CONSULTANTS ON THE MAT.
Ever need
consultants to figure how much your consultants cost? Would you be
surprised to know that the above sentence is a headline from an ad
run by a consulting company? It’s probably a sign of the times that
consultants of every stripe are turning the searchlight inwards,
looking at how they operate in a world with no shortage of
specialists. They’ve also been confronted by the uncomfortable
reality that the world’s largest consulting companies have been
found guilty of perpetrating corporate fraud, and worse, giving
large companies bad medicine.
In
the US, reeling from the Enron scandal (where auditors and
consultants worked hand in glove), the focus has shifted to other
large firms like McKinsey and PriceWaterhouseCoopers (PwC) who have
much to answer for. McKinsey, the blue chip consulting outfit that
launched the guru phenomenon and gave rise to celebrity CEO’s (from
former IBM chairman Louis Gerstner, to the notorious Enron CEO,
Jeffrey Skilling), has the worst PR any consulting firm can want.
Its roster of clients include the big bankrupt brands Swissair,
K-mart, Enron, and the one time darling of the dotcom era, undersea
cable company, Global Crossing. So it’s no surprise that the
consulting profession is now earning the same barbs once reserved
for used-car salesmen and lawyers. The discussion of consulting
ethics is a hot topic in board rooms, the US Congress and Op-Ed
pages.
An
oft-cited complaint about consultants is that they are heavy on
advice, make splendid presentations, but are not there to roll up
their sleeves and implement the strategies they unload on
management. I would be surprised if there’s anyone reading this
column who has not been ignored by upper management only to see a
highly paid consultant to come up with the same ideas. To be fair,
consultants are not often allowed to work with the rank and file.
Their time is so expensive (around $160 an hour!) that they often
only meet top management, and see little beyond the board room.
Workers on the shop floor turning out the widgets bristle at the
fact that consultants have no grease under the fingernails. The
popular invective about a consultant being ‘someone who borrows your
watch to tell you the time’ has a familiar ring to it. In the wake
of the Tom Peters type of management guru, many people got into the
business of consulting by merely adjusting their clothing and
adopting the right bits of management jargon. What they often advice
companies is nothing that the cubicle dwellers haven’t known.
Today a lot of that has changed. And more radical consulting
changes will surely follow. Even before the Enron scandal,
consultants were revamping their strategy (now there’s a word
bestowed on us by consultants!), sensing an impending backlash. And
it was not just management consulting companies that saw this
coming.
Ad agencies and PR firms, who often fall under the ‘outside
consultant’ umbrella, have been quick to fine tune their services.
The ad agency-turned marketing consultant has to be a
multi-disciplinary outfit. Even agency fees have been calibrated
accordingly, to encourage results. Or to put it another way, their
job isn’t done when the campaign runs. |
The agency needs to show results just like the grunt workers at the
lathe, the gal who files invoices, and the janitor who empties the
waste-paper baskets at night.
Brand consultancies, as an offshoot of ad agencies, are particularly
feeling the heat. One hot shop pitches itself in a deliberately
anti-consultant language. “When you hire a consultant”, says Mobium,
“the net result is usually a logo, a theme line, a truck load of
PowerPoint printouts, a lot of incestual information and very little
insight.” Strategic thinking doesn’t cut it.
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You know all this strategy talk is a hot
button issue when even a would-be consultant takes on an attack
mode. An IBM TV commercial about consultants has a CEO showing off a
consultant’s plan at an executive meeting. “You've all read this,"
he lectures, waving a fat bound proposal. "Top-shelf consultants.
Two million bucks. Pure Strategic thinking. This could put us years
ahead...” No one in the room even flinches when the CEO admits that
even he is psyched. He then asks his audience (comprising a few
minorities, for added effect), whether they think the strategy can
be implemented. They flatly answer no. Where do you think IBM is
going with this tone of voice? It has, after all, worked very
closely with consultants. When the commercial ran earlier this year,
it may not have made sense. But recently, IBM has been big on trying
to marry strategy and implementation. Or, to strip it of
consultant-speak, IBM is trying to sell its services as a
start-to-finish business. But advertising rhetoric is not a strategy
in itself. The final piece of the puzzle can be found in stunning
news this August: IBM bought out consulting firm
PriceWaterhouseCoopers. It is a move that shifts IBM one more notch
away from the hardware business, and smack in the midriff of the
consulting profession. What does that signal to the others?
David Maister, author of many books on professional consulting,
believes that the problem with professional service firms is that
they talk the talk, but don’t walk the walk. For all their jargon,
they seldom practice what they preach. Precisely what that suddenly
relevant IBM commercial’s says. The final voice over ends with a
rhetorical question: “strategies you can execute?" asks a cynical
voice, "now there’s a plan!”
The gloves have come off. The pure-play consultants must be
sweating in their corner. |