Accountability: A Leader’s Guide to Working with Consultants

This post has been adapted from the A Leader’s Guide to Working with Consultants paper by Josh Atwell, Elizabeth Donaldson, John Esser, Ron Forrester, Ben Grinnel, Jason Hobbs, Courtney Kissler, and Jessica Reif. 

This post of the Leader’s Guide to Working with Consultants series focuses on accountability, whether you have established clear ownership of the consulting engagement outcome, and whether you have put in place mechanisms for validating that the desired outcome is achieved. Below are the accountability quadrants, ranging from most ideal in the top-right quadrant (long-lived transformation) to least ideal in the lower-left quadrant (consultant dependency).

We will go through each quadrant in the post below. To find out where your company lands in the Accountability quadrants, download the full A Leader’s Guide to Working with Consultants paper and take the free assessment.

Long-Lived, Transformative (Top-Right Quadrant)

The transformative quadrant represents organizations that are entering a consulting partnership with a high level of self-ownership. In this quadrant, outcomes are expressed as business Objectives and Key Results (OKRs) (measured in earnest), which are then used to guide the progress of what’s ultimately being delivered. Organizations operating in this space understand that during large investments in change and transformation, the organization itself must retain the responsibility and ownership of outcomes, despite consultancy presence. The outcomes are more likely to have a meaningful impact on the business; therefore, the ownership of outcomes should be maintained in house.

In this quadrant, “deliverables” or solutions are not entirely predictable from the outset, and a high-value solution is most likely to emerge as it’s iterated upon and adapted to meet the business’s needs. A natural tendency in this quadrant is to change course or pivot, especially if desired outcomes aren’t being achieved. Engagements set up this way are able to steer away from bad ideas or concepts that are likely to fail, versus persevering and falling prey to a “sunk cost fallacy.”

Given the high level of shared or organizational ownership along the way, a transition to full organizational ownership and operational responsibility is a fairly painless proposition once the engagement is complete.

Story

A retail organization had decided to invest heavily in their mobile experiences and needed help to scale the team and deliver a three-year roadmap in eighteen months. The senior director of engineering decided to engage with a consulting company to help. Before signing the agreement, she spent time outlining what outcomes mattered and would create a win-win for the retail organization and the consulting company. They ended up choosing three outcomes:

• improving the app store ratings from 2.4 to 5
• reducing crash rate from 4% to 1–2%
• retain eNPS (employee Net Promoter Score): this team had a really high eNPS of 68, and it was important to not have any impacts to employee engagement

As the teams started to engage, they focused on building trust and operating as one team. They focused on the working agreements, leveraging shared backlogs, and setting up daily stand-ups and ongoing forums to validate the progress toward the outcomes.

Another challenge the retail company faced was building internal capability around iOS development. The consulting company had a bootcamp program designed to teach iOS development, which included actual delivery of features to production and pair programming with their developers. This allowed the retail company to invest in their internal talent and scale their mobile development team.

Throughout the eighteen months of their engagement, the companies worked together to adjust the working model to optimize for delivering the outcomes and setting the retail company up for success. The teams improved the app store rating to 4.8, reduced the crash rate to .5%, and the eNPS increased to 89. Many of the leaders involved in the engagement have moved on to other organizations and continue to engage with the consulting company because of the success and partnership.

Call to Action

The transformative quadrant is a great place to be if you’re prepared to truly partner with a consultant to pursue business outcomes and if all parties are prepared to learn and flex along the way. It’s not without its caveats, however.

You’ll need to ensure that the terms of the engagement reflect the level of flexibility you expect during this kind of transformational effort. It’s probably a good idea to set up your contractual agreements in a way that promotes frequent periodic evaluation of the engagement, allowing both parties to have checkpoints at which language and terms can be changed. The engagement should be abandoned if the business objective continues to be elusive beyond an untenable number of cycles of innovation.

In these types of engagement you will de-risk by limiting the impact radius and by encouraging frequent check-ins of the relationship and terms. This is preferred to falling back to deliverables-based or strictly time-based agreements that forgo genuine positive business outcomes.

Consultant Dependency (Bottom-Left Quadrant)

In the consultant dependency quadrant, organizations are entering a more “traditional” consulting engagement, where the consultancy is focused on a fixed set of deliverables and the outcome is defined as delivery versus measurable business outcomes.

Examples of deliverables in this quadrant might be:

• creation of an agreed-upon application or set of applications
• delivery of a website
• consultancy provides a set of actions the organization might follow

In this quadrant, decision-making is typically delegated to the consultancy, and although there may be an organizational “sponsor,” their level of involvement in making or challenging core decisions as part of the engagement is quite limited.

Here, value is determined mostly on whether the consultant successfully delivered the requested deliverables and is unlikely to be expressed in terms of business Objectives and Key Results. Typically, there is a high level of expected predictability in this quadrant; however, “true” business value may take second place to the delivery of a contracted solution.

Once the engagement is complete, the modification of the delivered solution to address current or future business needs may be challenging for the organization due to a heavy initial dependence on the consultancy. As the organization wishes to increase internal ownership, they will often have “inherited” a finished solution that is difficult to change and for which the organization itself has little understanding.

In some cases, this quadrant is best if you need a consultant’s help for something that is not considered differentiating or core to your business (i.e., payroll processing).

Story

A tax software company had identified some activities that needed to be completed in advance of the upcoming tax season. None of the activities were considered strategic, and the company did not want to leverage the existing team to focus on the tactical activities. Because the activities were clearly defined, the company decided to engage with a consulting company to deliver the work.

The agreement was structured with clear deliverables with expected delivery dates. The company had no intent of maintaining the short-term solutions post–tax season. The consulting company delivered the short-term solutions, and the tax company focused the internal team’s energy on long-term solutions. This engagement still required oversight by the internal teams but allowed them to focus more of their time and energy on the long-term solutions.

Call to Action

Engagements in this quadrant are actually quite likely to be “successful”—at least, according to the terms of the engagement. However, genuine business value, as well as the future viability of the delivered solution, may inadvertently be put at risk here.

Things to Consider

• What if the consultancy delivers what was agreed upon, but the solution fails to provide the desired business value? For example: a new sales application was created, but it failed to have an impact on the overall sales for the organization.
• Will the organization’s own teams be able to easily adopt and modify the solution later in order to rescue missed value?
• Will another engagement with the consultant be required to make modifications?
• If the delivered solution does have a positive impact on business objectives, will internal teams be able to shift to maintain and operate the solution, perhaps to scale it?

If you are in this quadrant, attempt to create more shared ownership in the organization, especially if the engagement (in terms of investment amount or “perceived benefit”) is large. This can be accomplished by intentionally blurring organizational and consultancy boundaries at leadership and team levels to co-deliver and to make core decisions.

It is also advisable to work to shift the engagement toward outcomes, such as business value or improved capability, versus output or “deliverables.” If you’re investing in building something without having a good idea of what the real business objective is, or having really good signals from users and the market that this is indeed the right thing to build to achieve those objectives, you may be stuck in “the build trap,” as Melissa Perri outlines in her book Escaping the Build Trap.

Validated Outcomes (Bottom-Right Quadrant)

The validated outcomes quadrant represents organizations entering consulting engagements where outcomes are likely expressed as business Objectives and Key Results (measured in earnest). The objectives and key results are then used to guide the progress of what’s ultimately being delivered. The organization, however, may be leaning heavily on the consultancy to make and change delivery decisions in favor of the business outcomes, and little or none of the organization’s own leadership is involved in key decisions.

In this quadrant, “deliverables” or solutions are not entirely predictable from the outset, and a high-value solution is most likely to emerge as it’s iterated upon and adapted to meet the business needs. Because there is a low level of internal ownership, the terms of the engagement will need flexibility in order to work this way, and there may be some conflict if changes in direction are needed if there is limited organizational or contractual support for change.

Once the engagement is complete, the modification of the delivered solution to meet business needs may be challenging for the organization due to a heavy initial dependence on the consultancy. As the organization wishes to increase operational ownership, there is likely to be some ramp-up and education required in order to shift that ownership as a new team inherits the solution.

Story

A retailer was struggling with customer return rate, specifically with online purchases. The executive team had a lot of opinions about what was causing the increased return rate, and the retailer needed external guidance on where to focus.

An engagement was structured with a consulting company to ideate and propose solutions to reduce return rate. One to two individuals from the retailer were assigned to work with the consulting company. Throughout the engagement, the working team prototyped solutions and ended up recommending a fit technology solution to help customers make more informed purchasing decisions.

Although the output from the engagement was compelling, because only one to two individuals had been involved from the retail organization, there was not a lot of support to transition the work to the teams needing to deliver the solution to production. The retailer had to restart the initiative and engage more team members to ensure a thoughtful turnover. The solution took an extra six months to deliver and would have had less of a delay if the engagement had been structured to include more internal team members initially. Once delivered, though, the retailer did see a slight reduction in return rate and was able to iterate on the solution.

Call to Action

Engagements in the validated outcomes quadrant have a high potential to produce strong value. This is based on an agreement to achieve real measurable business outcomes versus simply delivering a fixed solution. The above scenario accounts for change and flexibility while the latter has a more linear or static path to completion. If your organization or customers see continued value in the result of the consultant’s work, it may become necessary to reevaluate where primary ownership of those outcomes should lie. You may wish to simply be involved in more decision-making or look to bring internal teams into the project to increase ownership in delivery or maintenance of the solution.

If you wish to increase your ownership of the engagement outcomes, proceed with some caution and be mindful of the outcomes you are looking to achieve. A future shift of ownership of a successful solution back into the organization may be overly focused on the final solution itself. This may feel natural, especially if the solution is highly technical in nature; however, it is important to identify and acknowledge the challenges and market variables that helped to arrive at the solution. Failure to do so may lead to increased ownership but will leave market and domain expertise largely with the consultancy.

Things to Consider

There may be an opportunity to increase organizational ownership and accountability during this effort, and shifting that ownership closer to the organization may have an outsized impact on the future capabilities of the organization itself. Ideas to take on more organizational ownership include:

• Build an internal group of stakeholders who can partner with the consulting firm and participate in decision-making sessions and feedback sessions from consumers. Have this group immerse themselves and learn not just the domain but the methods and ways of building solutions that are business-objective focused if this is not something your organization is currently doing.
• Pair up organizational leaders with the consultancy to create shared account-
  ability for the business results. Have them learn along the way.
• Observe the effort along the way. Have frequent playbacks to the organization, not just to highlight the emerging solution but to understand the method followed in order to have it emerge. Evaluate what it would take to build internal capabilities so that similar endeavors could be pursued by internal teams in the future.

Project Management (Top-Left Quadrant)

The project management quadrant represents organizations who are entering a consulting partnership with strong ownership of outcomes by the organization but where the engagement is focused on a fixed set of deliverables and accountability may be centered around delivery instead of measurable business outcomes.

Examples of deliverables in this quadrant might be:

• creation of an agreed-upon application or set of applications
• delivery of a website
• consultancy provides a set of actions the organization might follow

In the project management quadrant, value is determined mostly on whether those deliverables were met (did the consultant successfully deliver) and is unlikely to be expressed in terms of business Objectives and Key Results. There is typically a high level of expected predictability in this quadrant. However, “true” business value may take second place to the delivery of a contracted solution.

Given the high level of shared or organizational ownership along the way, a transition to full organizational ownership and operational responsibility once the engagement is complete should be simple. Challenges may present themselves if changes are required in order to maximize business value or meet business needs in the future. In particular, there may be organizational friction in order to modify the finished solution. Internal owners may have developed ownership of the solution itself, but may lack true ownership of desired business results.

Story

A retailer was facing a tough decision—traditionally, they had not leveraged consultants and were facing high attrition rates in a critical area of the technology organization. The technology leaders decided to pursue an RFP (request for proposal) to assess consulting partners to add capacity to the existing team while they continued to hire full-time employees.

Although the retailer had clear outcomes defined as part of their strategic plan, the approach with the consulting company was to first focus on clear deliverables (e.g., documentation). Clearly outlining the deliverables helped ease the concern of the team that the company was going to outsource the technology work. With the focus on documentation, the consulting company was able to learn about the technology ecosystem and add value to the organization by reducing burden within the teams.

Call to Action

Engagements in this quadrant tend to afford the organization a high level of “comfort” and perception of control. They present themselves as very “traditional” projects, and large legacy organizations are typically very familiar with this “project management” mode of solution delivery. Deliverables, timelines, and expenditures can be tracked in traditional ways, and traditional risk management can be put in place to mitigate increased scope or complexity over time.

However, a real, unseen risk is often present in this quadrant: genuine business value. Because linear and predictable progress of delivery is desired, and there’s often a heavy focus on progress and the deliverables themselves, validation and evidence that the solution is viable long-term and that real business value can be recognized is often missed. These traditional projects tend to be large “bets,” whether they’re organizational change plans or software systems. The intent is good, but the results are often not observed until the investment has already been made.

Similar to the advice in the consultancy dependency quadrant, it’s highly advisable in this quadrant to attempt to shift the engagement toward outcomes, such as business value or improved capability versus output or deliverables. Create more agreements on outcomes for the business or user versus fixed deliverables. Making this shift will require more flexibility in the engagement, and the organization’s ownership will likely focus more on achieving business outcomes than on project delivery, which almost certainly will require different terms for the engagement.

Next, we’ll explore the Dependency Quadrants. 

You can download the full paper and assessment here.

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