An eye opening mini-guide to internal and external consulting

What many people don’t realize is that the world of consulting is generally split into two major categories: external (market facing) consultants and internal consultants.
External (market facing) consultants operate externally of their organization and their expertise is provided on a temporary for a pre-determined fee. Internal consultantsoperate within an organization but is available to be consulted on areas of specialty by various business units, leaders, and individuals.

Out of my 16 year career as a consultant, fourteen years were spent working as a market facing consultant and two years as an internal consultant.     Nothing brought more clarity to my career than the combined experiences.  Here is an observation of the similarities and differences of the skills needed for both types of consultants based on my experiences. 
Let’s start with the similarities.
·         Heightened sense of psychology.  As a consultant, you have to learn how to play sponge AND be a chameleon at the same time.  You have to have a grasp on how people think, how to communicate with them, and what triggers fear, motivation, or action.  You also have to learn how to read between the lines of what is verbally said (and what is not said).
·         Systematic approach of change.  Consultants, whether working internally or externally, have to have a keen understanding of the systems to change.  Change of people, processes, technology, and data. 
·         Ability to influence.  While influence looks differently for each type of consultant, the ability to influence is what elevates a consultant towards becoming a trusted advisor.
·         Commitment to lifelong learning.  Access to knowledge and technical expertise are key pillars of the value consultants bring to the table.  To do this well, consultants must have a ferocious appetite for knowledge and best practices.  
·         Have passion for the work they do.  Given the demanding nature of the role, passion helps make good consultants into great consultants.  Passion allows you to see the root cause of problems, helps you to sift through the noise, and helps you stay laser focused on what really matters – creating an impact for your clients.
Now…the differences.
·       Stakeholder exposure.  While internal consultants have the advantage to build longer term relationships with broad set of stakeholders and establish rapport and affinity more easily, external consultants are better positioned to take more high stakes organizational risks with senior leadership that can transform a company.
·         Different appreciation for cultural nuisances.   Internal consultants are likely to be accepted as an insider because they work for the company. Internal consultants tend to lean into the culture when making recommendations because they understand (intimately) what will work and what will not work.  External consultants bring an outsider’s perspective to a culture and might not always be attached to the recommendations made or empathetic to the impact of the recommendations.
·         How they position their expertise.  Internal consultant position themselves from a place of trust, while external consultants lead with influence, expertise, and a market place lens because they bring experiences from working with other clients.
·         Integrating with the rest of the company.  Internal consultants are able to connect the dots a lot of quickly to gauge how a recommendation could potentially have downstream impact on the company’s financials, people, processes, or technology.  External consultants may not always have the bigger picture of other programs, processes, or business line activities in mind when completing a project but is able to take on more risks with less repercussions.
·         Different agendas.  Internal consultants are seen as being an ally with more skin in the game given their personal allegiance to their company.  External consultants are objective and typically focused solely on the results than a personal affinity.
As an internal consultant you have an opportunity to learn how to better influence, navigate organizational politics, and build deep relationships, all while having an empathetic understanding of the motivational triggers of your stakeholder groups.   As an external consultant you have the opportunity to work on numerous client environments, business problems, and projects. 
In order to become a great consultant with depth to your expertise, I believe you need experience on both sides of the table.

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