CHAPTER 39

Consulting on the Inside: Roles, Competencies, and Challenges

B. Kim Barnes and Beverly Scott

At the time the second edition of Consulting on the Inside was published, the world of the internal consultant hadn’t changed very much since the 1970s. Suddenly, in early 2020, almost everything about most organizations changed—including the life of the internal consultant. Many of the aspects of the role are still true, but the daily practices have changed in both predictable and less predictable ways. This chapter addresses applications to the post-pandemic organization.

The term consultant may raise images of highly paid business consultants from large (or small) firms brought in by senior management to address problems that the organization cannot solve. These external consultants bring the advantages of outsider status and expertise drawn from a wider base of experience—the basis for their perceived value to executives. An internal consultant, on the other hand, has different requirements, advantages, and challenges that need specific roles, unique competencies, and other determinants for success.

There are similarities between the two roles as well as differences. Competent internal and external consultants both have:

•  Knowledge of human systems as well as organizational and individual behavior

•  An understanding of the process of change

•  A desire to be successful and recognized for the value they bring to their clients

•  A commitment to learning

•  Passion about their work

•  The ability to influence and lead

•  Skills to analyze needs and design initiatives

•  Credibility or authority

It’s also useful to consider the differences because each role has its strengths and one may be more appropriate for specific situations than the other. For a comparison of internal and external consulting roles, review Table 39-1.

Advantages of Internal Consultants

The internal consultant offers unique benefits as an insider with deep knowledge of sensitive issues, cultural norms, and organizational history. External consultants are often engaged for their unique and specialized skills and knowledge, but the internal practitioner has the benefit of intimate, detailed, hands-on knowledge of the organization’s business, strategy, and culture. You can download a tool from this handbook’s website, ATDHandbook3.org, that provides guidance for you about when to use each.

Internal consultants understand organizational politics, webs of relationships, and details of past history to a degree that few externals can match. Internals can also use inside jargon and language. Their deep, sometimes personal relationships with clients and colleagues build trust and credibility over time. Consequently, internals have an enhanced ability to assess situations and use the right approach with a shorter ramp-up time on new projects.

A second advantage is that internal consultants are active participants in the life of the organization. They are aware of business challenges, customer issues, and management decisions and actions. External consultants often enter the system for a short time to implement a specific solution and then leave. The internal consultant remains in the organization long after the project is completed and can thus follow progress, identify challenges or barriers to the solution, and follow up quickly with members of the organization to support the effort or ensure that actions are carried out or adjusted as necessary. Insider knowledge allows internals to recognize potential links to allied initiatives in other parts of the organization, involve other staff, or expand an initiative to include other issues.

Third, internal practitioners are a ready resource for senior leaders, internal change partners, and employees. They collaborate across the organization, build a commitment for change initiatives, and can give spontaneous coaching or advice. Immediate action may head off a potential problem, defuse a budding conflict, encourage a project leader, or provide needed support in developing new behaviors.

Issues and Challenges of Internal Consultants

Internal consultants’ intimate knowledge of the organization and the business makes them valuable business partners. However, this also challenges their role of neutrality and objectivity; they may be seen as too familiar, not capable of providing an objective outsider’s worldview. Sometimes they must stand at the edge, operate at the margins, and maintain distance. This delicate balance of having organizational knowledge, yet keeping a marginal position defines the paradox that confronts the internal consultant. Belonging to the organization and finding acceptance helps internal consultants be congruent with their clients, yet they must be cautious and avoid collusion (such as failing to tell senior managers the truth).

Many internal consultants are placed in a middle tier of the reporting hierarchy within the human resource function. Many organizations do not appreciate the value of a strong, skilled internal consulting function. Practitioners may find this status and reporting relationship to be a barrier to establishing competence and credibility, especially with a senior executive. In addition, when senior leaders bring in external consultants to lead change initiatives, the success of these efforts often depend on follow-up work by internal practitioners. Developing a professional relationship with external experts and a seat at the table for major initiatives can be difficult. Internal consultants must show that they are more than a pair of hands to implement projects driven by an external firm. Several conditions will lead to success in such partnerships, while others can undermine them (Scott and Hascall 2002, 2006):

•  Internal–external partnership conditions for success.

  Both parties are flexible and practice open communication with each other.

  They have a sense of being in it together and share accountability.

  The organization acknowledges the opportunity to leverage cost, efficiencies, knowledge, and credibility.

  The external partner recognizes and values the knowledge and skills of the internal partner.

  The internal partner is open to learning from the external partner and is not competitive.

  They both appreciate the value of pairing insider knowledge with outsider perspective and credibility.

  They both respect the organization’s culture.

•  Internal–external partnership conditions that undermine success.

  Internal consultants do not have the organizational influence to lead major change initiatives.

  Senior management does not understand the value of the internal consultant’s organizational ties and thus fails to support the partnership.

  External consultants ignore or go around the internal function, promoting themselves to senior management.

  Internal consultants are left out of the contracting process and thus feel resentful, threatened, or marginalized, resulting in a lack of commitment.

  External consultants are seen as arrogant, exclusive, and judgmental; in turn, internals are perceived as ineffective or incompetent.

Successful internal consultants have access to the hierarchy. However, many internal consultants face pressure from senior-level clients to break confidences, take on unrealistic projects, or make inappropriate changes. Internal consultants may also experience resistance and a lack of cooperation from their human resource peers. While the internal consultants are advocating and facilitating change, their peers in human resources, in contrast, are more focused on protecting and stabilizing the organization. These challenges and paradoxes create conflict and stress for internal consultants who aren’t prepared for these challenges (Foss et al. 2005; Scott 2000).

Developing collegial relationships within the organization may present difficulties, due to the confidential nature of much of the work that internal consultants undertake. For example, friendly colleagues may expect them to share inside information. Internal consultants often have to find their best confidants, mentors, and coaches—people with whom they can discuss their concerns and issues to learn and gain new perspectives—outside the organization.

A key part of the internal consultant’s role in many organizations is educational—letting others know what they can expect and gain from developing a strong working relationship with them. This is a marketing challenge and may require the internal consultant to help clients and colleagues unlearn certain expectations (for example, that the consultant will fulfill an order as requested) and learn new ones (for example, that the client will be expected to provide their time, energy, and wholehearted support). Initial meetings with new clients offer opportunities to negotiate an effective working relationship and establish realistic expectations of one another. The internal consultant should be alert to other opportunities to promote a broader understanding in the organization of their value proposition and how to best access and take advantage of it.

The role of a consultant, whether internal or external, is dependent on their ability to influence clients, colleagues, team members, and others in the organization. A strong set of influencing skills and a sophisticated ability to apply them in the service of important organizational or client goals are essential to success. The consultant may be called upon to lead important change efforts and take an active role in moving the organization toward achieving key strategic goals. Perhaps the most important challenge any internal consultant faces is that of adding real value by influencing others to take actions they might not otherwise take. However, this may not win them recognition—in fact, if they are successful, as Lao Tzu once wrote, the people will likely say, “We did it ourselves.”

Opportunities for Internal Consultants

Despite the challenges, internal consultants have a unique opportunity to exploit their position and have a long-term, significant influence on the organization. Internal consultants’ holistic knowledge of the organization enables them to take a systems view, ensuring that organizational structures and processes support the change targets. When they partner with external consultants, they can be multipliers by disseminating and reinforcing expertise and cutting-edge concepts, integrating them into the culture of the organization through their day-to-day work. Using inside knowledge of the business and organization, they can be catalysts for needed change, ensure organizational alignment with the business strategy, prepare employees with skills to cope with forthcoming changes in a tumultuous business environment, and provide candid perspectives as confidential sounding boards for senior executives.

Internal Consulting Roles

The internal consultant, like the external consultant, uses expertise, influence, and personal skills to facilitate a client-requested change without the formal authority to implement recommended actions. The change usually solves a problem, improves performance, increases organizational effectiveness, or helps people and organizations learn.

Being a successful internal consultant requires both process skills and business or organizational expertise. Internal consultants are expected to bring more than their presence, process, and observation skills. They also bring technical competence and content knowledge. Consultants may balance the process or technical roles or emphasize one over the other. Let’s review some of the roles an internal consultant might choose (Lipsey and Scott 2008):

•  Classic consulting roles:

  Doctor. The consultant’s role is to make a diagnosis and recommend a solution. The client is dependent on the consultant to offer a prescription.

  Expert. The client determines what the problem is, what kind of assistance is needed, and whom to go to for help. Then the consultant is asked to deliver the solution.

  Pair of hands. The consultant serves as an extra pair of hands, applying specialized knowledge to achieve the goals defined by the client (Block 1981).

•  Traditional organization development roles:

  Change agent. This is the classic OD consultant role in which the consultant serves as a catalyst for change as an outsider to the prevailing culture and external to the subsystem initiating the change effort (French and Bell 1999).

  Process consultant. The consultant provides observation and insights, often at a larger system level, which helps sharpen the client’s understanding of the problem (Schein 1988).

  Collaborative consultant. This is similar to the change agent and the process consultant, but with the key assumption that the client’s issues can be addressed best by joining the consultant’s specialized knowledge with the client’s deep understanding of the organization. The client must be actively involved in the data gathering, analysis, goal setting, and action plans, as well as sharing responsibility for success or failure (Block 1981).

•  Newer consulting roles:

  Performance consultant. The demand for increasing organizational and employee performance has contributed to a role that transcends the traditional description of a skills trainer. This role combines the whole-system focus of organization development with the understanding and techniques of skills training. The performance consultant partners with the client to identify and address the performance needs within the organization and provides specialized services that change or improve performance outcomes.

  Trusted advisor. The rapid pace of change and the complexity of the environment place organizational leaders in unforeseen and unknowable challenges and dilemmas, such as competitive global markets and rapidly changing technology; thus, they must chart a radically new strategic direction for their organizations. Amid this turmoil, they must focus internally on maintaining cultural alignment while still meeting the needs of customers, employees, and other stakeholders.

The role the internal consultant plays in the change initiative reflects four considerations: the characteristics of the consultant, the characteristics of the client, the client–consultant relationship, and the organizational situation. While internal consultants may occupy many or even all these roles in the course of a single week, each one is particularly well suited to certain situations and it is the consultant’s job to choose based on these considerations (Scott 2000). Each consideration can be explored by using these questions:

•  Characteristics of the consultant

  What are my interpersonal strengths?

  What is my consulting competency?

  What is my technical expertise?

  How well do I grasp core business processes?

  How is my expertise relevant to the client?

•  Characteristics of the client

  Who are the sponsor, primary client, and secondary clients?

  What support is there for the initiative at different levels in the organization?

  Is the client committed to being involved and participating in the project?

  What is the client’s readiness for change?

•  The client–consultant relationship:

  Does the consultant understand the client’s definition of success?

  Is there a commitment to help the client learn skills and insights?

  Have expectations been explored and clarified?

  Has the client’s trust been established?

•  The organizational situation

  Are the organization’s vision and strategy clear and understood?

  What are the key strategic needs of the organization?

  What are the effects of the current market and competition on the organization?

  What is the focus of attention?

  What resources are available to support the project?

  Are other strategic initiatives being driven in the organization? How might they affect the current initiative?

  What cultural norms and mindsets will influence the project?

  What are the organizational expectations of internal consultants?

  What organization needs are not being met?

  Is the expertise of the consultant relevant to the organization’s needs?

Competencies for Internal Consultants

We have discussed the advantages, challenges, and roles of internal consultants. However, the competencies required to deliver the desired results are perhaps even more critical. Competency includes the knowledge, skills, and attitudes (KSAs) needed to be successful. Organizational consulting, whether from outside or inside, requires a sophisticated set of competencies. Many of these are the same for both groups, but internal consultants have a more complex role as insiders with an outside view. Internal consultants report that their success requires consulting competencies that are different from those of external consultants. Table 39-2 shows behavioral descriptions of eight important competencies for the internal consultant. The categories of internal consulting competencies and some of the descriptive behaviors were developed from the results of interviews with internal consultants. While the descriptive phrase might occasionally resemble that of external practitioners, internal practitioners demonstrate the competencies differently because the context of the internal practitioner is different. A self-assessment can be found on the handbook website at ATDHandbook3.org.

Keys to Success for Internal Consultants

The most critical key to success for an internal practitioner is gaining the trust and credibility of both leadership and employees. Trust and credibility are based on both competency and personal integrity. The credibility of internal consultants, more than any other staff function, is influenced by the integrity, self-awareness, and self-management of individual practitioners. This strong foundation relies on developing authentic partnerships with clients and making careful judgments regarding the client’s resistance, readiness to take the risk of change, need for support, ability to lead the organization through transition, and openness to tough feedback. To achieve the successful outcomes internal consultants envision with their clients, they must also build strong relationships with their managers, other levels of management, and peers and colleagues in HR or other staff functions. Building strong relationships requires internal consultants to educate and prepare others to understand and appreciate the role of consultant; take the initiative to understand the others’ perspectives; and be strong, clear, self-aware, and self-managing. Misunderstanding of behavior or agreements can quickly destroy many years of effort by the internal practitioner (Foss et al. 2005).

More than the external consultant, many of whom specialized in a limited area of practice, the internal consultant must be a generalist, familiar with and competent in a broad range of approaches and solutions. The internal practitioner must master a wide range of potential initiatives. However, this also represents a potential pitfall. Internals cannot be successful trying to do everything, so they must be selective in offering their services to maximize the benefits of their efforts. By making conscious choices and aligning with organizational strategy and priorities, the internal consultant will add more value to better meet the needs of the organization.

The Process of Internal Consulting

Though similar, the consulting process for internal consultants is different from that practiced by external consultants. It is usually messy and organic; the steps are seldom linear, often overlap, and may require cycling back to repeat or expand an earlier phase (Figure 39-1). The consulting process does not begin with entry as it does for external consultants. It begins with the initial contact with the client and is heavily influenced by the consultant’s reputation in the organization. That reputation is as valuable as a popular product brand name, and many internal consultants use it successfully to market themselves within the organization. Internal consultants can help to position their reputation by setting the stage at the time of hiring and negotiating their charter with their managers and most senior potential clients. The ability to manage relationships and the dynamics of living inside the organization is a requirement for successful movement through the consulting process.

There are eight phases in the internal consulting process (Scott and Barnes 2011):

•  Contact. Seek an understanding of the client’s organization or business need. Lay the foundation of the consultant–client relationship.

•  Agreement. Confirm consultant and client roles and expectations, and the actions each will take. Define the need to be addressed and the goal or outcome to be achieved.

•  Information and assessment. Gather information about the issue, business, performance, and organization. Assess or analyze the data and information collected. Gain an independent view and interpretation of the issues.

•  Feedback. Provide the client with the information or data; seek acceptance or ownership of the data. Offer a consultant’s analysis or interpretation.

•  Alignment. Seek alignment with the client on the desired outcomes or future state and the approach to be used to achieve it.

•  Change targets and transition strategies. Clarify which components of the system need to be changed and identify the necessary support and resources. Develop a transition strategy to navigate from the current state to the desired future.

•  Implementation. Complete the project by providing guidance, coaching, facilitation, and leadership to implement the planned change.

•  Evaluation and learning. Evaluate the success of the project with the client system by supporting the client’s reflection and identification of learned skills, knowledge, and self-awareness. Explore enhanced knowledge, skills, and self-awareness.

Challenges and Opportunities for Consultants in the Post-Pandemic World

The year 2020 forced organizations and practitioners to accelerate changes that were, for the most part, already under way. Remote and hybrid work teams became the norm for most information and technical employees. Most formal learning processes and team meetings now take place via webinar or video. A great deal of informal and formal communication has also migrated to communication platforms and apps.

These changes offer challenges and opportunities to internal consultants who need to help their clients learn to navigate and manage continuing changes in structure and culture. For example:

•  Building an aligned community with people who are geographically dispersed or who seldom meet face-to-face

•  Creating a sense of fairness and equal opportunity within hybrid teams, where those who are remote can feel isolated from and less important or visible than co-located team members

•  Communicating in ways that are memorable and engaging with team members and colleagues at a distance

•  Inventing and practicing revised approaches to problem solving, decision making, and other important processes that can work in a variety of formats

•  Devising ways to use flexible structures that can change according to individual and organizational needs

Internal consultants also experience their own challenges in this hybrid environment, such as:

•  Supporting and facilitating the required changes as organizations and teams become structurally more flexible—moving from remote to hybrid to in-person and back again

•  Finding ways to replace the watercooler conversations that keep them informed about below-the-surface issues and interests

•  Designing remote meetings and experiential learning sessions that are interesting and engaging

•  Developing new approaches that involve remote or hybrid groups in ideation, strategic thinking, and decision making

•  Facilitating virtual meetings that build trust and enable the team to address sensitive interpersonal and team issues

There are also new opportunities to explore. Organizations have learned that employees can be trusted to work at home and that they need direction based on outcomes rather than supervision of the process. Technology makes it possible to collaborate across boundaries. Internal consultants can encourage and support these new ways of working and coach leaders to make the changes needed to be successful in this shifting environment.

Many consultants have also found it easier to develop informal relationships with clients given the looser organizational boundaries and more informal settings. For example, meeting someone’s dog or toddler on camera can offer a way of becoming more real to one another and lead to deeper conversations about things that matter in the organization.

Because organizations and teams have become more flexible, even shape shifting, internal consultants will be an especially valuable asset to leaders whose roles have changed in significant ways. Internal consultants’ work will address the same issues as before, although perhaps in new forms. Stress, conflict, and change continue to create difficulties for leaders who may find it more difficult to know and understand the individual members of their teams when they mostly see and hear them on a screen. Achieving high-quality results remains a continuing challenge, so learning new skills and developing their own and their team members’ careers are as important as ever. By educating, supporting, coaching, and challenging their clients, internal consultants have new opportunities to contribute to the reinvention and growth of their organizations.

For internal consultants and leaders, we have a great opportunity and significant challenge to take what we have learned during this difficult period and bring the best of it forward into whatever the new normal becomes. We will probably be more relaxed about where team members are located, even though we aren’t face-to-face, especially if our trust in one another has stayed the same or even increased. We will likely offer more online learning experiences that people can attend from anywhere in the world. And we can make our meetings both more efficient and more inclusive.

Having lost the opportunity for so long, we’ve also come to appreciate the value of meeting one another in person and know how and when that’s important. We may also have a better understanding and empathy for team members who are parents or caregivers and work to help them have a more balanced life. Internal consultants will want to reflect on what they’ve learned about themselves during this period of enforced isolation from their usual colleagues. What new options for working and relating to clients and colleagues have opened up for you? What did you find that you could live and work without? COVID-19 provided a natural experiment to test new ways of working—let’s make the most of the opportunity.

Final Thoughts

Internal consultants offer unique benefits with their deep and intimate knowledge of the organization. They are a ready resource to management and staff. Insider knowledge makes them valuable partners to external consultants; however, being internal challenges their neutral and objective role and requires them to manage a delicate balance of having deep organizational knowledge with maintaining a position at the boundary.

Successful internal consultants cultivate trust and credibility as business partners to senior managers, supported by demonstrated competence. Competence includes their professional expertise as well as the unique capabilities required of internal consultants. Knowledge of themselves, their clients, and the organization allows them to choose appropriate roles. Professionals who are committed to successful outcomes for the organization, willing to step out of the limelight, and remain humble and generous of spirit can find rewards and make a significant contribution to the organization to which they belong.

The whitewater we are all navigating now creates new opportunities for internal consultants to contribute to their clients and help shape the nature of their organizations. It’s a time of uncertainty and constant change—conditions under which creative thinkers and intelligent risk-takers can thrive. Those who are drawn to the field of internal organizational consulting have an exciting and fulfilling ride ahead.

About the Authors

Beverly Scott served as a consultant to organizations for more than 35 years. She served for 15 years as the director of organization and management development for McKesson Corporation in San Francisco. She is the co-author of the second edition of Consulting on the Inside: An Internal Consultant’s Guide to Living and Working Inside Organizations. She has served on the faculty of organization psychology at John F. Kennedy University, and as chair of the OD Network board of trustees. Bev also published the historical novel Sarah’s Secret: A Western Tale of Betrayal and Forgiveness, based on the uncovered family secrets in the lives of her grandparents. You can reach Bev at [email protected] or on her website, bevscott.com.

B. Kim Barnes, CEO of Barnes & Conti Associates, has more than 40 years of experience in leadership and OD, working globally with organizations in many industries. A frequent speaker at professional conferences, Kim is the developer or co-developer of popular Barnes & Conti programs, including Exercising Influence, Managing Innovation, and Consulting on the Inside. Her books include Exercising Influence: A Guide to Making Things Happen at Work, at Home, and In Your Community; Consulting on the Inside: An Internal Consultant’s Guide to Living and Working Inside Organizations (with Beverly Scott); and Building Better Ideas: How Constructive Debate Inspires Courage, Collaboration, and Breakthrough Solutions. She also writes mystery novels with an internal consultant as the protagonist. You can reach Kim at [email protected] or on her website, barnesconti.com.

References

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French, W.L., and C.H. Bell, Jr. 1999. Organization Development: Behavioral Science Interventions for Organization Development. Upper Saddle River, NJ: Prentice-Hall.

Lipsey, J., and B. Scott. 2008. “Consulting Skills Toolkit: Roles.” OD Network, odnetwork.org/resources/toolkit/consultingskills.php.

Porter Novelli. 2020. The 2020 Porter Novelli Executive Purpose Study. Porter Novelli, September. porter novelli.com/wp-content/uploads/2020/09/PN_Executive_Reasearch_Report_9.8.2020.pdf.

Schein, E.H. 1988. Process Consultation: Its Role in Organization Development, 2nd ed. Upper Saddle River, NJ: Prentice-Hall.

Scott, B. 2000. Consulting on the Inside. Alexandria, VA: ASTD Press.

Scott, B., and B.K. Barnes. 2011. Consulting on the Inside, 2nd ed. Alexandria, VA: ATD Press.

Scott, B., and J. Hascall. 2002. “Inside or Outside: The Partnerships of Internal and External Consultants.” In International Conference Readings Book, edited by N. Delener and C. Ghao. Rome: Global Business and Technology Association.

Scott, B., and J. Hascall. 2006. “Inside or Outside: The Partnerships of Internal and External Consultants.” In The 2006 Pfeiffer Annual, Consulting, edited by E. Biech. San Francisco: John Wiley & Sons.

Recommended Resources

Barnes, B.K. 2015. Exercising Influence: A Guide to Making Things Happen at Work, at Home, and in Your Community. Hoboken, NJ: John Wiley & Sons.

Bellman, G.M. 2001. Getting Things Done When You Are Not in Charge. San Francisco: Berrett-Koehler Publishers.

Biech, E. 2018. ATD’s Foundations of Talent Development. Alexandria, VA: ATD Press.