Bad consultants are bad news for nonprofits

By Todd Cohen

The charitable marketplace is home to some great consultants and a lot of good ones.

They understand and care about charities and the communities they serve, and want to help them improve.

But consultants who are mediocre at best, and who care more about their fee than they do about charities and the communities they serve, are courting nonprofits and foundations in growing numbers, and those organizations need to be wary.

Often exiles from nonprofits because they were ineffective, burned out or just wanted a bigger paycheck, bad consultants can drain nonprofits’ limited funding in return for simplistic advice masquerading as strategic thinking.

Many who could not cut it as nonprofit professionals turn to consulting because they spot easy prey in nonprofits desperate for strategic advice.

Some of these consultants, despite their professional mediocrity, recognize that shameless self-promotion can yield a big payoff.

They radiate self-confidence, and try to sound smart by parroting philanthropic and business jargon.

They crank out books that consist of little more than superficial, feel-good prescriptions for fundraising success and organizational improvement.

And they aggressively book themselves to speak at conferences, workshops, lunches and webinars, where they weave self-congratulatory tales of their own consulting work into their presentations while hawking their products and services.

Their showmanship makes believers of nonprofits hungry for help, and resonates with foundations eager to find intermediaries to push foundations’ agendas in return for lucrative fees.

What these consultants are selling is blind faith in their image and self-confidence.

But after paying the fees, many nonprofits are left with little more than a consultant’s promise that cosmetic and formulaic changes will improve their organizations.

Nonprofits buy what mediocre consultants are selling because, strained to the breaking point in our damaged economy, and struggling to make ends meet in the face of rising demand for services and of shrinking resources, they need help and want to believe the consultants can provide it.

The icing on the cake is that consultants are neither regulated nor accountable for whether their advice actually makes a difference.

The hard work of turning that advice into results remains with the nonprofits.

And if the nonprofits fail to improve, the consultants are long gone, with the convenient excuse that the nonprofits did not follow their recommendations.

Many foundations also are smitten with consultants.

Their endowments can insulate foundations from the struggle to survive in the real-world marketplace, where success depends on good ideas, good strategy, good execution, and hard work.

Because they control endowments, even though the assets typically represent wealth created by other people, executives and program officers at many foundations fancy themselves experts, if not sages.

And admiring their own reflection in consultants, foundations pay them to push their ideas and agendas on nonprofits.

‘Consultant Nation’

Jan Masaoka, outgoing editor-in-chief of Blue Avocado and incoming CEO of the California Association of Nonprofits, recently questioned the growing clout of what she calls the “Philanthropic-Consultant Industrial Complex.”

The infrastructure of consultants and organized philanthropy is “changing who’s running the show,” she wrote on Nov. 11.

“Rather than supporting nonprofits,” she wrote, “foundations and consultants are increasingly telling nonprofits what nonprofits should be doing.”

When a foundation announces it is launching a new initiative for low-income seniors, for example, “we now assume that much of the money will go to re-grantors, researchers and consultants rather than to on-the-ground nonprofits and the seniors themselves,” she wrote.

In an article on Dec. 10 entitled “Consultant Nation” that looked at the growth and influence of the consulting business in the for-profit world, The New York Times reported that what separates consultants from business executives is that consultants “remain removed from their decisions.”

Unlike executives who climb the corporate ladder at a single company, the Times said, consultants “do not execute the decisions they make and live every day with the consequences.”

That also is a big problem with consultants in the nonprofit world: They swoop in, ask questions, facilitate a board retreat, produce a report, pocket their fee, and leave.

Nonprofits and foundations need to stop this madness.

They need to take a hard look at consultants who want their business, and ask tough questions about who they are, how they work and what they actually do.

They should request samples of consultants’ work, and ask other clients what they were like to work with, what advice they actually delivered, and what kinds of results that advice actually produced.

If they do not become more informed and critical consumers of consulting services, nonprofits and foundations will have no one to blame but themselves if all they get for their money is a report filled with philanthro-babble and empty promises.

And in the end, the ones who will pay the price for bad consultants are the people and places the nonprofits and foundations exist to serve.