‘House of Lies’ puts the consultancy world in the spotlight

Do you know that the dark comedy ‘House of Lies’ is due to premiere on Sky TV on the 2nd October?

Based on the bestselling book ‘How Management Consultants Steal Your Watch and Then Tell the Time’ – the series is A MUST SEE for business leaders not to mention anyone operating in the business consultancy or advisory world.

SKY advertises the series focusing on the ‘con’ in consulting. Consultants across the country should take note. Many of them are about to be found out.

If the series is as good as the book it will be fascinating to watch. Although a comedy, I believe ‘House of Lies’ could do for the consultancy world what ‘The Office’ did for the management discipline - encouraging professionals up and down the country to think about their behaviour, code of ethics and ways of operating in the commercial world. I can’t wait to see it.

Sharp practice has been rife in the management consultancy world for decades. David Craig wrote a great book ‘Rip Off’ in 2005 about his twenty year experience of working in the industry and in particular about the lying, incompetence, greed, manipulation and fraud which went on.

The frustrations experienced by business leaders

The series prompted me to think about the many discussions I have had over the years with client business leaders about the role of the consultant and the things that still to this day frustrate them. Here is a sample list for you to consider.

1. Consultants place the lowest commercial bid to win the contract and as soon as they are in situ they will find creative ways to increase their billing. By the end of the project the client has paid considerably more than they originally budgeted for.

2. High charges are levied to the client for premium five star accommodation, first class travel and other costs linked to the contract.

3. Client billing is based on actual time spent on the project – similar to that of the legal profession – with no fixed price options available from the outset.

4. Consultants use a variety of delaying tactics to drag out the project (apparently it’s called churning) resulting in higher charges to the client.

5. Proposals submitted to clients using the terms ‘based on our initial research’ and ‘outline costs based on our understanding’. Yes you’ve guessed it – this is coded talk for ‘an increase in charges is coming to the client soon’.

6. Selling and winning the contract by highlighting key experts and specialists on the team but using the B or reserve team to carry out the actual work with the client. Not very professional, I’m sure you will agree.

7. Using sub contracted ‘associates’ to deliver the client work who clearly don’t understand the needs of the client or the project. More importantly they don’t demonstrate the values of the organisation they are representing.

8. Charges being levied to clients for ‘understanding their business’ This is often included in the proposal as ‘research and development’ and is used as a means to extract large sums of money from clients to ‘get up to speed’.

9. Maintaining control of the project in a way that the client feels obliged and pressurised to keep using the consultant. Power and influence become the main levers to stay with the consultant for years resulting in the racking up of unnecessary fees.

10. Consultants selling what they have to offer rather than what the client needs. “I have this snake oil and it has a number of uses” is a typical response from the consultant.

Of course, there are many more examples of bad practice I could mention. The above list gives you a flavour of what can happen should a client choose or work with a consultant operating to a different code of ethics.

Thankfully the consulting industry has worked hard to clean up its act but I believe this is down more to clients wising up to the antics of the players in this sometimes unsavoury marketplace.

The winning formula approach to supporting clients

When I founded the winning formula in 1995, I was acutely aware of the mindset and methods of the consultant and decided that the consultancy route was not the way forward for the business and the brand.

I have spent the past 17 years reminding leaders that whilst consultancy support may be useful to them, specialist practical support which empowers their people to perform will achieve better results.

Our winning formula growth framework achieves this at a fraction of the cost of consultancy support and advice. The development approach we use is collaborative and more importantly cost effective for the client. Fixed costs are standard for using it. Oh and we dont charge clients for extra support and advice outside of the contract. We call this service ‘added value’ and our clients love it.

Finally

Business leaders nowadays want their people to feel empowered and to take greater responsibility for their contribution and performance. Practical tools are the order of the day supported by timely and value driven support.

Don’t get me wrong, consultants can play an important part in helping business leaders and their organisations grow and change, but the rules of consultancy have changed forever and a more ethical and professional approach is required.

Enjoy the House of Lies and best wishes on your business growth journey, wherever it may take you.

John Stein – Founder of the winning formula.

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This entry was posted on Monday, September 17th, 2012 at 7:43 pm and is filed under The Role of the Consultant/Coach. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

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