We’re often asked “is it right to use reverse auctions to select consultants?” (and with unsurprising equal frequency we have consultants asking us “what can we do to stop our clients reverse auctioning us?”).
The answer to this first question is simple; yes, as long as you are only interested in cost. So the answer is, for most clients, probably no.
Why? Because reverse auctioning is a powerful purchasing tool which is fantastic for commoditised “widgets” where you can thoroughly specify exactly what you want and “lock in the value”.
But when buying consultancy you are buying people – and whilst you might be able to standardize elements of a service requirement nobody has yet manage to create a “standardised consultant” (OK, the robots are enhancing consultants capabilities, but they have a way to go before they fully replace them).
And in fact you are often looking for exactly the opposite – some unique skills which give your organisation an advantage. Consequently, it’s critical to get the top people at the top of their game and as such people are in demand they will only work for clients who adopt an approach to engaging them which demonstrates that they value them as an individual.
So this being recognised maybe there is one use for reverse auctioning – to create a short-list; if the consultants you are considering agree to let you reverse auction them you should perhaps think about using another firm.
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