In this presentation I will show you how to start and run consulting company fast and efficiently. The course is based on my 12 years of experience as a consultant in top consulting companies and owner of small consulting company (the last 7 years). I have been also CEO, Board Member responsible for strategy, improvement and turn-arounds in biggest companies from FMCG, SMG, and B2B in Poland so I know the subject from all sides including the customer of consulting firms.
My intention is that thanks to this presentation you will know:
1. Where to find ideas for consulting business, consulting firm?
2. How to analyze in Excel whether the business makes sense or not?
3. How to get first customers?
4. What to concentrate on if you are 1-man show, a freelancer?
5. What kind of tools you should have?
6. How and in what way you can set-up pricing for your services?
7. How to prepare for scaling, expanding?
8. What kind of business you can build on the basis of consulting firm?
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How to start and run consulting firm fast and efficiently
1. 1
How to start and run a successful
consulting business?
Practical guide
2. 2
In this presentation I will show you
how to start and run consulting
business. You will find here a lot of
practical tips
3. 3
Source of ideas for consulting business
We will start by showing were you can find ideas for
consulting business
4. 4
Source of ideas for consulting business
Getting your first customers Pricing Tools
Later we will discuss ways in which you can get new
customers, what tools you can use and how you should set
up the pricing
5. 5
Source of ideas for consulting business
Getting your first customers Pricing Tools
Scaling of the business
Add-on business
Once you are done with the basics I will show you how to
scale the business and what add-ons you can have
6. 6
Source of ideas for consulting business
Getting your first customers Pricing Tools
Scaling of the business
Add-on business
1-man show
freelancer
As a separate part we will discuss the small consulting
practices (1-man show / freelancers)
7. 7
What I will show in part of extensive on-line course where you
can get all additional resources including Excels
Click to check my course
How to start and run a successful consulting
business?
$190
$50
11. 11
With consulting you can reach things that were out of your
reach
Consulting Professional help in achieving certain goal
Way to fill-in the gaps
=
12. 12
You maybe surprised but actually there are plenty of good
reasons why companies hire “overpaid” consultants
They want to get better /
faster / more efficient
They do not have certain
competence /skill
They lack capacity to do
something
Sudden unrealistic deadlines
Required by owner or
regulator
Turn arounds
They need independent view
One-off events
20. 20
If you have already some business existing, you can create consulting to
help you solve your problem. First you create internal department to take
care of your need Old business
New department
21. 21
Once you get the proper quality of service and profitability you
grow it and separate into stand alone
business
Old business
Consulting business
22. 22
There are plenty of nice examples of such companies
Old business
Consulting business
Examples of such businesses
Consulting on Adwords / facebook / SEO /
content marketing that you needed to
master and there was no decent provider
Consulting to support the sales of
software, (including SaaS) that you have
produced
Consulting to support good usage,
maintenance of your B2B product
(machine, production line)
23. 23
For this method to work you need to have certain
things occurring
You are one of the best / first users
You have easy access to the underlying good
You have some cost advantage because you buy
in bulk
The specific underlying good / service is
complicated to master or changes fast
Customer do not want to make out of the
knowledge you are providing competitive
advantage
25. 25
You can also create consulting business by carving out a
department from existing company Current
departments
26. 26
You have to identify the department that you will transform
into stand alone business and start running
it as a separate business unit
Old departments
Carved out part
that will be
changed into
consulting
27. 27
Once it is big enough you can make it into separate entity
Old departments
Carved out part
that will be
changed into
consulting
28. 28
There are plenty of nice examples of applying this strategy
Examples of such businesses
Marketing departments
Sales department
Analytics / Market Research / Pricing
departments
R&D departments
Technical support
Shared Service Center
Project Management
Old departments
Carved out part
that will be
changed into
consulting
29. 29
For this method to work you need to have certain things
occur
People in the specific departments have very
volatile utilization
Running the department requires huge
investment into people, trainings and software
Department has become relatively big and the
company does not have skills in running a
consulting company
The demand of the company for the service
offered by the department is irregular
31. 31
One of the ways to clone is to clone 1:1 the whole business
Examples of such businesses
Consulting on Adwords / facebook / SEO /
content marketing that you needed to
master and there was no decent provider
Consulting to support the sales of
software, (including SaaS) that you have
produced
Consulting to support good usage,
maintenance of your B2B product
(machine, production line)
32. 32
For this method to work there are number of factors that
may improve the odds
Market is mature and ready for specific
consulting services
There are foreign companies that are
used to this type of service
The group you are targeting is
sufficiently big to support a business
There are no cultural barriers to using
consulting
Fees are acceptable
Low level of government in the economy
33. 33
You can also clone the idea and adjust it to a different
segment / group of customers
34. 34
For this method to work there are number of factors that
may improve the odds
Market is mature and ready for specific consulting
services
The group / market to which you are switching has
to be big enough to support a business
The consulting companies you are coping for
some reason have low incentive to enter specific
market (low size, their strategy that assumes
focus etc.)
There is a niche that is not served well by current
consulting companies
36. 36
In same cases the consulting business is created by a bit
forceful division Other departments in your old
company
Your departments
37. 37
You either join another big corporation or you build your own
business Other departments in your old
company
Your departments
Other departments in the new
company
38. 38
There are plenty of good examples for both cases
Examples of such businesses
Department in banks
Group of people / department in
consulting – usually serving specific group
of customers or 1 type of service
Department from training company
Department from software company
Other departments in your old
company
Your departments
Other departments in the new
company
39. 39
If you have some business you can creating consulting to help
you solve your problem
Examples of such businesses
Department in banks
Group of people / department in
consulting – usually serving specific group
of customers or 1 type of service
Department from training company
Department from software company
Other departments in your old
company
Your departments
Other departments in the new
company
40. 40
For this method to work there are number of factors that
may improve the odds
The customer will follow you
You take all the competence from your previous
company
The company you join has almost none of your
competence
The company you join has customer to whom you can
sell your product
You can take the references
Low threat of second-wave division
You have sufficient money gathered to survive the dry
season and projects sliding
42. 42
You can create a consulting on the basis of existing product or
service
Agency
Implementation consulting
company
Implementation consulting
(set-up, purchase, run)
43. 43
For this method to work there are number of factors that
may improve the odds
Product or service is complicated and changes a lot
The customer has no resources to master it
It is a one-off
You have better access to the producer of the product
/ service
You have the support of the producer
44. 44
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47. 47
Service companies in general are all about converting your
workers time into money
Man-hours
48. 48
There are some general rules that you should follow
Measure man-hours
Measure tasks
Stay productive and
efficient
Make sure supply matches
demand
Forecast and create
demand
Manage supply ahead of
time
Make sure that margins are
OK
50. 50
The typical model of a service model can be presented using
this logic
% Utilization# hours
available
# of billable
hours
Revenues
Gross
Margin
Operational
Profit
Net Profit
Hourly fee
HQ costs
Bonuses
Interest
% Gross
Margin
Wages
53. 53
The easiest way to get the customer is to steal them from
your competitors
54. 54
As a first step you have to show the customer somehow your offer,
especially when the relation between the customer and current consulting
company is about to end
55. 55
If you are successful in your move you will get a launching /
reference customer
56. 56
There are number of situation when you can pull it off
successfully
When you can pull it off
Carve out
Walk away with customers
Buy out the customer
Bribe the customer
Use external pressure on competitor or
the customer
58. 58
You can try to establish a consulting company by convincing a
senior personal with a good relation with customers to join
you
When you can pull it off
There is internal reason for the departure
(i.e. the director does not fill happy in the
company)
He can walk away with customers
There are no legal problems with
implementing the switch of customers
There is no barrier related to the brand of
the company you are breaking apart
The partner you taken over has to be able
to generate new customers as well
There may be legal reasons for this move
to be favored by the consulting company
(i.e. they cannot keep certain business by
law)
Other departments in your old
company
The department / director you
want to join you
60. 60
For some consulting services you can start with marketplaces
Step 1
Find the right marketplace
for you
Step 2
Do great job for a small
task
Step 3
Try to move away from
marketplace and expand
the contract
61. 61
You can try number of different type of markteplaces
Graphics Startups related Lawyers
General for
freelancer
62. 62
Marketplaces are a good solution in a number of situations
You are offering simple service
You are targeting smaller customers
You need some reference
You are not that much into making
big money
Services where you have thousands
of customers
There is potential for longer
cooperation outside the
marketplace
64. 64
For some consulting services you can get customers by proper
content marketing
Step 1 – Generate Traffic
Create content
Generate traffic to your
blog
Step 2 – Get their emails
Convert it to email list
Step 3 – Convert them
Convert the list directly to
sales via short funnel or
long funnel
65. 65
Content marketing is not easy and requires some things to be
successful
Your target group has to actively
look for info how to improve
Your target group should be present
in one of the social media
Your target group should be
identifiable by search terms or some
criteria
You have to create high value
content and unique
Content marketing takes time
Content marketing not always leads
to direct conversion
66. 66
There are plenty of tools that you can use for content
marketing
Creation of content Traffic generationMarket research
67. 67
Here is an example of content marketing used for one of our
brands
Post on the blog
Distribution
Recycling of content
Request for
proposal
Sales
69. 69
For more stubborn you have to go for events marketing
Step 1 – Create opportunity
Organize or join events
Create content that will
establish you as an expert
Step 2 – Take advantage of
opportunity
Network during the events
Set fixed targets in
number of business cards
that you have to acquire
Step 3 – Fast conversion
Do the follow-up in the
next weeks: send them
your content, meet with
them, call them
Hustle
70. 70
For this method to work there are number of factors that
may improve the odds
The ticket (value of potential contract) has to big
enough
You have to have a high density of potential
customer in the event
You have to be active - listen and provide value
and only after that try to sell (if he can become to
his benefit your customer)
Test the short and the long funnel to see what
works better
72. 72
Similar yet more subtle to event methods is to go for
trainings
Step 1 - Attract
Organize free open
training for your target
group
The training has to have
unique content to
establish you as an expert
You have to actively reach
them
Step 2 - Soft conversion
Convert them to paid
trainings – advanced
version of the free
trainings
Step 3 - Hard conversion
Convert them to
consulting services
74. 74
Unavoidable is trying cold calling
Step 1- Preparation
Find source of leads
Prepare – choose the right
sequence and the target group
you want to reach
This is a first hypotheses that
you will change during your
tries
Prepare all necessary tools:
script, ready made emails and
materials, CRM
Step 2-Cold calling
Execute and modify till you get
to predictable stable model of
sales
Step 3 - Conversion
Convert meetings into request
for proposals (RFP)
Convert RFP to projects
75. 75
In cod calling you have to have a sequence of events that you
will follow
Cold visit
Mail /
Cold email
Warm call Meeting Sales
Cold
email
Cold call
Warm
email
Warm
call
Meeting Sales
Example 1
Example 2
76. 76
Cold email with
a piece of your
content and CTA
Cold email with
a piece of your
content and CTA
Cold email with
a piece of your
content and CTA
Cold email with
and invitation to
a first meeting
Meeting
Invitation to
free training
Convert to paid
training
Convert to
consulting
services
In cod calling you have to have a sequence of events that you
will follow
77. 77
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80. 80
If you are a 1-man show you have to carefully use your time
as it limited
Number of
available
hours
%
Utilization
Fee per
hour
Additional
revenues
170 30% 200 3 000
81. 81
There are number of ways in which you can increase
the available hours Liczba
dostępnych
godzin
lalka Stawka Godzinna
Dodatkowe
przychody
You hire new employees, partners, co-workers
New
employees
Description When can be used
Good solution when the growth is permanent
There are new customers or product added
In the case of entry-level recruitment there has to be
some career path for
The employees should be less expensive than you or bring
new customers
You have to have training system
You subcontract part of the work to other
freelancers or a company
Subcontractors
Good choice when the jump in projects is just temporary
Good choice when you do not have the skills and
knowledge and you do not want to specialize in it
You divide the work to be done into parts.
The easier part, more repetitive you give to
virtual assistants
Virtual
Assistants
Very good when the assistant is much cheaper than you
Good choice when the assistant can create things that you
can sell
Good choice both for temporary as well permanent
growth
82. 82
Overall Labour Efficiency how much work there is in the work
?
Workday
Time that you can devote
Time left for real workLack of work
100%
54%
OLE =
100 %
54 %
x
x
98%
Work
98%
37%
No work due to
organizational
issues
Movement
70%
Work well done
70 %
Liczba
dostępnych
godzin
lalka Stawka Godzinna
Dodatkowe
przychody
83. 83
The biggest return you will get from improving your utility
Liczba
dostępnych
godzin
lalka Stawka Godzinna
Dodatkowe
przychody
Automate whatever you can so you have more
time to sell
Automation
Description Examples
Emailing /Newsletters – Mail Chimp / GetResponse /
FreshMail
Automation of small tasks i.e. twitting, putting some data
into table etc – Zapier, IFTTT
Social Media – Buffer / Hubspot
Calculators on your webpages
Marketing Automation - Mail Chimp / GetResponse /
FreshMail / SalesManago / InfusionSoft / Hubspot
Resousres on your webpage / YouTubie / Slidesharze /
Dropboxie
Improve the
efficiency of
team work
and the
cooperation
with
customers
Improve the efficiency of teamwork and also the
way in which you communicate and exchange
info with customers
Getting Things Done
CRM – Google Sheet / Insightly / Close.io
Task management tools: Trello / Nozbe / Leankit / Asana
/ Smartsheet
Avoid email communication– Google Sheet / Slack /
asana
Working on virtual space– Google Drive / Dropbox / 1-
Drive
84. 84
The biggest return you will get from improving utility
Liczba
dostępnych
godzin
lalka Stawka Godzinna
Dodatkowe
przychody
You have to minimize the time you spend
travelling
Fewer
movements
and travels
and better
organization
Description Example
Remote calls and conferences– Hangout s/ Skype
Webinars
Working on virtual space– Google Drive /
Dropbox / 1-Drive
Round trips across the country to visit customers
Outsourcing /
specialization
Find somebody to whom you can
outsource the repetitive part of you work
especially if he is better at it
Interns
Assistants
Virtual Assistance
Subcontractors
Standards,
templates and
modules
Create you work on the basis of modules,
template and standards.
In this way you will be able to reuse them
Specialize in one product
Templates and standards i.e. Excel analysis, sales
presentation, proposal etc.
Turn non-standard presentation into modules in
which 80% are standard modules
85. 85
Think also how to increase your price
Liczba
dostępnych
godzin
lalka Stawka Godzinna
Dodatkowe
przychody
You change the pricing depending on your
situation, availability resources and
demand
Dynamic
Pricing
Description When to use
Use it when there is a big seasonality in demand
Use it to sell in advance of time – similar to first
minutes
Useful when you want to hide difference in the
price of similar service among customers – then
you have a price list and a bunch of different
discounts that blur the vision
You can start earning depending on the
performance / success
You can have installments
You can have a complicated system of
different fees for different things
Change the
price formula
Useful when you do not want to show the fee per
consultant that incidentally may be higher than
the Board Members’ salaries
Introduce subscription
Switch to
subscription
model
When you want to increase the demand for your
service
When you have to compete with the in-house
departments
When there are a lot of small task that you do not
want to negotiate separately
86. 86
Last but not least create additional products
Liczba
dostępnych
godzin
lalka Stawka Godzinna
Dodatkowe
przychody
Books / e-books /
reports
On-line courses Off-line courses
Webinar PodcastFilms on youtube Audiobook
Affiliation
E-commerce Physical products –
i.e. games
Sponsoring
87. 87
It is worth to have 1 main KPI that will let you say whether you
are heading in the right direction
Total time devote
to it
Total net income
from all sources
200 h
50 000 USD
250 USD / h
92. 92
Why it makes sense to standardize?
Easy to go through what
you have done so far
You can reuse your
products
Less versions to manage
Brain works faster with
standards
You can find faster what
you need
93. 93
How to decide whether to standardize
Used by manyOften used
Last for longer time
Standardize
94. 94
Below you will find examples of things standardized in
consulting and a typical company
Folder structure
Consulting
Naming of files
Proposals to customers
Typical company
Agreements
Deliverables
Analyses
Main processes
Internal documents
External documents
Main process
Dress code
Language of
communication
95. 95
There are some rules for standardizing that you should follow
Use few standards
Internal standards
higher than external
Round up to closes
standard
Communicate standards
Teach standards
97. 97
Templates can save you a lot of time. They are area almost
ready made pieces of work that need some changes to be
used. It is great for repetitive work
98. 98
How to decide whether to make templates
Often UsedCan be reused
Time-consuming
Template
99. 99
Define what you should create templates for. In consulting we use
a lot of templates to make the repetitive work less time consuming
Sales presentation
Consulting
Emails
Data request
Project Time sheets
Proposal
Agreement
Folder structure
Deliverable
presentation
Dimensions
For every product, branch
All standard emails: about meetings, data request, workshop, sales emails,
thank you email
For every product (project type) and branch – Word
For every product (project type) – Word
For every product (project type) – Word
For every product (project type) and branch in Excel
Library of standard slides with typical analyses to choose from
For every product (project type) and branch – Excel
101. 101
Modules is something that helps you go beyond templates
and used them in a situation that seem not easy to be
standardized
102. 102
Creating modules enables you to turn even things that
Sales
presentation
About the company (history, experience, offices)
Problem description
Proposed solution
Pricing
Team
Contact Details
Rather standard
Unique
104. 104
What rules should be used for Power Point Presentations
Use the template
1 slide = 1 message
Agenda
Executive summary
Excel analysis for every
slide
Sources
Dates
Backup
Next version rule
Show money
109. 109
What rules should be used when building analysis in Excel
Usage of colors
Consistency between
sheets
Pyramid principle
1-source rule
Repetition of variables
Shortcuts
No mouse
Description
Data source
Master sheet
110. 110
The most useful functions
Basic functions
Financial /
Mathematical
Others
SUMIF / SUMIFS
COUNTIF / COUNTIFS
HLOOKUP
VLOOKUP
MATCH
SUMPRODUCT
IF
AND / OR
IFERROR
AVERAGEIF
LEFT / RIGHT / MID
FIND
CONCATENATE
YEAR / MONTH / DAY
ROUND / ROUNDUP /
ROUNDDOWN
TODAY
VALUE
WEEKDAY
RAND / RANDBETWEEN
MOD
NPV
IRR
ABS
MAX / MIN
CORREL
Pivot
Slicer
Relative addresses
Formats
Hyperlink
Remove Duplicates
Filters
Sorting
Data Validation
Trace Dependents / Precedent
Analysis Tool Pack
112. 112
In most cases in consulting you will be doing a lot of different
project and you may loose a track of what you have done
Supply chain
General audit
Cost cutting
Sales Force Management
Marketing improvement
Cost cutting
Supply chain
Supply chain
Sales Force Management
Sales Force Management
Marketing improvement
General audit
Supply chain
After a few project you will be
lost – you will not remember
what was done on what project
Consulting and many services
are bout managing knowledge
If you organize the knowledge
properly you can reuse it on
other projects
Therefore create universal
structure of folders
113. 113
Below an example of structure used for consulting project
Customer
folder
Project A
folder
Admin
Legal
PBC
Area A
Area B
Deliverables
114. 114
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117. 117
The most useful pricing models are….
Fixed fee
Difficult to define scope
Non-standard project
Scope evolvingTimes & Materials
Simple projects
Projects with big buffers
Projects where you want to hide the fees
Success / performance
fee
When performance can be measured by external KPIs
To supplement previous methods
Limits
To limit certain spending's esp. in the case of time and
materials limits (floors an caps are used)
Per usage
This is used in many technical industries where you
cannot control the immediate result of the consulting
so link it with the usage / availability of certain
resource
DescriptionExample
$ 100 K
Markups
Markups can be a part of fixed fee structure and times
and materials
Markup is put on purchases done by consulting
company for the project
$ 200/h
Traveling costs
Food costs
% of Target achieved
$ 100 K for achieving
certain goal
$ 200/h but no more
than $ 100 K
$ 10/flight hour
$ 20 K/plane
15% on costs incurred
119. 119
In dynamic pricing you identify the low seasons and try to sell them at
lower price or at higher price
25%
50%
75%
100%
88%
63%
13%
43%
88%
83%
63%
50%
1 2 3 4 5 6 7 8 9 10 11 12
Low season
120. 120
There are 2 conflicted approached to treat low seasons
Emergency approach
You keep the people during low seasons
waiting for desperate customers that needs
the project now
Since you have the resources you can help him
yet the price goes up significantly
Such a structure can be a part of your regular
contract – at certain time during the year,
month, week you charge the client with higher
price or above certain number of man-hours;
for shorter reaction time
The logic behind
Price in low season with
respect to high season
150%-200%
Fire sale approach
In this approach you sale with discount
because the resources will be lost if not used
50-80%
123. 123
Partner
Director
Project
Manager
BA A
Project
Manager
A BA BA
Director
Project
Manager
BA BA
Project
Manager
A BA BA
Consulting companies operate using pretty flat structure…..
Market Research Department
Visual Department
Knowledge Base Department
126. 126
What is the role of business analyst?
Business
Analyst
Associate
Senior
Associate (PM)
Director Partner
Consulting companies
McKinsey
Business
Analyst
Senior
Business
Analyst
Associate
Senior
Associate (PM)
Engagement
Manager
Associate
Principal
PrincipalDirector
130. 130
Rotation is one of the nightmares of a consulting company. It will
differ on every position
Business
Analyst
Associate
Senior
Associate (PM)
Director Partner
How long you
stay in years?
Category
2-3 2-4 3-6 3-6
% of people
that leave at
certain stage
?
10-20% 20-30% 30-60% 10-30% 20%
135. 135
In the beginning you will be competing for the best
candidates from the best universities
Universities
Established consulting
brands You
136. 136
Most management consulting workers are recruited from
business schools or exact science departments
Business Schools and
Department of
Economics
% of all candidates
70%
% of all workers
50%
Exact science (math,
physics, computer
science
15% 30%
Medicine 5% 10%
Others 10% 10%
137. 137
You can use number of methods to recruit
Comments
% of candidates
recruited
Direct recruitment to
specific position
You have to build the whole recruitment process
Usually it consists of logical – analytical test (GMAT
level) + interviews with your employees – 3-9
Usually you recruit for entry-level positions
50-70%
Internships
They have to go through at least the part of the normal
recruitment – tests and 1-2 interviews
Helps you test in real life the candidates
You have to give them real work and not making coffee
10-30%
Closer cooperation with
students and student
organizations
You can either recruit directly to specific position or to
internship
It can be an event, ambassador program, cases solved
with students
10-30%
Closer cooperation with
the universities
You can either recruit directly to specific position or to
internship
It can be event, lecture, joint conference, projects done
together.
10-30%
138. 138
What improves your odds of getting good candidates for
entry level position?
Let them do real work
Train them better and faster than other
Make sure that after working for you they got great jobs
Stay in touch with your alumni
Take advantage of stronger brands of your customers
Put them to work for your customers
Work hand-in-hand with student organization to actively
search for the best candidates
Go to universities with lower rankings
140. 140
To create proper training you have to take care of number of
issues
Targeted end-profile of a
employee on every level
Time
Option 1: 1-2 months a year
Option 2: 1 day a week
Forms of training
Lectures
Practical exercises esp. oriented at mastering certain consulting skills: Excel,
communicating with slides etc.
Workshops devote to certain area, skill, industry, trend
Case studies
Lesson learnt
Resources
Money
Coaches / Mentors
Sales Marketing Operations Programming
Current level
Target level
141. 141
For more go to our extensive on-line course where you can get
all additional resources including real examples from our
practice
Click to check my course
How to start and run a successful consulting
business?
$190
$50
142. 142
Check my presentation on on-line models to understand
them properly
Market research
Practical guide for startups and entrepreneurs
presentation
143. 143
Check my extensive presentation on productivity hacks to see
how you can me 10x more productive
Management consultant
productivity hacks
How to be lazy and still get things done
presentation
144. 144
Check my presentation on on-line models to understand
them properly
Business models
Practical guide for startups and entrepreneurs
presentation
145. 145
Check my presentation on on-line models to understand
them properly
How to open a successful
restaurant
A practical guide
presentation
147. 147
For more go to our extensive on-line course where you can get
all additional resources including real examples from our
practice
Click to check my course
How to start and run a successful consulting
business?
$190
$50