Compatible personality
When deciding on an advisor, make certain that you feel comfortable with the individual’s personality. If you are going to have an ongoing relationship with the advisor, it is important that you feel comfortable with the degree of communication, the attitude, the approach, the candour, and the commitment to your business success. A healthy respect and rapport will put you more at ease when discussing business matters and thereby enhance your further understanding.
Confidence
You must have confidence in your advisor if you are going to rely on the advice to enhance the quality of your decision-making and minimize your risk. After considering the person’s qualifications, experience, and personality style, you may feel a strong degree of confidence in the individual. If you do not, don’t use the person as an advisor, because there is a very good chance that you will not use him or her as extensively as you should, or when you need to. This in itself could have a serious negative impact on your decision-making.
Fees
It is important to feel comfortable with the fee being charged, and the payment terms. Are they fair, competitive, and affordable? Do they match the person’s qualifications and experience? The saying “You get what you pay for” is true of fees charged by lawyers, accountants, and consultants. For instance, if you need a good tax accountant to advise you on minimizing taxes, you may have to pay a high hourly rate for the quality of advice that will save you several thousands of dollars. On the other hand, if what you require is the preparation of annual financial statements, perhaps a junior accountant can do the job competently at a more affordable rate. Be certain the rate is within your budget, or you may not fully use the advisor effectively because of the expense. Not using available professional advice when you need it is poor management. At the outset ask about the estimated fee.
Comparison
Do not make a decision as to which advisor to use without first checking around. It is a good rule of thumb to see a minimum of three advisors before deciding which advisor is right for you. The more exacting you are in your selection criteria, the more likely it will be that a good match is made, and the more beneficial that advisor will be to your business. It is a competitive market in the advisory business, and you can afford to be extremely selective when choosing advisors to complement your business needs.
