How to successfully leverage consultants for IT projects

Much like lawyers and salespeople, consultants can elicit negative emotions when discussed in some circles of the corporate IT space. You may hear stories of large, expensive failed projects, contentious lawsuits and possibly even destroyed careers. While I have personally witnessed and even participated in some of these unfortunate projects, I am here to tell you that it does not have to be that way, and I believe consulting should actually be a critical complementary component to most IT organizations. To be completely transparent to my potential bias, I am the managing partner in an IT consulting company today, but I spent much of my career on the corporate IT side working as client of a variety of consulting organizations both large and small.

There are many good reasons to leverage IT consulting, as it is very difficult to maintain a staff that has all of the skills and capabilities to support every initiative that you may take on. Technology changes rapidly, and consultants are incented to stay ahead of the technology curve. Filling in the knowledge gaps of your team or hiring consultants for new or non-standard skill sets can be a very cost-effective model.  It is also a great way to bring your internal team up to speed on new technologies – have them watch and learn from the experts. However, diving into a consulting relationship without sufficient forethought and planning can lead to a bad experience. With that in mind, here are some of the key items that I believe you should be prepared for when planning to leverage consultants to support your IT project:

1. Know Your Destination

This likely seems a bit obvious, but you should have a pretty solid idea of what you are looking for before engaging consultants. Generally, you would never hop into a cab without a destination in mind, but IT projects often start this way. Frequently, as a consultant, we will be asked to produce an estimate to deliver a solution based on very little information. As a part of our discovery process we will do our best to elicit as much information as possible to produce an accurate estimate, but often that is not possible. In those situations, we will offer an assessment engagement where we will work with a client to drive out wants and needs to ensure a successful solution. However, assessment engagements tend to not be very popular because most clients do not want to pay someone to help them figure out what they want or need: they just want them to deliver it! Starting an engagement without a clear destination will typically lead to missed expectations, delayed schedules and project overruns.  If you are not sure what you need and unsure how to figure it out, consider an assessment phase – it will be worth the time and money.

2. Know What You Are Buying

This is akin to knowing the features and options on a car that you are ordering. You never want to be in a situation where you show up to pick up your new car and your first impression is, “I thought this was going to have a sunroof?” Any good consulting company is going to provide you with a quote that outlines scope and deliverables. Those deliverables will not map out every detail of what you are getting, but they should outline the most important parts. If you think a critical deliverable is missing from the quote, then ensure that it is added before signing.  It is in the best interest of all parties to have accurately defined scope and deliverables and a change control process to manage out-of-scope requests.

3. Proper Level Of Engagement

Handing over the keys of a project to a consulting company and saying, “let me know when you’re done!” is never a good idea. This is not to say that consulting companies cannot be trusted or that you need to keep an eye on them, but having regular stakeholder engagement is best for everyone involved. No matter how well planned a project is, there will always be roadblocks, decision points and unforeseen curves in the road, and close stakeholder engagement can help mitigate all of those potential issues. Lack of stakeholder engagement can often lead to schedule delays, cost overruns and overall missed expectations. Accept the fact that you are a significant and important factor in the overall success of your project.

4. Partners Not Adversaries

This is a particularly interesting topic: I have seen many times where a client hires a consulting company for a particular project, but then takes an adversarial position with them. Almost suggesting a “we don’t really trust you, but we need you” type of relationship.  This is also typically a recipe for failure. If you do not trust someone, you probably should not be in a relationship with them, and starting any relationship from a position of distrust is never good. I see the client/consultant relationship as a partnership with shared goals and objectives. The consultant’s job is to do everything possible to make the project and the client successful which requires the support and collaboration of all stakeholders. Obviously, there is a financial component to the relationship which needs to be managed closely with complete transparency and no surprises. An unforeseen invoice or an invoice that is higher than anticipated is never a good surprise for anyone and can quickly deteriorate a solid relationship. There will always be project missteps that occur and questions that arise, but: Bottom line…the consulting company is not your enemy!

5. Culture Counts

This is a factor that I believe is often overlooked. When you are hiring employees, finding people that fit your company culture is particularly important, but the same principle applies when hiring consultants. Whether hiring an individual or a company, evaluating their fit with your team is important. Hiring a large consulting company to support your small or mid-size business may not be the best choice even if the price tag works. It is important to understand how consulting companies manage their projects, what type of resources will be brought to bear and how your needs fit within their overall portfolio of client work. You may not want to be their biggest client, but it is probably best not to be their smallest either. The instinct may be to hire the “biggest and the best,” but fit is far more important. Unfortunately, in many cases, the smallest clients will garner the least amount of attention and have the last pick of resources.

6. Project Management

Project management is always a significantly important factor on any project, and it tends to be even more important when consultants are involved. For large projects, having both a client and consultant PM is probably the best way to go. Those resources work together collaboratively, and communication flows well between both organizations. Often, smaller projects will not require multiple PM’s and having one PM, either client or consultant, will suffice. Regardless of how you resource the project, ensuring that budget, schedule and scope are adequately managed in a transparent manner is of utmost importance. It does not have to be a heavyweight process if communication and engagement from key stakeholders is taking place regularly. However, untracked projects are basically a runaway train and no one wants to be onboard for that.

In Conclusion

Hiring a consultant can be intimidating and stressful if you are not properly prepared, and the last thing you want is to waste time or money hiring someone that is not a fit or does not bring value. However, with adequate preparation, the right mindset, and proper processes in place, taking on projects that leverage consultants can be extremely cost-effective and beneficial to your organization. Hopefully, the key areas of focus that I have outlined will help ensure successful project initiatives and valuable consulting/client relationships for you and your team.

Bringing It All Together

Overall, there are many facets to IT projects that make them challenging to deliver successfully. In my three-part article series, I have highlighted some of the key areas that can impact the success or failure of your IT project initiative, and hopefully I have offered some helpful suggestions to ensure a positive outcome. From inception through delivery, even the smallest missteps can have significant impact, but with great diligence and a careful focus on the details, the pain and suffering of having your project go off the rails can be avoided with a successful outcome achieved.

Why do so many IT projects fail?

You may have seen some of those outrageous statistics such as “75% of IT projects fail” or “one in six IT projects has cost overruns in excess of 100%”. These are just some example factoids that you can easily find via Google, but most anyone that has spent time in the corporate IT space has seen or experienced failed projects. IT projects are generally evaluated on three specific metrics:

  • Scope: What you are planning to deliver
  • Budget: How much you are going to pay for it
  • Schedule: When it will be done

On the surface it seems straightforward enough and not far different than many other types of services that you would pay for, such as automobile repair or home improvements. This begs the question: Why do IT projects fail? There are certainly many factors, but I will attempt to outline the major reasons as I see them:

Lack Of Alignment To Business Goals

This ties back to Part I of my blog series: Why do businesses initiate IT projects?  This seems like it would be easy to answer, but the reality is far less straightforward. Often times, projects are initiated for wrong or unclear reasons, and if you are not completely sure why you are undertaking a project, it is very difficult to accomplish it successfully. 

As an example, no one would ever hire a General Contractor to put an addition on their house without a very clear reason for doing it. Maybe you need an in-law suite for your aging parents, extra bedrooms for the kids or additional bathrooms to solve a bottleneck. Whatever the reason, you would have that very clearly defined before ever starting a project, and you would have clear metrics that define success upon completion. An example of a metric could be as simple as a fully functioning bathroom upon completion.

Unfortunately, IT projects do not always have that type of clarity of purpose, and it is not uncommon for IT project teams to have no understanding or visibility as to the business reasons why they are delivering a project. Seems crazy, but it is true.

Inadequate Planning

Poor or lack of planning is a very common reason that IT projects fail. While your business goals outline why you are initiating a project, your planning needs to clearly outline what you are going to deliver and how you are going to accomplish it. Scope, budget, and schedule should be clearly documented and planned before starting a project. Estimating is one of the most challenging aspects of project planning and tends to be much more of an art than a science.

Doing a deep dive into detailed requirements prior to estimation can go a long way into improving accuracy, but that takes significant time and resources and most companies are unwilling to make that investment. Estimation is usually formula-driven with multipliers for various work functions such as Quality Assurance or Project Management. This type of estimation is much faster to build out, but is dependent on a high-level knowledge of the work effort and is prone to error. Adding contingencies can help add a layer of buffering for inaccuracies, but that typically does not exceed 20% of the overall project cost or schedule. 

Essentially, in many cases, the project planning phase really equates to a “best guess”, which obviously does not lead to a high level of on-time, on-budget, successful projects.

Disengaged Sponsorship

This is another interesting scenario where you have received approval to start a project, but you do not have adequate engagement of the business owner or sponsor. During the natural course of a project, there will always be key decision points, approvals and guidance required to keep the work aligned with business goals moving forward. Lack of sponsorship engagement can result in significant delays or simply bad decisions, which can lead to poor results or rework. The business sponsor does not need to be engaged on a daily or even weekly basis, but when needed, they must be responsive and available.

This expectation should be agreed upon at the beginning of the project, and if it cannot, you likely need to find a new sponsor.

Ineffective Project Management

In my opinion, Project Management is one of the most challenging IT roles to perform. This is not to say that there are not a significant number of tools and methodologies available to guide the process, but ultimately the effectiveness of Project Management will come down to the capabilities of the individual. I have worked with many PM’s that touted Project Management Institute (PMI) certifications but struggled to actively manage projects. I believe this is because Project Managers require many intangible skills to be truly effective such as leadership, interpersonal communication, and political savvy, and all those skills are difficult to measure with a written test or an interview.

The ability to develop a project plan or schedule are certainly valuable, but it takes more than that to successfully lead a project. If your PM does not possess these intangible skills, your odds for a successful project diminish significantly.

Unrealistic Expectations

Simply put, it is not feasible to build a $1 million house on a $250k budget or squeeze a six-month project into a six-week timeline. Yet, companies try taking on these types of ridiculous projects all the time. It is usually because of a hard-driving senior leader who will not take no for an answer, and he or she thinks if they push hard enough, they can get what they want. This usually leads to crazy work hours for the project team, burnt out resources and a solution that ultimately misses the mark. It is not uncommon for project teams to go through periods of time where hours are stretched to make up time, but kicking off a project that has no realistic chance to be successful is a bad idea.

Resource Limitations

This seems fairly obvious: if you do not have the right resources, it will be difficult to accomplish your goals. However, I have seen far too many times where critical project roles are staffed with under-qualified resources. It could be related to cost or simply providing an individual a career growth opportunity on a project. Whatever the reason, lack of skill and experience can reduce a project’s likelihood for success. Depending on the criticality of the project and role, this can sometimes work, but often it will lead to project delays or failure. One common way to alleviate this issue is to engage consultants for key skills or experience. 

Why do businesses initiate IT projects?

The technology field is ever evolving, and we are constantly challenged with keeping up with the latest trends and solutions available. When you read about the newer technologies with all sorts of buzz around them such as Blockchain, AI, IOT and Big Data, it is difficult not to get excited about the possibilities.

However, it is important to remember the primary business decision factors when considering taking on a technology initiative.  Generally, there are only three primary reasons why any business should decide to move forward with an IT project initiative:

Reason #1: Drive Revenue

This tends to be the most obvious reason that a business should leverage technology, but this can manifest itself in many ways. One of the most common options is simply developing an ecommerce platform to leverage the internet to expand the market coverage of a product or service offering.

Another less obvious option is developing a technology solution that disrupts a market. This is typically achieved through building a customer experience that is so compelling that it outweighs the actual product or service offering.  Think of Uber as a great example of this. They do not necessarily get you to your destination any better than a taxi, but the mobile-app-driven customer experience that they developed sure makes it compelling to use. 

The Uber example also highlights another solid revenue-driven reason to initiate technology projects: keeping up with the competition. Think of the taxi services that now offer customer-facing mobile apps to order their cars and arrange pickups. The customer expectation changed due to Uber, and they were forced to react to maintain their revenue streams.

There are many different industry and business-specific technology solutions that companies will undertake, but the most significant underlying driver of these initiatives will always be revenue.

Reason #2: Cost Savings/Efficiency

Efficiency is an interesting term when you think of it from a business perspective. Taking on a technology initiative for the purpose of driving efficiency can be worthwhile, but if it does not indirectly result in cost savings or increased revenue, the benefit is debatable.   

If you are paying three resources to manually enter data on a daily basis and developing an integration solution will eliminate the need for that work, it is fairly easy to quantify the return on your technology investment through workforce reduction. Similarly, technology initiatives that can help drive throughput to better meet customer demand are relatively easy to justify because revenue growth should come along with them.

However, when developing applications or solutions to simply make a job easier or more efficient, it becomes a bit more complicated to understand ROI. If the focus is improving work/life balance and overall employee engagement, that can have intangible benefit, but generally it is a much tougher sell from a financial perspective. Freeing someone up to do higher value work can also be a reasonable justification to take on a technology initiative, particularly with under-utilized employees, but you still may not take on this investment without some downstream financial benefit.

Therefore, efficiency-based initiatives tend to be more difficult to justify funding compared to revenue generators. Without a clear path to ROI, it is a tough sell, and these types of initiatives tend to get pushed year over year without a strong business advocate.

Reason #3: Technical Debt

Technical debt tends to be the bane of most CIO’s, IT Directors, and even small business owners. It is the equivalent to homeowners having to replace their roof every 20 years. You know that you need to do it, you recognize the importance of staying dry, but spending $10k to replace your roof with no tangible gain other than continuing to stay dry never feels good. 

In the IT field this typically manifests itself in the form of a software application, a piece of hardware or an operating system that is past its intended lifespan but still functioning as needed. You can spend the money now and eliminate the risk of catastrophic failure or wait and maybe spend the money on something more compelling like a new website.  Technical debt projects tend to get pushed year over year – “let’s wait one more year to take that on” – because something else is always more important.

Often it takes something catastrophic to drive the decision to move forward on a technical debt project (i.e., your roof is leaking). The problem with waiting too long to deal with technical debt projects is that the hole gets deeper the longer you wait. What may have been a moderate upgrade project can turn into major costly overhauls if the decision is delayed for too long. This can be a very common occurrence in businesses of all sizes, and typically requires a strong IT leadership presence to keep this from happening.

Like many other things in life, procrastinating until next year can come back to bite you hard, but we all continue to do it.

Project Success Factors

Hopefully, these technology initiative decision factors seem obvious to most, but I can assure you that many a technology project has been undertaken for wrong or unclear reasons. Whichever of these decision factors has ultimately influenced you to take on a technology initiative, it is extremely important that the underlying business goals are clearly defined as project success factors. 

Without clearly defined, communicated, and well-understood business goals, technology projects have a high probability to be considered a failure. Even if the delivery team produces the solution flawlessly within budget and on time, the claims of victory will ultimately ring hollow if the project does not have a clear tie to business goals.  I have seen many “successfully” delivered technology solutions ultimately fall by the wayside because they were never properly aligned to a business outcome.

You think you’re NOT a Tech company?

A few years back, I was having a conversation about technology with the CEO of a prominent manufacturing company when he somewhat defensively exclaimed to me, “But we are not a tech company, we are a manufacturer!” At the time, I thought it was an interesting reaction, but the reality was that he was right. The mindset and direction of that company was clearly not driven by technology, and spending resources on IT was very much looked at as a necessary evil.

To be fair, at that time I don’t think that mindset was particularly unique compared to other manufacturing organizations, but the tables are definitely starting to turn. The impact that technology is having on all types of organizations, including manufacturing, is dramatic. Not only is it changing the way that we run our internal businesses, but maybe more importantly, how we engage with our customers.

In this era of digital transformation, the technology that we use to engage with our customers can have as much impact as the products or services that we offer. It’s no longer enough to just have a good product; we need to provide the technology-enabled customer experience that is expected or potentially be left behind. If your competition has a more user-friendly website or a mobile app that makes them more accessible to customers, you will very likely lose business to them, even if your ultimate product is superior.

Most enterprise-level organizations have accepted that they need to lean into digital transformation, and while they are all at varying stages of maturity, most are heading down the path at their own pace. Where we do not yet see the same level of acceptance is in the mid-market organizations. We still see these organizations operating with blinders regarding technology and a persistent focus on “business as usual.”

$100 Million organizations with IT staffs of 2-3 people, websites that look to have been crafted 10 years ago, and fax machines still prominently in use for business communication. Eventually the transformation will catch up to them as well, but can they afford to wait, or will it be too late? Trying to change a foundation of legacy technology overnight can be very difficult and very costly. The change management alone can be enough to tip over an organization. I believe a proactive approach towards technology would suit them better in both the near and long term, but sometimes convincing high-level decision makers can be challenging.

As you might expect, the SMB space is even further behind when it comes to digital transformation. The cost of IT can be prohibitive for smaller businesses, and most will explain that they simply cannot afford to keep up. However, I would argue that they cannot afford NOT to be proactive when it comes to technology. While they may not be able to hire FTE resources to join their organization, hiring third parties to perform work or leveraging serviced-based IT offerings are typically an affordable option.

When you think of even some of the smallest mom & pop service-based businesses out there, from landscapers to hair salons to plumbers; they all could benefit from various online components including inquiry, quoting, scheduling and payment collection. However, very few of these types of businesses offer that type of technology-driven customer service.

As the millennials and other younger generations transition into customer age for these types of businesses, the need for technology-driven customer service will be even greater. Very few young people want to pick up the phone to call and schedule appointments, and their expectation is that they can transact with a business without having to speak to anyone. What happens to the small business that can’t, or doesn’t, offer this type of support? They get left behind.

It’s time for businesses of all sizes to accept the fact that we are all technology companies. You may not sell or deliver technology as your primary source of revenue, but you definitely need to embrace it as an integral part of doing business. Your customers expect it…whether it’s the distributor that sells your products, the retail customer that requests a quote, or the person who schedules an appointment, the expectation is that all interactions can be done easily online from our phone, laptop or PC.

The time to decide is now. You can either sit back and wait to react to your competition getting the jump on you, or be proactive and prepare your business for the transformation that is sure to come. To me, it’s a pretty easy decision.

Onboarding – The forgotten step

In this day and age when finding the right talent is so difficult, particularly in technical fields, the onboarding process is a component of hiring that many organizations  completely overlook. We spend a significant amount of time, energy and resources in identifying, recruiting and hiring just the perfect individuals. As most experienced managers have heard over and over; the most important and potentially costly decisions that we make are directly related to hiring. If you hire the right resources it can pay significant dividends for years to come, but if you swing and miss…that mistake can have just as significant of a negative effect on your organization and possibly your career.

For the purposes of this discussion, let’s assume that you have found the exact right person to add to your team. He or she has the perfect skill set to complement your team and is a strong cultural fit. You’ve interviewed no less than 10 people over the course of 2 months, complete with phone screens, in-person interviews and personality testing. You make a competitive offer and the person excitedly accepts. They now transition into your background screening process which may include criminal, drug and credit screens among potentially others. After all of this is completed, you schedule a start date and finally your hiring process is complete!

Deep sigh, it’s been a very long arduous process, but your sense of accomplishment is quite high.  Unfortunately, this is the point where many organizations drop the ball as hiring begins to transition to onboarding.

Just like in any new relationship, you only get one attempt to make a great first impression. I contend that while the candidate is certainly gathering an impression of your organization during the interview process, the true first impression happens when they walk in the front door. What does that first day, or even first week, look like for the new hire?

We’ve all experienced first days of work in our careers, and how many of us can think of a company that truly met our expectations? Most have had experiences similar to these examples:

  • General orientation to the company was not prepared or offered
  • Workstation, cube or office was either undefined, unprepared or uninhabitable
  • Hardware such as computers, phones or printers were not ready
  • No communication of ground rules, basic expectations or initial assignments from your supervisor
  • No training plan or training resources identified to help with your transition
  • No specific welcome had been prepared such as introductions or team lunch

These are just a few examples of bad onboarding, and I am quite sure there are others that I have missed. The emotional change that situations like this can have on a new hire is significant. Their thought process can very quickly change from being excited and eager to join a great new organization, to having an oh-sh#t moment of wondering about what a huge career mistake they’ve made.

In a period of less than 1 week, you’ve destroyed the good will that you obtained during the hiring process, and may have turned a potential long time employee into a short timer. Obviously, you hope your culture, your work environment and the career opportunities that your organization offers will ultimately win back the sentiments of your new hire over time, but in the competitive environment of today, can we really afford to wait?

Onboarding is the critical final piece of the hiring process. Most companies do not have standard onboarding processes, and rely on individual managers to design and perform the process. The problem with that is those same managers have their normal day to day duties to attend to, and it is very difficult to carve out time to focus on planning for onboarding. To be fair, some mangers likely do this quite well, but I would contend that it is an afterthought with most.

Could it be time for organizations to take ownership of the onboarding process and standardize it in the manner that they would prefer to represent themselves? Considering the costs and challenges associated with hiring good people, I believe this type of effort would pay off ten times over. Remember, the first impression has lasting impact, and you only get one shot at it. Why not make it a good one!