Qs about the 2 Bobs on "Office Space"

Factual Questions
21

I’ve had to work with several firms of management consultants working for large corporates. They were used to help deliver big infrastructure projects. I was pretty impressed by all of them. The were seasoned professionals and in this case they were there to help make a project happen. This meant dealing with a lot of the intractable blockers that exist within large organisations. Tensions between different parts of the same company or between the company and its suppliers regarding how much they get for a service.

I was working for a Telco that had won a contract to redesign a huge enterprise network and I was really working with the consultants to deliver it. They never really get their hands dirty with technology, they were never techies, but they understood the issues. What they did was really help the client move forward by applying a bit of oil to its processes. Where there was a contention between the supplier and the client that was raised and not fudged. If two supplers had some conflict, they would be the ones to knock heads together on behalf of the client.

Consultants are used as hired guns. When a company is spending money on projects and expanding, it is a lot easier than if it is in trouble and contracting. In the latter case they are used to do the dirty work and look for ways of downsizing the payroll without losing some of the key players. Consultants tend to be used to do the jobs that a client does want to or cannot get its own people to do. When they job is over they go on to the next project. They get paid a lot, have to travel anywhere at a days notice and have to show high levels of commitment and professionalism. They are usually charged to the company at several thousand $ a day. McKinsey probably are at the top end.

At the other end of the scale there are consultants who are not really consultants at all. They are young graduates at the beginning of the their career who have wandered into some agency that is a body shop. They find their new job is not with the company they thought it was, but instead that they have been sold into slavery in some dysfunctional corner of a large corporation or government department. They are there to be charged out at some day rate to fullfill a consultancy post. Their salary is in no way connected with how much they are charged out at and their contract might have several layers of other contracts above it. A lot of the big accountancy firms have consultancy arms because they can see where a company is losing money.

If you meet consultants when you are in a fairly low down to pecking order in a company, it is usually bad news.:frowning:

22

I worked in a mid-sized firm, and we’d had various consultants appear and depart over the years for various reasons…

First, there’s the business analysts crunching numbers on Bay Street (Canada’s equivalent of Wall Street). They look at overall numbers - gross income, processes, what other companies are doing, market volatility - and they come up with a number - “You should have this headcount for your level of business.” Doesn’t matter if you business has other special considerations, the statistics guys have spoken. Those guys? MBA’s, financial analysts, working for accounting/management consulting firms. Lose the headcount until the numbers match.

(Dilbert’s Point-Haired Boss: “I don’t hate you. You’re my favorite headcount.”)

Then we’ve had some management consultants come in. They never did detailed performance analyses. They would do quick over-views: what does the department do, how many doing each particular task… Rough estimates of volume of work and compare to number of workers, get estimate how many people needed.

First thing I should point out to guys who want to be Bob… entry level Bob has no more job security than we did - in fact worse. We knew 3/4 of us were pretty secure. My impression was anyone who got to spend their work time out in the actual departments where work happened, instead of hobnobbing with the execs, is that they were hired guns who were contracted for the duration of the project, then waited around the phone until called to come work on the next one.

Which is what happened to us. The consultants produce a report, you need X employees to do the departmental job, you have Y, lose (Y-X). The departmental reports said "you need X engineers, so (Y-X) engineers go. You need A support staff, so (B-A) are laid off. Some departments went honestly by seniority, some by favoritism. The head of engineering (a suck-up and a dick) laid off one of the clerical staff who told him when he was stupid, only to realize a few months later she was the only one who did a certain key task, and work had been piling up for months. Another department laid off some technicians; on had clashed with an engineer. So they found a little later that he was the only one experienced with a certain process control. They asked him to come back on an hourly basis to do the work. He told them his rate was $150 an hour, they told him it was too much. Instead, they ended up flying tech consultants in from Finland at twice that rate. The guy is now a senior systems person for one of Canada’s major banks. $150 an hour would have been cheap.

The other result was that they ended up realizing that the management recommendations made no allowance for vacations, sickness, etc. They weren’t allowed to hire ore, that would add to headcount and suggest upper management made a bad decision. They were, however, allowed to hire contractors. Since they could be booted out the door with no warning, they didn’t count as headcount.

Any surprise that by the 90’s, MBA began to be a pejorative term in the real business world? The problem is consultants would have an MBA, some experience with carefully crafted problems in accounting classes, and no real-world experience of how a business actually worked; yet they were coming in and telling someone else how to manage a business when they had no idea and that someone else had decades of experience with same.

(I actually had our exec hear a consultant make a suggestion in a meeting and tell him what a good idea it was; when I had made that same suggestion 5 minutes earlier, no reaction…)

23

The BBC podcast “50 Things That Made the Modern Economy” had an interesting episode on management consulting that I also liked:

Specifically, I was interested by the experiment that was done with textile factories in India that showed that management consulting can actually have positive effects:

24

I’ve had that experience, except it was often something I’d suggested weeks or months earlier.

25

Funny story. Years ago I was working at a firm that specialized in distressed companies. One of my buddies, a managing director (a level above my mere “director” level), just returned from leading a team to meet with a client, a senior vice president at a large trucking company in the Midwest.

“How did it go?” I asked.

“Well, I’m talking to this 50 year old VP who rose up the ranks from truck driver to running an entire logistics division. I’m showing up with this team of 20-something year old “directors” and “VPs”, not to mention our dickhead lawyer friends, none of who, by the way, know the first thing about trucks, trying to tell him about running his business. I’m pretty sure he thought we were the biggest A-holes in the world.”

I always enjoyed this particular managing director’s ability to be brutally honest about the inherent absurdity of our profession.

There is a bit of a gray area between being an actual management consultant and being a “staff aug” (short for staff augmentation). Really the more technical and generic the role, the more likely that it’s a “body shop” or “staff aug”. The reason for that, IMHO, is that providing high level strategic guidance to a CEO or top executive is a bit of a hard sell. You really need to have deep industry experience and knowledge to add real value. At the other end, companies always need contingency workers to write code, act as business analysts or project managers.
Interestingly, at one recent client, one of the VPs was mortified that an admin referred to me and my colleague as “contractors”.

Not necessarily. But I can see how one can get that impression. I recall one of my first projects out of business school, the firm I was working for (rhymes with Toilette & Douche) sent me to do “time and motion” study of the invoicing processes at a manufacturing plant. Basically following people around with stopwatches as they perform their tasks. I’m actually evaluating the benefits of implementing an ERP system, not evaluating their job performance, but it’s still off-putting.

26

Coincidently, I was trying to explain to my Dad, what it is we actually “do” as consultants. He doesn’t really grasp it. He spent his entire career doing sales for a Fortune 500 industrial company. So he thinks in terms of “my job is to go into work and do XYZ.” Best I can describe is how consulting firms work in general.

Consultants generally start their career getting hired right out of college or business school, or maybe a few years after their first job. The typical profile is smart, well rounded, “student-athlete” types you might typically find in student government or in a fraternity or sorority (without being too much of either a nerd or meathead). Consulting firms typically recruit from the top 50 colleges and top 10-20 business schools and actively recruit from around a dozen or so specific schools. At larger firms, new hires typically go through an orientation class that can last from one to four weeks. Some firms prefer to time hiring with the next class so everyone “onboards” at the same time while others have you start immediately and you go through orientation at some point later on in your first year.

Consultants don’t really have a “boss”. They have a partner who leads their practice area and each consultant is assigned a “mentor” or “performance manager” who coordinates performance reviews. But there isn’t someone who watches them day to day giving feedback or advocating to get them staffed. You can envision it more like they get thrown into a pool of resources to be utilized as required. We call this pool of unstaffed consultants “the bench”. Consultants primary goal at this point is to get off the bench.

Once I reached the level of “management”, I gained more insight into the staffing process. Consultants typically create a “bio” or “resume” or fill out some sort of “capabilities matrix” so the resource managers can match the right consultant with the right project, based on their skills and experience. But in reality, the “right consultant” is anyone who is on the bench at an appropriate bill rate and the “right project” is usually the next one. While proactively reaching out to managers and partners certainly doesn’t hurt, from my personal experience and observation it is largely irrelevant. The leadership knows who isn’t billing and when a new project lands, they will staff whoever they can. Being on the bench longer than a few weeks is a stressful and anxiety-producing experience as after some unknown period of time, you will be “counselled out” (fired) if we can’t staff you.

Typically once a year, management conducts performance reviews for the staff (and partners of the managers). It’s basically a “rank and yank” system where we rank the consultants from best to worst, depending on various factors, subjective and objective, fair and unfair. Ultimately it tends to be a bit of a popularity contest. The best consultants get considered for raises and promotions. The bottom get considered for performance improvement plans and “counselling out”. Many firms have an informal or formal “up or out” policy where they will exit you (fire) if they don’t plan to have you rise any higher in your career.

Consulting is a game of attrition. While young consultants think they want to be on lots of different projects and clients, the reality (in my observation) is that the successful consultants tend to camp out long term at one company, working on different projects (or one long one). The advantage is that no one gets fired for billing 40+ hours every week for years, whereas jumping from project to project exposes you to being on the bench during a downturn, potentially right after having a bad project. The best consultants are the ones who are highly specialized industry or subject matter experts and actively sought after by various partners in different practice areas, or even by clients directly. Of course the challenge is how does one become an SME if one month you are working on a IT integration for a pharma company, the next you are doing a gap analysis for a trucking company’s procurement team, the month after that a sourcing engagement for an airline.

I’m at a point in my career now where I’m transitioning into more of a business development role. Which is exciting because that is how one eventually makes “partner” or “principal” where your compensation is no longer limited by your bill rate x the number of hours in a year you can work. OTOH, I don’t know if the small (boutique) firm I work at really has anything to “sell”. And I may be better off using my “relationship capital” to position myself for a full time executive job at a real company.

In case it’s not clear, unless you are in a position where you are selling work at a consulting company, YOU are the product that is being sold. And that seems to be the main challenge I see for a lot of my colleagues (including myself) who get stuck around “senior middle management”.