Wednesday 21st Mar, 2018
By Fiona Czerniawska.
Imagine you’re walking down the supermarket aisle looking for breakfast cereal. Bored with the one you’ve been eating all these years, you’re in the market for a change. You pick up the first one that catches your eye. “MEGAPOPS”, the package shouts in an unnecessarily lurid colour, “THE BEST WAY TO START YOUR DAY WITH A ZING!!!!” You look for the small print, some tentative indicator of what a zing is in this context—but there isn’t any. “SUNNYNUGGETS,” screams the next, “GOLDEN! DELICIOUS! FAST!” But is it healthy? Well, there’s nothing to tell you that. As consumers we wouldn’t—and don’t—put up with this. Decades of regulation and government intervention ensures that we’re in a position to make informed choices about our breakfast cereal. Sure: We can—and many of us do—choose to ignore them. Sure: There are still improvements to be made to the labelling. But on balance, as consumers, we’re the best-informed generation in the history of humanity.
If only that were true for consulting.
Friday 23rd Feb, 2018
By Fiona Czerniawska.
The Trusted Advisor is probably the single most influential book on the client-consultant relationship published in the last two decades. More than 15 years after it appeared, you can still find it on the shelves of senior partners right across the professional services sector. What made the book especially powerful was simplicity: Trust, it argues, stems from individuals’ expertise, whether they can be relied on to do what they say, and the extent to which they can go beyond the conventional supplier-customer relationship. Truly “trusted” advisors, says the book, also avoid the pitfall of self-interest: they put their clients’ interests ahead of their own commercial imperatives.
But “trust” has become a problematic issue. In all the many, many conversations I’ve had with clients, I don’t think a single one has used that word. It’s true that many describe the relationships they have with their advisers in terms that imply trust, but that’s not how they’d articulate it. “Trust”—like “loyalty”, again a term you never hear—has become associated with dependence and the suspension of critical judgment. A loyal customer buys the same product because they feel they should, because they don’t want to or can’t be bothered to change, not because it’s the best product. Even the clients we talk to who spend a lot of money with the same firm on a regular basis don’t equate that with loyalty: “Our procurement team would kill me if I said that,” one observed.
It’s tempting to shrug our shoulders and blame the zeitgeist. After all, this isn’t just an issue confined to professional services: The global financial crisis taught a generation not to trust banks; we shouldn’t trust the media, and we can’t trust politicians. But automation will put trust back in the limelight.
In the traditional world of professional services, your adviser—be they a lawyer, an accountant, or a consultant—would turn up and talk to you. You, as the client, would be able to gauge their level of expertise by talking to them (which is why, incidentally, the best clients have always been experts themselves). By working with them, you’d get to know whether they could be relied on to do what they promised, and by getting to know them you might—this was always the hardest bit—decide that you shared the same set of goals and values. But supposing it’s not a person who turns up, but a machine. That third aspect is clearly out of the question. “Intimacy”, the perhaps slightly unfortunate term used in The Trusted Advisor, is clearly a non-starter: Machines don’t have values. But you can probably be fairly confident about “reliability”, because a key advantage of a machine is that it won’t make mistakes, and you’d think you’d be able to judge “expertise”, assuming you’re one of those good clients who knows your stuff. But can you really be sure of the latter?
Wednesday 31st Jan, 2018
By Alison Huntington.
Conventional wisdom tells us that McKinsey, The Boston Consulting Group (BCG), and Bain only really compete with each other.
But as the tectonic plates of the consulting industry are shifting, there’s mounting evidence that this is simply no longer true. Sure, the MBB firms might still retain an aura of differentiation through the prestige of their brands, but as client demand changes, and as firms of all stripes converge around digital transformation, there’s a serious danger that McKinsey, BCG, and Bain’s obsession with each other is blinding them to other threats.
Take McKinsey’s clients. We asked current users of McKinsey which firm they’d pick as their first choice in a range of consulting services, if they were given free reign*. Unsurprisingly, large proportions of its clients are loyal--on average, 20% say they’d pick McKinsey as their first choice firm regardless of service. But, looking at the table below, we can see that their loyalty varies considerably depending on which service they’re thinking about. And the arms into which they’re likely to drift are anything but the familiar foes.
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