 When deciding to make an investment in hiring an outside consultant or advisor one of the most common concerns most business leaders have is trying to justify in their own minds the cost of professional services. Since business owners and senior managers are paid to do many of the things that outside consultants and advisors often do there can also occasionally be ego issues that have to be addressed. Good advisors can save companies lots of time and money not only by the business building ideas they can deliver but also by the mistakes and errors they can help avoid. The following story helps illustrate just one way the value of outside advice can be considered.
The Fable Of The “Vibrating Machine” And The Consultant.
There was a manufacturing company who was having a great deal of trouble with vibrations on their assembly line. They had run all sorts of trials to solve their problem to no avail. The vibrations were costing them hundreds of thousands of dollars each year in quality defects and accelerated wear on their equipment. The company had brought in a number of “experts” but none of them solved the problem. Many of the experts claimed to know everything about the machinery and yet they spent lots of time and charged a lot of money without solving the problem.
Just about when the company was ready to give up and resign themselves to accepting the vibration problem as “just a cost of doing business’ an advisor was referred to them by a business associate who had a similar problem that the advisor had fixed.
The advisor arrived at the factory with a small toolbox and before going to the machine asked the machine operator and superintendent a series of questions. She then went to the machine and took out a nut, a bolt and a washer. The consultant drilled a small hole and inserted the bolt and fastened it with the washer and nut. The vibration problem was solved.
The next week the factory owner received a bill in the mail form the consultant for $20,000 at which time he immediately got on the phone and demanded that the advisor provide him with and itemized bill since he had heard from the superintendent that the advisor was just in the plant for fifteen minutes and the only parts used were a nut, a bolt and a washer.
The advisor asked the factory owner if the vibration problem was solved and was assured that it was. After this assurance the advisor said she would gladly provide an itemized bill. Her itemized bill, which arrived at the manufacturers office several days later looked like this:
Vibration Problem –consulting services itemized billing detail.
• One bolt
• One nut
• One washer
• Knowing where to place above items |
.07
.02
.01
$19,999.90 |
| |
$20,000.00 |
The advisor had solved a vibration problem that was costing hundreds of thousand of dollars in quality defects and accelerated part wear. Fixing the problem for twenty thousand dollars was indeed a bargain. The moral of the story is don’t be penny wise and pound- foolish. When you are questioning the value of working with an advisor don’t just ask yourself the cost. Consider what is at stake and what pain you could avoid, or what you potentially stand to gain from the advice. You can spend lots of money and perhaps eventually solve a problem through “trial and error” however with an investment in a good advisor who has “ been there and done that” you can often gain a great deal from their experiences at a lower cost and with less risk than spending your valuable time and money on “trial and error”.
About the Author – Scott Francis is President of Topline Development LLC a Strategic Marketing Consulting Group that provides helps companies determine how they can make the most amount of money with the least amount of resources. To learn more about Topline Development LLC visit their web site at www.ToplineDevelopment.com or contact Scott directly at scott@toplinedevelopment.com. |
