The consulting gamble

Bearing in mind how much his organisation spends on consulting services, that seemed like a gamble of enormous proportions. My mind drifted as I started thinking of other purchases where the odds of success are 50:50. Cars? ‘Ah, yes, half our cars run like an absolute dream, sir. The other half tend to crash into buses the minute they leave the showroom. You takes your chances.’ Watches? ‘Sorry, madam, the advert about precision time-keeping only applied to half of our watches. The one you bought hasn’t the foggiest clue what time of day it is.’

It’s a glib point, of course; an element of uncertainty about an outcome has always surrounded professional services and always will. Such is their nature. It also doesn’t take into account that the overall impact of consulting services on an organisation may still be positive. As long as the half that works more than pays for the half that doesn’t, the gamble pays off anyway.

Never the less, the question for anyone about to bring in consultants is how to stack the odds in their favour. Or, to put it another way, how to start working out which half they’re going to get.  At the moment, to borrow the car analogy again, nobody whose car crashed into a bus the minute they left the back of the showroom, ever thinks to go and tell the people queuing up at the front (even if they’re from the same family) that all the blue cars have been driven off without incident, while every single red car has ended up wedged under the no.14.

This might be where management consulting stands out from other professional services. The trouble is that very few people are comfortable discussing the reasons they needed a consultant in the first place, and even less comfortable admitting that after spending lots of money on expensive consultants, their problem wasn’t solved. So they keep quiet.

Consulting firms, for their part, like to send out evaluation forms, but they send them to the right people (at the right time) and in return they get some nice shiny quotes with which to furnish their new marketing brochures. Clients, like customers of 50% Motors R Us, tend to do nothing.

Who’s to blame? Well, everybody and nobody really. The fact that $300bn is being spent on management consulting globally every year, without ever having its efficacy recorded, hints at a systemic failure on the part of client organisations to address the issue of evaluation properly. The only people that have responsibility for controlling, monitoring and evaluating expenditure on consulting tend to be procurement professionals, but if their internal customers are reluctant to talk and only ever engage procurement when they want them to hammer down prices anyway, it seems a bit harsh to point the finger at them.

The buck has to stop somewhere though, and whether it’s with consulting category managers or CPOs, if procurement departments aren’t prepared to start tackling the issue – and loading the dice in their favour – then it’s likely nobody else will.