The Credit Professional as Internal Consultant

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When you need consulting services, you generally go outside the organization. The result? "In most cases, you end up paying dearly for a three-ring binder," observes Jerry F. Dean, CCE, manager of Corporate Credit Services for BP Amoco Corporation (Tulsa, OK). "It seems as though businesses feel they have to have third-party understanding and pay for it. They fail to realize that they should be able to get the information they need within their own organizations--without all of the costs."

For this reason, Dean encourages credit professionals to transform themselves into internal consultants in their organizations. "Future business conditions will require us to rethink our current roles," he explains. "In addition, you already know your organization better than a third party does."

"For example, we just installed an SAP accounts receivable software system," he says. Prior to the installation, it became obvious that the company didn't have a strong enough infrastructure to implement SAP at the time. "We found ourselves having to look at every process internally, trying to figure out how to make the appropriate business improvements," he continues. The experience helped Dean realize that, had the company adopted the concept of internal consultants earlier, most of these problems would have already been dealt with.

Contributions
What can you contribute to your organization as an internal consultant? Dean sees several opportunities:

You can make recommendations related to strategic and operational questions being considered. This information can help management make more intelligent operating decisions and strategic decisions.
You can develop alternative courses of action.
You can make recommendations to improve efficiency.

"Your input could be very valuable under the right conditions," he notes.

Skill Requirements
What skills would you need to become an internal consultant? Some of the essentials are:

Being sure to begin with a broad base of experience (including managerial accounting and industry trend knowledge).
Developing a mindset of starting your own consulting practice, and thinking like a professional consultant.
Generating credibility with senior management if you don't already have it.
Working to be perceived as a professional, or no one will seek out your advice.
Being sure you have excellent communication skills.
Thinking of co-workers and managers as clients who could easily outsource your services. "Adopt a willingness and ability to be responsive to client (internal customer) needs," says Dean.
Being sure to have a strong sense of "value-added" in the performance of your duties.
Beginning with the "olive branch" approach, rather than trying to "bull" your way in. "Approach the process as a team player, rather than an intruder," Dean advises.
Explaining what you can provide and how your services will add value to the organization.
Being able to demonstrate some measurable improvement in the organization as a result of what you do or recommend.

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As an example of internal consulting in practice, Dean cites his experience working with the company's marketing department where he was able to identify a multi-win opportunity. "We work with jobbers who purchase our products and sell them to retail outlets," he explains. "These jobbers are in business for themselves. We were able to work our way into a financial consultant's role with them. We prepared a financial report called the 'Jobber Financial Analysis Report.'"

This annual report compares jobber performance with their peers (of like size in terms of assets). "It also ranks them in terms of strengths and weaknesses," adds Dean. "The jobbers love it. We even get calls from their CPAs wanting additional recommendations on how to improve their organizations."

Opportunities to 'Shine'
What kinds of results and benefits can you expect by setting yourself up as an internal consultant? "You'll have the opportunity to 'shine' in your organization," he says. "If you can show substantial bottom line results, you may even be able to work your way into a different job title and promotion.

Some readers may agree that they can do more than they have in the past in the role of consultant but feel that there is still a role for third-party consultants. After all, don't they bring a sense of objectivity to the table that internal people lack? Dean disagrees. "I think this concern really boils down to communication--or lack of it," he says. "Traditionally, people in organizations have often had difficult times talking with each other. I think something is wrong with an infrastructure if you cannot work together. Once you are able to do so, you can accomplish so much--and you can do it by yourselves."

Editor's Note: The above article originally appeared in the Credit & Collection Manager's Letter, a newsletter purchased by Credit Today in 2006. This article originally appeared prior to 2000.