Consumer Strategies Report May 2005/Opinion

It is regrettable that when one hears the title "management consultant", one glazes over and has a mental spasm at the inevitably high price tag associated with the title. And for what? To tell you nothing more than what you already know. Yes, there are many great obstacles for management and strategy consultants, especially those not associated with the large, global firms. Those firms don't need to justify their fees because their clients are almost always former consultants themselves for the firms they engage; while all other strategy firms are left to explain their worth to jaded entrepreneurs. And rightly so, since the majority of strategy consultants mimic the big boys in method and knowledge.

Strategy is then left to the large firms to define and their clients to understand. Non-consulting clients are left clueless and the consultants seeking to do business with them doing a shoddy job at explaining their worth to clients. Not so 75 years ago, when the deans of management consulting were rainmaking among the early entrepreneurial titans of industry by proselytizing the value of letting their firms (composed mostly of young inexperienced non-managers) analyze the heck out of the biggest challenges objectively and tell them how to manage their firms.

So what is strategy and how do you consult on it? For starters, one must understand that when one engages a consultant, one is actually engaging a teacher. Not surprising, the professional teacher's tools and product is information. In order to properly teach, information must be collected before the teaching, but as part of an engagement. Once the information is collected and reviewed in context, the consultant must relay it to the client. This, in consultant-eeze, is referred to as increasing the efficiency and velocity of knowledge. This is 50% of what you're paying for. Once relayed, the consultant then uses their objective perspective to pinpoint opportunities in maintaining their current investment directions or alternatives in which to redeploy their resources (the firm's strategy). This, friends, is strategy consulting (and the other 50% of what you pay for).

The greatest failure experienced by these "professional teachers" is in managing the expectations of the client, including defining the role of the consultant as teacher. Many "consultants" are often functional consultants, regurgitating the particulars of the role they once possessed. Others are industry veterans, advising on how things were done in their former departments at that point in the history of an industry. These consultants are invaluable tacticians and analysts, but unfit to advise on strategy.

Many clients are also employers of MBAs, also trained as consultants, but unfortunately not trained to think of anything else other than their duties at the client firm in the context of what's going on in the industry or functional area. They're spectacular project managers and producers, but because they're not mobilized to look at the big picture, they're also unqualified to displace the role of an outside advisor. (This is why the term "cookie-cutter" has often been used to describe a consultant's product and why managers are willing to pay such a high price for innovation.) Although a specific strategic challenge needn't be articulated, there should always be a consensus among consultant and client in the value a consultant will deliver.

Another tragedy contributing to the misunderstanding of the business of strategy consulting is the dearth of innovation in the way a consultant teaches. It's ironic that consultants spend so much time improving clients' businesses, and yet, they rarely think of improving their own business. What other differentiator exists for a person hired to think and teach if not the way in which they think and teach? And yet, most consultants and their firms are refugees of the large firms, where they were trained in the culture and methodologies of the big boys. Even the big boys, if you trace their origins, came from three firms and schools of thought (engineering, accounting, and the science of business management).

What's more, the average tenure of a consultant is under 2 years, very likely due to an inability to "make rain" independently (most graduate programs don't teach you to find business, only to function within a large corporate environment) or a victim of the up-or-out culture at most consultancies. Consequently, most consultants don't plan on consulting as a career and innovation in the profession remains stagnant.

Worse still is that if a consultant's approach wasn't refined within the walls of an established firm, it was refined in a business school. If you've ever been to one, you know that (prestigious) business schools are factories, proponents of the thinking of their benefactors (employers included), inexorably teaching not to innovate in their own profession (teaching), but innovate in business tactics and implementation. They're marketing machines, administratively and aloofly unable to self-assess their losing monopoly over the process of learning, yet dictating what constitutes as knowledge. In the land of the blind, if institutions of higher learning are blind, what are their clients (students) really learning? More critically, what are those who employ MBAs or pay them as consultants for their "knowledge" truly getting for their money if no one learns to convey that knowledge in any other way than how they've been taught for the last 75 years? Clients expect, and consultants increasingly depend on, incestuously close relationships and golden rolodexes to be their one-eyed men (and women). This is definitely not strategy or strategy consulting.

The most insulting obstacle for professional strategy consultants is the widespread belief that operational functions, such as marketing and legal, are capable of addressing enterprise-wide strategies single-handedly. Functional consultants sell their cookie-cutter "solutions", rather than address or even acknowledge that there's more to business than their single area of proficiency. The most senior executives therefore tend to disregard insights from all but the brightest or most "acquainted" functional strategy consultants because in the daily scheme of things, the area barely registers in their radar.

A case in point is marketing consulting. "Marketing strategy" is an oxymoron. Because creativity is subjective; because there are a finite number of media format choices to reach an audience (1); and most importantly, because marketing doesn't change behavior, simply initiate and manage relationships in the hopes of being considered when a consumer is making a transaction, marketing can never truly be strategic, but reactionary.

Functional consultants are tactical executioners, usually biased, not always pragmatic. They tend to be a confusing and confused breed who repeatedly toss around obsolete strategic terms in a bid to appear more "strategic" than they actually are; a group inculcated in the religion of project management and inter-office politics. Nothing pleases a tactician more than thinking they're a know-it-all strategist. Nothing boils their blood more than the mere utterance of the term "vendor". Should one be surprised at management's displeasure at all "management consultants" who turn out to be tacticians in disguise?

The objective here isn't to ridicule, argue, or speculate, but to defend the profession of consulting against misunderstanding (thanks primarily to those who offend the profession by being "consultants, for now") and the profession's own ignorance of how to address its perceptions. Nothing is more valuable to a strategy consultant than an educated client, but with so little actually written about the philosophical foundation of professional strategy consulting, it's the obligation of consultants in this space to pick up where our forefathers left off and continue to innovate in and expound on our value and worth.

Write to Al Berrios at editor@alberrios.com

Footnotes

(1) Despite the virtually unlimited choices within each format, with only 6 formats (TV, radio, print, outdoor, and the newest internet and wireless; half of which are converging), there's a finite number of ways you can mix and match before you've exhausted the full spectrum of "strategy". Content choices come and go, but formats are forever.

Disclaimer: The recommendations, commentary and opinions published herein are based on public information sometimes referenced via hyperlinks. Any similarities or likeness to any ideas or commentary from any other sources not referenced is purely coincidental. al berrios & co. cannot control any results occurring from advice obtained from this publication nor any opinion(s) conveyed by any reader of this publication.

(c) 2005. All Rights Reserved. al berrios & company, inc. Published by al berrios & co. This Report may not be reproduced or redistributed in any form without written permission from al berrios & co., subject to penalty.

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