Deeper read or quick summary? Depends on the time we have.

researching_innovation

I recently wrote a post “Finding knowledge and research to help you learn and adapt. On reflection I should have replaced the word “research” with “time”……time to help you learn and adapt.

Finding time is a real struggle and going that extra mile to read thought leadership views, long often drawn out reports or academic papers can be a step too far, I know but I can’t help myself, it is part of my job and certainly for me, many are really worth the read in a positive end result of new learning..

In that post mentioned above, I was recommending Deloitte and their thought leadership as a good place to visit. Now I’m not sure how many of you actually did so I thought in this blog, to pick out a couple of ‘choice pieces’ and make a posting summary of these, as ones that might be useful.

So I’ve chosen two that challenge and break ground.

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Finding knowledge and research to help you learn and adapt

Learning and Knowleodge Sharing“The world has never been as complex, dynamic and uncertain as it is today and the pace of change will only increase.”

We hear this consistently, our continual problem is trying to make sense of it.

So much is coming towards us and to assimilate it and turn it into value, usable value, so we can adapt and respond to it in new ways of opportunity by adding further to the knowledge by turning this into new innovation potential.

Seeking out knowledge, being proactive, partly helps as being consistently caught by surprise makes your world even more insecure.

To attempt to keep up to date we all need to invest increasing time in acquiring a better understanding, a deeper knowledge of all the interconnected parts. Even if we are “time starved” we simply must try and keep moving along in this understanding.

As part of my job, advising others on all things swirling around innovation, I invest significant time in researching, learning and applying what I feel is important to others, so as to understand or at least to raise their awareness to changing practices, thinking or approaches. At times it all seems to come literally flooding in, overwhelming the senses, that I just have to wait and let it settle in my mind, before I can attempt to process it and translate it into something of value to me, then eventually to my clients or readers.
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That sheer consulting muscle hopefully delivering global momentum

Pushing the world uphillHas consulting changed over the years? Certainly the business model behind them has, big time. I really do wonder where it is all going inside the business organization. Consulting has become a huge business dealing with our global and local organizations and governments.

Just take a peek around the board room doors, just who are all those strange faces, bulging muscles, huddled in meetings with the boss? Ready to take on the world.

Following on from my recent post on “the value of the visiting consultative fireman” this further post explores the external reliance on the consultant our organizations have become accustomed too. It got a little long, my apologies for that.

‘We’ seemingly can’t live without consultants.

Cant live without you 1They are now competing constantly for those semi-permanent, year-in, year-out relationships with companies willing enough to pay millions of annual fees for help and advice.

It is all about the repeating the consulting / client engagement across the entire business in as many different ways as possible.

Consultants are necessary or so it seems for any big decision in our global business organizations as the employment of consultants helps ‘sit behind’ the recommendations made, the often billions about to be spent, for them to validate, investigate, recommend and then rubber stamp your decision. Who will fire you for bringing in a respected global brand like McKinsey, a few perhaps but not many?

You wonder if the executive within our large corporations would be allowed to sneeze without the consultant stepping up with the handy handkerchief or latest prescribed medicine to easy his/her discomfort.

Consultants seem to underpin decisions everywhere and today are equally asked to execute on these, as the resources within our business organizations or government departments are ‘far too thin on the ground and busy just keeping what we have going”. Consultants are not just recommending the changes but being highly paid to make it happen.

Scale, scope and size are needed today to be a global consulting player

In the words of McKinsey on their website: “We strive for world-shaping client impact” where they then claim their “scale, scope and knowledge allows us to address problems that no one else can.”

They suggest “we bring out the capabilities of clients to fully participate in the process and lead the ongoing work”. Really I’m not sold on that one. At McKinsey they claim to “hire as many MDs, PhDs, MAs and JDs as MBAs” and well that just must be why business organizations fail without them isn’t it? Yawn.

The ever-growing big numbers of ‘boots on the ground’ to deliver solutions on client’s needs.

boots on the ground 1So much of McKinsey’s ability to ‘land’ work and secure ongoing work is due to McKinsey’s famous alumni network where more than 20,000 former colleagues connect with each other and with our firm.

It is a juggernaut in consulting support ‘within’ our organizations, highly interconnected into the very heart of our business organizations, to secure acceptance and validation of choice.

Of course, they still have to deliver otherwise next time it might get harder.

Today McKinsey has 17,000 employees and 9,000 of these are consultants. Others offering ‘pure’ consulting equally are sizeable organizations. BCG has 9,700 employees and 6,200 consultants, Bain & Co 6,000. A T Kerney have 3,200 with 2,300 consultants, PA Consulting with 2,150, Bearing Point with 3,350, Roland Berger with 2,700 consultants, Monitor Deliottes with 1,500 and the emergence from the combining of PwC’s consulting with Booz & Co into Strategy& with around 3,000 employees makes for a formidable array of business consultants to call upon, when in need. Let alone the countless smaller, more specialised ones below these global players.

Then you briefly look at the jaw-dropping numbers employed at PwC of 184,000 due to their tax and advisory services, Deloitte 203,000 employees, Ernst & Young have around 175,000 and making up the big four is KPMG with 155,000. These make up the ‘muscle’ within the International management consulting firms. Then as we move into technology we get Accenture with 280,000, CapGemini with 131,000 and we have IBM, Hitachi Consulting. It goes on and on.

Consulting is a huge, big business utterly dependent on generating repeating revenue

Big businessWe knew that, didn’t we? The combination of Credentials, Reputation and Size cultivated around the consulting brand has become intoxicating for business organizations.

They seem to simply not live without the consultant being ever-present. They can’t let go, surveys seem to be recently indicating the need to bring more consultants in to solve their problems.Consulting is an integrated big business, designed to extract the numbers, be indispensable.

Spending on consulting can rise (and fall) dramatically. For the large consultants their constant focus on communicating the value they add and differentiating themselves from competitors is vital.

While there is this ongoing pressure among businesses to keep head count low it is stimulating growth for consulting firms, the ones constantly providing the research of global volatility, uncertainty and the need for constant vigilance. The very consultants that argue for a lean approach to be flexible and ‘reactive’, ready to seize opportunities, with the consultants help.

No wonder head counts are kept low with the very ‘solution masters’ whispering in your ear all the possible doom and gloom from their latest research and global surveys. Even if businesses did relax the head-count restrictions it seems all the brightest, not necessary the best, are locked up in the consulting company, happily moving from one different challenge to another. Why would they join one firm and become part of the permanent furniture?

Moving down and across the consulting food chain is essential today for all involved.

To feed these large ‘fee guzzling consulting beasts’ the larger management consultant firm not just search for the ‘big whale’ projects that might have $20 million and upwards in price tags to complete post-merger activities, they often bring them to the board room table. With the recent merger frenzy re-entering the Pharmaceutical scene these fee’s if you land the ‘whale’ become huge.

The shift to combining strategy and technology, the challenge to redesign total system structures is requiring each consulting firm to make their own ever-increasing bets on where to focus. The growing shift is to more operational work, the move away from ‘pure’ strategy work, is redesigning the consultants into more ‘one-stop’ solution providers.

The lower end of fees, below half a million dollars for a piece of work is nothing today, this is becoming table stakes to play at the big consultants table. Consultants are charging $2+ million for a stand-alone study, constantly looking to turn this into the $15 to $20 million total system redesign. This requires having the infrastructure available internally for these more broadly based assignments. Fee’s are clearly on the rise as mega-mergers and risky projects drive the numbers up even more.

The ‘rub’ of repeating money

The RubThe ‘rub is’ that these designs have to be repeated and repeated, to earn the profit margins expected from the investment in those initial up front solutions designed for one customer. ‘Suddenly’ these are turned into global solutions that meet the ’emerging’ shifts in trends to make this a global movement of the many seeking the latest practice.

The solutions suddenly become the large ‘big tent templates’ for repeating revenue as many more clients are needed to be found where this ‘trending’ redesign will help meet this new business imperatives outlined by, oh yes, the same consultants as a must have.

The profit comes from as much as you can ‘repeat’ to ensure you don’t keep reoccurring those dreaded origination costs. The consulting business model requires this repeating even more today than in the past. It simply has too, with all the employees on the books made up of all those very bright “MDs, PhDs, MAs and JDs and countless MBAs” all expecting their bonus to be better than previous years.

I wonder if we are having the conflicts of vested interest in consulting as we have been witnessing in banking with the ‘dual’ chase for big bonuses driving our decisions?

The huge consulting bandwagon rolls on and on

Consulting bangwagonWithout doubt consulting companies are working exceptionally hard on their overall reputation, culling the consultants that don’t perform to prescribed formats and time lines, seeking to accelerate those that do constantly perform.

To support this consultant firms are investing in deepening experiences and exposures into different clients to wring out more projects and ‘drive’ the revenue they need.

They are working really hard on improving their tools/techniques, adding in thought leadership and innovative thinking, improving their reports/presentations into more visual feasts.

They are certainly highly conscious about the results they are delivering as just standing outside the door is the alternative consulting company, just itching to be let in.

Is hiring the outside consultant totally addictive?

I think the use of outside consultants is for ever growing. Consultants are operating up and down our business organizations today. As Organizations have shrunk their resources right down and are still certainly very reluctant to employ new people this will continue.

The pay-off is for whom? Call in the six-pack abs-solution man

Six pack absConsultants have a great advantage over their clients; they can provide their solutions with new understanding, they are the feeders of “best practice” that magical potion waved over you providing you engage me to ‘reveal all’. They are constantly working out to keep ‘in shape’ to help.

They have the equivalent of the six-pack abs as the good looking solutions.

Also they are not only ‘solution fit’ but they are provide the surgeons, doctors to nurse you back to health using their solutions for you to keep your body stable as long as you don’t go off their life support system. This allows you still the opportunity to be able to take on the physical challenges of everyday life in your stride focusing on the efficiencies and improving the effectiveness, moving the flab around, leaving the consultants with the real challenges, the heavy lifting as they bring in the ability to deliver on this.

The consultant offers the solutions to keep you lean and lacking in in-house resource

They provide the solutions to make sure any spare resource (or fat) is quickly eliminated so you can continue to gaze at the solution abs pack of the consultants, simply because you never had the time or real determination to get into the shape to manage these challenges yourself.

The leaner you are, the more dependent on the consulting supplements to keep you going. We are back to the semi-permanent dependence we crave for as ‘we’ simply don’t have the talent or resources to call upon whereas the consultant has plus the ‘revolving door’ experiences.

When the consultant leaves the building (if ever)

Left the buildingWith this prevalent “leave it to others” more often than not when their solution abs consultant leaves the premises, all you are left with is the left over pizza’s and flat cokes from all those late night burns the consultant put in to complete the required data crunches and show to you, their perfect solution.

Thank heavens they are only one phone-call away or is it simply one floor below-away, working on different problems you always seem to have, to adapt the business to the global forces at work?

Don’t tell me it can also be different- not possible

Sorry Mr Faithful employee, just get back to your everyday work. Innovation, oh forget that. We have no time for that; we are plotting the next big thing alongside our consultants. No, look, I mean there are no merger drama’s, complex wheeling and dealings, it is based on too many intangibles, innovation always seems to have long development processes or complex testing procedures, ending up with mixed results. It is best you stick to the incremental stuff and leave me and the big consultant to manage growth, we know best.

“We will simply buy in innovation success” Oh yeah really!

The ultimate key to successTalking of different innovation that can take place within their organizations (disruptive, radical, reverse engineered etc) makes many of those sitting at the top of our organizations have an uncomfortable feeling simply because the big consultants don’t also seem to have the answers to this innovation stuff. Surely if they don’t we can’t possibly!

Understanding the ability to field genuine experts that can be highly valued and focused, well there must be a catch in that surely?

Thankfully today that genuine expert still offers the ‘sweet spot’ for innovation. It is a place for the small, independent, highly focused consulting person or specialized teams that connect the many necessary ‘dots’. Yet getting top management’s attention or sign off is getting harder to achieve, when the big consultant likes to show his growing muscle mass, attempting to cover off the innovation bases as well.

Presently many of the bigger consultants still seem to have little true understanding of the underlying dynamics needed for internally generated innovation, those solutions than can equally lead the growth, if only they were given the same amount of attention at the top. Equally the time line for this can be long, solutions are often unique and much is often not repeatable, this goes against the business model mostly found in bigger consultants.

Thankfully innovation is one of those last frontiers that still mostly come from within, when it is given the chance and the limited external resource that can help facilitate this.

The value of the visiting consultative fireman

Keep calm I am the visiting firemanI was reflecting on the value and role of consultants and have written here, here and here on this. These thoughts have covered the topics of suggesting different consulting models, exploring the shifts taking place in consulting and where consulting can contribute. Then I offered a post late last year under the title of “client engagement- full of whipped cream and lumpy gravy?

So in this post I will reflect and look at the visiting fireman here, the ones I experienced in the corporate world. I still believe they are far from endangered species.

Consultants hold a specific fascination for me, they come in all shapes and sizes, offering a bewildering array of solutions for your business.

For many clients, consultants have become ‘totally essential’  yet for others a necessary evil. Today with far less resource within our business to call upon and coping with increasing pressure on time there is also this total reluctance to employ someone on the books, it is better to bring it in on an ‘as and when’ basis. Keep it lean and mean, charge it off against that years operating expenses, don’t bring it onto the longer-term books.

Mostly the consultants knowledge leaves when they do

What comes in and what leaves gives the value to you in you applying their knowledge not just the consultants solution. Often this knowledge understanding totally ‘fails’ to reside or be absorbed as ongoing learning. Partly it is not so easy to transfer, especially to those that are too busy to learn it!. We often miss this critical point of transference and we continually bring in consultants time and time again, actually for the majority of seemingly ongoing work, the repeating part we should be resourcing from inside but never seem to get around to recruiting or convincing others of the need.

We also never pick up the rhythm and real understanding how the external expert connected all the dots differently from you and we then fail to copy down the important notes to recreate the understanding. Many time I had to ‘catch myself’ on one particular slide, fascinated how that was put together, failing to hear the message behind it.

Have you also noticed how the outsiders always give us those ‘bells and whistles’ we fail to hear within our own immediate surrounding although it was there for us to see but we were too busy to find it, so we simply let others at potentially a higher end cost.

Experiencing the different visiting fireman

Experiencing the firemanIn this post I wanted to recall the visit of many visiting firemen when I was running various country operations in different parts of the world for a handful of global corporations. More than one organization called outside expertise “the visiting fireman”.

There to help fight the fires, hose down the areas of critical combustion, recommend the essential fire fighting equipment and escape drills you will need from their experience.

I had experienced three types of visiting fireman in corporate life.

Three types of firemanThere were three general types; the regional fireman, the corporate fireman and the outside consultant one. Can you relate to these and the mixed emotions they can give you?

Are visiting firemen important to your business?

Yes I expect they are, they can make the real difference between ‘dosing the fire early enough’ to bringing their expertise and resources to bear, helping in managing that crisis or difficult problem you would be unable to resolve without the outside perspective, contribution or support. Yet they all seem to leave one holy of holy messes. There is always some form of re-building to take place from these consultations.

Often I think we all need to ask questions on the value of consultants. Would ‘things’ fall apart without the required dose of consulting medicine? Do they come into the organization, create havoc and then move on? Or do you value them as essential, as you quiet simply do not have the time or resources and expertise ‘in-house’ and they help ensure the delivery alongside you on what is needed within your business?

There are three groups of ‘visiting fireman’ associated with large organizations.

Do these ring any bells with you? These were my experiences and maybe yours are somewhat different, managing in specific operating structures. I spent more of my corporate career tackling difficult operating conditions, often very thin on resources, battling volatile market conditions. Now that does seem like today’s operating world doesn’t it?

I tried to remember some of these ’emotions’ when I then became the visiting fireman myself, in all three different types I will mention here

The first firemen was coming from the regional support group

The first firefighter type 1These seemed to announce their pending arrival sometimes weeks in advanced to fit their crowded agenda of moving from one type of regional or global meeting to another. Or they were suddenly ‘dispatched’ to handle growing issues. That sudden crisis where they ‘must’ be seen to be on hand, Then we had the Sherpa type preparing future visits, fixing the lines and ropes for visitors from ‘on high’ trying to influence your agenda or shape your presentation.

Lastly arriving just a week or so before the key yearly strategic discussion meetings, so as they could be better prepared to fully participate in the discussions to catch up and ‘form’ their opinion. You had to watch the hose on this one, its power and potential disruptive force coming from multiple sources based on latest ‘Intel’ gleaned on these simple fact finding missions.

They came sweeping in offering detailed advice on their specialized area, be that marketing, finance or product development. These tended to be the most difficult discussions, as they were pushing often their personal agenda’s, holding back a critical element of the corporate agenda. They often were believing what you were doing was going against company policy, general direction or conflicting with branding issues. I found much ‘creative friction’ in these visits from the regional fireman.

Ultimately you may have the final decision, or you thought you did,being responsible for the P&L but these visiting firemen could wreak havoc in the ‘whispering game’ back at regional group, prompting numerous conversations with the regional president to clear these ‘conflicts’ up. Most were short on specifics or detailed understanding, grabbing at potential ‘straws’ to be floated in the corporate wind.

I found this group of visiting firemen far less supportive than expected; they had enough understanding to be dangerous but could potentially provide those value additional insights or access to resources you needed. These visits were the most difficult. These were closer inspections to see that the house was in good order and you were not a potential ‘fire hazard.’ It often was a fine balance between their contributing value and what they constrained. These visits often disturbed and confused the local teams.

The second group of visiting fireman, the corporate ‘big-wig’

The corporate firefighter typeThese were usually the corporate executive vice presidents, the chief operating officer, the corporate legal beaver or even the CEO himself. This was a visit where you polished your credentials, went through countless preparations and checks around the facilities. They always had one or two of the regional group in close attendance at least; to point out areas they felt helped the ‘broader agenda’ that “facilitated” the discussions or messed the visit up completely by going off script and you spent the rest of the visit in ‘personal crisis’ mode.

These were times of real pressure where you had two to three hours of getting the message across on what was happening, what needed to be resolved, what was missing, what was the value of appreciating making further investments within the country and why it (and you) was relevant in their bigger picture of things.

Then off on visiting the multiple manufacturing facilities, you praying continuously that the plants would not come to a grinding halt at that precise moment. A ‘lightning inspection’ by this big-wig where you always know the visitors will simply compare, suggest and sometimes to pick up on something that did not fit with their view but was totally out of your local context. Or how they would become (briefly) misty eyed and comment on “when I was running an operation like this”. These visits from the corporate fireman often were defining moments, often that career or future investment defining one rested on the ‘good visit’ deemed by all in the food chain that determined your career.

I always searched for the opportunities for one-on-ones with this corporate fireman where you got the deepest ‘transfer’ of their knowledge. Cutting out dedicated time from the encircling herd of ‘minders’ allowed for some terrific and intense conversations that become the real bond that cemented understanding. These exchanges allowed for my constant learning of the mind-set of the corporate visitor and the value it gave to what you could contribute into the bigger corporate ecosystem.

These visits gave real moments of identity for the team that often drove it on for weeks and months after. These were also times when you could separate personal agenda’s of the more frequent visitor with the corporate agenda, to ‘ground’ your contribution you could make to the corporate set of goals and tasks. These were hugely important visits by the corporate firemen and women.

Then we had the final group of visiting firemen, these were the outside consultant

Outside consultants were often brought in on behalf of someone else or because you needed some different perspectives or solutions. They break down into two types.

The outside consultant firefighter you paid forThe first type is the ones that arrive to make an assessment on behalf of others always had that ‘air’ of real detachment. That ease of knowing what you don’t know but you would love to find out. They listened, they seemed to always take many notes, made countless photocopies that clearly supported their investigation and only gave away what they wanted too.Then left.

These types of visiting fireman is what I regarded as always “short” on advice, even though they had such a potentially richer potential to offer me thoughts than I would benefit from. They were not there for that!

I had to work really hard to ‘draw them out’ by separating what they were there for and what issues they could offer me alternative thinking. It was in many of these conversations you gained some terrific insights on alternative practices, possible avenues of investigation to help you.

Then the ones you were paying for, well not you but it is coming out of your P&L

Your firefighterThen the other ones, where you needed their expertise and the funds for this were to come out of your P&L. I never really seemed to work out this group, or extracted the value I was expecting. I think my need and their agenda mostly with often prepared solutions beforehand often were incompatible. They never seemed to learn the full context before they were off fire fighting. In all honesty I would reckon I got better value from about 25% of those I engaged. They seemed to come well-equipped though

I was recently reading on www.sourceforconsulting.com that only 27% of clients say that the value added by consultants exceeds the amount paid to them in fees when they completed one survey in the Gulf region.

I wish I knew then what I know now.

It is this group, the ones your engage with as consultants, employed by you that I want to spend some time on, in a future post. This will relate more than likely to innovation consulting, although I think most of the comments and observation can be generally applied to most consulting that is for sure.

Where do you feel about the visiting fireman, the expert or consultant and how it works for you? Do you suffer from the many mixed emotions I felt?

 

Where consultants contribute to innovation

I have been concerned for quiet some time about the ‘state’ of the consulting industry when it comes to innovation. There are simply far too many out there offering pieces of the innovation equation. If I was a client I’d be getting fairly hacked off- different people, different approaches, styles, methods of working and that nagging feeling it does not fit any bigger picture.

How do we resolve this?

Combining all these islands of knowledge into some form of combined force would be a healthy step but before we go there I was thinking about what does an innovation consultant contribute and where?

Here are my opening thoughts on this:

A consultant’s perspective for contributing to innovation activity

Constructing, implementing and sustaining the innovation process is made up of:

  • Supporting the capturing of ideas effectively both internally and externally of the client and then subjecting them to independent evaluations by the consultants own understanding and getting others involved (i.e crowdsourcing)
  • Defining, supporting and communicating the long-range business strategy and the links with the innovation process alongside the leadership of the business.
  • Understanding the innovation planning process and how to achieve input across the enterprise to align and effectively deliver. Providing the ‘glue’ to help make this work.
  • Identifying and encouraging individuals with entrepreneurial skills;
  • Indentify and empower individuals with the necessary skills to act as innovation champions, supporters or leaders in an emerging innovation process.
  • Characterizing and delivering the customer’s needs; incorporating market links into the innovation planning process, seeing these with independent eyes.
  • Establishing innovation metrics based on monitoring the broader benefits generated by the application of the innovation technology/ service/ product/ concepts developed and actively encouraging these to be adopted and, yes, actually measured.
  • Positioning the cost and contribution of innovation in perspective and necessary returns. Show the client his  ROII (return on the innovation investment).

There are clearly many more I expect one can consider but  my point is this, they all point to the need of taking a  more ‘holistic’ approach to innovation by consultants.

As mentioned above, this holistic approach seems to be missing from many of the service offerings made by innovation consultants today- that of a complete view on innovation to provide good advice that is timely and more complete than the fragmented messages offered by many today.