The Peculiar World of the Management Consultant Take Two
They aren’t all successful. In fact, many consulting engagements are instructive to the consultant more than they are successful for the client. That invariably happens closer to the beginning and end of a consultant’s career.
Lessons Learned
One of the most difficult lessons for me to learn was that when attempting to sell work to the client that the client actually needed, there are four levels of benefits. First is the benefit you will actually provide. If you’re extremely lucky, the client buys that. Few do.
Next down the line is the benefit that the client believes you will actually achieve. This is always lower than reality. Next lower in value is the benefit the client will acknowledge. This is invariably less than what he really believes you will achieve. The bottom one is how much of what the client will acknowledge for which you are actually paid. The reason most often given is “We would have found that ourselves.” The fact that they had failed to do so for eighteen years is irrelevant.
Another is that unless I am absolutely certain that I can deliver, I should never contact the client. This can be tough, if the engagement is lucrative, but it’s necessary. I cannot afford the risk of failure. Likewise, if the client refuses to listen, I have to offer a full refund and offer suggestions for qualified replacements. In this case, I cannot afford the risk of the client’s failure.
Always deliver everything in the contract. That may be difficult and expensive, but that’s irrelevant. If I agreed to it, I had to do it.
Testing the client.
It is impossible to work with or for a true narcissist. Thus, I must push at least slightly against the client early in the sales cycle. That has still led to several severe mis-steps.
When the client tells me we have to talk about the price, I raise it by ten percent. This has a remarkable effect on people whose entire frame of reference is that the man with the gold sets the rules. The consultant-client relationship is one of equals.
Sometimes you’re the windshield, sometimes you’re the bug.
On arriving at a client location, I learned that they had implemented EVA, Economic Value Add. One of the principles of EVA is that one adds value by reducing a cost only if there is an alternative use for the cost being reduced. In this case, the cost was a beloved long-term employee. His services were irrefutably no longer needed, and I sympathized deeply with him. My employer at the time was being reimbursed for its services based on cost reduction. By eliminating his position, cost had clearly been saved.
Client employees argued that his name was still on the payroll, thus no savings had been realized. I often observe that one can’t fix stupid, but these people were not stupid, merely ignorant. Sometimes, one can’t fix that, either.
At another client, the consultant on-site asked for help. He had identified some things he wanted to do, but the supervising consultant told him that was not his job. His job was obviously to make the senior employee of the company on-site look good. I wrote to the supervising consultant and told him that what was obvious to him was not necessarily intuitive to others. The eventual upshot was that I flew up to work with the consultant and client. The consultant was trying to work them through re-engineering a process, and having little success. That’s typical, most such efforts fail.
At the out-briefing with the COO, the consequences of the current process were laid bare. The client, a nationwide rental car chain, assigned the cost of purchases to repair another site’s vehicle to the site paying for the repair. Cost to tow the vehicle back to its owning site were charged to the owning site. Site managers were evaluated based on how much they spent, rather than what they it spent on. And, every purchase had to be approved at multiple levels, which resulted in missing every early payment discount.
The COO ordered that both rules be reversed, and that only the top 10% by cost of invoices be subject to review. The IT supervisor present could not handle the change because “we’ve always done it this way,” and had a psychotic break. She was taken out on a stretcher, and I have no idea what happened to her.
I regret not finding another way to do what the client needed.