While every industry has some bad apples, the ERP consulting space is one that seems to have a few extra worms. We have also recently heard several horror stories from companies regarding their past experience with ERP consultants.
The common phrase “you get what you pay for” comes to mind here. However, there are many cases where well-paid consultants fail to deliver. This is true whether you are looking at a niche consulting firm, or large system integrators such as Deloitte, Accenture, or Capgemini.
Having been in the industry for over a decade now, I have seen and heard plenty of reasons to run from consultants. There are definitely some good ones out there (see our blog: how to find the best independent ERP consultants), but also plenty of opportunity to be taken advantage of.
Below are a few common tactics of “shady” consultants you may want to watch for. Addressing these risks and issues can help avoid ERP failure:
Requiring heavy up-front retainer:
If you are being requested to pay up front more money than needed for initial travel or kicking off a project, run. There is good possibility you are funding the operations of a poorly managed firm with you retainer money, and you risk not seeing that money again (or for a very long time).
Excessive manager or partner oversight:
If you are seeing weekly bills for “oversight”, it’s more than fair to ask what you are receiving for this investment. While there is definite value in having a senior partner provide input, some firms will take advantage of this and simply bill x-amount per week regardless of value provided. If you are finding several senior people participating in every phone call, this is also reason to question the value you are being provided.
Consultants in every city:
The big firms do have offices in most major cities, but if you are working with a niche consulting group that has “resources” in nearly every city on the planet, you are essentially dealing with form of staffing firm that will just contract in a particular city when they have work. Not always bad, but unless consultants are trained and managed to consistency, you are not going to receive the same delivery that you expect or that others have received.
So many clients but no references:
It’s very easy to show a long-list of past clients and state confidently that they were all “successful”. If none of these past clients are available to share their experience with the consulting firm, however, you may be talking to a firm that has not made many clients happy. There are also firms that will use the same references over and over, and even compensate them. If the responses sound too rehearsed, feel free to ask for another reference.
Lack of hands-on experience:
You can find anyone to help evaluate potential systems or claim to fill a project manager role, but if they don’t have hands-on experience with the industry’s top ERP systems, then their experience is largely academic. In order to be successful, you need a strong team of consultants with plenty of pragmatic, hands-on experience in evaluation, implementation, transformation, organizational change, and everything in between.
The consulting space is plagued with turnover and there is not much anyone can do about this. What you want to watch out for is when a firm cannot give you the names of consultants that will potentially be placed on a project. It is understood that there could be some level of substitution based on project start date, but using an excuse such as “we need to wait until the contract is signed to assign resources” only buys a poorly-staffed firm more time to go out and hire or contract the resources needed for the project. What you get through this scenario is consultants that have not been trained and end up putting your project at risk.
Another risk with turnover is that past projects and digital transformation case studies that are shared with you during the sales cycle have absolutely no relevance to the current capacity or experience of the consultants that are now in place at the firm. You might be looking for a consultant with deep Department of Defense experience and be talking to a firm that has a long-list of similar companies they have worked with, but if none of the consulting staff that produced that work are around, then what good does that serve?
Keep in mind that you will never find the “perfect” consulting company. If you find one that has every single angle covered, take a close look at how realistic that really is. The key is to find one that is transparent in answering your questions and shows true intention and ability to help you through your technology initiative.