Consulting Dinner at the Courtyard Marriott

Sometimes, you just gotta go ghetto.

Consultants = Big Strategy, Little Execution. Client Needs = Little Strategy, Big Execution

"There's a lot of money in prolonging a problem, telling the client what they already know, not taking the steps to solve it, and just sprinkling in some buzzwords." - NumbaJockey

NumbaJockey nailed it. Consultants get paid to ponder, strategize, optimize, align, accelerate, etc. But rarely at a strategy consulting firm do we help the client to execute.

I once worked with a guy who had done several projects at a large auto manufacturer. He described, with some condescension, how our firm had given our clients all these brilliant strategies, but the client had never implemented them, and therefore it was their fault. My response was that if the strategies aren't implemented, it's a worthless strategy, and that's our fault.

For the consultants out there, how often does your "strategy" recommendations, ACTUALLY get implemented? Clients always say great things about the work at the final brief out, but what percentage actually result in changes at the client?

What am I doing? Well, nothing.

I fear I'm losing the ability to actually get things done. After years of making slides and doing analysis, I am starting to wonder if I could actually get something done. Like grow a plant from a seed to harvest.

At one point I was an entrepreneur, and every day I got stuff done. Actual products, actual service, actual value to clients.

A friend of mine is opening up a store in Manhattan - over the weekend we talked about his business plan over beers. I looked through the financials, the marketing plan, the exit strategy, and saw it was pretty light. This stuff isn't this guy's strong suit, he admits. But he wasn't worried, because he just knew, with total confidence, how to bring customers in and make them happy. And I believe he will succeed, because of his confidence and competence.

I walked away from the bar thinking that if a consultant were in his shoes, they would craft a beautiful business plan... but they wouldn't know how to actually get customers in and how to make them happy.

Another Casualty of the Financial Crises - Privatized Social Security

George Bush, February 2, 2005 State of the Union: "As we fix Social Security, we also have the responsibility to make the system a better deal for younger workers. And the best way to reach that goal is through voluntary personal retirement accounts..."

Imagine if social security funds were invested in the market.

"We'll make sure the money can only go into a conservative mix of bonds and stock funds. We'll make sure that your earnings are not eaten up by hidden Wall Street fees. We'll make sure there are good options to protect your investments from sudden market swings on the eve of your retirement."

Choose your poison. Corporate bonds, or equities?

Personal retirement accounts should be familiar to federal employees, because you already have something similar, called the Thrift Savings Plan, which lets workers deposit a portion of their paychecks into any of five different broadly-based investment funds. It's time to extend the same security, and choice, and ownership to young Americans.

Because TSP funds have been very effective at capital preservation.

Consultant Ninja Analysis: Social Security Privatization is dead for at least 20 years.

Source: CNN.com, TSP.gov, Consultant Ninja Analysis

Another One Bites the Dust

"...I decided to end it all. The prospect of wasting my youth (and the rest of my life) doing something utterly meaningless that makes no positive tangible difference to anyone’s life was certainly not appealing." - The Analyst

Consulting chews people up. The travel, the uncertainty about work, the lack of control over your career, the sacrifice of your personal life, the eating out 4 days a week on an expense account, the distance from actually seeing something done, the relentless pressure to get promoted or be fired... all of it just wrecks people's lives. It's no surprise that the industry has a 20% annual churn rate; the half life of a consulting career is just 3 years.

I've chosen to share this blog with some friends and co-workers over the past year. I've come to regret that decision somewhat, because I feel the need now to be more circumspect in comments about my work. I've had to filter what I've wanted to write, with what I could write. My frustrations with my firm, with the projects that I feel are a waste of my client's money, with the exertions of effort for dead-end marketing or intellectual capital initiatives - I've had to store them up inside me, where they've burned me up and increased my bitterness.

But this week something has changed; I realized that I am not alone. I am not the one eyed man in the valley of the blind. Others see the faults that I do, have the same frustrations and sense of injustices. I am not crazy. I am not a wimp. I am not a whiner. I am just one of many hardworking people, seeking a rewarding career, and finding that the current experience falls short of that goal.

Somehow, that realization that other see the same reality that I do fills me a brighter measure of satisfaction. For that, my colleagues, I thank you.

Filed under the tag Consulting, not Bitterness.

McKinsey: Obfuscation through Excessive Analysis

One common characterization of McKinsey work is that they will do all sorts of ridiculous levels of analysis, even if the outcome isn't cogent to the actual case. A harsher view would say that McKinsey hangs audacious ideas onto that analysis to push the client into pursuing their recommendations, even if they won't work in reality (i.e. "Ted Airlines").

Consider the article that fell into my reader today:

Consultant Ninja Analyis: Power curves have interesting properties that I remember from undergraduate circuits class. McKinsey's going to use an interesting mathematical formula to tie economics and nature together. Great, let's see what they do!

Consultant Ninja Raction: All this lady has done is sort a few statistics according to size. Once you sort a population by size, it almost inevitably follows a pareto distribution. And a pareto distribution can almost always be fitted by a power curve function.

If this consultant wrote "bank crises by size show us that you should focus on 'Build flexible business models'" she would be challenged by the client. If she instead writes "a power curve analysis with an R-squard of 0.96 shows us that bank crises are dynamically unstable. Therefore you should "Make the system the unit of analysis'", the client, who can't possibly understand her 2 weeks of work in a 60-minute meeting, would blandly nod his head.

Bottom Line: A common (and fair) criticism of consultants it that we whip up terrificly complex analysis for the purposes of intellectually bullying clients into just blindly going along with the larger message we construct. McKinsey is guilty of it here.

PS. What the hell is the Y-axis on the banking chart, anyways?

The Secrecy of Management Consulting

The profession of management consulting is supremely intellectual, involved with the application of frameworks, hypotheses and logic to messy and abstract realities, furthering the search for truth (and incremental EBIT).

Many professions share this search for truth, in their respective domain. What makes management consulting stand apart is the absence of collaboration and sharing of knowledge, so present and integral to other professions.

Consider the following:

Doctors

• Open teaching hospitals, books, published papers, conferences

Lawyers

• All briefs and arguments filed with the court are open to the public
• Legal arguments and analysis are shared with opposing counsel in any negotiations.

Scientists/Professors/Engineers

• Research is shared publicly, published papers, conferences, teaching universities

Military Officers

• Army War College, joint training exercises, officer exchange programs, published books

Auditors/Accountants

• FAS rulings, journals, filings with the SEC.

Management Consultants

• Conclusions are never shared outside the client
• Books & articles are filled with bland platitudes
• Clients rarely share decks from prior work from previous consultancies
• Internal Knowledge management systems are universally pathetic

In short, the management consulting industry has no means of independently evaluating and rigorously defending logic & analysis.

"Without light, truth cannot be found."

The Genesis of "Let a Thousand Flowers Bloom"

The HR flack was speaking about our internal initiatives. She was soliciting ideas. "Our attitude is 'let 1,000 flowers bloom' on this." - Consultant Ninja experience

Our world is full of pithy sayings like this, and I have sensed a rise in its usage in the past year. Few people ever consider the source of it.

"Letting a hundred flowers blossom and a hundred schools of thought contend is the policy for promoting progress in the arts and the sciences and a flourishing socialist culture in our land." Mao Zedong, February 1957

After this speech, Mao Zedong listened carefully and thoughtfully for six weeks. Criticisms were diligently recorded, along with their source. Then, Mao had those who spoke up executed or sent to prison camps.*

It pisses me off that HR staff, who lecture us about cultural sensitivities and diversity, choose to quote a mass murderer. Next time I'll ask them to use a quote from Hitler.

* Mao, the Untold Story

Dilbert Slays, one day at a time

Mealy-mouthed consultant speak

Sent in by a reader...

"My visit started with meeting the President of XXX. We had a fascinating dialogue about XXX's strategies for global expansion - in both the YYY and ZZZ sectors - and the balance between current imperatives and longer term globalisation trends. We honed in on the importance of being "authentically local" as a critical success factor, which has played out in a win in India and the challenges they have in deciding where to place their geographic bets. They have a similar need to reinforce long term relationship development versus campaigns or transactions, which is analogous to our own drive toward client centricity. We also discussed the importance of the expansion of their services business as a counter to lower sales as well as the very active management of their pipeline given the volatility of their customer base. XXX is an account where we have taken a steady approach over the past couple of years to develop C-suite relationships and it is clear we have an interesting platform for the future." - Internal Communique of a major consultancy

What the hell does all this mean?