All CEO’s, business owners, and finance execs (CFO’s, VP Finance, and controllers) hire and manage outside experts. Auditors, lawyers, turnaround consultants, IT consultants, sales consultants, business consultants, executive coaches, etc. Anyone we hire as an independent contractor to do a specific task, project or someone who can add value when and where it’s needed.
Heck, I’m an outside expert generally hired to improve the company’s results and help free up a business owner’s time so they can focus on their strengths. As an outside expert, it’s not always easy consistently performing above expectation.
Why it’s so important? We all want to do a good job and perform at the highest level, but it’s easy for the hours to get out of control or for the project to go in a different than the planned.
I’ve been on all sides – most projects go well, but some don’t. I had a Sarbanes-Oxley project I was managing go extremely well. The project came in on budget, on time and right on scope. It was a pleasure working with the expert I hired to help with the project. He was professional, showed up on time, handled the company’s employees well, and delivered a final product that made me look good.
I’ve had times that’s it’s been the other way. The professionals don’t perform anywhere close to where I expected. They embarrassed me with my client’s leadership team. They gave me a bill that blew my socks off, and the project wasn’t complete – and not even close to what I expected.
As an outsourced CFO for the past 10+ years, I’ve learned how to be an effective outside resource – what works and what doesn’t. I now have crystal clear objectives with weekly status meetings to ensure everyone is on the same page. I drive my value delivery to 10-15 times my fee charge, and I try to continually quantify my value and ensure we are all clear on the go forward plan.
The key for me to be successful is a clear sense of the project and clear communication to re-visit the objectives and continually re-evaluate the situation.
Some tips for managing outsourced engagements.
- Have a clear engagement letter, statement of objections or memo/understanding.
- Have clear objectives. Clearly, knowing the expectation on all sides.
- Consistent regular review of past, present, future priorities.
- Ensure all invoices are received and paid timely. Be clear on pricing and don’t let invoicing get behind.
- Ensure value is being received. For me, I try to show 10-15x my fee in revenue gain and better profits.
As an outsourced pro, we need to make doing business with us easy. Know what the client is looking for in the arrangement. Be clear with expectations from both sides – yours and theirs.
- Invest time to get to know them.
- Make them feel part of the team.
- Give feedback on performance – positive or negative, provide continual feedback.
- Understand their other projects – this happens to me all the time.
- Pay them market or better – don’t skimp on paying what they’re worth.
Above all continual communication is the key. Have open and honest communication. If the projects focus turns – either agree on the new direction or get the project back on the correct trajectory.
Think profit and go deep,