Not every project is as successful. During Fashion Furniture Rental’s first project with San Diego State, Pidgeon asked for a feasibility report on a new “home staging” business; the company would temporarily furnish homes for sale so they’d be more attractive to buyers. The students advised against the project, suggesting that too much competition would make it unprofitable, but Pidgeon and his team decided to go with their gut and proceed anyway.
Today, that project — now called Parker Rose Design — constitutes a significant portion of Fashion Furniture Rental’s business. But even that situation wasn’t a failure, insists Pidgeon, who notes that the students raised valid concerns and stimulated important thought and discussion about the venture. “If they raised one point that helped me prevent a mistake,” says Pidgeon, “then I recovered the $4,000 fee.”
Indeed, since the expense is so small, business owners can choose to implement student recommendations — or take a pass — at their discretion. By contrast, companies often feel obligated to implement the recommendations made by big-ticket professionals because of the significant investment they’ve already made in hiring them.
Dan Abraham, chief executive officer of FortiusOne, agrees: “It’s only advice, not direction,” he says of student recommendations. The Washington, D.C.-based startup, which specializes in infrastructure security analysis, is currently working with a student team from the University of Maryland’s Smith School of Business. FortiusOne plans to improve its business plan to attract future investors — the company just obtained a modest A round of financing — and to switch its pricing from a billing-rate model to a value-based model.
Abraham says that since the project isn’t finished, it’s too early to assess results, but he notes that he wouldn’t have engaged the student consultants “if it took any of my time that didn’t bring value.” He declines to say exactly how much FortiusOne paid for their services — the Smith School charges $9,500 or less per project, based on company situation and size, according to academic director Bob Krapfel — but Abraham acknowledges that student consulting “helps get our discretionary spending farther.” Would his company go without consulting services of any kind were it not for the students? Probably, says Abraham, but more important, “we would go without sleep because the work still has to be done,” and FortiusOne would have to identify solutions itself.
Companies can find out about opportunities through their local chamber of commerce or through business schools themselves, but networking is important, too; most of the companies that worked with the schools in this article had word-of-mouth referrals. That can be valuable when you consider that this year, the Fuqua School received 68 applicants from local businesses for just 11 spots, according to student consulting faculty director William A. Sax. Other schools report a similar rate of competitiveness.
Whether a company is accepted may depend on a particular school’s focus — say, on technology — or on the school’s desire to offer students a wide selection of possible business projects from which to choose. But most important, maintains the Smith School’s Krapfel, is that companies applying for a program understand that “it’s first and foremost a course — value to the students comes first.”