Confero Winter 2014: Issue 5 | Page 25

Telling Good Consultants from Bad demonstrate some aptitude. Furthermore, the education, experience, credentials, sophistication, and cost-effectiveness are also worthy of consideration. Simply having the criteria is not always enough to make a decision. For instance, you may have a clear understanding of your consultant’s costs, but you might not know how that compares to peers. Similarly, it will require some research upon your part to truly determine if the consultant being used has really selected a fair index to benchmark their performance against. You may see a number of credential designations behind the key consultants—AIF, CRPS, MBA, CFA, CIMA, QPFC, CFP—but which are most valuable to you? If you feel unqualified making these types of judgments, it might be in your best interest to hire a separate consultant for the sole and exclusive purpose of vetting other firms. This arrangement might seem like an unnecessary complication, but the additional level of scrutiny is actually quite common. A key aspect of demonstrating prudence in any endeavor is comparison to peers, and without a thorough understanding, an uninformed comparison can be damagingly misleading. Consultants are often called upon to benchmark the service providers common to institutions—like lawyers, actuaries, accountants, recordkeepers, and custodians - and to provide an opinion on the relative costs and services they provide. Asking for a consultant to run a peer-driven consultant benchmarking can be a valuable exercise and provide superior matching of client needs to consultant capabilities. www.conferomag.com | 23