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Hiring Consultants

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Sometimes I hear tall tales about startup companies doing $300,000,000 of business within a few years of opening their doors. In truth, this rarely happens. No one is profitable right from the start. Successful companies typically spend at least a year or two figuring things out. It takes time to find your core leaders and fine tune your operations and business model. If your company is starting out and you hope to foster the kind of growth that leads to long-term success, you need to approach the challenges ahead with realism. And, if it’s your first time starting or running a direct sales company, you need good consultants to help you in key areas.

Choosing the right consultant often proves difficult. This article lists some important considerations to think about as you look for the right consultants for your company. You can also use them to identify what needs to change if you already have consultants who are not providing you with the guidance you need.

Look for Executive-Level Players

When you’re starting out, it’s important that you look for consultants with direct sales experience at the executive level. Make sure you have someone on board who understands the big picture. More likely than not, this is the area in which you most lack knowledge.

If you understand how to motivate people but don’t know how to source materials, work with manufacturers, or manage supply as demand changes and grows, you need to bring on someone who does. Executive-level players have experience making the decisions that will guide the growth of a burgeoning MLM company. Without them, you will struggle and waste vital capital.

It’s hard to emphasize this point enough. There may be many areas in which you need consulting, but obtaining a consultant with executive-level experience is the top priority. If your team lacks someone with this type of experience, remedy that as soon as possible.

Look for Operations Experience (Not Just “Idea People”)

Similar in essence—but distinct from executive experience—operations experience is essential in the consultant who will guide you through the nuts and bolts of bringing your ideas to fruition. It may be easy for you to come up with great ideas, but it can be difficult to get those ideas to work internally.

Unfortunately, while there are many consultants with big ideas and minimal specific insight, there are few operations consultants in the industry. Many consultants avoid operations specifics because they take too much personal time and create too much liability if things go wrong. Look for consultants with backgrounds in operations. They need to be adept at spotting the gaps in a big idea and know how to bridge those gaps. When you find your operations consultants, encourage them to get specific.

Avoid Having Too Many Consultants

Not long ago, it was common to see startups without any consultants at all. Today, I often see the opposite problem—far too many consultants. There’s an old saying. “The man who has one clock always knows what time it is, but the man who has two clocks never knows what time it is.” The same applies with consultants. A new company has to build a consistent coherent strategy and plan for

  • Sales and marketing.
  • Operations.
  • Product.
  • Distributor build strategy.

Having too many consultants can damage that cohesion.

One person engaged in every facet of the company is better able to see the whole picture, notice when problems are coming, see the causes of those problems, and guide the company away from them. With too many consultants, each specialized into one corner of the business, communication breaks down and nobody sees the big picture. This ties back to my first point: Executive-level consultants are familiar with many aspects of the business and are ready to wear multiple hats. Look for these and avoid the chaos of too many cooks in the kitchen.

Look for a Breadth of Experience

While it’s important to find consultants with a broad knowledge of the business, you also need to find people with broad knowledge of the industry. Don’t hire consultants on their number of years of experience alone. Look for people who have experience working with multiple direct selling companies.

All companies are not the same. A brilliant idea for one company can be terrible for another. People who have worked with one company for a lengthy period of time can have a narrow view of the industry as a whole and may tend to put stock in that narrow view. The last thing you want is an ill informed voice on your team speaking with utter confidence.

Look for Experience That Meets Your Needs

Make sure that any consultant you hire has experience in the specific role you need them for and with your company’s business model type. Don’t hire a party plan consultant for a network marketing plan; a network marketing consultant for a party plan; or both to cover your bases. Irrelevant opinions from the wrong kind of consultant will distract you from the issues you need to focus on. Know your business model and your needs and hire the right consultant for you.

Avoid Outsourcing Your Compensation Strategy and Plan

Developing the right compensation plan for your company is paramount to success, and it’s important that the key strategic decisions are made in-house. You need to take ownership of your compensation plan and have a solid understanding of the rationale behind each decision.

That said, you should definitely secure a compensation consultant. This person will be very valuable in sorting through compensation plan concepts, pointing out the pros and cons of each part of the compensation plan, and helping to seamlessly weave your plan together with your build and product strategy.

Your compensation consultant should train and work with one of your senior-level employees so you have someone long term who understands why decisions were made and how they tie into the overall company strategy. This internal “compensation guru” should not be an inexperienced staff member or an employee who isn’t fully invested in the company—down the road, you don’t want to find yourself asking, “Why did we choose this?” with the only answer being, “Oh, some consultant told us to.” The compensation plan is the pumping heart of any direct sales company, so put it into skillful and trustworthy hands, not those of someone who may make the lazy or familiar choices.

Check References

You might be surprised how many companies hire consultants before verifying their track records. Far too many startups make the mistake of keeping someone who keeps promising greatness without bringing results. Don’t be fooled by slick websites and be sure to get references before hiring any consultants.

Be Discerning

The simple thread tying all of these pieces together is this: Be discerning. Look carefully at your needs and your options before you bring consultants onto your team. Hiring consultants is not a “the more the merrier” game. You can’t get the results you want by throwing more consultants at a problem.

Tips for Finding the Right Consultants

If your startup company needs a consultant but you’ve never hired one before, you may not know how to find prospects. All of our advice about who to hire won’t help you if you have no options on the table. Here are two tips about where to look for consultant.

  • Ask for recommendations from vendors who specialize in direct sales services, such as the software providers, merchant and pay card providers, and fulfillment services you do business with. These companies have usually worked with good consultants and can provide you with objective advice. (Be aware that some consultants pay referral fees to vendors. This isn’t necessarily a problem, but you should know if such an arrangement exists.)
  • Spend some time reading industry literature. Most good consultants try to give back to the industry by writing books, articles, and blogs, or by speaking at seminars. Reading what a consultant has published can give you a good idea of how they think and help you determine if they’d be a good fit for your company.

Consultants can take you through chaos into stability. Their experience and knowledge can make your company. Choose wisely, use their experience effectively, and prosper.

 

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