It’s a fact of corporate life that external consultants have come to play a significant role in helping many organisations shape or implement new organisation strategies, structures and systems. Understanding how external consultants operate is key to successfully managing critical projects and in turn obtaining value for money. The day to day responsibility for managing these external professionals often falls to internal specialists who work in the HR, IT or finance spaces. To succeed in this role, they need to appreciate both the strengths and potential pitfalls of working with external professionals. As someone who regularly helps develop internal consultants and business partners I learn a lot about how some external advisers operate and behave towards their clients, so here’s a tongue-in-cheek guide to the world of external consultants.
In the first instance, it’s important to be wary of how some consultants respond to a potential project. For example, when someone says to you “a speedy review is essential,” what they may really mean, is that “currently some of our consultants have no chargeable work, so we’re really desperate to get them work as soon as possible.”
Equally when an external consultant counsels that “any review should be viewed as an initial step in a staged process”- Be fully aware that you maybe about to embark on a process that will ultimately involve three projects, instead of the one, you originally intended!
Perhaps the most dangerous statement to listen out for is the ubiquitous, “We have done this type of project before!” This is often code for – “Actually, we’ve never completed a project like this before, but if you’d like to give us sufficient time and budget, then we know we have some very smart people back at the office and I’m sure we can do something useful for you!" Many a complex and troublesome IT project has fallen into this trap.
The fact is that we may raise a cynical smile at some of these statements but those corporate professionals who have been around a while will recognise glimpses of truth in all of them. One of the most disturbing books to read in recent times was Final Accounting: Ambition, Greed and the Fall of Arthur Andersen written by Barbara Ley Toffler the former Ethics Director of the now defunct Arthur Andersen (AA). Toffler left the firm three years prior to the infamous Enron financial disaster but she highlighted the dark side of the consulting world. She described in detail how the global success of the firm eventually corrupted it with an endless and misguided pursuit of profit and growth. She detailed how consulting jobs were inflated in terms of workload to hit aggressive revenue targets and how colleagues could be heard making comments such as, “Bill that client’s brains out!” as their staff left for a client meeting.
Of course, as a former disgruntled employer Toffler may have had an axe to grind. However, there is no doubt that the Enron collapse helped shine a light on how Andersen’s leadership clearly failed to navigate the moral hazard that life in the corporate and consulting fast lane inevitably brings. On the back of Enron, AA was in 2002 fined some $500,000 and put on five years probation for witness tampering involving document shredding. Although for the record, in 2005, the US Supreme Court overturned the conviction on what many observers felt was a legal technicality. But by then it was all too late as AA had effectively collapsed and its various components bought up by other firms.
Whilst the failings at Arthur Andersen’s were perhaps one of leadership it does show the potential underbelly of all consulting firms – they are as profit driven as anyone else in the corporate world.
There is of course nothing wrong with that, but it is vital to understand this fact when managing any professional services firm.
The best consulting firms will be highly driven, ethical and client focused. Their operational field staff will be motivated more by a genuine desire to serve their clients than their actual firm; such is the hallmark of a great consultant. Such firms genuinely want to add value and assist the client in solving their problems in the most effective and efficient manner. But against this we must keep in mind that all consulting firms are tasked with hitting targets and developing client business. The way you get on in a consulting firm is no different to any other business, you must succeed and in a professional services firm that typically means winning and selling client projects. It’s why a great question to ask any consultant team that is pitching for business is whether they will be the team that will deliver the actual work? All too often firms will send their A team to sell the work and the B team to implement it. So be alert to such tactics as it’s an early warning to be on your toes when it comes to working with a firm.
Another aspect of the consultancy world is the diversity and the huge range of offers available to clients. Listed below are a few of the usual suspects that you can run into. Each has their own strengths and downsides but again they all need managing to ensure you get what you want.
The Terminators are the tough guys of the consulting world. Their domain strength and core competence is strategy and efficiency / cost cutting. They often come with high fees and expenses but are willing to sacrifice all for their client; happily working 24/7 for weeks on end. Mostly required when a very challenging and demanding “big job” needs to be executed, Terminators operate like a special forces team, combining speed with precision and accuracy. Intellectual rigour and a clinical approach to data analysis are the hallmarks of their working routine. When talking to clients they will tend to use words such as “execute,” “dominate,” “transform,” “core-competence,” and “re-invent.” Not generally known for their friendly and approachable style, their hugely logical and fact based approach to solving any problem or challenge affords them an immense feeling of certainty concerning any ideas, proposals or recommendations they come up with. “Arrogant but Smart” are the words that are often used by some of their clients to describe their approach.
Having been directly hired by the CEO & Board, the Terminators feeds off that legitimate power source and combines it with their immense intellectual capabilities to ride over any internal opposition that stands in their way. They have been hired to do a job and have no intention of letting anyone get in their way. History, precedent, culture or people will not be a reason to argue against their flawless research and recommendations. To take on the Terminators’ recommendations is a defining career act that you are more likely than not to lose!
Any client needs to understand exactly what they are getting into when hiring the Terminators. They don’t typically use collaborative approaches except when seeking to influence the CEO or Board. Whether you like it or not you will be subjected to their rigorous and exhaustive review processes and methodologies.
The success of the Terminators means that their staff are highly sought after and often end up in senior leadership roles in many corporate environments. This in turn generates new business opportunities as the Terminators are like the military in so far as they know how to create a strong esprit de corps and sense of loyalty that exists long after their service has ended. The Terminator environment operates a hugely demanding and tough working culture where you must commit 100% to the business. In turn this cultivates an individual sense of “being unique and special.” Rather like the special forces you belong to a group of people who are bound together by unique skills and shared experiences that few other people have. Your commitment to the cause and your fellow colleagues is something you hold onto for ever. So, if you end up in a large corporate and need a consulting firm to help you “who you gonna call?”
The problem is that history tells us that despite their immense intellectual rigour and certainty the Terminators ideas and recommendations aren’t always proven right in the longer term. Life has a habit of showing us that not everything is run simply on logic and numbers. But you’ll never get a Terminator to admit they got it wrong!
The Trekies are of course the IT and systems consultants; professionals who believe that technology is the solution to all your corporate ills and problems. Forget the fact that your people for the most part either ignore or abuse your customers or that your product or service is rubbish. What you really need is a new mega digitised cloud based IT strategy and architecture. These consultants use words like “mission critical”, “cloud”, “process automation,” “web-enabled”, “enterprise wide”, “digital solutions” “SSCs,” CRM and “network architecture.” They are hugely successful and the project fees they generate can literally bankrupt companies. They have a proven ability and track record to turn a six-month review project into a six-year occupation of your entire IT department and organisation.
In today’s VUCA (Volatile, Uncertain, Complex and Ambiguous) world the Trekies are having a field day as they advance their cloud solutions and endlessly promise a brave new and exciting world via Artificial Intelligence and Machine Learning. Meanwhile it still takes you the best part of 45 minutes to hire a rental car or get through on the telephone to a real person at your retail bank or amend your airline ticket. To the normal customer, it can seem as if the Trekies live in a parallel universe as you daily battle with the sheer ineffectiveness and frustration of doing business with some organisations.
With the very expensive 117th upgrade of you key proprietary operating system you can effectively mortgage your business future to these advisers. Their best friend is the IT director and given the fact that very few other leaders or managers know what they are talking about they tend to be allowed to get on with things without interference or disturbance. That is until you shockingly discover that you have been paying these consultants to do something that has never been tried before. The sheer horror of learning that your critical business mission project is now 18 months behind schedule and has every probability of being a total and unmitigated disaster. The stark realisation that the new software won’t work in your business environment will focus the entire management team like nothing else before. But you’ll also realise that your now so deep into the project that there’s no turning back unless you want to collapse the entire company. At this point you’ll probably fire the existing consulting team and seek out a new group to try and save the day!
An early warning sign of things going wrong with the Trekies is when the Finance Director starts to develop health problems signing their invoices and you see the consultants disappearing off site for important meetings back at their own offices. Remember once in the company Trekies are extremely difficult to say goodbye to or remove. The most likely scenario is that after four years or so you’ll end up hiring half of the consultants to work for you permanently as it’s a lot cheaper.
The Guru is often a highly influential sole player in the consulting world. Frequently viewed as a thought leader or authority figure, they cultivate an aura of deep insight and wisdom on the big issues of the day or rather the decade. Fond of using powerful facts and a reflective questioning technique they have will tend to have either a technological or people centred approach to the business world. “You need to reinvent your business model by embracing AI” or “You can do nothing without aligning people to your customer strategy” are their typical mantras.
They possess an almost mystical power over the CEO; who seems to have fallen under a spell and implements all the Guru’s wisdom and advice with blind adherence. Often the CEO will have run into the Guru whilst attending a leadership conference sponsored by the Terminators. They will then have bought the Guru’s latest, bestselling book and issued it to all the senior management team to read and take on board. This may then be followed up regular two day off-site “retreat” workshops involving the Guru. If really motoring the company’s entire 50,000 workforce will be put through a one day workshop to ensure the ideas and approach are cascaded throughout the business. The problem is that all too often this creates tensions amongst the senior leadership and management team as colleagues begin to disagree with the obsessive focus on the issue and then become frustrated by their inability to influence the boss. It seems that the Guru’s word is all that the CEO will listen to.
The strong focus on the technology or human centric dimension often means that the business starts to miss other equally fundamental issues such as the fact that your business model is fast becoming obsolete or that your customer service sucks! The lesson learnt is that Gurus are great so long as you keep them in the context of operating in the real world! Most companies tend to find this balance but beware the leader who falls under the Guru’s spell.
The Clint Eastwood consultant is a much tougher version of the Guru. A lone player with a long contract and a stranglehold over the CEO’s mind and actions. Unlike the Guru, Clint has no soul! It’s all about business and his belief that you must do whatever it takes to get a job done. Clint possesses a tough finance or strategy background and has been successfully involved in lots of big crisis or turnaround situations. The fact that they now work alone is due to the fact they packed in some 35 years of tough business experience into a 20-year period only to “burn out” a few years earlier. Clint was originally trained as a Terminator and he only came back into the corporate world as a single player, as he finds the inner workings and politics of a larger consulting firm an irritating distraction. His business network is extensive and he uses it to generate a select number of long term contracts with people he knows well and who have worked their way into influential leadership roles. Because of his earlier career commitment and personal sacrifices Clint is financially independent and so can afford to pick and choose when and where he wants to work.
Sometimes working with leaders who lack confidence or in some cases his experience, Clint will encourage his clients to take tough decisions involving restructuring businesses or organisations. Where he deems it necessary he will argue for pre-emptive strikes against troublesome or dissident colleagues. Floating around the organisation with a shadowy presence, he’ll whisper into the CEO’s ear, phrases such as, “I’d watch them if I were you as they are a real threat to what your trying to do here,” or “Are you really sure about her?” No one is clear as to what Clint’s role in the company really involves and all too often people are afraid to ask, such is his intimidating presence. Clint has no real friends in the company but that’s not a problem for him as he’s not looking to win any popularity contests. He’s effectively a hired gun.
We all know the Suits. They are everywhere because they specialise in everything. For integrated business solutions read “body shop.” You have a problem we can solve it, just pay us enough money and give us sufficient time, we’ll find you a great solution. They have an amazing range of offers and solutions and are often seen as the “go to” place for corporates and large public sector organisations. In client meetings, their default statement is a confident, “Yes we can do that”. The Suits do have the interests of the client at heart however the problem is that they have become so big that they’ve lost some of their original values and integrity. They are as concerned about growing their revenues at your expense as they are about helping you grow yours. They are also keen followers of fashion; whatever is the current business trends they’ll be promoting and leading it. Last season SSCs, BPO and Risk Management, this year cyber security and digital consumer platforms. Not for them the problem of the technology or software “disillusionment curve” as they’re already promoting the next big thing; for which your leaders will be invited to Nice for a two-day conference to learn all about it.
The Suits are easily recognisable; young, smart, digitally savvy, and highly motivated they tend to dress the same and will happily work incredibly long hours for you. Whilst often lacking in experience they will be guided in their day to day work by extensive process methodologies and practices that are contained in digitised manuals developed by their experienced and highly ambitious practice leaders. Most likely to say, “using our experience elsewhere...” which is code for “we will insert your name into the last high quality report we produced for another client.”
If you make friends with the Suits, over a few drinks, they’ll sometimes tell what is really going on in their own organisation. However, be careful, as what they might tell you about the deficiencies of their own IT systems, processes people management and leaders may really shock you. You’ll then worry that you are paying such people to advise you on how to run your business! The more worrying trend is the fact that many Suits are indeed now running large parts of their client’s business and in the process leveraging other client work across the same platform. But it’s not a problem as in a few years we’ll have the trend of insourcing and bringing “things” back home to enjoy the level and quality of service we never got by originally outsourcing! You get the idea, it’s a fashion business and what goes around comes around! Think centralise and decentralise, outsource and insource, focus and diversify!
The Happyologists are a very fast growing group of consultants who specialise in people centric organisations. To them it’s all about people focused strategies. They are a splinter group from the HR (Human Remains) school of consulting and feed off the argument that we are moving to a more people centred world of work.
Prone to beginning any conversation with “how are you feeling today” they cover a vast array of consulting offers which have brand themes such as “understanding millennials needs,” “work-life balance,” “health and wellbeing,” and the ubiquitous “staff engagement.” They will advocate anything from “mood and rest” rooms being set up, to meditation classes being offered on a regular basis to all staff in organisations. They will warn of the dangers of staff eating a sandwich at their desk during lunchtime and the need to allow staff to share their deepest personal worries and concerns at all times. Some will advocate the benefits of learning from professional Horse Whisperers and the virtues of juggling sessions and massage therapists in highly stressed work environments. Keen to cite fabulously successful companies such as Apple and Google and their approach to such themes the Happyologists are almost religious in their belief that theirs is the right path to organisational success.
Whilst it is hard not to disagree with them that there is indeed a massive problem today with people feeling insecure about their levels of job security and experiencing excessive levels of stress in their long working days, their approach fails to address the root cause of such problems which are huge failings in corporate leadership and governance. As they happily run work-life balance workshops in an organisation you can bet that the leadership team is discussing in secret their next tranche of business restructuring or the latest remuneration consultant’s report on how to improve their salaries or individual bonus schemes; even though their share price and market share has declined by five percent in the last year!
Remember to stay very alert when hiring any external consultant. Some consultants through their attitudes and behaviour can make their clients feel weak and insecure and believe it or not some clients will accept such an approach. To avoid this, remember, always, that you are the client and you have the power. With some consultants, it’s important to let them explicitly know, now and again, who the real client is!
Be clear as to your needs and objectives from the outset of any project. Always ensure you have an agreed and signed off terms of reference or project charter that sets out exactly what work will be done and what the expected outcomes are. Set out early on how you want them to operate with you and all your staff. Be clear on how you want to be advised about progress and what you don’t expect to hear. Be respectful and courteous; as a client don’t waste the consultant’s time by not adhering to any commitments or agreements you may have given in terms of time and resources. In return expect to be treated with equal respect and courtesy. Don’t put up with any negative behaviours such as cancelling meetings, arriving late, coming to important meetings ill-prepared and failing to deliver agreed deliverables.
Highly reputable and professional consultants will be very happy to work in this way. They want to enjoy a positive and productive working relationship and ensure that they deliver the right results for their client. Mutual respect and trust is the corner stone of any successful working relationship.
So, good luck and remember that if we are to listen to the latest “Gurus” we are all going to end up as consultants in the very near future!!!!