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Maximizing the Value of Consulting

Maximize the Value of Consulting | HRDQ-U Webinar

60 minutes

The consulting profession is an essential contributor to most organizations. While consulting has grown steadily in recent years, more internal functions are being outsourced, creating additional demand for external consulting. Internally, organizations are creating opportunities for consulting expertise. At the same time, questions surround the value of the consulting process. Many top leaders ask external consultants to prove the value of their work, and in some cases, show the ROI before a project begins. Internally, consultants are struggling because of the COVID-19 pandemic, with reduced budgets and eliminated departments.

Executives and sponsors need clear and compelling evidence that consulting makes a difference in terms they clearly understand and appreciate. This session will show participants how to manage the process to deliver value, be relevant in today’s environment, and calculate the value of consulting. Implementing these actions will ensure that a project is connected to the business, manages costs efficiently, and value is delivered (impact and ROI). This session demonstrates how to maximize the value of consulting.

Attendees will learn

  • How to connect a program or project to business needs.
  • How to conduct analyses to arrive at the correct solution.
  • How to develop objectives for application, impact, and ROI.
  • How to identify data collection methods and calculate ROI.
  • How to use results to allocate more funds to consulting. 

 

Who should attend

  • Independent consultants
  • Managers and supervisors
  • Anyone interested in consulting  

 

Resources

 

Presenter

Patti Phillips

Patti P. Phillips, Ph.D., CEO of ROI Institute, Inc., is a renowned leader in measurement and evaluation. Patti helps organizations implement the ROI Methodology®️ in more than 70 countries around the world.

Since 1997, Patti has been a driving force in the global adoption of the ROI Methodology and the use of measurement and evaluation to drive organization change. Her work as an educator, researcher, consultant, and coach supports practitioners as they develop their own expertise in an effort to help organizations and communities thrive. Her work spans private sector, public sector, nonprofit, and nongovernmental organizations.

Patti serves as a member of the Board of Trustees of the United Nations Institute for Training and Research (UNITAR). She serves as chair of the Institute for Corporate Productivity (i4cp) People Analytics Board; Principal Research Fellow for The Conference Board; board chair of the Center for Talent Reporting (CTR); and is an Association for Talent Development (ATD) Certification Institute Fellow. She also serves on the faculty of the UN System Staff College in Turin, Italy.

Patti has authored or edited more than 75 books on the subject of measurement, evaluation, analytics, and ROI. Her work has been featured on CNBC, Euronews, and in more than a dozen business journals. Connect with Patti on LinkedInFacebookTwitter, and at www.roiinstitute.net

 

Sponsor

HRDQstore

Training professionals everywhere are feeling pressure to prove the value and impact which their training initiatives can bring to the organization. Without a proven return on investment (ROI) of learning, management buy-in and training budgets are in jeopardy. HRDQstore provides a range of tools for helping you learn how to calculate ROI for your learning initiatives. Learn more at HRDQstore.com/ROI-of-Learning

Watch the video

Play Video

Maximizing the Value of Consulting

0:03

Hi, everyone, and welcome to today’s webinar, Maximizing the Value of Consulting, hosted by HRDQ-U, and presented by Doctor Patti Phillips.

0:13

My name is Sarah, and I will moderate today’s webinar.

0:16

The webinar will last around one hour. If you have any questions, please type them into the question area on your GoToWebinar control panel, and we’ll answer as many as we can during today’s session. And Patti will also be using the questions box for asking you guys’ questions today, so, when she asked you to do some rapid-fire chat, make sure you pop those responses into the questions box.

0:39

Today’s webinar is sponsored by HRDQ-U Virtual Seminars. HRDQ-U Virtual Seminars are engaging, soft skills training classes with real-time interaction and expert trainers. Grow your organization’s learners in HRDQ-U virtual seminars and let them develop the performance skills that they need from their home or office. And on any device from desktop to mobile. Learn more at www.hrdqu.com/virtualseminars.

1:07

I’m excited to introduce our presenter today, Doctor Patti Phillips.

1:11

Patti is the CEO of ROI Institute, renowned leader in measurement. And Patti helps organizations implement the ROI Methodology in more than 70 countries around the world.

1:23

Since 1997, she has been a driving force in the global adoption of the ROI methodology, and the use of measurement and evaluation to drive organizational changes.

1:34

Her work as an educator, researcher, consultant, and coach, supports practitioners as they develop their own expertise and an effort to help organizations and communities thrive.

1:45

Her work spans the private sector, public sector, non-profit, and non-governmental organizations. Thank you for joining us today, Patti.

1:55

Thanks, Sarah, and it’s always great to, to work with you on these webinars, so hello, everyone.

2:01

Pleased to be here with you today. I just wanna give a shout out to Melissa Brown in advance, from our team, who are also here.

2:07

So, if you hear of something that we mentioned during the webcast that you need, feel free to ask for it and they will pop it right over to you.

2:14

Speaking of pop and things over to you because you are attending, we’re going to share with you some resources.

2:19

So if you have your cameras handy. Go ahead and scan the QR code to access these resources.

2:25

We’re sharing with you the application guide that describes the process that I’m describing today, along with an offer for our book, Maximizing the Value of Consulting. It’s a big thick book on how you can deliver value as a consultant to your clients into your organization.

2:42

So if you want the book, just again, go to the QR Code.

2:46

Respond to the question there that asks, do you want the book and give us your address, and we’ll ship it right over to you.

2:52

Then we’re also going to share with you the slide deck PDF.

2:55

The slide deck, and as I said, as we talk through the session today, if there are other things that you’re interested in, we can pop those in the portal, or share with you via e-mail.

3:05

So, quick question for you, just so we know who’s in the room.

3:09

Um, this is our first poll.

3:11

What is your role? Are you?

3:13

Are you a consultant and external consultants or in clients? Are you a consultant inside an organization like an HR business partner or a D&I business partner?

3:23

Do you employ consultants?

3:26

Are you a professor or researcher or other?

3:28

And then select the one that best fits your role in being here today. So what are you representing in this session today? So external consultant, internal consultant, you employ consultants, your professor, or researcher, or other.

3:45

And we have great responses coming in. right now, I will give you about five more seconds here to submit your answer if you have not already.

3:55

OK, great, and we will get those results up on the screen now.

3:59

Wonderful.

4:03

Can you see that, Patty?

4:06

Sadly, I cannot.

4:07

I can’t because I can’t, because I had to delay hip.

4:11

Click OK, so over half are external consultants, just like that’s very good, Get 23% internal, and then 18% or other in your chat. If you’re, if you voted other, just in your chat, we’ve just quickly tell us what that is. What other is?

4:27

Just real quick, and then Sarah, and you’re Melissa, whoever can see that, if you can just tell me what you see there in the chat.

4:35

I’m just curious what, what other is?

4:38

Yeah, so take that response there in the questions box.

4:44

Don’t be shy.

4:47

We have a plan to engineer.

4:52

What else do we have?

4:58

Sales manager.

5:04

It looks so, we have a bit of a quiet crowd with us today. That’s OK.

5:08

That gives us an idea, said, they’re actually, it sounds like in private practitioner role, that manager role where you’re coaching and consulting your team.

5:16

And maybe this is something, maybe external consulting is something, you aspire to be post, current position. So, all right, thank you very much.

5:25

So, another quick question, when you think about your role as a consultant, or if you do hire consultants, what is the overall perception of your consulting?

5:41

Is it viewed by executives within your organization or by your clients as a cost, meaning that the client or the executive wants to control that cost, reduce the cost, or eliminate the cost, or do they perceive you and your work more as an investment?

6:01

They want to maintain it, enhance it, protect it.

6:05

There are consequences to, but, so, you know, activities of consulting, represent cause, cause get cut, right, if they view what you do as a consultant, or as a cost, as partnerships are a little more difficult to create, and your influence diminish you.

6:21

Yeah, I know consumable product, right? You come in, you leave, and you’re done.

6:27

Um, your funding is at risk, but if it’s viewed as a real investment, you’re delivering value, then you have those partnerships that are sustainable over the long term, you build relationships, so it’s not just that transactional Opportunity, you’re actually in there to stay You have a seat at the table, so to speak.

6:48

Right.

6:48

People go to you, you’re the thought partner in all things, OK, and then getting funding, of course, is easier, so in your, in your chat, or the Q&A, just real quickly, tell us, how is your consulting actually perceived?

7:04

Is it perceived more as a cost? It’s more of a transactional relationship? Or is it a real investment?

7:09

They work with you, they come to you, even when not on a contractual basis, they come to you because they want yet thought partnership.

7:19

So we have shot fed perceived as cost, used only as needed to meet code. Mohammed said and investments, Tatianna also Seddon investment, Sandra Seddon investment we have lots of investments coming through a few more.

7:35

Investment: as I’m also saying a mix of the two, OK, yeah, so it depends, right?

7:39

Maybe depends on the project, you’re working on, the client, you’re working web, so mix of the two, so good, but good news that we have a lot of people whose consulting practices viewed as an investment.

7:50

Deliver results, right? So investments are allocated cost or cut. So this is where we want to get. We want to make sure that our consulting practice is viewed as an investment.

7:59

That is an investment and relationship, not just the transaction or the solution we can offer up.

8:04

one more poll real quick, is why are you pursuing ROI, why are you in this session?

8:11

Today, we’re talking about maximizing the value of consulting, and part of that is demonstrating the ROI or a program, project initiatives that you offer up your clients.

8:21

So, are your top executives or clients a requiring impact and ROI of the programs, processes, and interventions you deliver? Is there any pressure to justify your existence?

8:32

So, again, if your internal That would be on your budget, if your external that would be your, your contract.

8:40

D, you know, eventually, you’re gonna need to demonstrate more valued, you want to show increased accountability for your expenditures, or the investments that clients are making in your Consulting Practice.

8:52

Or is it that you just want to explore new techniques to measure success of your solutions.

8:56

So, what are we seeing, OK, half are going to explore new techniques. It’s wonderful.

9:01

Right? Yeah, As consultants. We always need to learn, right? It’s always what’s out there.

9:06

How can we get better?

9:08

Then we have 38% need to demonstrate more value, but you don’t need to demonstrate in the future, so prepping for the future, that’s great. You’re not reacting.

9:17

And reacting to a request makes it much more difficult, right?

9:22

And then we have about 20% top executives require it. This is true, they are.

9:28

So a little bit of all of it.

9:30

So, very good, but over half are really looking at new techniques to measure program, process success, though you’re in a good place.

9:38

Alright, so, to maximize the value for consulting, you first need to show the value, right?

9:43

So, we talk about showing the value.

9:45

First thing we want to do, is we want to share the value, so that we stand out, can consulting continues to grow.

9:52

People are leaving their organizations at a very large rate.

9:58

Right now, we have that, know, the mass exodus from organizations, and people want the consulting industry is growing more and more independent consultants than we’ve ever seen in the past. Also, inside the organization, consulting is growing. We have HR business partners; we have performance consultants. We have diversity, equity, inclusion, business partners. We have learning and development, business partners. We have marketing business partners. Everybody wants to be a business partner, those business partners, or consultants. So, consulting externally, as well as internally, continues to grow along with consulting, right?

10:35

We need that.

10:36

We have to have that proof that executives and CFOs, and that’s clients, really want to see they want to see business value.

10:45

Consulting should not be inactive, the activity represents cause costs, get cut, consulting, should be an investment, but to deliver, and to take advantage.

10:56

Those people, funding, providing the investment, needed to see value. So, we, it gives us, showing value gives us the proof we need for those people.

11:04

Funding is our practice.

11:07

Opportunity, while, on the one hand, consulting is growing, both internally and externally, we’re also seeing it die: 80% of new independent consultants fail in the first two years for a variety of reasons.

11:26

But it’s hard.

11:27

I mean, half of you are external consultants, just like we are. We’ve been, we’ve been very happy and very lucky and very successful.

11:35

And we’ve been around for 2.5 decades, but it’s not easy work, right?

11:41

You have to deliver value; you have to have something your clients want.

11:45

And it is hard. And so, a lot of people go into consulting, and they fail for whatever reason.

11:50

Not prepared, financial aid that don’t have a product people want, or maybe they just aren’t designing to deliver the value they need to.

11:56

So, we want to maximize value by showing value so that we stand out. We have the proof we need that. We’re delivering value.

12:02

Instead, we, we leverage the opportunity we’ve been giving consulting spot your thought pop up, Parker, right? Not just solution providers, but Robot Park, so want to leverage that opportunity. Last, but we do want to lend a seat at the table.

12:15

I know this week or this phrase forever, rigas, sit at the table. But we’re really do. You want to be the go to person as a consultant?

12:24

They call you for your expertise, but then they may call you for other advice as well.

12:28

So, by showing the value of our work, we can stand out, have that proof we need. We can leverage the opportunity; we’ve been given as consultants. And we can win that seat at the table.

12:38

Now, there are different ways that we demonstrate value of the consulting work that we do. Of course, there’s the contracting, right, so level zero data.

12:47

Level zero data just represents the mini projects that we, that we get, how many projects we’re involved in, how many customers We have. The names in the database, right?

12:56

That’s all based on activity.

12:58

We have 150,000 consult AMENA projects going on out there, OK, That’s good, right? But that’s just talking about the activity in which we’re involved in.

13:07

The question is, what do people really think about the solutions that we’re providing? Are we providing solutions that are really relevant to the problems that they’re facing?

13:16

Or are they solutions that will help them take advantage of the opportunities that they have in front of them?

13:22

Another value, opportunity here, a measure of value, is learning. What are they learning from us that they don’t know?

13:29

Are they gaining new insights? Are they building new skills? Are they getting new ideas? Are they finding new resources? Are they connecting with other people?

13:36

You know, we as consultants, we can be those connectors.

13:40

We’ve just having a conversation today, molest was on, Melissa drives our partnerships. So we’ve grown over the years.

13:47

The way we operate is, we have a partner network, so it’s almost like a franchise opportunity, but it’s partner network, around the world with about 70 countries, so today we had one of our partner meetings for those who could come, and we were talking about the value that they bring, so some of them are new and they’re just getting into ROI and just getting into working with clients. Our methodology, in Sam, lack a little bit of confidence. And this is not about what you can do, what you know.

14:14

I mean, it is, But, he said, it’s not about that, is it that knowing where to get the information, you are a valuable consultant. If you can make connections to people who do have the answers, people will come to us for that.

14:27

So, from a learning perspective, we have to think about what people are learning from us that they do not know, are short illusions, helping them develop skill, are solutions given them insight that they don’t have, or are solutions connecting them to others who may have another opportunity for them who may have a solution.

14:47

So, no learnings important values that we deliver as consultants includes at learning component, again, doesn’t have to be a training solution.

14:56

What do we given them that? they don’t know?

14:58

But, from an application standpoint, this is where we really start to have some fun, because this is where we create change, is not about what people know.

15:06

It’s not about what they learn, it’s about what they do with what they learn.

15:10

So, you’re making those connections. But are they leveraging it? You’re helping them install new software. There’s a big implementation integration, or they do, and what you want them to do, web.

15:21

So, are they doing what you want them to do? We work a lot in diversity, equity, inclusion.

15:26

We talk about Employee Resource Groups or business Resource groups.

15:30

And, you know, having it is up here at the top, right, so having an Employee Resource Groups or Business Resource Group is an activity. The number of people involved; it’s an activity is an input.

15:42

Inputs represent activity activities, represent cause, spots, get cut, right?

15:47

So we have to look at it and say, OK, well, what are they getting from it in terms of relevant content. Are they bought into it, are they learning anything new, but more importantly, are any actions coming from it?

15:57

So, when we think about the value, we contribute to our clients, something needs to change as a result of it, that could be behaviors, it could be processes, it could be implementation of new policies and procedures. It could be action items identified during a meeting, but you want that action to occur.

16:18

So, we want to make sure that our consulting solutions are relevant to our clients, that they’re learning something new, and, more importantly, that they do something with what they now know.

16:29

Now, the next question is, OK, so what?

16:33

It’s relevant. They’ve learned it, they’re doing something with what they now know, So, what?

16:38

How much improvement are we seeing in measures of output, quality cost, time, customer satisfaction, job, satisfaction, work habits, innovation, and how much of that improvement is due to this consulting intervention, and not something else.

16:51

That’s your impact.

16:52

Answering that, so, what question is critical?

16:55

If we, as consultants, want to thrive and survive, we have to deliver value that is meaningful to the client, and meaningful value is often that operational excellence improvement in those key performance indicators.

17:11

And then there are sometimes when a client wants to see the ROI.

17:17

So we’ve improved productivity, 75%, The next question is, what’s the value while the value is savings of $750,000, OK, but what did it cost me to save that 750?

17:29

If you tell them, well, it only cost you a million to save the 75th date, is that a, you know, you spent more than you got back.

17:38

But if he saved them $750,000, and now only cost them, 425,000, that’s a different story.

17:46

That is what … does for us demonstrating return on the investment.

17:51

The solutions we provide our clients, tells them in one measure, how they did with the resources they invested in your practice.

18:01

So there are different ways that we can demonstrate value. They’re all important.

18:07

But they all represent value from different perspectives. Reaction, and learning.

18:11

Look at value from that person, engaged in that consulting intervention, it’s relevant to me, and I’ve learned something new.

18:18

Value from the application standpoint is Level three, tells us the system is supporting the knowledge, skill, information, and insight gained through the solution.

18:29

People are using what they’re learning, so is also, from that participant perspective, I’m using what I’ve learned through this intervention, but more importantly, the system that supports that user, the system, supports that participant, is supporting the use.

18:46

And then, from an economic or business standpoint, we’re looking at value, it’s helped us in improving output, or because time, customer satisfaction, job satisfaction, work habits, innovation, and we know what’s due to the consulting, because, through the evaluation process, we took a step to isolate the effects of the consulting, and we know that we get greater benefit, Then, the cost we spent on the consulting practice. So, value from, from multiple perspectives.

19:15

To get there, we’re going to follow a 12-step process.

19:19

So they’re 12 step in the ROI methodology.

19:22

So, we begin by starting with the why.

19:25

Why are we doing what we’re doing?

19:28

Right? So, what is the why?

19:30

Then, we’re going to make it feasible, medium, identify, a solution that is feasible, that will solve the Y, solve the problem, or take advantage of the opportunity that we set up objectives.

19:44

We go out and collect data, As we implement the program, project, or initiative, we’ll collect those reaction data and those learning data, because we want to make sure that those people who are involved in the project are bought into it, and that they’re learning what they need to know, so that they can do what we want them to do, And then we follow up to see if, in fact they’re doing it.

20:06

Are they doing what we want them to do, and are those impact measures as KPIs, as business measures improving, as a result of it, through the analysis, we isolate the effects of the program?

20:17

Now, if we stop here, at the evaluation, we stop here, you’ve got a good story.

20:23

It’s an impact study is demonstrating that the investment that they’ve made, and your consulting practice has had an impact.

20:32

But, if we want to show ROI, then we’re going to take the next step. And that step is to convert those impact measures to money. Compare it to the cost of the solution.

20:41

Calculate the ROI, some of the measures we work with are intangible. So your employee engagement, your customer satisfaction, your customer experience, your teamwork, those types of measures, we often leave, it’s intangible. It doesn’t mean we can’t convert them to money. It just means we’re choosing not to, because it may be too expensive to do it too complicated to do it at the time.

21:03

If we do it, it could be that it’s so soft: People won’t believe us.

21:07

And sometimes intangible benefits are good enough, sometimes, if you can just show that those customers are happier than they were in the past. I’m OK with what it cost me.

21:19

Then, again, we calculate that ROI.

21:21

We communicate results and then we use the data.

21:25

So, that’s the process that gets us to the data in the framework.

21:29

So, your evaluation approach begins with that framework of data that we just walked you through.

21:34

The framework is just the way in which we categorize data.

21:37

We want to make sure that we have data from multiple perspectives, and that it is flows in a very logical way. It tells that Complete Story program success in a very logical way.

21:48

And we’re going to make sure that we are reliable in what we report following a process, and this is the process.

21:57

Now, want to look quickly at the ROI formula, so that we’re level set on what we mean by our why.

22:04

So when we talk about why we’re talking about the most fundamental measures of Return on investment that are out, there are many measures of return on investment by many measures of economic value add. There’s internal rate of return. There’s A, which is Return on Assets, R E, which is return on equity, net income compared to shareholder equity. There’s ROC, which is Return on Capital Employed.

22:26

So a lot of different measures, most of them are measures used at the macro level or the corporate level.

22:35

So there are those corporate macro level measures. What we’re looking at are more of the micro measures.

22:41

So the operational measures, those measures that our operations managers or leaders, our sales managers, are working with all the time.

22:50

Any type of project, program or project can deliver and ROI Doesn’t mean we’re going to evaluate them all.

22:59

And it doesn’t mean they should all do, but any of them can deliver an ROI, because all you’re doing is comparing the benefits of the solution in monetary terms to the cost.

23:09

So these two measures are their most basic, and we can use them for any consulting project out there.

23:15

So if you’re a consultant and you work in D&I, and you may have a talent acquisition solution, you can evaluate that solution and report ROI using these metrics.

23:27

If you are a sales manager or a marketing leader, we use these metrics to demonstrate the ROI of a sales process.

23:35

If you are working with communication strategies or IT, we can use these measures and the benefit of using these two is, again, you can use them with anything, and it gives us an opportunity to compare ROI to Ottawa to our Why across the different investments.

23:52

So, we show both of these.

23:54

Typically, we’re going to work with this ROI formula, but we show both because there tends to be a little bit of confusion And, because, sometimes your client leans toward one more so than the other.

24:05

So, BCR’s benefit cost ratio is the output of cost benefit analysis.

24:12

The BCR or cost benefit analysis is grounded in welfare, economics, and public finance. So, it’s a government metric.

24:20

So, when you’re working with your government clients and they say, oh, you can’t do ROI in government because government what’s your name?

24:27

It’s been done for years, we traced it back to the 16 hundreds and Sir William Petty found the cure for the play, resulted in an 84 to 1 benefit cost ratio. So, yes, you can. It’s just understanding what’s going in the numerator.

24:40

Now, Roy comes from business and finance it’s been around as long as the BCR but it’s coming from private sector.

24:48

Here, you’re looking at the net benefits compared to the cost.

24:53

So numerator is the benefits.

24:55

So benefits represents what we are doing in terms of helping the organization make many say, many avoid cost. So, you convert your measures to either profit, so if you’re a sales manager, think yourself manager.

25:12

If you’re a sales manager in your people, are selling more, there’s the value from the sale, said the revenue, and then there’s the gross profits. You take the cost of doing business out, you use your gross profit. So, with sales, we’re going to work off gross profit.

25:28

For everything else, you’re working off cost savings and cost avoidance.

25:32

So, your solutions are helping your organization either make money, save money, boyte cost, are doing some greater good while making money segment money endpoint and cost, right? Because we can do both. We have to, right? You have to do well financially in order to do good in the world.

25:48

So, again, your solutions are either helping the organization make money save money or avoid cost.

25:55

BCR you’re going to take the benefits.

26:00

And compare it to the cost.

26:01

R a Y We take the net benefits and the reason we do this is classic ROI formula is earnings compared to investment.

26:09

Well, not all of our solutions are driving sales. Not all of our solutions are driving revenue.

26:16

Many, if not most, are helping the organization save money, avoid cost.

26:21

So, we take our benefits, make money, so many, avoid cost or profit, cost, savings, cost avoidance, and then we’re going to subtract the cost of the program.

26:31

That’s going to give us the net benefits, compare it to the program cost and then multiplied times 100, which is the percentage. So, the two formulas are similar, yet different BCR you’re looking at gross benefits compared to cost or why you’re looking at net benefits compared to cost. So, let’s try it one more time. one time. This is 1 of 2 math problems.

26:53

Sarah has always done math, and so she knew this was coming.

26:57

OK, so, let’s just say, we’ve improved productivity, 75%, and as a result, for one year, we have saved our organization, $750,000.

27:10

And we only spent 425,000. Your consulting only cost, $425,000.

27:17

What is the base E R, and what is the R Y?

27:20

Pop it in the Q&A, where Sarah has directed you to pop your responses to my questions, pop it in there, and let us see how you did.

27:30

Sarah, I’m counting on you, or Andy or Melissa. Someone to let me know what they say.

27:35

Yeah. I’ll give you a moment here.

27:38

Do that calculation, and then I’ll share off some of the numbers and see what the responses here with the correct answer is.

27:51

So we have Shaun said 1.76?

28:00

New Sean would be first up this time. Dan said 1.7, 6 as well.

28:08

That’s for our base ER OK?

28:14

What else do we have?

28:16

Anybody else?

28:18

Come on! Don’t be shy!

28:20

I’m on got our … 1.76 is correct for the BCR. What would your ROI be?

28:27

If BCR is 1.76, what would your ROI?

28:33

Dan said The ROI would be 76.47 OK, we have one from shot.

28:42

Keith also said 1.76 for the VCR. So what did you think as well Keith said 76.47 as well, Sean said 76.5 rounded up there.

28:54

All right, very good.

28:56

So, nice job if we if we had a special prize for you, we would give it to you.

29:02

So, BCR is 1.76 to 1.

29:06

This is going to tell us; this is typically how you’ll see it written. The math is 1.76, but typically you’ll see at one point seven hundred sixty-one.

29:14

This tells us for every $1 we invest, that’s your $1 investment.

29:19

For every $1 we invest, we get a dollar, 76% back, engross benefits, they should BCR.

29:27

Your ROI is telling you, for every $1 you invest, you get the dollar back, plus an additional 76%, or a 76% return on investment.

29:41

That makes sense. So they’re similar yet different.

29:44

Now, what we will see happen and as consultants you need to net because they are coming.

29:49

People are coming to you as your partner and you don’t need to know everything, but when you do math, you need to know what do it, right?

29:56

Because we can lose credibility quickly if we get it wrong and it happens, but here’s what I don’t want it to happen to you.

30:04

Sometimes we will see people take this 1.76.

30:09

They’ll say your BCR is 1.76 and then they’ll multiply 1.76 times 100 to report a 176% return on investment.

30:23

Does everyone see what’s wrong with that?

30:26

And I can see, from this side of the screen, all these hands are going up, saying, Yeah, we see what’s wrong with that.

30:33

They hate it.

30:36

There are a Y A B C R is 1.76, an ROI is not just merely multiplying, 1.76 times 100.

30:46

The R Y is the net is to 76%, so we want to make sure you don’t make that mistake.

30:52

It happened not, for not malicious reasons. I’m not trying to overstay. But just because there’s, you know, is a noun there, uninformed misinform, or they just forgot, right?

31:02

So just be careful that we don’t do that because as a real quick way to lose our credibility Another thing I also recommend is when you do show an ROI, go ahead and show the formula.

31:13

Here’s how I got there and just be fully transparent so that your client can say, OK, yes, I see how you got it.

31:21

You shall go ahead and general formula.

31:23

now, if you have someone coming to you to sell you a product.

31:29

And we know as consultants, both internal and external. A lot of people do, right.

31:34

So if they come to sell your product, in a person shows you their ROI, but not the math, asked to see a map.

31:42

You just always want to make sure that what they’re showing you is correct, and what you’re showing your client is correct. So transparency is helpful.

31:51

So, given that, let me ask you guys one more poll question real quick.

31:56

What is your experience with using ROI to demonstrate the value of your consulting solutions?

32:11

We’ve got a little bit of experience as goodnight.

32:15

All right, very good.

32:18

So we’ve got some folks who’ve done some ROI study. I’d love to hear more about that.

32:25

All right, so a couple of a few folks have said they’ve conducted studies about the same amount, no experience, and then a few have attempted it, so very good.

32:35

All right, thank you for that. So yeah, I’d love to hear about your experiences with it.

32:39

And maybe we’ll have time for some of that at the end.

32:44

All right. This is just our benchmark data. So, this is just saying that every one of our projects and solutions need to demonstrate return on investment and even us.

32:53

So, our consultancy is around demonstrating ROI. So we teach people how to do it.

32:59

We do it, or clients, so we will come into an organization, actually do the studies.

33:04

We will serve as coaches and thought partners, as they complete the studies, we have a certification process that teaches them how to do it so they can do their own studies. So that is our product, right.

33:15

So, even our work, we have to demonstrate the ROI of our work to our clients.

33:22

So whatever programs and projects and initiatives you deliver, there is an opportunity to demonstrate our why.

33:30

That doesn’t mean All of your projects need to be evaluated to our why. There are some things we do, but maybe they’re lower cost.

33:38

Maybe the client isn’t trying to drive KPIs.

33:42

They just want to, to offer up new information, new knowledge, or a simple new tool, to their, to their chain.

33:49

So not everything is evaluated to our Y, so these are our benchmarks, or what we say, is our minimal target in terms of consulting projects that are evaluated to each of the levels.

34:01

Probably about 20% of what you deliver a client is impact evaluation worthy. Now, what we found through our research and our most recent benchmark study, and we’re happy to share the benchmark study with you, we can pop that in the portal.

34:16

What we found is that we are seeing higher numbers Then what we even suggest is like minimally acceptable. So we always say at least 20% to 20% of what we did levers should be evaluated the impact. Or what we saw from our most recent benchmarking is it’s 37% of projects are being evaluated, the impact level, which is good, that means we’re more strategic, and what we’re doing.

34:41

We suggest five to 10% are candidates for our why evaluation, based.

34:45

Our most recent benchmark study met 18% of projects being delivered, are being evaluated to R a Y, and then you can see the other levels as well.

34:55

But, again, this is good, because what we’re seeing from that is that the projects being delivered, and the engagements with the consultants, tend to be more strategic, they are transactional, and to be focused on those things that are really going to move the organization forward.

35:15

These are the characteristics of those types of initiatives that should be evaluated to impact in our why.

35:23

Your big projects are the big engagements, they’re driving strategy, they’re connected to operational goals.

35:31

They’re connected to executives who are really interested in seeing impact and ROI, sometimes the visibility of the project. So we’re working on a project now, and it’s really looking at a prototype.

35:44

So those of you who were and with any kind of innovation, but any project can be innovative.

35:50

We’re working with one group, and they’re piloting a program.

35:53

Instead, the client wants to see a business case.

35:57

Now, the best business case is to demonstrate the ROI on the prototype on the pilot. That is your best business case. In talking to the client, we learn more that. What she really wants is more of a theoretical business case. So looking at analytics within the organization, looking at research on, here’s what others are doing. Or based on our analytics, here’s what could happen. Nothing wrong with that. And then we do preprogram forecast all the time, so nothing wrong with that, you can do that.

36:28

But what we say is that it’s truly a theoretical business case because there’s no evidence that what you’re seeing in your data is actually working.

36:38

So if you have the opportunity to make a business case, by developing an ROI on a prototype, or a pilot program, that your best kicks, because now we know, is it working with a pilot group. And we also know what needs to happen, to ensure it worked with everyone else.

36:56

So sometimes those pilot programs that we’re involved in a great opportunity to do impact studies in our lives.

37:02

So again, not everything we do warrants that kind of valuation, but the big ones do the big projects do.

37:11

So the next question is, OK, so how do we get there?

37:13

How do we ensure that our programs and projects and interventions with our clients deliver value?

37:19

Well, to show value, you need to design for value, and that’s where we like to go.

37:26

It’s all about what happens upfront. So, here’s one of our favorite articles. If you’ve attended my other sessions, you may have seen, this is one of our favorite examples of why as consultants.

37:37

We need to ask more questions upfront.

37:40

So this is an incident that happened in London: Scotland Yard’s, Scotland Yard, hired a consultant management consultant, and I won’t say the name, but it was in the articles as well, look them up.

37:55

But it was a management consulting group to help them.

38:01

Saw what the executives’ thought was the problem. And that is leadership.

38:08

And we all know, you know, can’t get enough leadership development, leadership, solving all of it, and leadership development does solve a lot of things. But it’s not always the right solution.

38:17

So, the solution was a leadership program.

38:21

Soft skills, 50,000 hours of 1 to 1 coaching with all these officers, five days of workshop per person participating.

38:31

So per officer, there was a 360 feedback questionnaire and then they did the personality profile, you’re blue, right?

38:38

Great, OK. All of it, worthy investments, if it’s for the right reason.

38:44

You see the feedback.

38:47

one of the officers said, Yeah, everyone who attended was so angry.

38:51

They angry because I felt like what was happening was such a waste of money. It took them out of the borough at the time and they’ve got so much work to do.

38:59

And here they are going through this exercise on leadership development.

39:04

Um, another person said, we’re on our knee’s crimes going. Ah. Serious crime is going up, the public’s worried about it and here we are.

39:13

We don’t have the resources, yeah, they’re saying we could have spent that money, you know, buying cards, adding staff.

39:20

Then the spokesperson for the metropolitan police for Spelling Yaar said, you know, London’s biggest employer, we need to support our leaders by giving them the skills. They may well lead well, trained people, deliver better.

39:32

And ultimately, that means Londoners Get Great Service. Yet prime rates going up.

39:36

So this was the Solution, Consultant Solution leadership about probably a really good program if it was the right program.

39:45

Problem they’re trying to solve.

39:47

Problem was that participants weren’t buying into it.

39:50

That’s a problem, right? People, people have to buy, and I have to say, this is important.

39:53

People weren’t bought into it, so what is and put this in your chat, in the chat or in the Q&A?

40:00

You know, who owns this problem?

40:04

Who owns it, then how could it have been avoided?

40:09

So who owns the problem, because it was a problem, this was on the front page at the Paper the public was outraged.

40:17

You can see the headlines right here.

40:19

Met … accused of wasting millions on leadership development training as prime source, so who owns the problem and how could it have been avoided.

40:31

There, you see anything. You can type your response to that questions box.

40:36

We had a comment here from Jeff said, No, by any means, no success.

40:42

Mohamed said met Police, Jeff said, Involve the team in the solution.

40:49

We have Michael saying, the project team, Sharon said, Mette Leadership owns the problem.

41:00

I said, Yeah, we had your Keith said leadership of this project.

41:05

And Cynthia said, was there, uh, and need assessment done, Take this survey.

41:13

All right, we’re good. So it was a needs assessment done.

41:16

The client, I heard the client owns the problem, OK, guess whose names dragged in the mud on this thing? Is the consulting group read the article in subgroups?

41:25

How could this have been avoided?

41:27

We can blame the client.

41:29

We could do that.

41:30

And how could this have been avoided if we want to design our consulting practice, belting solutions, to add value?

41:42

Arkansas?

41:44

What could have happened? Now, of course, that needs assessment for sure can happen.

41:49

But that’s a step into the consultant’s role. What could have happened to avoid this?

41:57

Michael said from the beginning, the key stakeholders should have been engaged and Michael also said there should have been a root cause analysis, conducted Mohammed said of the project.

42:15

And Keith said clarity of expectations of every constituent group involved.

42:21

All right, very good.

42:23

So, clarity of expectations. What is the real problem? And that’s what we suggest, right. We’ve got to start with the why. It’s not about behaviors, right? It’s like, what is the problem?

42:34

Because, obviously, the client hired this consultant to come in to do leadership training. Well, that’s not, you know, what is that they’re trying to solve.

42:45

Leadership training is a solution.

42:47

It’s a solution to something, but what isn’t right? So, we want to start with Y, so we wanna make sure we’re delivering value to the client.

42:55

Start with one, why are you doing what you’re doing?

42:59

What is the problem that you’re trying to solve? And the problem is not that we need more leadership development. The problem is not that we need more leadership in an organization.

43:11

The problem is, there is an opportunity for our organization to make money, save money, avoid cost, or do some greater good.

43:22

And then, there are some specific business measures that need to improve that if we improve them will help us take advantage of that opportunity.

43:31

That is the why you don’t need but change behaviors.

43:37

We need something else; we need something else or something going on. Why don’t we need to change behaviors? And then once we know that, then we can carry through with our process. So, again, it’s that Brian analysis, we as consultants, tend to go into a project with solution in mind.

43:54

We just went through that exercise with the client.

43:57

We were a sub-contractor to another contractor to apply, right? Risky, risky role.

44:04

Because the go between the person didn’t ask the right questions upfront, we got involved in the conversation, we started asking questions. What are you really trying to accomplish?

44:13

We weren’t the right solution at the right time. They did not need this at the right time, given what they were trying to do.

44:20

So we asked them more questions, and suggested they do something else. And then, let’s come back to this.

44:28

We are thought partners in this yet, we as consultants, we go right in for the jugular because that’s what we sell.

44:35

Consultants sell a leadership development program. So this is the solution. It’s not we should be good partners.

44:42

Just because they tell us they want, doesn’t mean that they do, because what happens if you are the wrong solution, you get to be on the front page.

44:51

The newspaper with the citizens screened out $10 million wasted on, leadership. No, you don’t want your name in the paper like that.

45:00

So we start with why. What are you really trying to accomplish? What is the opportunity for your organization to make money save? Money, avoid costs? What are the specific business measures, measures of output, or the cost time?

45:11

Customer satisfaction, job satisfaction, work habits, and innovation that need to improve.

45:16

That’s the first thing that we want to do. Why are you doing what you’re doing?

45:20

And then we get really, really curious, Ober Curios and start asking questions.

45:28

And we ask questions such as, well, what is happening or not happening in the organization that if you changed it, would help you improve these measures.

45:38

And by asking those questions, assessing those performance needs solution start to bubble up.

45:45

And let me start to see what’s feasible in terms of the solution, who may not be the right solution. But guess what?

45:50

You know someone who is: Now, you’ve just provided them with a solution. So, we asked the questions, why are we doing what we’re doing? What is our opportunity to make money, save Money? Boy, costs do some greater good.

46:02

And what are the specific measures that need to improve that if improved, tell us we are moving toward that?

46:09

Pay off opportunity, and then we ask the next question, what is happening or not happening?

46:15

That if we changed it, can help us improve the measures, and this is where we start having some fun series like that.

46:22

Performance needs assessment is the most fun because that’s where we can use some of our cool diagnostic tools. We can use organization network analysis, with nice focus groups, interviews. Sometimes, it’s just a matter of having a conversation. We have a great case study that describes how someone used nominal group technique to sort out what people were leaving the organizations.

46:42

So assessing that performance data is really where the fun and the work comes in. Because we’re really digging down, we’re asking good question about, well, what’s really going on here?

46:51

And then once we land on potential solutions, we ask the next question, OK, what is it people need to know to ensure they do what we want them to do using this solution? so that we can improve the business measures, so we can take advantage of the payoff opportunity? And then, how can we roll it out so that they buy in?

47:11

Those officers in London, they were put in a class. It was done to them, not done for them. They didn’t want to be there.

47:19

And part of our strategy, enrolling our solutions is getting buy in upfront.

47:23

How do we position that so that it’s truly relevant to those people engaged? Had they gone into it saying, Hey, folks, crime rates up.

47:32

And it says, serious crime. That’s the big problem.

47:35

And to change that, we need to do these things differently. We need to behave differently.

47:40

So, our solution that’s going to help us drive that behavior is this leadership development program by these fine men, in fact, consulting group.

47:48

Now, in order to make it work, here’s what you’re going to need to know.

47:52

So when we look at preference need is how do we roll it out and deliver the solution, said that those people involved buy into it.

48:03

And if they buy into it, they were more likely learn what they need to know.

48:07

And better yet, they’ll go do what we want them to do to drive the business measures to take advantage of the payoff. And then input needs is just the project itself.

48:15

So designing for value begins on the left side. It’s not about behaviors, it’s about what’s the real issue here.

48:24

Now, those of you who are solution providers, as we all are, let’s say they have hired you why they’ve hired, you.

48:32

They know why you’re coming yet, even though they think they know, and this consulting group in London could have uses, even though they think they know, never go in 100% certain that they did, because you don’t want to be on the front page of the paper. So changed the what you ask, Right? They come in, they say, OK, we want you consulting group, whatever you deliberate leadership development Now.

48:55

What exactly is it that you want these people to learn, that they don’t know now?

49:00

I want to know how big it later, Write that down. We think we should all know how to be a great leader.

49:05

What exactly do you want them to do that they’re not doing?

49:08

that they should be doing, in order to be a great leader?

49:13

And this is, again, where we might use diagnostics, or just questions, but the client says they need to change their behaviors in these areas, then your next question is, OK, great idea. What measures will improve as a result of changing those behavior?

49:28

And had the client think about those ultimate outcomes.

49:32

And then when they tell you it’s going to be increase in sales, or reduction in crime, or improvement in quality, improvement in employee satisfaction. Next question you’re going to ask is what is it worth to the organization?

49:44

Right? So you move your questioning from the bottom-up they’ve hired you, but just make sure as you’re consulting with them, you’re asking these questions, Be curious about it.

49:53

What do you want them to know, if they don’t know now what behaviors you want to change?

49:58

If they do that? What’s going to happen in terms of output, quality, cost, and time.

50:01

If they call you in and say, hey, I need these behaviors to change, and you’re the solution for it, your next question is why?

50:09

Why do you need those behaviors to change? I change the behaviors.

50:13

How’s it going to improve output quality, cost, and time?

50:16

Or another way to ask that is, what if you don’t?

50:19

What the consequences of their not changing the behaviors is not about giving up your work.

50:26

It’s about ensuring you do the right work.

50:28

So to design for solutions, we have to be clear upfront.

50:32

Then all we do from there is develop objectives, clear specific expectations.

50:38

As you guys said, well, your specific expectations, and then go out and evaluate the success of your program.

50:46

So, again, we want those expectations. We design around expectations. You design around objectives.

50:53

We need objectives. Objectives. Tell us how we’re going to measure success.

50:58

They also tell us how we’re going to design that solution. You’re designing around that, those expectations. The other thing about really good objectives is that it makes the evaluation process much easier.

51:12

Big goals, vague objectives, bait outcomes, I always like to say, Vague and Nebulas is going to give you …, so the more specificity around the objectives, the easier it’s going to be to really deliver value to that client and to show the value that you delivered.

51:29

Once we’ve got those objectives, then we start engaging with the client.

51:33

Then all we have to do from there is ensure that we’ve designed it so that it matters.

51:39

Again, collecting those data throughout the implementation that tells you, people are buying it, and you can do it different ways, right? Different ways to collect data, you can use surveys and pulse surveys, but you can also just ask a few.

51:52

You know, how are we doing with that, and are you learning anything new?

51:56

We’ve got to make sure it’s working for the people involved in the project.

51:59

Yes, the client, the person finding it is key stakeholder. Right?

52:04

But, if the folks involved aren’t into it, is not going to work.

52:08

And then your name is on the front page of the paper.

52:12

So, we’re going to make sure that it matters to our people, and we’re going to make sure it sticks that they go out. And they do what we want them to do. They’re applying it.

52:21

So, that’s where we do the follow-up, want to make sure that they’re doing that, we follow up with questionnaires. Again, a lot of different ways we can collect those data. Technology is very helpful in this, depending on what you have.

52:33

Lots of fun tools out there to follow up with, force surveys. And questionnaires are the number one.

52:40

It’s hard because everyone’s surveyed to death.

52:43

And when the client says no more surveys, no, that’s not necessarily a bad thing. It makes us think, how else can we do it. We use action plans a lot, and some of the projects that we work with, performance records, typically.

52:56

If you’re external consultant, that’s going to come from the client, but that’s just getting into their database and reporting what they’re seeing with the measures.

53:07

And sometimes, you have the luxury of observation, and sometimes testing and assessment will use interviews and focus groups. So, a lot of ways we can collect the data.

53:15

And then, also, through the analysis, we want to make sure that our analysis is credible.

53:21

And that’s why, when we are evaluating consulting projects, or even evaluating ours, we’re going to ask the question, how much of the improvement in the measures is really due to our intervention and not something else? And there are a variety of ways that we do it.

53:40

Those quantitative, more research-based techniques, trend line analysis, control groups, mathematical modeling, are the most used as a route, now, from a single bet on a single, singular basis. You know, you see participant estimates. This is coming from our benchmarking.

53:57

Participants’ estimates are used frequently, because they’re used as a backup or a fallback position.

54:05

We have a lot of research on, or examples of these techniques and the book that we’re offering, you guys at no cost, if you’re outside the US, you will have to pay for the shipping. Inside the US will cover the shipping, but this maximizing the value consulting talks about how you can isolate the effects of your consulting.

54:23

You want to make sure when you’re claiming that your consulting is adding value, you have a basis for your argument, OK, and the basis is the step in our process.

54:33

And then of course, when we’re trying to get to Roi will convert measures to money and then compare it to the cost different ways, we can convert measures to money.

54:43

Of course, we never want to forget those intangible benefits.

54:46

These are the measures we choose not to convert to money and then of course, when we talk about the cost of consultancy, just remember when you intervene with your client, it’s just it’s not just your cost as a consultant.

54:58

It is the cost of all those people in the client organization who are involved in that project.

55:05

So, it’s their time is materials, it’s facilities.

55:10

It’s tribal. It’s all of it.

55:13

So here’s one last example in the world, call it a day, because I know we only have four minutes left.

55:19

one last math problem for you, though. So this was part of a culture change project, and one of the major measures that they were interested in improving was turnover of staff.

55:27

So the managers wanted to reduce that departures at staff the unit of measure. So the level or measure that they were looking at and wonder days one regrettable turnover.

55:38

The value of the measure was $21,000 based on their research. It was 60% of the annual salary for those who are leaving.

55:46

The change in performance was three per month. So on average, they were reducing turnover three per month.

55:54

To get to that, are why we want to annualize that change and performance. So, step four is annualizing the change in performance.

56:03

And then all we have to do to get to the numerator is multiply, the annual change of performance step four-time step two.

56:11

So, getting to that ROI is not that difficult, the hard part, the hard part is getting those measures upfront, and then going through the process and isolating the effects of the program, and that’s not that difficult.

56:23

If you build it, then, as we’ve talked about, so those of you who are the math whizzes, I can’t wait to see what you’re doing. If you already have the ROI here, go ahead and pop it in chat.

56:33

For the rest of you, what we’re going to do as you work through these five steps, step five gives you the numerator.

56:39

Then the cost of the intervention was $339,000.

56:44

So real quick, if anyone has the R Y, I’m going to pop it in, but I’m going to carry on. Are you seeing anything? Sarah? Just let me know.

56:53

You don’t have any responses yet? We do have a comment came through from, Michael made a comment, and he said, this has been amazing. I truly find this as a profound investment of my time. I thought that was great. Wonderful! Yeah! Thank you so much, Michael. So hopefully you’ll value the resources that we provide in the tool.

57:11

If you never, ever need any help and seriously, if you guys ever want to just brainstorm in talk about consulting practices and demonstrating your practice, just let us know. We happen to hop on a call with guts.

57:23

So, OK. In the meantime, do we have an ROI?

57:25

So here we’ve got 3 3 turnovers per month.

57:30

Over 12 months 36 turnovers, they avoided through this project that saved the organization $756,000.

57:38

It costs 339,400.

57:42

What is the ROI I’m about to show you?

57:49

No one’s done it yet.

57:51

You don’t have any responses that they, they’ve mapped out on. So, for this particular project, it was 122% ROI.

58:01

Alright, last, always tell your story and a very compelling, logical way, that chain of impact, those levels, represent the chain of impact. Use that as part of your storytelling because that tells that complete story.

58:12

And most important. Remember that evaluation is about process improvement. We are all consultants. We are always trying to improve.

58:21

Don’t be afraid to evaluate the success of your, your solutions to your clients, because that’s kind of didn’t have to make it better for you.

58:29

All right.

58:29

So these are just some of the payoff opportunities, but I do want to end with one of our favorite sayings here at that the office when it comes to maximizing the value of consulting, hope is not a strategy. Luck is not a factor. Doing nothing is not an option. Change is inevitable. Progress is optional. It’s really up to all of us to deliver value. So, maximizing the value of our consulting practices begins.

58:52

First by showing value, and then by designing for value to really show that value, we have to design for value. So, think about that, next engagement.

59:03

Again, we’ve got all these resources for you. Just let us know if you want the book, and the team will ship it out to you. Andy is actually going to pop in the portal, another document that’s not listed here called the Alignment Conversation.

59:17

You might find it interesting. It was part of that conversation. I had walked me through all the alignment model, that, the model. So that is a good tool and could be handy for some of your client conversations to give you some good questions.

59:28

And if anyone really wants to learn how to maximize the value of consulting, join us for our one of our certification opportunities. We do these all over the world, used to, we did them all over the world.

59:40

I guess they still are world, like we just never leave the office to do them now, but we are starting to see some live and in person, So join us for the certification, We’d love to have you guys join us.

59:51

And then to just send me in that, let me know what was going on with, you’d love to chat with you more, so thank you for hanging with us. I can stay on way too long. I do this to Sarah every time, and I’m sorry, Sarah. So if you want to close it out.

1:00:04

Thank you, guys, and please let us hear from you.

1:00:06

Well, thank You, Patti, that does bring us up here to the top of the hour. Today’s webinar was sponsored by HRDQ-U Virtual Seminars. Be sure to check out our curriculum of more than 80 virtual instructor led online seminars. Go to www.hrdqu.com/virtualseminars for more information. And that is all the time that we have for today. Thank you again, Patti.

1:00:32

Thank you, let us know what questions you have, and if there’s any questions we didn’t get to, we’ll, we’ll get responses out to you, but, seriously, let us hear from you.

1:00:40

So, here’s to 2022 to all of you consultants, especially the panels, it’s going to be a great year ahead.

1:00:49

It is, thank you all for participating in today’s webinar, happy training.

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