The Consultant's Scorecard, Second Edition: Tracking Roi and Bottom-Line Impact of Consulting Projects

It is quite surprising that more reviews have not been written about this text by Phillips, because it is seemingly rather difficult to find other works that directly address the bottom line impact of consulting (especially outside the training space). Before acquiring a copy of this book, be aware that the content is rather substantive, reaching nearly 400 pages. Although much more math was expected, the author's argument that complex formulas for return on investment (ROI) are really not needed made sense after reading chapter 8, which begins by discussing the viewpoint that "the phrase return on investment in consulting is occasionally misused - sometimes intentionally. In these situations, a very broad definition for ROI is offered to include any benefit of the consulting intervention. ROI is thus defined as a vague concept in which even subjective data linked to a program are included. In this book, return on investment is used more precisely and is meant to represent an actual value arrived at by comparing consulting costs to benefits. The two most common measures are the benefit-cost ratio and the ROI formula. Both of these are presented, along with other approaches to calculate the return or payback. For many years, consultants sought to calculate return on investment for consulting interventions. If a consulting intervention is considered an investment and not an expense, then it is appropriate to place consulting in the same funding category as other investments, such as those in equipment and facilities. Although the other investments are quite different, they are often viewed by management in the same way. Thus, it is critical to the success of the consulting intervention to develop specific values that reflect the return on the investment". The lack of complexity is a strength of the process presented, and offered a reminder of a comment made recently by Warren Buffet on Squawk Box (CNBC) that the investor needs to be wary of stock picks based on complicated formulas (i.e. developed by quants). However, there is much more to "The Consultant's Scorecard" than ROI calculation, the subject of which consumes a small portion of the content. Presented are 6 different measures collected in a consulting intervention that present a balanced viewpoint of the success of the consulting project and involve both qualitative and quantitative data collected at different time intervals: (1) reaction and satisfaction, (2) skill and knowledge changes, (3) implementation, application, and utilization, (4) business impact data, (5) financial payoff, and (6) non-financial intangible measures. As Phillips states, "the ROI process [presented here] is not for every organization or individual consultant. The use of the ROI process represents a tremendous paradigm shift as an organization attempts to bring more accountability and results to the consulting process. It is client focused, requiring much contact, communication, dialog, and agreement with the clien

I bought this book 8 years ago and since that time it has been very useful in order to show value to my customers in our consultant assignments.

As any consultant - and author Jack Phillips - will tell you, the days when a consultant could make a living by sharing the latest trendy approaches to business are long, long gone. Today's executives expect consultants to adhere to the same standards of accountability that consultants themselves have advocated for years. Therefore, the ability to determine a consulting project's return on investment is an important skill for both executives and the consultants they hire. Phillips offers a practical approach to ROI that somehow avoids consulting jargon and complex formulas. Although it lacks case studies that show how to overcome specific obstacles to data collection and interpretation, this is a valuable book that fills in an important piece of the consulting puzzle. Best of all, it does so in a common-sense way that can be understood by carbon-based life forms, therefore we [...] recommend this book to consultants and those who hire them.

Just like the soup, this book is mmmm...mmmm...good!As a client, the book provided a very clear guideline to keep consultants accountable. I now feel that I will know when hiring a consultant is both a good idea and cost-effective. Knowing that I had read this book, our consultants were able to better communicate with us. Overall, incredible!