Innovation

Get the most of your contractor relationships

Organizations hire contractors to help meet their strategic and operational objectives; however, the wrong resources could spell real trouble. Here's how to get the most from the relationship.

Effectively engaging external contractors and consultants is a strategy employed by the best companies to meet their strategic and operational objectives; however, the wrong resources could spell real trouble. Let's face it, especially in times like this, many resumes and marketing materials are little better than fiction, and I'm very skeptical of personality screening. Regardless, embracing outside help brings an infusion of intellectual capital that's hard to foster within your employee base, with a relatively minor commitment. It behooves you to engage wisely, however, by heeding this advice:

Consultant or contractor?

First, understand for yourself whether you need a consultant or a contractor. These terms are often used interchangeably, which propagates great confusion; let me clear things up. Consultants are used to help you or your team solve a challenging problem or take advantage of an opportunity that you cannot resolve for yourself. They are brought in to augment your intellectual capacity. Here are some situations when you would use a consultant:

  • You need help with your strategy and / or long-term planning.
  • You need a special analysis done.
  • You just purchased new software and have no idea how to use it.
  • You want to partner better with the business.
  • You need a sounding board to validate your ideas.

Don't confuse consultants with contractors. Contractors are brought in to augment your capacity. They are used to temporarily perform the same function you or any one of your employees could do. Here are some situations when you would use a contractor:

  • You want to evaluate a resource you intend to hire.
  • You have unexpected demand and need burst capacity.
  • Somebody quit, and you quickly need a backfill.
  • You have a short (i.e., a year or less) project that you need to staff.

Years ago, contractors were a good way to employ surrogate employees with a lower commitment of engagement, but those days are gone. This practice will get both you and your contractor in trouble, so avoid using any sort of outside help for this purpose.

Selecting the right person

Once you're clear on your need, you must find the right resource. For consultants, follow this process:

  1. Ask a colleague. Start with a recommendation from a peer who has used a consultant for a similar purpose. There's nothing better than a good reference from somebody who has experienced success in the past.
  2. Ask another consultant. We tend to network with each other, so most likely, if a consultant you know can't help you with your issue, that person probably knows another consultant who can.
  3. Search the Web. A lot of good consultants are prolific in their writing and easy to find on the Internet. Stay away from their marketing materials, but search for free or inexpensive books and articles that they've published and read them. If their ideas are interesting, give them a call.

For contractors, be clear on exactly what skills you absolutely require and be flexible on the rest. Laundry lists of 20 different technologies, plus 10 more nontechnical skills, plus prior experience in an obscure trade or industry is not fair or realistic. Disregard most of the information in their resume, and use technical experts to challenge them on technical skills. Uncover their problem-solving skills, not whether or not they can memorize a reference manual.

Getting clear on the consultant vs. contractor distinction is a critical first step that will set the stage for all the decisions that follow. Survey your current resource pool of outside help. Are you using contractors as consultants or vice versa? Do you have contractors that have been there longer than your employees? If so, think about making some adjustments. In my next article, we'll discuss tips for engaging outside help: how to start, how to maintain, and how to exit the relationship.

About John Weathington

John Weathington is President and CEO of Excellent Management Systems, Inc., a management consultancy that helps executives turn chaotic information into profitable wisdom.

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