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 90 DAYS TO
SUCCESS IN
CONSULTING
William McKnight

Course Technology PTR

A part of Cengage Learning

Australia, Brazil, Japan, Korea, Mexico, Singapore, Spain, United Kingdom, United States
90 Days to Success in Consulting © 2010 Course Technology, a part of Cengage Learning.
William McKnight
ALL RIGHTS RESERVED. No part of this work covered by the copy-
right herein may be reproduced, transmitted, stored, or used in any
Publisher and General Manager, form or by any means graphic, electronic, or mechanical, including but
Course Technology PTR: not limited to photocopying, recording, scanning, digitizing, taping,
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contact us at Cengage Learning Customer &
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Printed in Canada
1 2 3 4 5 6 7 11 10 09
To Lourdes, Daniel, and Hannah
 Acknowledgments
I would like to thank the many people who made it possible to
bring this project together. Thanks to the folks at Cengage
Learning, including Mitzi Koontz, for bringing together the idea
and the 90 Days concept. It was a pleasure to work with Cathleen
Small in the editing process. Furthermore, I would like to give my
sincere thanks to those who invested in me early in my career and
began making possible the experiences I share here. Many thanks
to Jon Rubin and Peter Costigan. My clients are my lifeblood.
Without them, there is no consulting. Special thanks to John
Whitehead, John Gideon, Dale Danilewitz, Carol Wood, Louie
Torres, Casey Lau, Michael Furlow, Victor Dudemaine, Tom
Lyons, Daniel King, Trenton Cycholl, Steve Westmoreland,
Glenn Schentag, and Roger Barker for believing in me. There
may be no finer profession than consulting if you look at the peo-
ple in it and around it. To Jill Dyche, Claudia Imhoff, Colin
White, Scott Humphrey, Wayne Eckerson, TDWI, Shawn
Rogers, Ron Powell, Joe Caserta, Kevin McManus, Information
Management magazine, SearchDataManagement, Kim Dossey,
and Kim Stanick, thank you for being a pleasure to work with.
And finally, I could never have done anything if I didn’t surround
myself with the best. I’ve had the privilege of working with
Charles McCarthy, Afonso da Silva, Cory Shouse, Jeanine Davis,
and Stuart Mullins.

iv
About the Author
William McKnight is president of McKnight Consulting
Group (www.williammcknight.com). He is one of the leading
experts in the information management space and provides ser-
vices in business intelligence, master data management, data
warehousing, and information technology assessment. He has
worked with more than 100 corporate clients worldwide. His
team’s implementations have been recognized with several Best
Practices awards.
In addition, McKnight has held executive roles in public and bou-
tique consultancies. He relates to each level of consulting growth
and is a passionate communicator and motivator. He is also a for-
mer information technology vice president of a Fortune company
and holds an MBA from Santa Clara University.
McKnight is a popular keynote presenter at major conferences
internationally and has given more than 150 public seminars and
webinars. He has hundreds of articles, white papers, and tips in
publication. He is widely quoted in the press and was honored as
an Ernst & Young Entrepreneur of the Year finalist.
McKnight writes pragmatically from his experience starting from
scratch and growing a consulting company, McKnight Associates,
Inc., to placement on the Inc. 500 and the Dallas 100 for growth
and later selling it as a multimillion-dollar consulting firm.

v
This page intentionally left blank
 Contents
Introduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . xiii

Part I: Breaking into Consulting as a Profession

Chapter 1
What Is Consulting? . . . . . . . . . . . . . . . . . . . . . . . 3
Who Is a Consultant?.................................................................5
The Goal: Becoming a Top Consultant.....................................6
Consulting in Hard Times .........................................................9
For Those Entering Consulting Post-Recession .......................11
Client Value-Add .....................................................................12
Action Plan...............................................................................16

Chapter 2
The Traits of a Professional Consultant . . . . . . . . 17
The Right Frame of Mind .......................................................18
Clearing Your Life Deck ..........................................................19
Traits of a Good Consultant....................................................20
Time Management ..................................................................21
The Consultant Image .............................................................23
Health.......................................................................................25
Travel .......................................................................................27
Action Plan...............................................................................30

Chapter 3
The Top Consultant Image Building Blocks . . . . . 31
Business Name .........................................................................32
Logo: The Little Icon That’s Supposed to Convey
Everything ................................................................................33
Slogan.......................................................................................35

vii
90 Days to Success in Consulting

Website .....................................................................................36
Other Tools of the Trade.........................................................39
Domiciling Your Business ........................................................41
Action Plan...............................................................................42

Part II: Establishing and Expanding the

Practice

Chapter 4
The Bottom Line . . . . . . . . . . . . . . . . . . . . . . . . 45
Securing Income to Get Started ..............................................46
Brokers .....................................................................................46
Business Formation and Taxation ............................................50
Insurance..................................................................................53
Startup Money .........................................................................54
Action Plan...............................................................................55

Chapter 5
How to Stay Current: Technology and Skills . . . . 57
Focusing Your Technology Coverage.......................................58
Mastering Domains..................................................................60
Technology Environment.........................................................61
Planning Time for Learning ....................................................62
Updating Technology...............................................................63
What If Technology Is Not Enough?.......................................63
Action Plan...............................................................................65

Chapter 6
Service Planning . . . . . . . . . . . . . . . . . . . . . . . . 67
Categories of Services..............................................................69
Clients Need Consultants.........................................................70
Consultants Your Clients Will Want ........................................73
Packaged Services ....................................................................74
Training Services......................................................................76
Project Services ........................................................................77
Action Plan...............................................................................78

viii
 Contents

Chapter 7
Establishing Fees . . . . . . . . . . . . . . . . . . . . . . . . 79
Hourly Consulting Rates..........................................................80
Rate Flexibility .........................................................................84
Rate Sheet ................................................................................86
Fixed-Bid Services....................................................................87
Billing Variations ......................................................................89
In Conclusion...........................................................................89
Action Plan...............................................................................89

Chapter 8
The Role of the Consultant . . . . . . . . . . . . . . . . . 91
Consulting Is a Personal Relationship......................................93
Curb Your Enthusiasm.............................................................93
Credit Is a Four-Letter Word ...................................................94
Corporations Are Problem Creators........................................95
Consulting Is About Tradeoffs .................................................95
Be a Positive Communicator....................................................97
Be Very Conscious of Naming Conventions............................98
The Occam’s Razor Principle of Consulting ..........................99
What Could Go Wrong? ........................................................100
The Use of Guiding Principles ..............................................101
Action Plan.............................................................................102

Chapter 9
Client Contracts. . . . . . . . . . . . . . . . . . . . . . . . 103
Master Services Agreements ..................................................106
Opening............................................................................106
Personnel ..........................................................................107
Confidentiality..................................................................108
Payment Terms.................................................................110
Rights Ownership.............................................................110
Rates.................................................................................111
Liability Limits .................................................................112
Administrivia ....................................................................113
Statement of Work .................................................................113
Action Plan.............................................................................114

ix
90 Days to Success in Consulting

Chapter 10
Acquiring People . . . . . . . . . . . . . . . . . . . . . . . 115
People: Who Needs Them?....................................................116
Employee Styles .....................................................................119
Regular Salary ..................................................................119
Regular Hourly.................................................................120
Part-Time .........................................................................120
Temporary........................................................................121
Per Diem...........................................................................121
Casual...............................................................................121
Finding People........................................................................125
Action Plan.............................................................................126

Chapter 11
Requests for Information/Requests for
Proposals . . . . . . . . . . . . . . . . . . . . . . . . . . . . 127
When to Respond...................................................................129
What’s in an RFP? .................................................................132
RFP Timelines .......................................................................135
Action Plan.............................................................................136

Chapter 12
Client Communications . . . . . . . . . . . . . . . . . . 137
Communication Should Be Honest .......................................138
Listen First..............................................................................139
Communication Should Be Frequent ....................................140
Structured Project Communication .......................................141
Political Sustainability of Work Product ................................144
Action Plan.............................................................................145

Chapter 13
Writing and Speaking . . . . . . . . . . . . . . . . . . . . 147
Writing Articles ......................................................................148
Public Speaking......................................................................151
Other Channels to Fame........................................................155
Weeding Through the Feedback ............................................158
Action Plan.............................................................................159

x
 Contents

Part III: Beyond Initial Success

Chapter 14
Managing Capital. . . . . . . . . . . . . . . . . . . . . . . 163
Top 10 Spending Decisions in Consulting .............................165
1. Hire or Contract the Billable Team .............................165
2. Hire Sales .....................................................................165
3. Pay for or Self-Build Marketing....................................166
4. Have a Board................................................................166
5. Office Space .................................................................166
6. Annual Bonuses ............................................................167
7. Accounting and Legal ..................................................167
8. Bookkeeping, Accounts Payable/Accounts
Receivable.........................................................................167
9. Conference and Training Attendance and
Sponsorship ......................................................................168
10. Technology Environment ...........................................168
Accounts Payable and Accounts Receivable ..........................169
Financial Statements ..............................................................172
Action Plan.............................................................................174

Chapter 15
Partnerships . . . . . . . . . . . . . . . . . . . . . . . . . . 175
Oh, the People You’ll Meet in Consulting .............................176
Partnership Business Formation.............................................178
Deal-Based Partnerships ........................................................181
Partnerships with Vendors .....................................................183
Action Plan.............................................................................185

Chapter 16
Getting the Word Out . . . . . . . . . . . . . . . . . . . . 187
The Campaign .......................................................................188
The Telescript and Being Prepared for Conversation ...........192
The Target List ......................................................................194
Newsletter...............................................................................197
Action Plan.............................................................................197

xi
90 Days to Success in Consulting

Chapter 17
Marketable Value and Exit Strategies . . . . . . . . 199
That’s Not a Marketable Business..........................................200
Business Valuation..................................................................201
Timing Is Everything .............................................................203
Valuation Metrics ...................................................................205
To Sell or Not.........................................................................207
The Deal ................................................................................208
Action Plan.............................................................................210

Chapter 18
Parting Words . . . . . . . . . . . . . . . . . . . . . . . . . 211
It’s Not What You Make ........................................................212
Save Some for Me! .................................................................214
Riding the Roller Coaster ......................................................214
Buying Self-Determination ....................................................216
Giving Back............................................................................217
Less Than All-In Consulting..................................................218
Ethical Issues ..........................................................................218
Have I Held Back? .................................................................220
Final Thoughts.......................................................................221
Action Plan.............................................................................222

Index. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 223

xii
 Introduction

I n college, when I was working my first consulting job, a pro-

fessor called with a problem with a slow computer. He had
tried everything he knew to fix the problem, to no avail. The com-
puter used to have good performance, but something had hap-
pened. Upon arriving at his office, it didn’t take me long to spot
the problem. There it was: A big red Turbo button—useful in the
Off position for some gaming, which he wasn’t doing—was beg-
ging me to press it. I did. Performance came back. We joked
about the $5 payment—5 cents for pushing the button and $4.95
for knowing which button to push.
Good consultants tend to see answers that others don’t. 90 Days
to Success in Consulting will aid any consultant or would-be consul-
tant in putting the “business” around the insights and expertise
you offer.
Motivations to enter consulting are plenty. Sometimes it’s the
monetary rewards. Sometimes it’s the satisfaction or the control.
I’m continually surprised at how many people want to get into
consulting. However, there’s a lack of solid information about the
consulting business. I have something to offer there. 90 Days to
Success in Consulting will help you do consulting right if you really
want to get beyond just talk. I try to learn as much as possible
every day. I’ve made more mistakes than I care to remember, but
usually not the same one twice. I see mistakes. I’ve picked up
street smarts. All of the information herein is intended as practi-
cal knowledge.
The book is organized into three parts, designed to logically take
you through the major topics that will be interesting to you at
each phase of your consulting journey. In Part I, I cover topics of
instantiating the business, including preparing your mind. In Part
II, I take you through all the issues required to expand a practice.
Part III covers issues in a maturing practice.

xiii
90 Days to Success in Consulting

I organized the book to be modular, so you can dive into any

chapter when you wish to learn about that topic. I did have to
reference other chapters occasionally, though. And although you
can read the chapters as they interest you, the book is ultimately
designed to be read from start to finish and to provide both con-
textual information and specific deliverables to you in all the
topics.
Those specific deliverables are summarized at the end of each
chapter in the Action Plan. For those of you who are reading the
book before you’ve started consulting, these are the deliverables
to do in the first 90 days after you’ve thrown down the gauntlet.
I anticipate that many of you will have already started consult-
ing. Make the Action Plan items that you haven’t done your
action plan for the next 90 days. Taken in the aggregate, all of
the Action Plan items in the book comprise your work plan for
90 days.
In terms of fields of application of consulting, this book is about
the business of consulting and applies to all fields. All consulting
has clients, contracts, finances, fees, consultants, employees,
proposals, campaigns, outlets for your creativity, and so on. It
doesn’t matter whether your field of application is information
technology—as mine is—marketing, mergers and acquisitions,
website design, or workplace safety. Of course, you need to know
all about your field (and I give you tips about this in Chapter 5)
as well as the business of consulting.
Consulting is such a broad term. There are so many paths within
the field. Many are valid. I acknowledge that with this book. I help
each consultant design his or her practice. I don’t assume you start
with immense popularity in your field, a bestselling book, C-level
connections, or the skills to mesmerize an audience of thousands
at a convention. I won’t let you sell yourself short, but you don’t
have to be any of these to be successful in consulting.
Because independent practitioners and small consulting business
owners have some needs that employees of consulting firms don’t
have, there are a couple of chapters and some other errata that
deal with those challenges specifically. Chapter 3 (on the building
blocks of the business), Chapter 17 (on exit strategies), and the
part of Chapter 15 that deals with partnership business forma-
tion may be less interesting to employee consultants at this point

xiv
 Introduction

in their journey because, depending on your level, many items

may be taken care of for you at the firm. However, I have found
in 15 years of consulting that the closer you are to running your
employee consulting ship like a business, regardless of your role,
the higher you will go. Remember, somebody’s dealing with all of
these issues at every consultancy.
Although I put a gross income goal out there of $500,000 annu-
ally, this is decidedly not a get-rich-quick approach. And there’s
nothing wrong with motivation, but I’m giving you the good, the
bad, and the ugly about consulting. It is also not an approach
where you leave scorched earth behind you. This approach is
about creating a win-win with clients, partners, and staff. It’s
about knowing when to sell consulting, not just how to sell it. It’s
about creating a tangible return on investment for your clients,
leaving them better off for having engaged your service in the first
place. It’s a confident but not aggressive or egotistical approach,
where your capabilities are what give you your confidence.
It’s my distinct pleasure to share with you some of this journey
I’ve been on and the things I’ve learned along the way. I hope that
my advice helps you succeed in whatever aspect of consulting you
commit to. Please enjoy. We are all consultants.

xv
This page intentionally left blank
PART I
Breaking into
Consulting as a
Profession
This page intentionally left blank
 Chapter 1

What Is Consulting?

■ Who Is a Consultant?
■ The Goal: Becoming a Top Consultant
■ Consulting in Hard Times
■ For Those Entering Consulting Post-Recession
■ Client Value-Add
■ Action Plan
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