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Between 2005 and 2011, IMC published Daily Tips every weekday on consulting ethics, marketing, service delivery and practice management. You may search more than 800 tips on this website using keywords in "Search all posts" or clicking on a tag in the Top Tags list to return all tips with that specific tag. Comment on individual tips (members and registered guests) or use the Contact Us form above to contact Mark Haas CMC, FIMC, Daily Tips author/editor. Daily Tips are being compiled into several volumes and will be available through IMC USA and Mark Haas.

 

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#725: Build the Network You Think You Don't Need

Posted By Mark Haas CMC FIMC, Friday, December 23, 2011
Updated: Friday, December 23, 2011
I've never found networking events to be particularly productive in the consulting business. I'd rather be getting to know potential clients than other consultants or professional service providers. If the goal is to build our consulting firm, shouldn't we focus on clients?

Networking is taken as an article of faith among consultants - as well as other professional service providers and business people of all stripes. You may be asking the important questions in reverse order. The third question is how valuable is networking; the second question is what do you mean by networking; the first question is what is the objective of networking.

Robert Kiyosaki, author of the Rich Dad, Poor Dad, says "The richest people in the world look for and build networks, everyone else looks for work." HIs point is that, regardless of the size or breadth of your consulting practice, the pace, complexity and uncertainty of the business environment means that you will increasingly need fresh relationships, resources, and information sources to thrive. A few colleagues or data sources are no longer sufficient to give you what you need. This is what networks are for.

The next question of what networking is should not focus on "networking events." Regardless of how well these are designed, they are largely semi-structured aggregations of people who, if you are lucky, can connect with each other. This may be what most people mean when they say networking but it is not the same as building a network. This requires defining the people, information, skills, resources and access necessary to keep you current with trends in your industry and discipline. A network is defined, explicit, and intentional. It is also continuously redefined. The final question, how valuable it is, can be answered in terms of how critical the network(s) are to your professional (and personal) growth. How damaging to your business is a loss of prospects, partners or revenues when the market changes, key staff leave or technologies or competitors devastate your market? Your networks are your safety valves. We can never have too many networks, and few consultants have enough.

Tip: Start by defining what you need to be agile in your business, to anticipate and respond to emerging trends. Like making a packing list for a trip, write down what you need to have and be over the next five years? What people or skills do you need to acquire theme? What different networks do you need to develop or strengthen - you may need 5-10 different networks? What is your plan to build, support and evaluate the effectiveness of those networks? How do you intend to not just connect others into your network, but to connect to other networks? The LinkedIn model of a "network of networks" is a good way to look at your own networking approach. Finally, since you don't know what you will need a few years from now, how will you build your networks so you have access to that which you think you don't need?

© 2011 Institute of Management Consultants USA

Tags:  agility  assumptions  change  consulting colleagues  innovation  knowledge assets  networks 

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#721: Use Cognitive Biases to Your Advantage

Posted By Mark Haas CMC FIMC, Monday, December 19, 2011
Updated: Monday, December 19, 2011
I would expect that all advisors want their recommendations to be judged fairly by the client and not be unduly influenced by either extraneous information or bad logic. How do we make sure that the information we present gets a "fair hearing"?

None of us is immune to cognitive bias, regardless of how much we'd like to believe we could impartially decide on the facts alone. Even where we take an oath of impartiality, there is an expectation that some biases are still present and the best we can do is to recognize them, disclose where possible, and compensate or recuse ourselves as appropriate. As a consultant, you have to sometimes work hard to avoid such biases.

When it comes expecting clients to judge your work impartially, it is up to you to understand the different kinds of biases and deliberately structure our presentations to use techniques to level the playing field. Note that deliberately introducing bias in client decision making to favor your position starts you down the path to unethical behavior.

We can't go over all the dozens of biases here but here are a few of the most important for consultants to be aware of:
  • Recency Bias - giving greater importance to the most recent event (e.g., the person who presents last before a decision is to be made has a slight advantage).
  • Anchoring - the tendency to overweigh in importance a dominant statement presented or experience already known (e.g., describing the problem in terms that discount alternative explanations or focusing on only one aspect of a complex problem before offering a solution that resolves only that aspect of the problem).
  • Normalcy Bias - discounting outcomes that rarely or have never occurred before (e.g., discounting a looming disaster even though the precursors to that disaster that have already occurred also are rare).
  • Confirmation Bias - The tendency to favor an approach or piece of information that is familiar or consistent with one's world view or history (e.g., a proposal to do "more of the current approach" has higher intuitive appeal than one based on a novel approach).
  • Halo effect - the tendency to attribute greater value to suggestions from a well-known entity rather than the merits of the item (e.g., giving greater credibility due to position or perceived market brand)
  • Loss Aversion - the tendency to place greater emphasis on avoiding the loss of something than the potential gain of the same amount of that thing (e.g., using fear to promote saving something in danger of being lost rather than using desire to promote the potential acquisition of something).
Tip: As you can see, each of these biases can be at work in how you approach your own work as a consultant but also are present in your clients when they are deciding on the merits of your recommendations. For a pretty good review of these biases and some practices to manage them, consider (among many other sources) Smart Choices: A Practical Guide to Making Better Decisions. Many of the best decision making work was done in the early 1990s and the best resources are from that era, one of those instances where newer is not necessarily better.

© 2011 Institute of Management Consultants USA

Tags:  assumptions  attribution  decision making  interpretation  learning  methodology  presentations  professional development 

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#691: Your Attitude is A Powerful Resource

Posted By Mark Haas CMC FIMC, Monday, November 7, 2011
Updated: Monday, November 7, 2011
Balancing a consulting lifestyle can be complex, between personal interests and doing triage for client services, marketing, research, writing, networking and more. How do I keep from getting overwhelmed by these demands?

Things happen, to be sure, but you have a lot of control over the circumstances in which you find yourself. You also have a lot of control over how you see the world. Bad days are inevitable; bad attitudes are optional.

Think of people you associate with. Some can find something positive to say about any situation. A lost client is an opportunity to hone the sales pitch. A project that gets off track is a chance to work on project management skills. You leave a conversation with them feeling invigorated and positive.

Then there are people who can find something negative to say about any situation, even a neutral one. The new engagement will make them too busy to take a vacation. The researcher they hired doesn't have any useful skills.You leave a conversation with these toxic people feeling drained and dreading the next encounter.

Consultants, by nature, look for flaws and, consequently, improvement opportunities in every situation. We are trained to see the downside of people and processes, but that doesn't mean we have to carry that perception over into our dealing with our colleagues. Even when you think you are being "honest" or "helpful," doing so does not help.

Tip: Commit to leave every conversation with people feeling better than when you found them, whether family, client or colleague. This applies to you and the other person or persons. Find something positive to comment on, work on or look forward to. Everyone wins.

© 2011 Institute of Management Consultants USA

Tags:  assumptions  consulting colleagues  consulting lifestyle  professionalism  work-life balance 

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#685: Consultants Need to Understand Type I and Type II Errors

Posted By Mark Haas CMC FIMC, Friday, October 28, 2011
Updated: Friday, October 28, 2011
I always hear about Type I and Type II errors in business and how important it is that consultants understand these concepts. Why should I care about this?

People are referring to a statistical concept where a Type I error is a false positive and Type II error is a false negative. For the statistician, a Type I error is rejecting the null hypothesis when it should have been accepted. For a businessperson or consultant, a Type I error is seeing something that is not really there. Type II errors are missing something that is really there (and potentially company making or breaking).

A Type II error (false negative) can be serious when looking at competitive markets or human resource issues such as culture or employee opinions. Inadequate surveys or incomplete analysis may lead a consultant to conclude that there are not serious competitors or impending revolts among employees when, in fact, there are. Depending on the situation, a Type II error may result in serious losses for a company or put it out of business.

False positives are of most interest to consultants engaging in diagnostic or investigative activities, in two ways. As a consultant whose job it is to find problems to solve or opportunities to capture, we are looking for something on which to act. Maybe a process is "broken" or a market is "large and available" to your client. In either case, you may identify something that is not really significant enough to expend resources on. Alternatively, as a result of your activities, you conclude that your impact is significant when it really is not. In both cases, you have overstated the significance, or even existence, of your role to the client. Understanding Type I and Type II errors gives you good perspective on your role and significance to a client.

Tip: Think in terms of medical testing when you consider how you are going to control for Type I and Type II errors. The worst outcome when looking for a serious disease is to conclude it is not present when it is (Type II). To accommodate that, we use screening procedures that are relatively fast, cheap and for which we can tolerate a Type I (false positive) error. As a consultant, you may want to develop protocols that let you quickly tease out potential problem areas and for which you recognize there may be Type I errors. Those items that show up may be real or, more likely, false positives. Then you can proceed with more focused and rigorous protocols to look more closely at an issue, recognizing that what you want to avoid is a Type II error (false negative). You don't have to be a statistician to understand the concept and how your ability to mitigate risk on behalf of your client is a significant value added.

© 2011 Institute of Management Consultants USA

Tags:  analysis  assessment  assumptions  consulting terminology  consulting tools  diagnosis  information management  recommendations  risk analysis  statistics 

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#682: Make Assumptions Carefully

Posted By Mark Haas CMC FIMC, Tuesday, October 25, 2011
Updated: Tuesday, October 25, 2011
Part of being a good consultant is being able to get through the diagnosis and to a solution as quickly as possible (but getting it right). To do that we must make assumptions, but where are assumptions potentially erroneous short cuts and where are they appropriate?

You know what they say about assumptions. We can't realistically base our diagnostic conclusions entirely on our empirical research done at the beginning of an engagement. We make what we consider to be reasonable assumptions based on discussions with the client and staff, market or technical research, our own analysis and any other information we collect - including years of our own experience with analogous or similar cases. It is a judicious combination of facts, intuition and experience that is the hallmark of a consultant's detective like skills.

However, professionalism compels us to be on watch for assuming too much, too fast. It is all too easy, after years of experience, to be impressed with our knowledge and comfortable with believing we "have seen this case a thousand times before." To keep this in check, a professional has processes in place, maybe even formal ones, to challenge and verify all assumptions made on the way to a diagnosis. What are the ways you make sure you are not assuming too much without knowing it?

Tip: Write out the steps you take in your normal process (or more than one) of scoping a project, collecting data, completing a diagnosis, and presenting findings and recommendations. Note the type and criticality of your assumptions at each stage. Finally, describe the implications on this diagnostic chain of each of your assumptions and what you could do to mitigate the risks of wrong assumptions. Now, when people talk about your assumptions, they will have only good things to say.

© 2011 Institute of Management Consultants USA

Tags:  analysis  assessment  assumptions  methodology  recommendations 

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