Companies urged to keep control of consultants

Organisations risk wasting vast sums of money on external consultants by not managing them tightly enough or using them when the work could be done just as effectively in-house.

The warning comes on the heels of a report by MPs this week that revealed the public sector wastes more than £500m a year on unnecessary and poor use of consultants.

This week ZDNet.co.uk's sister site, silicon.com, asked a 12-strong CIO Jury IT user panel if external consultants deliver value for money, and the responses were mixed. Most said both "yes" and "no" — the main caveat being that consultants need to be tightly managed to get the best value out of them.

Neil Hammond, head of IT at British Sugar, said: "If there is there a specific question you want tackled or a specific, well-defined project you want undertaken, then consultants can be very useful in order to supplement resource and skills or take an external perspective. But, if they take over your strategic planning and programme management, then you're in trouble — keep consultants on tap, not on top."

That means consultants need to be used within a clearly and tightly defined context set out by the employing organisation. Paul Haley, IT director at the University of Aberdeen, said: "To permit the consultant to scope the project is to abdicate managerial responsibility."

Kevin Fitzpatrick, chief information officer of Sodexho UK, added: "Though consultants can sometimes truly be 'partners', their primary motivation is revenue for their company not yours."

Nicholas Bellenberg, IT director at publisher Hachette Filipacchi UK, said he has had excellent experience of using consultants when they are tightly focused, delivery-driven and given finite budgets, but said that is not always the case that they are.

He said: "My worst experience was years ago, when I had cancelled a particular piece of work. The company supplying the consultant said: 'Couldn't you just keep him on until the end of the month?' It was clear that their agenda was keeping the day rate coming in, rather than delivering value. Caveat emptor."

The use of consultants in the public sector is obviously a thorny issue given the cost to the taxpayer. Peter Ryder, Preston City Council's head of ICT, said: "Some do an excellent job, but perhaps the real question is: should we always be using and spending so much on external consultants who charge a considerable fee when a lot of the work can successfully be done in-house?"

Janet Norman-Philips, South Norfolk Council's head of e-government, added: "The right consultant at the right time can save you a fortune and a pile of grief. On the other hand, there are times when using a consultant is insane or, even worse, when the consultant you use is insane — then you are really in trouble."

But David Supple, head of IT and creative services at consultancy firm Ecotec, defended his industry. He said: "The key is knowing what to ask for and knowing whether or not the knowledge and guidance you are asking for is good value for money in the first place. The management of consultants is a skill in its own right."