Simple Guidance For You In Management Consultants.
Is management consultant worth it- Do not hire!
I need to tell a true story which is about 16 years old.
Jon had just left the secure world of a senior role in a multi-billion dollar global corporation to accept the role of the CEO in a mid-size family-owned company.
He had always been a go-getter, who had progressed fast in his previous roles.
He always showed impatience with the bureaucracy endemic in such large corporations, and believed that he could do things much better.
And, he might have been right in most of those thoughts.
Moving On In Management Consultants.
So, I was not surprised when announced his plans to take command of the mid-size Australian company.
Because he was not very close to me, I was a bit surprised when he sought me out, saying that he might contact me for a project once he was settled in his new role.
True to his word, and style, he did not let the dust settle before he called me up and requested a meeting.
He gave me some details of the situation, and asked for a proposal to revamp the procurement department – which he saw as the weakest link.
Because the story is old, I can share some contextual information while changing other details.
The company itself has been sold multiple times since; none of the information is confidential or identifiable.
Jon explained to me that he was the first external CEO in the business – which had so far been run by the founder.
The company had been reasonably successful in the mining boom, and was ready for its next stage of expansion on to the international stage.
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The Right Person in the Wrong Place
Jon, being the go-getter, was just the right man for the job. He was promised total autonomy by the founder/ past CEO – who had stepped back to the role of the Chairman.
In my first meeting with the Chairman, I found him to be an extremely astute man, who had built a strong company through difficult circumstances.
Granted that the recent boom had made things easy for the industry, he was not the kind of man who could easily relinquish control.
It will take a long narrative to describe exact details of the project, and these are not even relevant.
Suffice it to say that Jon, who had taken his bosses assurance of total autonomy on face value, found it very hard to operate the company as a CEO.
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Relinquishing Control is Difficult
Almost all the crew was used to go to a single man for every decision. For the past 25 years in the company, all decisions were made by a single man – the founder.
Despite the appointment of the new CEO, this continued to happen in our transformation project, as well as in the business-as-usual operations.
It became amply clear to us that our project proposal terms were unlikely to be honoured.
There was no way to get the co-operation from the management team because everyone was afraid of what the procurement data might reveal about the past and present.
We requested a meeting with Jon and expressed an inability to continue with the project under the circumstances.
He apologised to me about misreading the situation and putting us in very difficult circumstances.
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Being Thanked For a Half Done Job
The Chairman thanked us profusely for showing the direction to ‘his’ team and after getting assurance that we will continue to guide them as needed, wrote us a check on the spot
- which is the way he operated.
However, more ominously, within weeks, it was clear to Jon that he had jumped from a chiller to a freezer.
Within weeks he moved on to a new role as the CEO of a different, more progressive, company.
I will talk about how the story ended later on in this article. Here, I want to come to the main point of this article.
Many Such Situations
There are many similar situations when you MUST not hire management consultants because it will only waste time and money.
In my last article titled – “How To Get The Most Out Of Your Management Consultants While Spending The Least On Them?” – I wrote
The Quality of Your Management Consultants Will Decide The Heights You Eventually Climb To
A number of people wrote back, objecting to the presumption that every situation is amenable to getting management consultants.
While I did not say any such thing, when I thought about the topic, I recalled this story.
Leading from it, I can think of other situations where we did not start a project just because the person leading the project was really not in control.
The Latest Trend In Management Consultants
Title inflation
This can happen due to title inflation in some countries where people get titles without commensurate powers and abilities.
In many Asian countries, family owned corporations continue to be run by the family members, despite there being a whole cadre of professional managers in place.
It is very interesting to watch the dynamics of these organisations in practice.
The problem arises when many foreigners are misled by titles, not too dissimilar to the rare Australian situation quoted above.
Unions Galore
Unions are a fact of life in almost all big corporations – and they have a role to play in balancing the scales.
Yet, in some circumstances, they acquire so much power that any positive change is impossible. I quote one such very personal story in this article.
The point is simple – if the management is totally powerless against the unions they should not substitute analysis for action by carrying out one management consulting project after another.
That would be just throwing good money after bad.
If you adhere to these simple rules of the thumb then I can truly say that:
The Quality of Your Management Consultants Will Decide The Heights You Eventually Climb To
Coming back to the story that started this article:
The company went through two more CEOs, and an industry-wide government inquiry before the chairman finally relinquished control of the operation.
At this point, the company was a popular target for take-over.
