Are external consultants necessary?

[Monro]

If a company’s internal consultants perform well, is it necessary for an organization to hire external consultants?

[Ian Cai]

From my perspective, asking help form consulting firms is not necessary. It depends on the specific situation. In most cases, hiring an external consulting firm help, but you need to contrast the differences between the cost and the benefit of hiring consultants.

[Abby Chang]

External consultants set foot in many industries, so they may have more knowledge than internal consultants and have the ability to control the overall situation. But the internal consultants just need to face the situation in one company (one industry), so they won't have as much knowledge. In my opinion, hiring an external consultant is necessary because they can deal with many problems that internal consultants can't deal with. Some problems involve several industries, external consultants will give their customers a proposal timely and accurately to solve the problems.

[Tom Spencer]

Hi Monro, 

Very good question!

There are at least four (4) reasons that a company might choose external consultants (even when they have good internal consultants available): 

1. Expert knowledge: External consultants may have experience solving similar problems and an understanding of industry best practice that internal consultants do not have.
2. Independent advice: External consultants can assist management by providing independent third party recommendations. Internal consultants may have a vested interest in the outcome of their advice. For example, they are unlikely to recommend cost savings that include job layoffs in their own department.
3. Catalyst for change: Senior management may need to support for organisational change, and so hiring a top consulting firm can provide political cover for them to push through difficult changes, "nobody ever got fired for hiring McKinsey".
4. Cost effective solution: For some types of projects (e.g. software development) consultants may represent a cost-effective solution. A firm may lack the capabilities needed to complete the project in a timely or cost effective manner and it may not be feasible to hire and train full time staff.