Having an external consultant with a broad peer network that you can trust is invaluable. They can break the expensive staffing firm middle man cost, they can refer from specific knowledge of capability and they can find answers and comparisons for your organizational conundrums.
There was a discussion recently on LinkedIn about an internal employee recommending a consultant to his boss. The poster wondered if there should be referral fee; if it was ethical. The answer is no, but look at the arrangements that are made with third parties- one consultant bringing another in under the cover of “sub-contracting”. How come that is ok?
However lucrative I am not comfortable with these arrangements (staffing firms calling themselves consultants being the worst example) because now cash can guide recommendations. How strong is that referral now that money is changing hands?
When it does hasn’t your trusted advisor just turned into a gatekeeper?
Gate keeping can have its advantages if that person truly understands the individuals and the need. Impartial makes the understanding objective. Cash turns the pick of who to recommend into a subjective exercise.
The other way around view, from the consultant’s perspective can get even more confusing. Many consultants feel they “own” the client relationship. Weasel (their word not mine) into that “trusted” arrangement and you have broken the consultant ethical code. Most consultants will expect a fee for that connection (enter the non compete contract- which , thankfully, here in CA is not worth the paper its printed on).
At that exchange your trusted advisor just became a gatekeeper. A gatekeeper in the interests of their own pocket book not your needs.
Ask that key consultant of yours what they think of the ethics of consultant referrals and payment before you give them the trusted advisor label/role.
