinsey & Company who made the greatest revival in corporate history.
Vig Knudstorp has prevented the iconic Danish toymaker from becoming a history through these drastic, disruptive measures:
- Dumped all activities that the company had no expertise in--i.e., jewelry for girls, £125 million-worth theme parks, and clothing lines.
- Lego has started partnering with other iconic brands and movies.
- The toymaker has started using social media, movies, and other media platforms to connect with their fans.
- Lego now regularly conducts crowdsourcing competitions and events.
- The company has released designs that appeal to girls and young adult females. In the past, the vast majority of Lego's fans were boys who are generally into "good versus evil" characters, while girls demand more details and realism.
Types of Business Consultants
The list below shows the most common types of business consultants.
- Marketing consultants. They focus on strengthening your brand and growing your loyal customer base.
- Sales consultants. They provide training to sales representatives and recommend measures to boost revenue.
- Accounting consultants. They make sure that your short- and long-term financial goals are in line with your core operations. Also, they conduct auditing and review to trim down expenses without affecting the quality of service and/or product.
- Technology consultants. They recommend IT solutions to improve efficiency, protect sensitive data, and reduce overhead costs.
- Public relations consultants. They make sure that the public's perception of your company is in line with its core values.
- Legal consultants. They make sure that your company adheres to the legal requirements to avoid expensive lawsuits, complaints, and bad PR.
What LOJO Can Offer
At LOJO, we can help your company remain competitive and efficient through a wide range of services that include payroll and bookkeeping services, IT solutions, management, digital marketing, etc. Read our business consulting services to know more about how we can help you.
We also offer a free 30-minute business counseling session to our clients. Contact lojomarketing.com or call us at (916) 303-4080.