So, How Come So Many Consulting Firms Operate Like Industrial Companies?
TThe way most consulting firms operate can be the best described as a one-time transaction between a fungible vendor and an sceptical, suspicious, apathetic, indifferent client. It's not a new recognition that most consulting firms don't have a Trusted Advisor type transformational relationship with their clients. It's merely a money and activity transaction: "Give me the money and we'll perform some tasks for you."
With a little attention these transactions could be changed to long-term relationships based on mutual trust, respect and peer-level candour.
The consulting firm is the only form of business that provides highly customised and even personalised services - basically care, protection and guidance - to its clients, and delivers value in close collaboration with clients through one-to-one relationships.
The other difference is that while industrial companies can become successful by being sufficiently systemised and staffed by lower-skilled people who use those systems to achieve desired results, consulting firms, above and beyond creating effective systems and processes, must also compete both for attracting top tier talents who can create and deliver kick-arse service, and great clients who are willing to work hard with their advisors to receive great service and fantastic results.
So, considering the collaborative nature of client relationships ("what can WE JOINTLY achieve?" vs. industrial companies "What can I do FOR you?"), for a consulting firm to achieve industrial significance, it must thrive to attract both top-tier talents and cream of the crop clients with sexy, exciting engagement opportunities.
While it is clear that consulting firms are diametrically different from mass-production-based industrial businesses, the sad reality is that far too many consulting firms are managed as if they were industrial companies using manual labourers to mass-produce commodities.
Associates are often treated as necessary expenses, being expected to conform to rigid systems and processes, and they are evaluated on metrics which work in industrial companies, selling commodities to customers, but not in consulting firms, selling customised intellectual capital.
Sadly, you can summarise so many consulting firms' purposes in one sentence: To constantly and purposefully screw our people and our clients in order to fatten the partners' bank accounts. I know it sounds harsh, but hey, the reality can be pretty wild and hard to believe.
There are several big differences between industrial employees and associates of consulting firms. Two major differences are:
While industrial companies are highly compartmentalised, that is, sales, marketing, manufacturing, HR, accounting, etc., consulting firms operate as one cohesive unit with 100% transparency.
While industrial companies sell commodities to customers (people buying commodities at competitive prices), using a dedicated sales force, in consulting firms every single associate and partner is selling unique experiences to clients (people buying care, protection and guidance at premium fees). That is, in consulting firms there is no dedicated sales department and other silos.
You can read more about the differences in my Black Paper, entitled Ten Deadly Management (Mal)Practices That Often Bring Consulting Firms to Incalculable Suffering or Even Agonising Death. Among others you discover...
For a complimentary free copy of my black paper, The Dark Side Of Firm Management: Ten Deadly Management (Mal)Practices That Often Bring Consulting Firms to Incalculable Suffering or Even Agonising Death, follow this link and fill in the form. And then the magic of technology will soon plop the report right into your email inbox.
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