The anatomy of a bad relationship

Clients view consulting relationships in two distinct ways: the personal interaction they have with the consultants (the people), and the results delivered (the promises they make).  So what is it that goes wrong?

Unsurprisingly, clients cite poor quality consultants first. “Bad consultants are those who trot out platitudes and charge a lot,” was how one manager put it. “They offer little insight and add nothing new.” “They only do what they’re told to do,” complained another. “There’s no leadership.” Yet others talked of the arrogance consultants so easily slip into: “They think they are the sole owners of intellect in their area; they can’t relate to other people.” “A bad consultant is someone who either doesn’t listen or pretends to listen while coming up with a pre-packaged solution.” And from the people, clients move quickly on to talk about the broken promises. “A bad consulting firm is one that that sells you a project with one set of people but tries to deliver with another. You expect the organ grinder but get the monkey.” “They promise the earth and can’t deliver; they make powerful presentations but have no substance.”

The striking thing about these comments is how quickly an unhappy client moves from blaming the individual consultant to blaming the consulting firm which supplied them. That is not unreasonable: it is the consulting firm which is, after all, providing the service. But it is noticeable how the same connection is rarely made when it comes to good work: there, it is the good consultant who gets all the credit, not the consulting firm. Also worth noting is the way in which dissatisfied clients often criticize the consultants who work for them for putting their consulting firm’s interests about their clients’. According to one manager, a good consultant “will always act in our best interests, rather than imposing an overused solution or looking for future business and sales.” By contrast, bad consultants “aim to get as much money as possible out of us in short-term at the expense of any long-term relationship.” From a client’s point of view, individual consultants add value because they bring specific expertise, and this expertise allows them to make good their promises. “The key thing is the people in the firm assigned to the project. The people are more important than who they work for.” Consulting firms only get in the way of this, putting pressure on consultants to divide their work between other clients or look for additional sales opportunities.

Consultant: good. Consulting firm: bad.

The promise pyramid

Every consulting project has promises embedded within it: they may be small or large, explicit or implicit, but they are there nonetheless – and the single, most important thing a consulting firm does is keep its promises.

There are three types of promises.

First, there are the must-keeps.  These are the promises that all consulting firms make – and should keep – largely about time, money and delivery – completing a project on time within a specified budget, doing what they said they were going to do whether that’s implementing a new IT system, coaching a group of staff or analysing a market.

Second, there are the hope-to-keeps.  These are more amorphous: they’re what the client wants to achieve in a given project, that positive results will be sustained, that benefits, once delivered, will remain long after the consultants have left.  These are promises that consulting firms agree with in broad terms, but cannot guarantee: there are too many variables to be able to say with certainty that the recommendations the consultants make will stand the test of time or that an application they have installed will be deployed effectively by its users.  Both client and consultant may strive to achieve this, but neither side can guarantee the result.

Finally, there are the exceeds-expectations-if-kept promises. These are almost entirely unwritten; they are results a consulting firm may be able to deliver above and beyond a client’s expectations. Such promises fall into two groups.  First, by bringing in consultants it may be possible to raise the standard of thinking and working in a given organization. This may seem outrageously arrogant to suggest: after all, most managers in client organizations are thoroughly experienced and have as many business qualifications as the consultants who work with them. But remember we are talking about good consulting here, not just the workaday standard.  Good consulting firms, which set great store over the quality of work they do, can change how client managers see themselves and expect from their own staff.  Second, sometimes – and if we are honest it really is in a very small number of occasions – consultants can do something an organization has thought impossible. “We wouldn’t be where we are today,” is typically how clients see this.

Consultants as bellwethers for the economy?

There’s a common perception that consultants do well in a downturn.  Because they sell services rather than products, consulting firms are – the argument goes – better able to adapt what they do to, to fit changing economic circumstances.  Thus, in the good times, their focus is on growth and new markets; in bad times, it’s on cost-cutting.

But perhaps consulting tells us more about the economic situation than we think.

Certainly, clients have been saying for some time now that they intend to limit their expenditure on many forms of consulting but increase their spend on operational improvement – aka cost-cutting.  That was borne out by a recent survey from sourceforconsulting.com which showed that 68% of clients planned to spend more in this area, roughly twice the number planning to increase their expenditure in outsourcing and substantially more than any other area of consulting.  However, intention hasn’t so far translated into reality.  Firms with performance improvement practices are generally reporting steady, but unexceptional business.

The logical conclusion is that clients are cutting costs, but aren’t using consultants to help them.  After decades of remorseless pressure on efficiency, most organisations probably feel well-equipped to do this kind of work themselves.  We shouldn’t be surprised at this: clients have long absorbed “consulting” skills, forcing consulting firms to re-invent themselves.

However, the lower than expected levels of cost-cutting consulting may point to something more.  Organisations that are delicately picking their way through a variety of options to reduce costs may well want expert input from consultants.  They have more choices, time to think about them and sufficient cash in the bank to pay consultants to help them.  But organisations that have to take 10 percent of their costs out almost overnight don’t have any of their luxuries.  They also don’t need consultants to help them because slashing 10 percent of expenditure across the board is a lot easier than pruning here and there.

In other words, the lack of demand for cost-cutting consulting suggests that many organisations are in a very bad place indeed.