Partners Business Council

Consulting is not heresy. Time to overcome your prejudices.

Consulting is not heresy. Time to overcome your prejudices.

2016-02_PBC Group_consultoria não é heresia
Hard times are best suited to review rationally our concepts.

Two recent episodes provoked the reflections of this text. The first was a conversation with a friend businesswoman from the B2B area working successfully already for 16 years in the Food and Beverage market. The second was the comment of a highly qualified professional with over 25 years of industry experience and having held senior positions in three multinational companies.

I heard from the businesswoman, which company has several large and medium-sized enterprises as customers, that the owners of these companies have a huge resistance to hire technical or management advisory services.
From a friend, a highly success professional, who decided to quit his corporate life cycle and had opened a consulting company six months ago, I heard the following question:
– Why Brazilian businessmen have so much prejudice and rejection to the use of consulting services?

By sharing the experience with other consulting professionals in the food and beverage industry in Brazil, we can list some possible explanations.

First, we must separate the companies into two macro groups: the serious companies and the opportunistic ones. But always worth remembering that between the extremes black and white there are many shades of gray.

Regarding the opportunistic companies, which their stereotype is well known by professionals in the market: – the company goes badly, but the owner’s family is doing very well financially.

For this type of company technical or management consultancies are seldom requested. This type of company usually contracts consultancy services that are experts in the so-called fiscal engineering, or in institutional relations consultancy (political and commercial-financial) with the different levels of government, both for sales (state bids) and for access to subsidized funds. It is important to clarify that Lobby Services are considered illegal in Brazil.

As for the group of serious companies, the reasons for resistance to hire external support have very different motivations, namely:

– The vast majority of these companies are family enterprises and keeps family management style;
– They are highly conservative in their attachment by their methods, customs and their faithful collaborators (employees);
– On the one hand the traditions represent a reputable history of entrepreneurship and hard work through family generations, they also generate an environment averse to the assistance of external professionals;
– The main family executive has some apprehension and consider that hiring outside assistance would be to expose an alleged own weakness or inability to conduct the business to the company employees and other family members;
– Another factor is the fear of opening secrets and weaknesses of manufacturing, administration and sales for professionals who do not have a long and strong relationship with the company;
– They are also apprehensive regarding the extension of the diagnosis and the correction plan to be proposed by the consultants. Mainly that the solutions to be implemented could cause sensitive changes in the way of conducting business and to change the status quo of family-staff-business relations.

We cannot fail to mention that in Brazil prevails a highly antagonistic political and economic environment for entrepreneurship and business – excessive regulation, high taxes, Kafkaesque bureaucracy, very poor logistics infrastructure and insane financial costs.

For those reasons are necessary large professional experience, extensive practical experience and a strong pragmatism from the consultants in the design and implementation of business solutions.

Also it is necessary pragmatism by the entrepreneurs. They need to consider consultants as suppliers of raw materials, that is, their companies will receive what they need to continue to produce. In the case of consultancy services are professional diagnostics, methodologies, additional expertise and solutions.

By rational perspective, hiring professional consulting services are cost-effective solutions for the business, whatever the size of the company, for that reason are common practice in more mature markets. As consulting services are specific trade relations (projects) between two companies they are much more objective and flexible, when it compared with labor contract mainly in Brazil. Usually are simple contracts between the parties, which define the objectives of the work, time, cost, resources, schedule and also about the confidentiality of information (non-disclosure agreement).

As in any human activity, there are good and not so good consultancies and consultants, so it is very important for the entrepreneur to select properly and carefully. Otherwise instead of hiring solutions will be getting additional problems.

Finally, it is worth mentioning that the highest value for any consulting firm are its credibility and professional reputation, even more in the times of information at the light speed and the at the distance from a finger touch.

Article author: Luiz Azevedo

BSc. Chemical Engineering, MBA Marketing, MSc. Economics, Director of Profiler Business Consulting and Partner of PBC – Food & Beverages Consultants.