Right Questions To Ask Consultants Before Engaging Them

Question #1: Are you and your firm directly, indirectly or possibly conflicted in the context of the engagement we are discussing?

Note: Consultants working in multi-dimensional firms often are potentially conflicted. For example, a large accounting firm that is the auditor of a company is likely conflicted or potentially conflicted where a specialist consultant is unlikely to provide advice to the owners of that company that might disrupt the audit relationship.

Question #2: Whom do you consider to be your principal competitors?

Question #3: What differentiates you from your principal competitors?

Question #4: What do you offer to us that should result in us engaging you?

Question#5: Will you and your colleagues always subordinate your self-interest when completing the engagement to the interests of me and my co-stakeholders?

Question #6: Will you always ‘speak truth to power’ when advising me and my co-stakeholders, even if that means that as a result of your advice your engagement might be terminated?

Note: ‘Speaking truth to power’ is an increasingly popular way to describe ‘taking a stand’ in circumstances where the recipient of information or advice is in a position of equal or comparative power.

Question #7: What specific experience have you had in consulting with others in our industry?

Question #8: Are you able to provide three references and their contact information with whom I can speak?

Question #9: Do you have any hands-on business operating experience external to your consulting practice?

Note: Lack of relevant business operating experience is a profound shortcoming of most business valuation and transition consultants I have encountered over the past fifty years.

Question #10: If you do not have any such hands-on operating experience will you seek it out and sub-contract it if you believe it is necessary for you to do that?

Question#11: What knowledge do you have of current and prospective macro-, country- and region-specific economics as those things may influence our business going forward?

Question #12: What knowledge do you have of current and prospective government intervention as that may influence our business going forward?

Question #13: What knowledge do you have of current and prospective technological advances as those things may influence our business going forward?

Question #14: How do you determine your fees?