Consulting is a big tent
Consulting comes in many flavors. Or in other words, it spans all industries + non profit + governmental. Whatever story you read about in the WSJ, there is a consultant and an attorney who can help (or at least say they can help). M&A, sales and growth, cost reduction, restructuring, digital transformation, business model change, regulatory, or environmental. It’s an endless industry and function combinations:
- Petrochemical + supply chain
- Big box retail + Advanced chatbot, LLM, AI applications
- Non-profit + fund raising
Diagnostic vs. Implementation
Another way to think about it would be like the following image:
- A diagnostic is an intellectual sprint that involves a smaller set of (in the know) senior people, and it’s about assessing the situation, getting smart, making some valid assumptions, coming up with a series of options, and making tough decisions. Diagnostics are like creating blueprints. Draftsman creating “a deliverable.”
- An implementation varies a lot. Whether it’s a 5K or a marathon, it takes longer than a diagnostic. It can be 6 weeks (kaizen event) or 6 years (ERP implementation). It involves many more people, and moves as fast as the people do. Yes, think c-h-a-n-g-e-m-a-n-a-g-e-m-e-n-t.
Diagnostic
Some projects are diagnostic in nature. Like a primary care doctor who asks a lot of questions, runs a lot of tests, and gives your their diagnosis. “Based on XYZ, my experience, and your risk level, I recommend . . .” In my case:
- Pricing organizational design
- US healthcare hospital “certificate of need” proforma financials
- Sourcing, procurement ERP software business requirements
In a very fitting way, some consulting firms call this “a case” or “a study”. I teach at a university, and that’s how we talk. It’s an intellectual thought-experiment; it’s theoretical, pure, and worth your curiosity and time.
Implementation
Implementation is what happens afterwards. If the business case / strategic initiative / new organization / new acquisition is approved, then the BIG work starts. You can spend 3 intense months selecting a software vendor, then spend 3 YEARS implementing it. What’s harder, the exercise plan or getting really healthy and fit?
Story Time: James McKinsey
James McKinsey, the founder and namesake of McKinsey & Company, discovered this the hard way when he was recruited by one of his clients to be CEO. After many years consulting, he now had the authority to implement. In 1935, Marshall Fields was in need of help. The retailer had lost $12M over the last 5 years and had a $18M debt repayment coming up. Trouble all around.
McKinsey (the man, not the firm) attacked the problem aggressively, restructuring the firm and ensuring its long-term survival; after all, Marshall Fields survived another 70+ years until it was acquired by Macys in 2005. Not bad work. Those are the right and difficult decisions a CEO makes. McKinsey was an accounting professor and considered himself a management engineer.
Duff McDonald, author of The Firm: The Story of McKinsey and Its’ Secret Influence on American Business (affiliate link), says these 2 years were really hard on him. James McKinsey, the founder of the eponymous firm, grew depressed, eventually got pneumonia and died two years later. It was the hardest thing he had ever done.
Now, it’s hyperbole to say that implementation killed him, but letting go of 1,200 employees. Cutting whole divisions and retiring people early. Receiving 10-20 letters threatening his life. This is all tough stuff. . .
“Never in my whole life before did I know how much more difficult it is to make business decisions myself than merely advising others what to do.” – James McKinsey
Some people belittle implementation
They say it’s easy or boring. Something pedestrian and kinda blue-collar. While no one is foolish enough to say that it does not matter, they readily and arrogantly say that someone else should do the work. Hmm, disconnect.
Implementation matters
10 out of 10 MBAs will boastfully decry that they want to do strategy, as if that is where the money is. That is a false choice. Strategy and implementation are two sides of the same (value-driving) coin.
Consulting can be overly theoretical
I have been on several projects to clean up the “strategy” work of other consulting firms. It’s almost a cliche story: high-end $500+/hr consulting firm puts together a plan that sounds good on paper.
Real life example: Consulting firm (not mine) advises retail client to lay-off more expensive (read: experienced) sales people because the data shows only a loose correlation between years of experience & annual sales. Definitely cavalier. Stupid.
More than just the executives
Yes, we are hired by the C-suite. Yes, it is intellectually rigorous work. Yes, it starts with a smaller group of people with positional power. However, it should not end there. The recommendation is just the beginning. There is lots more to do.
Decisions sit
The command-and-control archetype is dead. The notion that decisions made in the boardroom swiftly trickle down to the reaches of the organization is dead. Decisions are like raw ingredients on a chopping board. They don’t cook themselves. They don’t jump into the blender and frying pan. Decisions just sit. Organizational inertia is bigger than me, bigger than you. It is not a 1 person job. Leadership requires relational equity and risk. It’s work.
Make it easy to implement
For me, change requires equal part head (intellect / analysis), heart (leadership / passion), hand (implementation). Organizations have inertia built up from legacy IT systems, veteran employees, M&A with limited post-merger integration, poor incentives, geographic distance, and plain-old laziness. However simple it may seem on PowerPoint in the boardroom, it is often a hot mess when you want to implement it.
Implementation is tough
Everything seems easier in theory. While it may seem straightforward to cut costs on an excel spreadsheet – what does that look like when you are the one delivering the news to managers and employees? Layoffs are real.
Change is not simple
It takes more than an executive memo to get an organizational supertanker to change direction.
McKinsey’s 7S framework
Yes, this is an oldie-goldie from the 1970s here. Strategy, shared values, skills, staff, systems, structure, style. That’s a lot of things to have to get right. Don’t be surprised if clients are slow to adopt and adapt – remember, they have been here a long time before you visited, and will be there a long time after you leave. “We’ve had consultants before” is a common refrain. Change is not simple. Change takes effort and heart.
Shout out to the implementation teams
This toast goes out to all the consultants who are on the ground helping clients get things done. We don’t make recommendations so they end up on the book shelf. We are in the business of making change happen. Kudos.
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