For their work, management consultants in the United States get paid more than $2 billion each year in the United States.
1 A lot of this money goes to useless data and recommendations that don’t work.
2 To cut down on this waste, clients need to know more about what consulting assignments can do. They need to ask more from these advisers and learn how to meet their new needs.
In this article, you’ll learn about current research on how to be a good consultant, as well as interviews with the partners and officers of five well-known businesses. Besides that, it comes from my experience supervising new consultants and from the many conversations I’ve had with advisors and customers in the United States and other parts of the world. This knowledge has led me to make a way to help people understand what management consulting is all about. When there is a clear sense of the goal, both parties are more likely to handle the engagement process well.
Purposes in a Hierarchy
Management consulting is a broad term that surrounds a lot of different things. The many companies and people who work for them often have very different ideas about these things. One way to group the activities is to think about what the professional is good at (competitive analysis, corporate design, operations leadership, or human resources). But in reality, there are as many differences between these groups as there are between them.
Another way to think about the process is to think of it as a series of steps, like getting in, signing a contract, getting a diagnosis, getting data, getting feedback, and so on. However, these stages are usually not as separate as most consultants say. Perhaps a better way to think about the process is its goals. Being clear about the goals of an engagement is an excellent way to make sure it goes well. Here are consulting’s eight main goals, arranged logically (see the Exhibit).
Exhibit A group of different reasons for consulting
1. Giving a client information.
A client’s problems can be solved.
3. Making a diagnosis may change how the problem is thought of.
4. Making suggestions based on the findings of the test.
5. Helping with the implementation of solutions that have been suggested.
Giving out information
Perhaps the most common reason people ask for help is to get more information. Some of the things that might be done to put it together are surveys of people’s attitudes, costs, and feasibility, market surveys, or studies of the competitive structure of an industry or business. The company may want a consultant’s unique skills or the more accurate, up-to-date information that the firm can give them. Or, the company might not have the time or money to make the data itself.
Often, a client only wants to know what they need. But sometimes, the information a client need isn’t the same as what the consultant is asked to give. One CEO asked for a study to see if each vice president generated enough work so that each one could have his secretary. The people he talked to said that he already knew the answer and that a costly study wouldn’t help.
Problem-Finding
People who work for managers often give consultants challenging problems to solve. For example, a client might want to know if they should make or buy a component, buy or sell a line of business, or change their marketing plan. Or, management might ask how to change the organization’s structure to better adapt to changes, which financial policies to use, and improve morale, efficiency, internal communication, control, management succession, or other issues. This is a common question.
Attempting to figure out how to crack problems like this is a good thing to do. But the consultant also has a professional duty to check to see if the problem is the one that needs to be solved the most. The client often needs the most help figuring out the real problem. Some experts say that executives who can figure this out independently don’t need management consultants. So, the first thing the consultant needs to do is figure out what the problem is all about.
Diagnosis that works
Much of the value of management consultants comes from their ability to figure out what’s wrong. However, the process of getting an accurate diagnosis can strain the relationship between the consultant and the client because managers are often afraid of uncovering difficult situations for which they might be blamed.
This can make the relationship more complicated. Competent diagnosis requires more than a look at the outside world, the technology and economics of the industry, and the manners of non-managerial members of the company. The consultant must also find out why executives made decisions that now seem wrong or ignored things that now seem essential.
When people say they need an outsider to make an independent diagnosis, involving people from the client organization in the process makes sense. One consultant says: “We usually ask that people from the client’s team be assigned to the project.” Not us, but for them. We’ll help, but they’ll do it. Every day, we meet with the CEO for about an hour or two to discuss the coming-up problems. We also meet with the chairman once a week.
Actions to Recommend
The end of the engagement is usually marked by a written report or oral presentation that sums up what the consultant has learned and says what the client should do. Firms spend a lot of time making their pieces look good so that the information and analysis are easy to read and the recommendations are logically linked to the diagnosis on which they are based. Many people think that when the professional comes up with a consistent, logical plan of steps to fix the problem, the engagement is done.
The consultant suggests, and the client decides whether or not to use it and how. Though it may appear like a perfect method to divide the work, this setup is simple and not very effective in many ways. Untold numbers of seemingly convincing reports submitted at a lot of money have no natural effect. The relationship ends when the consultant comes up with theoretically sound recommendations that can’t be implemented.
Putting Changes in Place
There is a bunch of discussion about how consultants should help people get things done. Some say that someone who helps put recommendations into action is taking on the role of manager, which is outside the scope of consulting. Others think that people who believe that the client is only responsible for implementing their recommendations aren’t very professional.
People who don’t follow through with their recommendations waste money and time. The consultant can find many ways to help with implementation without taking over the manager’s job. For example, the client can help with diagnosis without taking away from the consultant’s value.
People often hire consultants to help them set up new systems. However, if the process up until this point hasn’t been collaborative, the client may not want to help with implementation because it’s a significant change in the relationship. Practical work on implementation problems requires a level of trust and cooperation that grows over time.
