I’ve heard it said that a consultant is someone who borrows your watch and tells you what time it is, and then walks off with the watch.
While that’s actually pretty funny, I’m happy to say that my personal experience as a business owner is quite different and I hope it is for you as well. Much of that positive outlook is due to the fact that my company has learned a thing or two, after more than 30 years in business, about when and how to select the right consultant for the right project or area of expertise. One area where sound, practical advice is absolutely indispensable is finance, especially during these difficult economic times. It just so happens that our trusted certified public accountant of more than 25 years, Julian Rodriguez, is the benchmark I use to measure all other consultants.
Julian possesses three attributes which I have come to not only appreciate as a valuable resource, but which I now specifically look for during the screening process when considering other consultants. The first attribute is, necessarily, knowledge. The No. 1 reason for even considering a consultant to help you as you navigate the ins and outs of running your business is the need to acquire specific, specialized knowledge. Take finance for example. My father always taught me that I need to know enough about accounting to be dangerous, but Julian is expected to know everything down to the latest revisions in the tax law. Don’t settle when it comes to your consultant’s knowledge base. It’s critical to help you make the right, and difficult, decisions.
The second attribute to look for in a consultant is experience, particularly within your industry. The fact that Julian has been our accountant for more than 25 years is telling, but even more telling is that he’s kept most of his other clients for that long as well. His experience in the construction industry makes him an expert in industry-specific issues such as bonding which is vital to our business. Knowledge is critical, but proven experience in working with businesses similar to yours is indispensable.
The third and final attribute I look for in a consultant may not seem as technical as the first two, but it’s no less important. I call it the “We Factor.” Since Day One, Julian has always considered himself part of our team. He’s invested in the success of my organization, not financially, but personally, and voluntarily places himself right there in the mix with us. I can’t recall a single meeting where he’s said, “What you have to do is…” Instead Julian says, “What we have to do is…” It may not sound like much, but it’s a clear indicator that you’re on the right track with the right consultant.
And speaking of his advice on “what we have to do” from an accounting perspective, here are Julian’s best practices for business owners during the recession:
n “Beyond a doubt, the most important thing we can do during these difficult economic times is control costs.” This isn’t something that is applicable only to the construction industry, it’s applicable to any business because cost is one of those factors that we actually have some control over. We obviously need a revenue stream to survive, but we have no control over the ultimate buyer. We can’t control if someone will come in and buy our product, but we can control costs which means that we can ensure that we will have a blood line.
n “Get rid of any and all non-performing assets.” This goes back to controlling costs. Property that is not generating rent is a non-performing asset, and it’s got to go. The same is true with equipment that is sitting idle. Convert it into cash flow because cash flow is pivotal in times like these. And as difficult as this may sound, non-performing assets are not only physical assets, but human assets as well. If someone on the team is not performing, they too must go for the good of the organization.
n “Adjust the principals’ lifestyles.” Yet another example of controlling costs but this one carries even more weight because it starts at the top. There are plenty of business owners who refuse to face the fact that we are living in what a recent Financial Times article refers to as a “salary-stagnation mode” the likes of which we haven’t seen in more than 20 years. We have to make whatever cuts are necessary, and consider the positive effect we will have on company morale. “It’s not good for morale if the owner drives to work in a Ferrari when he’s laying off employees or cutting their salary. Some people may not like to hear that, but I think it’s important to be in solidarity with the people we work with.”
Manny García-Tuñón, executive vice president of Lemartec, an international design-build firm headquartered in Miami, can be reached at email@example.com.