Choosing a cost reduction consultant

Some aspects of cost reduction are best handled by an outside consultant for various reasons. An army of unregulated and sometimes unprincipled operators has sprung up, making the vetting of advisers something of a minefield. The following six principles should be followed, especially where you receive an unsolicited approach:

Give preference to consultants who are subject to a code of conduct (through membership of a reputable professional body), and get written undertakings that they are independent of vested interests.
Always take references, and always follow them up, preferably getting endorsements in writing. Look particularly for discrepancies between the name a consultant gives you and the name cited by referees.
Consider possible risks arising from incorrect advice: does the consultant have professional indemnity insurance or substantial assets to cover any claim you might need to make?
If the consultant offers a 'share-of-savings' deal, make sure you understand how the savings will be calculated: think critically about 'baseline' assumptions and the duration of the agreement. Consider capping the fee if you suspect the savings will be more than he or she estimates.
Enter into a written agreement, covering such matters as confidentiality.
Never pay up front, and be wary of paying for work in progress unless you can see clear results.