Mentoring, Coaching and Consulting: Which is Best for You?

Three Essential Entrepreneur Resources Explained

Mentoring, Coaching and Consulting are three essential resources for every business owner and their business. But when do you need them and when should you use a coach vs. a consultant? We break down the differences, and the similarities, between them to help you create the team you need for business success.

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Mentoring

For the new entrepreneur, having a mentor to provide knowledge and advice about their career and business can be an essential component to their business—from inspiration to exit strategy. Mentorship in the business world typically refers to the relationship between a seasoned business person and a more junior one, not necessarily because of each person’s age but due to their experience in a particular industry or business area, such as Fintech or grant applications.

But the definition of mentor is quite flexible and your particular mentor may not have expertise in your new business, but may provide more personal advice about your career, making connections and offering perspective on difficult situations. They can be quite focused on helping you develop leadership skills and honing your business acumen.

Friends, relatives and business associates often act as mentors and you’ll often find that entrepreneurs have several people they consider mentors for different aspects of their life and business—some for the personal aspect and others who are industry-specific, especially for venture capital-based start-ups.

While there aren’t any financial benefits to being a mentor or a mentee, there are infinite rewards from the give and take of an advisor and their advisee. Steven Spielberg has said of mentoring: “The delicate balance of mentoring someone is not creating them in your own image, but giving them the opportunity to create themselves.”

Build a network of mentors from people you admire and respect not just for their talents in business, but also for their character traits and communication style. A personal board of directors, in a way, to support you and your goals of every kind.

Coaching

There are coaches for everything from professional sports to dating these days. Even within the title of “Business Coach” you will find specialists in executive skills development, media training, goal setting and more. The formal structure of coaching provides you and your business with an accountability partner. While they offer guidance and resources, it’s up to you and your team to implement their advice.

Coaches may be called in even when things are going well, but you want to find ways to optimize your personal business skills, employee skills, or any part of the business that you’d like to analyze. Coaching is often described as moving you from functional to optimal.

To ensure you’re working with a qualified coach (as there are no legal guidelines for calling yourself a coach), check on their credentials through the International Coaching Council (ICC), the International Coach Federation (ICF) or the Worldwide Association of Business Coaches (WABC). All are membership-based associations for business coaching professionals involved. The ICC and WABC also provide an accrediting system for business coach training programs.

Once you’ve chosen a coach and determined the key business areas to focus on, they will work with you to determine a schedule and plan for your working relationship and then for the issues themselves. You set the pace and the goals while they provide business insight, motivation, and accountability. They may even identify additional places for improvement in the business for you to work on with or without their guidance.

Unlike mentorship, coaching is a financial-based partnership designed to work on specific goals and aspirations. They are mutually beneficial and one doesn’t preclude the other. Smart entrepreneurs will use coaches strategically throughout the life of their business.

Consulting

The most well-known type of consultants are the strategy consultancies, such McKinsey and Accenture, hired by big businesses to provide large-scale change management or prepare the business for an IPO. However there are many small business consultants as well. In fact, the term “consultant” is often used for almost every type of business professional. A small business may hire consultants for legal work, accounting, HR services, marketing support and much more.

Coaching and consulting services often overlap, so it’s very important to understand the type of professional you need. Consultants often implement the work they are hired for, or subcontract it out, as opposed to coaches who typically do not. Consultants are hired for solutions—not that you won’t arrive at a solution with a coach, but the route to get there is very different.

If your company has issues with growth, performance, or general direction, a strategy consultant is typically the go-to choice. They can analyze the business, research options and implement their recommendations. This process holds true for most consultants regardless of their specialty.

The range of services and business areas that consultants provide is too large for this overview. The most important things to know are that regardless of your business problem, there is probably a consultant to help solve it. But don’t limit yourself only to problem resolution. Consultants are ideal for implementing new processes or technologies to streamline your business, or even to shift your business’ products or services in an entirely new direction. And ask your mentor if they have recommendations for coaches and/or consultants. They may know exactly what you need.

When considering which type of support you need and when, keep in mind your business stage and business needs. New entrepreneurs may benefit the most from a mentor within their chosen industry to help them navigate the steep learning curve of the early days. As the business grows, coaches and consultants can help you refine your business skills as well as the business as a whole. When your business has specific growing pains or needs to pivot, bring in the specialists best suited for your needs. Regardless of stage or need, don’t limit yourself to only one type of resource—use a combination of mentors, coaches and consultants over the course of your business journey for optimal results.

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