A fresh perspective on your business

pharmafile | November 20, 2006 | Feature | Sales and Marketing |  consultants, marketing 

A consultant is someone who borrows your watch to tell you the time- a cynical view of the role of the consultant, a breed which is ubiquitous in many industries  including pharma. It's easy to adopt such cynicism, especially given the amount that the industry spends on consultants.

According to the Management Consultancies Association, the worldwide market for management consultancy is now worth $100 billion, which represents a ten-fold growth over the past decade.

While these figures cover all industries, pharma consultancy spending has also grown, although at a slightly slower rate. Management Consultancy magazine reports an increase in spending of 10% in the past two years.

Given the issues facing the industry – weak product pipelines, increased cost of R&D, pressure from government cost-cutting etc.-  coupled with a lack of experience in some marketing teams, the case for consultants is strong –  provided they are used wisely.

So just what is the role of the consultant? Are they simply telling pharma companies what they already know, or do they add value? For example, do they spot opportunities which those close to a brand or a product cannot?  

Furthermore, having decided to hire consultants, how do you choose which ones to work with? And how can you be sure they are delivering real value – in other words, how do you measure their effectiveness?

All of these are common questions, often asked in a cynical tone – and who should be surprised  as over the years many books have been written talking about the dark side of consultancy practice?  

Common complaints include consultants who deliver pre-defined, one-size-fits-all solutions to every client, with the only thing changing on the report being the company name and date; or alternatively, those who go in, spend lots of time on analysis, and then recommend solutions which are near impossible to implement, or, when implemented, take the company backwards rather than forwards.

This attitude is identified by Peter Block, author of Flawless Consulting, one of the seminal works about consultants. In an interview with the US magazine Management Consulting News, Block states: "Consciousness about consulting has increased since it's become such a big business.

"But clients are always going to be sensitive about bringing in consultants to tell them what they think they already know, or to implement what they don't have the courage to do.  Human beings just tend to be reluctant to accept help or to admit to their vulnerability."

What this view highlights is the importance of both the consultant and client getting it right if there is going to be value added from the use of consultancy.  

What is a consultant?

Perhaps a good place to start a definition of what a consultant is – or should be – is to identify what they shouldn't be. The tongue-in-cheek book Bluff Your Way in Consultancy implies that consultancy and bluffing are essentially the same thing  i.e. a consultant is somebody who pretends to know how to do your job better than you.

With a string of companies downsizing over recent years, it's true that many individuals and small bands of people have set themselves up as consultants almost overnight, with no consultancy training or experience. Many of these believe that because they have worked in a number of managerial roles, they are sufficiently qualified to be a consultant.

To be fair, there will be some who, with a good contacts book, a professional attitude and experience, will start to provide a good service, but there are unfortunately others who provide fuel for books such as Bluff Your Way

The key point is this: consultancy is not just about passing on experience, even if this can be one aspect of assignments. Professionally trained consultants are aware of best practice thinking in terms of appropriate processes, methodologies and project approaches.  Experienced consultants also have the added dimension of applying appropriate project approaches in varied situations, so that they often know the most effective and efficient approach to solve client problems.

Vitally, consultancy is about providing that extra sizzle, insight, nuance  that bright or innovative idea that can make a difference in driving competitive edge.

This can manifest itself in a number of ways –  a new launch strategy based on creative segmentation models and understanding of prescribing levers, for example. Or a fresh look at redefining structures, refining or adding processes and methodology to address real marketing problems, as well as giving confidence to marketing teams to implement plans in the most effective way.

So why does it sometimes go wrong?  Usually, it's down to one or more of the following factors: the issue that needs to be addressed is inappropriate for the use of an external consultancy; choosing the wrong consultancy; an inexact brief which leads to unclear expectations of both parties; the way the consultants are managed internally; and lack of measurement leading to an inability to judge results with the potential for disappointment.

The task in hand

The first step is to identify the tasks which are best suited to bringing in outside expertise and, consequently, understanding which jobs are better handled in-house. Consultancy can be regarded as a panacea for intractable internal problems best suited to internal solutions, but choose the right task, and consultancy shows its true value.  

In a marketplace which is changing rapidly, consultants can bring a level of insight and experience borne out of working in many different situations, something which can be difficult to achieve internally for all  even the very biggest pharma companies. Without this level of insight, internal teams are unsure what to do differently, with the inevitable tendency to play safe.  

In this situation, a consultant can provide ideas on new and/or improved ways of marketing the brand, can bring experience of what might be a new market for the client, can sanity-check projected RoI, and crucially, can bring understanding of the implications of what the client is planning and advise on the things that need to be done to succeed.

This is especially useful in situations where there isn't necessarily a problem to solve, but where the task is to use the benefits of current success to do even better in the future. One client we worked with was doing really well, but had no fixed idea about the implications of NHS changes. We helped them develop innovative new thinking about how they should change their organisational structure to align it to changes in the NHS, their own product portfolio and the wider marketplace.

They were able to do this knowing that it would be backed up with our expertise and experience.  In this case, consultancy enabled them to support calculated risk-taking,  the lifeblood of any enterprise.

In another situation, a client wanted to move from what appeared to be an intractable number two position in the market against a strong competitor. This required a fundamental re-think of the market, resulting in a new segmentation approach. In turn, this allowed the formulation of a new brand positioning, and a series of messages allowing a link between the current brand identity and what was required in the future to drive share success.

This, combined with an innovative communication and promotional campaign, resulted in a shift in internal expectations on what was possible. Early testing showed that the new marketing approach would result in a significant share increase if it were to be executed effectively.  

The client on their own would not have been able to generate this alternative approach. They needed outside expertise to develop an innovative project approach and manage all aspects of the assignment, from market research, to briefing the ad agency, to sense checking progress during the new marketing campaign using appropriate quantitative, qualitative and interpretative techniques. They needed the challenge to think differently, as well as the stimulus to allow alternative approaches to be explored.

But not all tasks are suited to consultancy, and understanding this can help to avoid bad experiences. Trying to use consultants to back up internally a pre-defined view is rarely successful. Neither does bringing in outside help to act as a referee in internal political disputes. And too often, consultants are taken on to replicate the work of a perfectly capable management team, which is a waste of resources and a sure-fire way of demotivating the internal team.

So the questions need to be asked: is this task appropriate for an external consultant? What type of consultancy is needed? What competence is required (branding, strategy, research, organisation, marketing execution, and so on)?

Know your objectives

If you want to get the most out of your consultants, clarity of expectation and briefing is critical. If the client does not have a clear idea of what they want to achieve, then it won't be a surprise if the consultant is unable to meet the objectives.  

Be realistic. Consultancy is seldom the magic bullet (just occasionally it is), especially where it's a question of introducing a me-too product. In addition, make sure you are not asking the consultant to achieve results which are dependent on factors and decisions that are outside their control; they can, after all, only strengthen the ability to succeed, rather than guarantee success.

We sometimes come across clients who know that they need help, but are unclear exactly how the consultancy can aid them. Dont be afraid to discuss the brief with potential consultancy partners. If they question the brief, dont take it personally – more likely, it is the sign of a group of people who are used to challenging thinking, and evolving it. That's usually a good sign.

A below average brief doesn't necessarily mean that the consultant will fail –  a strong consultancy will still be able to deliver good work to a weak brief. But clear direction, again, maximises the chances of achieving the objectives.

A brief should contain the following elements:

* A thorough, thought-through background to the project

*An exact description of the challenge you are facing

* Specific objectives you are asking the consultancy to achieve

* Any constraints  internal or external  you are working under

* Who the consultant will need to work with internally

* Timescales

* Budget

But be prepared to listen. After all, you are often asking a consultancy to help because they have experience; take advantage of that. This may result in modifications to the proposed objectives, but that is not necessarily a bad thing. Just evolution.

Big may not be better

Selecting the right consultancy for the job is the single most important part of making sure that results are achieved, but is also the area where the process most often goes wrong.  So how do you set about getting your carefully crafted brief into the hands of the right potential consultancy partners?

Finding consultants is much like finding any other set of professional partners – a combination of research, word-of-mouth recommendation, networks and market knowledge.

You should consider the size of consultancy which is right for you. Big is not always beautiful; it's too easy to fall into the no-one ever got sacked using IBM syndrome.

Bigger consultancies can mean (although not always) a bigger project approach, bigger teams  and bigger fees. You need to judge whether your project justifies that, or whether you would be better off working with a smaller consultancy which will be more flexible in its decision-making, and where you will see more of the senior people and principals.

There are several routes you can take to draw up a long list; talk to colleagues to get recommendations and harvest your networks. Also, read the trade press as those who are being published regularly are likely to be up to speed with the latest thinking, and if they're getting into print, they generally know what they're talking about.

Combine your written brief with a verbal brief, preferably to the consultancy principal. This will enable you to gauge the culture of the organisation and the consultancy to really understand the brief.  When reviewing the proposals, there will be several criteria to take into account:

* Do they show a clear understanding of the project?

* Is their methodology and process clear?

* Can you see innovative thinking?

* Can they deliver on time and on budget?  

* Have they got experience and competence to achieve the project objectives?

It is especially important to make sure you are not paying for the consultants to go up the learning curve with you. This is probably the main source of the "borrow your watch to tell you the time" sentiment. You need to make sure the people you will deal with are actually bringing skills and experience which you don't already have in-house.

Equally important is personal chemistry.  You will be working closely with the team, so make sure you are going to get on.

Real added value

If picking the right consultancy is vital, then so is managing the ongoing relationship to make sure the process is working. Pitfalls generally happen when the brief changes after the selection, something which is surprisingly common, or when there is an inconsistency of personnel on either side.  

The client should appoint a project champion, who needs to be available, and with the right skills, rather than someone who will be floundering out of their depth.

Preventing the natural mistrust that can occur when a team of consultants arrives on the scene is a question of communication. If internal people understand what the consultants are adding  and crucially, that they are on the same side, working to the same objectives  then much of the resentment and insecurity will vanish.  

Ultimately, achieving RoI on money spent on consultants requires you to measure their contribution. As we have seen, this is much easier when there are clear objectives against which to measure. You should build milestones into the project plan, and then review its progress regularly.

The wrong consultants, badly briefed and managed, will simply be a cost, and will lead to resentment and frustration. But used correctly, consultancy can add huge value, bringing capabilities, capacity and, above all,  objectivity. which can be difficult to find even in the very biggest and best-resourced companies. And even then, it is very rare that companies, especially big companies, genuinely have the structure and culture to encourage truly challenging thinking.

If the brief doesn't add value, then neither will the consultants. But get it right, and consultancy can make an invaluable contribution to delivering competitive advantage to your company.

Steve Highley is Managing Director of The MSI Consultancy.  He can be contacted at shighley@msi.co.uk; or visit The MSI Consultancy website at www.msi.co.uk