The economic activity of any enterprise should be based on an understanding of business processes, a strategy developed by managers, which includes the definition of the ultimate goals of the enterprise and methods for achieving them. But it is no secret that today entrepreneurs are people who are far from the economy, who poorly understand the features of the functioning and life of this or that business, who have only an idea, but do not know how to put it into practice.
Small business very often has great prospects for its development, it keeps a large part of the market and the existence of the entire economic system, which involves government services, all types of enterprises and end consumers. Understanding all the connections and features of the interaction of all elements of this complex system can only be people who have undergone special training, who perfectly understand what the economy is and what it is based on, as well as have considerable experience working with business entities of various types and directions. Sometimes the help of such specialists is critically needed not only for start-up businessmen but also for large enterprises that already have their own market share and understand relatively well the specifics of activities in the chosen field.
In Russia, in general, the word business and economics are very misunderstood. Despite the developing institute for training economic specialists, today entrepreneurs are engaged in people without education, who have gained a lot of experience but do not understand the theoretical subtleties at all. Many organizations are still surviving on the methods that were developed at the end of the last century, but many more such organizations are failing because they cannot adapt to new market demands. The policy of the organization, to help it get out of a difficult situation or simply increase its effectiveness, is called upon by business consultants, who are those specialists who have been trained and gained experience. It is hardly worth expecting that someday amateurs will completely stop trying to build their own business, it is better to learn how to make money on it, offering assistance to start-up entrepreneurs. In many cases, this will support a unique idea that gives impetus to the overall development, brings something new to the life of society and supports small and medium-sized businesses that are so necessary for the effective development of the economy. This is a feature of capitalism and post-industrial society, when business and free competition, creative development and raising the standard of living of mankind occupy one of the most important parts of modern society.
Services for advising entrepreneurs on existing and possible business processes are commonly called consulting today. This word is just fashionable, in its essence it is consulting, only accompanied by help in solving absolutely all issues related to business. Consulting is not just recommendations, it is a whole range of services aimed at real improvement of the position of the consulted company. Consulting can fundamentally change the economic activity of an enterprise and ultimately can affect the situation on the market as a whole. It is clear that only professionals who do not invent anything but act in accordance with economic laws and personal experience should deal with it. In this regard, opening your own consulting agency is the prerogative of people who
However, a talented economist can start his activity in advising enterprises as an additional expert, who, on an equal footing with top managers of the company, analyzes complex issues, analyzes the activities of the enterprise, finds non-standard solutions, develops and optimizes all areas of activity, acts as a freelance professional, to whom one turns for advice in a difficult situation. You should not even try to engage in consulting if you do not have knowledge and experience, or at least talent, a desire to develop and quickly learn everything new. If a layman takes up consulting, sooner or later it will become known to clients, the reputation will be hopelessly damaged, and it will be difficult and not interesting for the entrepreneur himself to engage in this type of activity.
Consulting can be general and specific, business development consulting refers to general economic development. Special cases of consulting are consulting only on separately ecology, finance, training, marketing, IT, HR, etc. Consulting differs from outsourcing in that it does not take on the duties of an entrepreneur, but looks for ways out of the situation with him. Consulting does not require the client to understand the issue, but aims to teach their own knowledge and qualified support, the consultant works together with the employees of the enterprise, often acting as an observer or even a leader. The agency offering consulting services, in this case, should conduct general consultations on the business as a whole and on its individual elements, that is, be able to resolve all issues sometimes in these cases of consulting. This is what can be called business consulting. Hence the need to maintain a large staff of employees who understand any field of activity: from accounting to operational management.
A company engaged in consulting services may carry out its activities in accordance with the legislation of the Russian Federation without obtaining a special educational license. It is enough to simply register as a business entity, and in this case it is more preferable to register as a legal entity. In order to be able to use the simplified taxation system, it is better to choose the form of a limited liability company. However, it should be borne in mind that consulting activities fall under the definition (OKPD 2) 70.22 Consulting services in the field of enterprise management, and in accordance with this, the OKVED code is selected. However, it is possible to provide business consulting services by working alone, and not by organizing a large enterprise,
It can be said that for a beginner in this type of business, it is better to start with opening a small company, in which, in fact, only the entrepreneur himself works, because the newly opened enterprise does not have the trust of customers, and the businessman is faced with a very serious task of earning his reputation. To start cooperation with large organizations, you will first have to deal with consulting for individual entrepreneurs and small firms. Of course, in this case, you will not have to rely on large fees, but at this time the entrepreneur earns invaluable experience, learns in practice to understand the features of running different types of business and independently faces all the difficulties that await entrepreneurs in general. Business Consulting Specialist – Generalist
After you have managed to work with a large number of enterprises and entrepreneurs, study different areas of business and face various kinds of problems, and most importantly, when you already have a reputation in the consulting services market, you can start actively promoting your offers for large and successful companies that turn to consulting, expecting to get the help and experience of specialists who understand more than full-time top managers. At this stage, the organization should already employ a considerable number of people, each of whom is engaged in his own business and advises on a narrow range of issues.
The office of the company in this case should be located in the business districts of the city, which helps to increase confidence in the consulting company. The representative office itself will employ employees who are engaged in more auxiliary activities, these are extras, analysts, financiers, and marketers who study the market for products and services identify the needs of consumers in general, and find new non-standard ideas for promoting types of products. A separate category is people who develop new concepts, create new products or improve old ones (we are not talking about production directly, but about design). These are people who are engaged in more scientific activities than direct consulting. This is necessary in order to offer our customers completely new, unparalleled developments,
In order for consulting services to be as effective as possible, a company needs to conduct a comprehensive study of the internal system of the corporation and the external one that surrounds this corporation. In other words, you need to be able to identify not only the strengths and weaknesses of the company but also all the factors surrounding it that affect performance indicators and directly affect business processes. We are talking not only about SWOT analysis but about obtaining the most complete data on all industries and areas of the company. This is what generalists, who are directly business consultants, do. After they have identified the problems and identified the business processes that need to be improved, narrower specialists step in to analyze in more detail and offer solutions.
Thus, consulting is inextricably linked with marketing. Conducting marketing research is critically necessary to obtain reliable knowledge about the external environment, without which consulting simply cannot be consulting. Moreover, a consulting company constantly conducts marketing research for its client, collects statistics and determines the development opportunities that the external environment gives it. After receiving this information, the financial and other capabilities of the enterprise are determined, the capabilities and resources are compared, and already on the basis of this, methods for achieving the goals set are identified. Consulting is always designed for the long term, work with the customer should ideally be open-ended, so research is carried out not only to achieve the goals stated by the customer, but also to improve the overall performance of the company as a whole.
This is followed by strategic planning of the company’s business processes, painstaking and thorough development of plans, improvement of organizational structures, improvement of management systems, optimization and logistics, work with personnel. At this stage, consulting begins to resemble the work of training companies and assessment centers. The same principles are used here, training employees, evaluating their activities, certification, identifying the level of interest in achieving the company’s goals (motivation), determining the organizational structure of personnel management, and, if necessary, a complete change in the company’s image as an employer or a change in personnel policy. In order for this stage of consulting to be as effective as possible, the team should include not only HR specialists, but also psychologists and conflict resolution specialists.
Further fulfillment of the task already depends directly on the goals set, in connection with which various methods of achieving them can be used. Consulting is usually turned to when there is a lack of new ideas. This includes companies that are expanding the market, trying to increase the range of products or trying to attract new categories of consumers, who cannot compete with competitors who simply experience stagnation in development or even regression. Start-up companies often need someone else’s experience and knowledge, and a consulting company that has worked on the market for more than one year can give newcomers a lot of valuable information and significantly change their position in the market. In this case, consulting becomes more of a support, an opportunity to get valuable advice from more experienced professionals.
Often consulting acts as a company that can help the customer complete a complex project or complete a task that he has accepted from his client. In this case, it may be necessary to have competent specialists from completely different fields of knowledge, including engineers, builders, technicians, IT specialists, etc. Here, consulting is already more like a professional team of specialists in the performance of certain works, from which execution is required, and not consulting directly. In companies with a complex management system or simply imperfect, it is often necessary to attract specialists who can become a link between the company’s divisions and solve administrative issues, as well as teach customer managers how to effectively manage. Finally, many large firms need to involve third-party experts who evaluate an already finished project or possible risks, based on their assessment, a decision is made by the customer’s management, but the method of expert assessments may not be taken into account in further activities. Here, the consulting company provides experienced experts who come to the project once and no longer participate in it.
The pricing system in the consulting services market is rather complicated. Currently, there are several types of payment, but everything can be roughly divided into three different types, as well as a combined payment, which includes the amount of funds calculated in different ways. The simplest is a lump-sum payment, in simple terms, fixed. In this case, the consulting company has its own list of prices for certain types of services and offers them to its customers only at the price that was originally set, while various unforeseen factors that can significantly simplify or complicate the task of the consultant are usually not taken into account. On the other hand, this method is used where risks are minimal: training, analysis, certification, and so on. The second type of payment is similar to lump-sum, is called time-based and is calculated based on the actual time spent on the customer’s task. The next type of payment is a percentage of the cost of the completed object or depending on the result obtained. In this case, the consulting company is particularly interested in the effectiveness of its activities.
It can be noted that today the cost of the services of a consulting firm in Russia is much lower than in developed capitalist countries, this is due not least to the fact that consulting by many firms is considered a non-priority item of expenditure. It is rather difficult to name average numbers, because a lot depends on the task, but in the case of a percentage payment, it rarely exceeds 5% of the project cost. Also, many firms today prefer to pay consulting firms by bartering or by transferring shares in their company, and in the latter case, the consulting firm is particularly interested in good order fulfillment because greater economic efficiency increases the value of their shares.