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9 Main Differentiating Factors between Internal and External Consultants. 4 Biggest Challenges of Internal Consultants.

Whilst most writing on consultancy draws upon the external consultant as an example, writers accept that there are particular issues faced by consultants operating from within.
It is recognised that internal consultants possess many of the skills deployed by their external counterparts (Armstrong, 1992; Duncan & Nixon, 1999; Laabs, 1997). They have the additional advantage of knowing the business – its systems, language and culture, from the inside. However, the internal consultant works within a complex contractual environment where reporting lines may be the same as that of their client. They will typically not hold budgetary or other power to enforce change and may be perceived as agents of a broader corporate agenda rather than true client helpers. As Armstrong (1997) states:

‘‘ Internal consultants may have just as much expertise, although as employees it may be more difficult for them to be – or to be seen to be – as independent as those from outside the organisation. They have to demonstrate that they are able to deliver truly objective advice.’’

If the role of the internal consultant is to facilitate change, then particular challenges exist over and above those facing consultants from outside. The skills and attributes they bring to the role are often overlooked when line managers look for support to achieve change so internal consultants can find themselves busy with mundane operational tasks whilst external consultants get the more challenging, strategic projects. This sidelining is a function of many factors: the credibility of the consultants themselves, their ability to market their offerings, the micropolitical landscape, status and value issues connected to consultancy use.
Typically the internal consultant is drawn from one of the teams of professional service providers such as HR, IT or finance where there is a history of supporting internal customers with specific problems.

The internal consultant’s role is to lead and influence change through supporting clients to learn and apply new skills. In this sense, there is a tension in the internal consultant’s role; how to help the client, where the best help that can be given may not be aligned to the organisation’s agenda.

The main differentiating factors between internal and external consultants are summarised below:

External Internal
Credibility through brand status and previous experience Credibility through history of interactions within the business
Broad business perspective – bringing new ideas Deep organisational perspective
Limited organisation-specific knowledge, possibly at content level only – ‘Not made here’ Understands its culture, language and deeper symbolic actions
Perceived as objective Perceived as an organisational ‘agent’
Special The same
Low investment in final success High investment in final success
Meets client’s agenda Meets corporate agenda – which may not be client’s
Needs time to understand the people – may misinterpret actions and interpersonal dynamics Knows the people, but may have preconceptions
‘On the clock’ – timed, expensive, rare and rationed Free, accessible, and available

In Kenton and Moody’s (2003) research internal consultants were asked about their biggest challenges in the role. By far the most frequently mentioned were:
 Lack of understanding of the role within the business;
 Lack of trust;
 Lack of senior management support; and
 Lack of power to action projects/proposals.

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