The term ‘Outsourced Business Partner’ is not a common usage business term. It’s one we have been using more recently to genuinely reflect the work that we do with clients. It has emerged due to the fact that we work at a far more granular level with them than say a business coach or consultant generally would.
A consultant may assist at a very specific level where certain expertise is lacking within the business. One example might be helping implement a quality management system. However, they generally will not have expertise over all business functions, especially related to implementation. This takes a certain micro-level ability that some coaches and consultants have, but in my experience, most do not.
Without disrespecting my own profession, many business coaches have been categorised as offering generalised advice without adding any real impact to the bottom line. It’s important as profession that we work to negate those impressions whether that be in business, performance, life, or executive coaching.
Part of the challenge is that assisting in project implementation adds to overall costs which is why you need a return on investment (ROI) value proposition.
Secondly, most business coaches do not have the required specific expertise in many of the operational delivery aspects that the business needs. I am specifically talking about the implementation of the following.
- Strategic planning
- Business or operational planning
- Implementing change
- Embedding culture & values
- Specialised staff training
- Managing business performance
- Managing people performance
- Optimizing internal systems and workflows
- Complex problem-solving
If you have a larger business where implementation can be safely assigned to team members without impacting on their day-to-day work that may be fine. However, the majority of businesses in the SME marketplace do not have that luxury. Under these circumstances, an OBP may be an option.
What type of businesses may benefit from utilising the services of an OBP?
An OBP can be very valuable to one owner businesses that have ten plus team members. They are generally private businesses or family businesses that do not have any or a strong internal management team. It does not specifically matter what industry they are in.
These business owners often struggle with the challenge of flying solo on a lot of the business decisions that need to be made. Additionally, they need someone who has that potential and motivation to think like an owner. However, they do not want to bring in an equity partner, mainly due to the complexity, risks involved and finding that right person.
A successful OBP will have practical skills in coaching, consulting, training, and mentoring. They are like to have had considerable business experience ideally combined with some recognised qualification in coaching, business and/or management consulting.
The top five reasons to find and use an OBT are as follows.
- Non-shareholder – An OBT is not a shareholder of your business, but the right one will take on the mindset of the business owner to support them in critical ways.
- Performance management – An OBP can be performance managed at a more tangible level that an actual joint business owner where quite often they think accountability is for others in the business and not them. If an OBP does not perform against defined metrics, their contract can be terminated.
- Implementation of plans – Business plans will actually get implemented and not get stalled at the goal and action step level. The OBT is a key driver of the implementation process.
- Expertise & Acumen – Because of their wide range of expertise and business knowledge that can help with multiple problem-solving areas within the business plus act as a general sounding board and confidante.
- Flexibility –The type, frequency and duration of the engagement can be varied to suit the project at hand. It embodies the typical consulting contractual model but however with all the features of coaching, training, consulting, facilitation, and mentoring.
Finally, where do you find these people and are they expensive?
They are likely be experienced business coaches or consultants. They will be people that enjoy working closely alongside the business owners and getting their hands dirty with specified aspects of the day -to -day business.
Depending on the size of company and complexity of issues they may work 1-2 days a week in a direct and remote capacity. Because of the nature of the assignment, I would suggest 80/20 in terms of working on site versus working remotely as a good guide.
There are three basic ways to justify the use of an OBP’s services.
- If this is a position that would normally be filled that and there is a vacancy on the organisation chart than an OBP would not be an additional cost providing they don’t charge exorbitant rates. If the latter is true, its likely to be a very short qualifying conversation!
- The return on investment or ROI should be factored into the equation including metrics from the start of the engagement. The OBP should allow the business owner and the business to increase revenue, margins, reduce costs or improve efficiencies so overall the business has a net financial benefit.
- The last aspect is an important one that has to do with helping improve the owners work life balance and overall coping levels which indirectly impacts on mental and emotional heath. Its largely an intangible, but an important one.
Before taking on any new assignment, you should assess right up front whether the OBP can add value beyond their costs. If you can’t justify that, it’s a warning sign that this may not be a net financial gain despite the obvious benefits of improved work life balance.
If you do proceed, then we recommend measuring progress against defined metrics on a monthly or quarterly basis. This high level of accountability will often turn some coaches and consultants away from this type of work and, if that is the case you are interviewing the wrong person to work with you.