Saturday 21 August 2010

The great consultant scam

Johann Hari (for once) has a pretty good piece here about the great management consulting scam.

But for all that, I think that he's wrong to blame people for taking an opportunity. I spent a large portion of my life doing technical consulting and the higher up the food chain I moved, the more I found insecurity about what needed to be done. When I was consulting at the bottom of the food chain, I was generally doing some clever stuff that their staff didn't know how to do.

As I started "engaging" higher up the food chain, I found myself spending more and more time rubber-stamping the opinions of techies on the ground who a) knew the problems better and more completely than I could ever manage and b) knew perfectly well how to fix the fucking problem. The real problem is that the management, for whatever reason, are wildly insecure about the solutions proposed by their staff.

Equally, I find that very often people are quite happy to pay for my time and then not execute the advice I give them, possibly for quite valid reasons, but reasons they don't share with me.

So yeah, be pissed of with consultants for taking the piss, but really the blame lies with the insecure management of the company or government department who need the "impartial blessing" of a third-party shaman before they dare to do anything.

It's the uselessness of the people running the show that is really to blame, along with the "cover your arse" nature of government and corporates.

17 comments:

Jampat said...

I think you've hit the nail on the head obo. Working in between the technical and business side of things I'm constantly surprised at the number of managers that can't make a quick decision on things. It's either a decision by committee or it's passed further up the structure where you get the ridiculous situation of a senior manager making decision on a relatively minor issue.

The "no blame" culture at it's best!

Bayard said...

The Civil Service culture has always revolved around blame avoidance. Management consultants are just the latest plate in the armour. A previous lunacy was the practice of always changing project managers mid-project. This meant that if the project was a success, they could both claim the credit, but if it was a failure, they could blame each other. "It matters not whether you won or lost, but how you placed the blame".

Jill said...

I concur. And it's not just technical issues. In my experience (freelancing outside the corporate set up, but involved in it, like you), managers are either lazy or stupid, or terrified of appearing lazy or stupid, and so can't - under any circumstances - give credit to their inferiors, who often have all the solutions available for free. So they either fuck everything up or pay someone like me to tell them what their inferiors have already told them a gazillion times.

Joe Public said...

The 'For further reading' suggestion at the end of the article is incomplete.

" 'House of Lies: How Management Consultant Steal Your Watch and Then Tell You The Time', by Martin Kihn"

The proper title should be:

'House of Lies: How Management Consultant Steal Your Watch and Then Charge You To Tell You The Time'

Jim said...

I think the reason for all this blame shifting is down to the rapid growth in technology. It is no longer possible for the management to know HOW things are done. Ergo they are dependent on what they are told by the people below them who do actually know how the systems work. Thus they are paranoid that they are being lied to, or given only part of the truth. So they employ independent outsiders to try and get a handle on whether things are as they are being told by their own staff.

In the old days the man at the top probably knew more about his business process than the people below him. He was perfectly capable of rolling up his sleeves and getting involved in the physical labour. Take Isambard Brunel for example - he was a hands on engineer, and was nearly drowned early in his career when involved in building the tunnel under the Thames at Rotherhide. He would never have needed a second opinion - he was the man in charge and knew the technology, what it could do, and made the decisions accordingly.

Beware of Geeks bearing GIFs said...

But then does that mean companies should be looking for flatter hierachies?

Or for a more successful business, should business models change to a more micro-business model where smaller companies/individuals have a closer relationship to the technologies/business when engaged in a B2B relationship and therefore are more accountable to the risks?

wv: nessi - that old legend!

Dave H. said...

"I spent a large portion of my life..."

Thank God. Sounds like the bastards's finally dying. At last we can let the children out.

Anonymous said...

If an organisation is being told to downsize, and the manager calls in management consultants to tell him who should be laid off, then surely the manager should be fired for incompetence?
How can you not know who to lay off, in your own department?

TDK said...

As a consultant I feel I ought to defend them.

There's no doubt that a lot of crap is done and I'll give examples later. However there are two ways in which a consultancy can give value

Despite what the article says, you don't get to become a senior consultant with 3 weeks training. And no junior consultant will ever be responsible for telling the client what to do. You need to build up something called experience to rise through the ranks.

The first advantage is that the consultant is an outsider. This is of value because this escapes from big company politics. Often times the consultant does just discover what to do from talking to the staff but being outside the politics gives it a credibility that the message wouldn't otherwise have. Companies like this whether the advice is good or bad because either way they can blame the party that is no longer onsite.

The second advantage is that companies get into ruts and start to judge things from their own blinkered perspective. An outsider brings fresh ideas and brings them to a level and mass that new hires would fail to achieve. A new hire would be an isolated voice in a pre-existing culture. A consultancy is better placed to bring change.

And consultants do pick up experience as they pass through their clients. They are able to offer fresh perspectives.

Think about what companies do. There is Business as usual and projects. The type of employee who would do BAU is less skilled and lower paid than the employee who does the special projects. If you want to implement that new software or change the way that certain processes are done then you don't look to the staff who will operate the system to manage the change.

Suppose you want to introduce an ERP system. One or two managers have experience of SAP. Are you going to go on that or are you going to get some advice.

When projects are complete companies cannot justify the project leader's salary, and frequently there is no role to move them onto so consultants are a good way to hire skills as needed. Many good people leave direct employment and set up as (or join) consultants because they can't progress any further as direct employees and their skills are worth far more to prospective users.

Having said that, some consultancies, particularly the Big 4, do the bait and switch trick where you hire the guy who does have the experience but you get a lot of graduates. However the customer can and should manage that.

These are quite different things. The first can be as a "beard" to things the company might do anyway. The latter is bringing and applying some genuine knowledge.

Johann's article is all about downsizing which actually had it's peak about 10 years ago although I've no doubt that it will experience a resurgence. Companies will hire consultants but invariably they will be as a beard to validate the redundancies that have occurred anyway.

Now let's discuss some of the wasted efforts that I have been involved in.

Y2K was the biggest waste of all. In 1998 I used to advise how this was vastly overstated problem and constantly lost work. In contrast others fed the panic and won it. In 1999 I joined the herd. Two things made me change. The first was the realisation that most IT managers knew full well that Y2K was tosh but had a window of opportunity of unlimited funding for their projects. Any project that they could vaguely associate with Y2K was given instant approval. Why on earth would I turn opportunities to share that.

TDK said...

As a consultant I feel I ought to defend them.

There's no doubt that a lot of crap is done and I'll give examples later. However there are two ways in which a consultancy can give value

Despite what the article says, you don't get to become a senior consultant with 3 weeks training. And no junior consultant will ever be responsible for telling the client what to do. You need to build up something called experience to rise through the ranks.

The first advantage is that the consultant is an outsider. This is of value because this escapes from big company politics. Often times the consultant does just discover what to do from talking to the staff but being outside the politics gives it a credibility that the message wouldn't otherwise have. Companies like this whether the advice is good or bad because either way they can blame the party that is no longer onsite.

The second advantage is that companies get into ruts and start to judge things from their own blinkered perspective. An outsider brings fresh ideas and brings them to a level and mass that new hires would fail to achieve. A new hire would be an isolated voice in a pre-existing culture. A consultancy is better placed to bring change.

And consultants do pick up experience as they pass through their clients. They are able to offer fresh perspectives.

Think about what companies do. There is Business as usual and projects. The type of employee who would do BAU is less skilled and lower paid than the employee who does the special projects. If you want to implement that new software or change the way that certain processes are done then you don't look to the staff who will operate the system to manage the change.

..

TDK said...

..
Suppose you want to introduce an ERP system. One or two managers have experience of SAP. Are you going to go on that or are you going to get some advice.

When projects are complete companies cannot justify the project leader's salary, and frequently there is no role to move them onto so consultants are a good way to hire skills as needed. Many good people leave direct employment and set up as (or join) consultants because they can't progress any further as direct employees and their skills are worth far more to prospective users.

Having said that, some consultancies, particularly the Big 4, do the bait and switch trick where you hire the guy who does have the experience but you get a lot of graduates. However the customer can and should manage that.

These are quite different things. The first can be as a "beard" to things the company might do anyway. The latter is bringing and applying some genuine knowledge.

Johann's article is all about downsizing which actually had it's peak about 10 years ago although I've no doubt that it will experience a resurgence. Companies will hire consultants but invariably they will be as a beard to validate the redundancies that have occurred anyway.

Now let's discuss some of the wasted efforts that I have been involved in.

Y2K was the biggest waste of all. In 1998 I used to advise how this was vastly overstated problem and constantly lost work. In contrast others fed the panic and won it. In 1999 I joined the herd. Two things made me change. The first was the realisation that most IT managers knew full well that Y2K was tosh but had a window of opportunity of unlimited funding for their projects. Any project that they could vaguely associate with Y2K was given instant approval. Why on earth would I turn opportunities to share that.

TDK said...

Bollocks

First post, Blogger reported rejected as too large, so I split it in two. Apologies for double posting.

Obnoxio The Clown said...

Just let us all know who you work for so we don't employ them for technical consulting, OK?

TDK said...

Actually technical consulting is exactly what I do do.

I got into consulting by a roundabout route. I first became good at certain software. I then got headhunted by a software company who doubled my salary for doing exactly the same work. That meant I went to work for dozens of different companies in lots of different sectors implementing the same software and linking it with other software. Sometimes that meant I worked as part of a larger team that included business consultants. In turn one of those headhunted me. It's not one of the big 4 - I'll tell you that.

Cheap shots aside, how do you know I don't know my technical stuff?

Let me give you a trivial example of where I added value. A client had data in SQL server which they wished to report in an OLAP cube. They wanted to use COGNOS and the IT manager knew that software X had a bridge to COGNOS. So he got me in to build a bridge from SQL Server to software X so that the data would get to COGNOS in two steps. Instead I showed them that they could use COGNOS Transformer to get there in one step, avoid paying the licence for software X and avoid the inevitable problems that accompany Heath Robinson solutions. They paid my fee out of the saving of software X. Everyone was happy except the vendors of that software. Did I do wrong?

Obnoxio The Clown said...

"Cheap shots aside, how do you know I don't know my technical stuff?"

You're clearly struggling with Blogger comments ... :o)

TDK said...

Fair enough. Don't employ me to write blogger comments.

Obnoxio The Clown said...

Plus, you appear to have no sense of humour. :o)