Why partner with a boutique consulting firm

The ‘Big vs. Boutique’-Dilemma – Inside stories of why small consultancy firms should not be underestimated

 

Procuring the services of a boutique consulting firm rather than a bigger and, perhaps, better-known company may raise the occasional eyebrow. Common sense tells us that bigger firms have already proven their value. They have survived, blossomed, and grown up to become cornerstones of business. But what with these small firms? You might start to wonder – especially with boutique firms that have been around for more than a year or two – if they’re so good, why aren’t they big?

However, just as the old saying about smartness and riches fails to accurately portray their relationship, the quality of a consulting firm cannot be gauged by looking at its size. In fact, a small firm may in some cases provide better services than a bigger firm. What then, do small firms bring to the table?

 

Specialization, direct access, and other advantages

Surprisingly, relatively little has been written about what might be called the ‘Big vs. Boutique’-dilemma. In work that does address the question, what often gets listed as advantages of hiring a boutique firm includes

• competitive pricing due to lower overhead costs,
• the level of specialization,
• the higher flexibility of work processes,
• the ability – partly thanks to flexible work processes – to initiate or lead business innovation, and
• direct access company officials have to consulting partners.

There is more to the story, though. As true as these statements ring, the abstract wording obscures rather than reveals what makes smaller firms worthy of your attention and business. That is why we decided to draw up a ‘Hiring a boutique firm: the inside story’. We had a chat with two company officials whom we worked closely together with in the past. What did it look like in practice, working with a boutique firm? What obstacles did you run up against, if any, and what did you come to appreciate the most?

We did so, because Ruhl SP is one among many such small firms. Not by fate but by conviction. The interview below will help explain why – we ourselves learned from it, too. As we found out, for instance, hiring a small firm has obvious yet often overlooked advantages when it comes to trust. And ‘having direct access to your consulting partner’ turns out to have multiple meanings, some of which are surprisingly common yet highly significant for taking your business further.

 

Names, brands, and comfort levels

We spoke to a research engineer and a mobility manager; both from large global corporations. In the following, they will go by Erika and Robert, respectively, remaining anonymous for reasons of corporate non-disclosure.

Research engineer Erika got acquainted with Ruhl at an industry conference and subsequently hired the firm to work closely together with her company on a new project requiring a deep understanding of both the technical intricacies of the new product and market developments over the next years. Mobility manager Robert brought Ruhl on when working on a new venture within his company, based on previous encounters with Ruhl founding partner Adam Harms.

Ruhl SP: Thank you both for taking the time to share your experiences with us, it’s greatly appreciated. Diving in head-first, have either of you ever directly faced the ‘Big vs. Boutique’-dilemma?

Robert: I am actually in that situation right now. I am trying to bid a project out to a small firm. It’s always a bit of a battle, getting the executive committee not to utilize a name brand and still get that comfort level. Some folks don’t want to put their positions on the line by taking a chance with a boutique firm. They’ll say, ‘Oh well, I’ll go with a larger firm, because I know we’ll get good work.’ However, I feel like with many of the larger firms, it’s as if you’re getting regurgitated material. Repurposed work that they’ve already done in other studies. You’re not getting a pure fresh new look at what you’re trying to do. If a firm has already done a similar study, it seems they tend to get to that same outcome.

Ruhl SP: … if only for efficiency purposes?

Robert: Yeah, exactly, that’s the reason. You get these solid proposals back and there’s a lot of information in it. But the only way they can already include all this information in a proposal – while they haven’t even started on the project – is because they’ve already done this. It’s valuable, of course, when they have knowledge on the topic. But it can also limit innovation and creativity because it limits the way they approach the problem – a bias toward a certain solution.

 

Building trust

Ruhl SP: Does this ring true for you, too, Erika? That bigger firms are more likely to be locked into specific methodologies, the status of previous results, and so on.

Erika: That’s interesting. It’s very possible. Sometimes there’s the feeling you’re getting something canned, with just a few personalized add-ons. I think with Ruhl in particular, the whole personalization process – the adjustment to what we as a team needed – was actually happening right under our eyes.

In our case, there was no dilemma of hiring a boutique firm or a larger firm. We met them at a an Industry conference and were impressed. First, there was the perception of them being different, being so agile and flexible. Then came the realization that they were a small firm, but it didn’t pose a problem. When we pitched this [collaboration, ed.], there was a little push back. Our leaders were briefly asking, ‘Who is this company?’ But other than that, no. The advantage was, they were so agile.

Also, there were less concerns of how many people learn about our processes, precisely because the firm was small. It meant information was more easily contained. It’s easier to build trust because you share your knowledge with less people. And it posed no difficulty to truly embed them in our team, as opposed to having an external institutional partner that feeds you information.

 

The power of networks

Ruhl SP: So hiring a small firm has its collaborative perks, especially when it comes to sharing sensitive information. Surely, though, there must be disadvantages to having fewer people working with you, too.

Robert: True. When working with a boutique firm, they can’t do it all. They don’t have an unlimited resource pool, with experts in all these fields, drawing on all of these resources for whatever you need. Standing up new facilities, for instance, or knowing how to build a manufacturing site, staffing required, power utilization estimates… A boutique firm is not like a one-shop-does-it-all. But they are very agile in making up for that. They’ll immediately go through and find the right experts if they don’t have them. At least Ruhl SP did.

Ruhl SP: Glad to hear you feel that way. Is that relatable for you, too?

Erika: With Ruhl, we could focus on creating our own network. Working with a small firm made our team understand the power of network. The fact that Ruhl was able to deliver what you delivered as a small boutique company, thanks to the extensive network behind you, made us reflect. We realized: we can be a small team but generate powerful concepts and practices if we create our own network behind us. In a way, we are all relying on our networks – and that’s something our company wasn’t doing so deliberately before.

Ruhl SP: So working with a small firm also changed your self-understanding, your appreciation of what you can actually accomplish as a small team?

Erika: Yeah, for us as an R&D-group trying to move a technology, we had to deeply realize that we can’t do it on our own, but that we are capable of reaching our goals, nonetheless. Ruhl helped us develop our networks. We used to look at ourselves as simply a global material provider, but Ruhl helped us to identify partners along the value chain and engage in conversations with each one of them. Modelling partners, equipment manufacturers – we learnt to connect and choose the ones that resonated best with us and that has brought us forward.

Robert: And that’s how true innovation becomes possible – if I may add to that.

Ruhl SP: By truly thinking together innovation becomes possible, is that what you mean? Can you give an example?

 

Innovation, bias, and the future of one’s industry

Robert: I am working on program in sustainable transportation, an extremely important topic in today’s world. But it seems some have already made up their minds on what the solution to sustainability issues is. Now, I agree that electric vehicles are valuable, but it may not be the solution for everything in every case. You need to look at it broadly enough. Some of the proposals I got back for this study from bigger firms were already almost summarizing – ‘It’s going to go to this solution’. When there are so many other possible solutions out there! I want us to do the work, together, that gets us to that point. Maybe the proposed solution is the right solution, but I don’t want you to tell me it is before we even get into it. This comes back to what I was saying before, about bias.

Ruhl SP: Is this also a matter of how closely you get the chance to work together with your consultant? We’d say it can greatly help your thinking and day-to-day creativity to actually go at it together.

Robert: Absolutely. The first project I was working on with Ruhl provides a good example. At the time, everybody thought this specific technology was the be-all-and-end-all. I was adamant to take a step back and question it. Ruhl facilitated a strong workshop that helped to break everything down. Technologies, places, processes. Consequently, we came up with a unique solution. We didn’t go with the industry standard technology; we went for something else. I can’t say more yet, because we’re working on the patents, but it’s a very revolutionary approach.

I think that’s what you’re more likely to get with a boutique firm. When we worked with the other large firm involved, their minds were set. Supposedly, the industry standard technology was the solution. In the end, I had to convince them of why our solution was better – they almost didn’t trust us. They kept saying, ‘But that’s not what the industry is doing.’ But I don’t care what the industry is doing. I care what’s going to be the future of the industry. I want to discover where we can fill a gap that others might not be seeing. That was what Ruhl helped us with.

 

Close-knit connections

Ruhl SP: Do you feel this is particular to your experience with us? It sounds like you don’t, but for what reasons do you think this sort of approach is more likely to be taken by smaller firms?

Erika: The personal connection does seem to be stronger when working with a small group of consultants who become easily embedded and part of your own team.

Robert: With boutique firms in general, I find you get a more personal, more human approach. You can tell winning a program means a lot to them. You’re not just another project to them. It’s not just about checking the boxes and getting the numbers. They’re really engaged and try to truly understand you and your business. We’ve had another study done before by a big firm where I felt it was too generic. As if they were saying, ‘Well, you do manufacturing; this is a known manufacturing solution you could get into.’ But on the nitty gritty level, the similarities simply didn’t exist. Boutique firms – some of them at least – get to know you a bit more intimately. It is a smaller team that’s responsible and the relationships you build with them usually extend longer, I think. They’re able to tailor their services more specifically to what you’re trying to do. They don’t stress owning every little bit of work they do, either, like some larger firms do.

Ruhl SP: So, it’s a matter of human connection and actual collaboration… Thank you so much for your time connecting with us.

 

Taking chances

In multiple ways, then, consulting processes can benefit from bringing on board a boutique firm. Big is not always better. In today’s culture, that may still sound a little offbeat, with our capitalist assumption of expansion as key to a company’s existence. In popular consulting literature, too, the idea of a company choosing to remain small is considered an anomaly. The goal of scaling one’s firm is widely taken for granted – a recent bestseller like ‘The Boutique: How to Start, Scale, and Sell a Professional Services Firm’ by Greg Alexander even includes it in its title. It may take a little effort, therefore, to appreciate that small firms can bring specific kinds of value to the table, precisely because they are small.

In the end, all procurement decisions are a matter of taking chances, no matter the size of the firm in question. Company officials whose hands are not as tied to name recognition may truly benefit from partnering with a small, not-as-well-known consultancy firm. Despite its size, such a small firm may significantly outcompete larger firms when it comes to trust building, originality, innovative capacity, and network utilization. In and of itself, the size of a small firm surely does not guarantee that it will – but it does not necessarily limit it, either.

And so, it becomes clear why small firms may choose to remain small. Not because of fate or mediocrity. But by conviction.

“Let’s Achieve What’s Next”