Monday, April 17, 2006

SIZE MATTERS, BUT IS IT BETTER?



In consulting circles everyone knows the big players but no one knows the medium size and independents who make up the major part if not the larger earners in the consultancy market.
Most of the big players started out as either smaller management consultancies or as accountancy or law practices before turning to management consultancy work. This pedigree can be seen in the various operating practices of the big players in the market.
However, is bigger better?
The major consultancies bring years of experience in their particular fields; mainly through the accouncy discipline of cost and fiscal practice adapted into templates for organisational change and organisational structure. These templates are usually derived form academic theorem or the consultancies own experiences over many years of work with the larger multi-nationals or corporations where downsizing and restructuring is practices with alarming regularity to re-align the organisation to the latest trend or boardroom edict.
However, very few of the larger consultancies spend any time actually studying or analysing the organisational ethos, structure or working practices of the organisations it provides its services to.
The reasons I believe; are as follows
  1. Time - Most consultancy projects are derived from requests to quote for projects or rapid start up assignments where the clients require a quick ramp-up to solve a problem. Most clients do not plan way in advance to hire a consultancy, but belatedly recognise that a fix to a specific problem is required. Therefore the pressure is applied to respond rapidly; hence short term notification and the need for a quick fix.
  2. Experience - The major consultancies do not specialise in specific areas; they offer a general portfolio of services, of which some of the services will include the relevant experience needed by the client. Most consultancies will not turn down a potential consultancy project (nor will anyone else), just because they do not possess experience in that particular field.
  3. Skills - Larger consultancies recruit their consultants and analists straight from universities or business schools. These bright and enthusiastic individuals and high charged with enthusiasm but not experience. All academia can provide, even with work-based practical assignments is a basic understanding of life, work and business practices. These junior consultants can bring a new and fresh outlook to your business, but you wouldn't let a seven year old drive your car, but you are willing to place the future of your business in the hands of a twenty five year old graduate with no business experience.
  4. Template Solutions - The use of standard business and organisational models and template solutions to change and organisational restructing provides a consistency of approach by the bigger consultancies. This is not for your benefit as one model or size does not fit all. It suits some bigger consultancies as it is easier to train their junior consultants and provides for a method of providing a rapid response for quotation.
  5. Sector Experience - Many consultancies do not possess the relevant sector experience necessary to accuratly address sector operational and market segment issues. Without an understanding or accurate analysis of the modus-operandi of the business the result will be poor implementation and disappointing or no long term benefit.

What do Medium size and independent consultancies bring to the party?

I believe that the three main attributes are skill, experience and accountability.

  1. Skill - Most medium size consultancies operate with approximately twenty to ninety consultants and analysts with many independents operating with between one and twenty consultants. Most meduim size and independent consultancies focus on specific services, sectors, market segments and disciplines or industries. A large percentage of consultants working for medium and independent consultancies are mature individuals with a wide range of skills and in-depth knowledge of the issues associated with these areas.
  2. Experience - In my experience, the mature consultant possesses the knowledge of both the sector, organisational structure issues and practical workplace practices and nuances that impact the day to day operation of an organisation. This brings real value to the project and ensures that the outcomes are tailored to the actual long-term benefit of the organisation.
  3. Accountability - The reputation of medium and independent consultancies is wholly dependent upon the generation of business with clients who are more sceptical about the impact of a consultancy study or project within their organisation. Bigger, major league consultancies are allied to larger longer-term strategic and frame agreements with corporate bodies or multi-nationals with multiple consultancies project ongoing at any one time. Medium and independent consultancies live on their reputations as a business and as individuals.

You're only as good as your last assignment is the adage we live by, and client satisfaction is all.

posted by Veros Consultants @ 7:40 AM 0 comments

Saturday, March 18, 2006

PROJECTS - LOSS MAKERS BEFORE THEY START

Have you ever noticed how many projects are doomed to failure before they even start.

Classic fundimental mistakes are made which hamper the project manager and team as they are handed the contract and pre-award tender files thinking that sound business practice and sharp negotiating skills have delivered them a highly lucrative and challenging project.

Not so, only a small number of projects commence with expertly negotiated and contractually sound agreements in place.

Let me take you through some of the classic tales of woe which have been brought to my attention.

BEST DEAL

Firstly, there is the "Best deal" scenario where the contracts or sales manager has achieved the best deal possible for the company. What they really mean is that they were so keen to get the project that they gave all the potential porfit margins away just to win the project.
Don't happen, you bet it does. I was one of those who was handed a "Best Deal" project; won against stiff competition.
Hoes does it get like this? Easy; the client starts a bidding war between the front leaders offering each one in term the contract if they come down in price; and then goes to the opposing bidder and does the same. The two bidders even know that the clinet is employing this tactic but is so determined to win they reduce the price, erode the profit margins and give away any concessions.

The result is a disaster.

BETWEEN THE LINES

The second type of project is one were nobody read the contractual terms and conditions properly before signing the contract. A typical example is a project delivery terms based upon the submittal of deliverables (approved by the client) against milestones. The project is awarded late by the client who then issues the project manager with liquidated damages for not meeting the milestone dates. This is then compounded when all your project deliverables are rejected over and over again, because "they do not meet client expectations".
The project is a loss maker before you submit your first invoice.
PROJECT TEAM WOT PROJECT TEAM?
The third type is the ubiquetous ghost team approach. The project manager is presented with the commercial files and contract document; ready to do battle. First question the client asks where is the project tema and when do I get my first traunch of deliverables?
When indeed? Who will produce them; the project team! Wot project team; no budget for a project team; no one available from the corporate matrix organisation to support the beleagued project manager.
The other scenario of the "Wot project team" has to be believed; but it does and has occurred believe me.
The project manager holds the budget and is told that his bonus is dependant upon the success of the project including the expenditure. Blinded by the though of bonus maximisation the project manager decides to trim the manpower budget. Working his / her way through the organisation chart he / she cuts and slashes away the superfluous functions efficiently removing the overindulgent growth ending up with the lean and keen project organisation.
One month goes by; no problem so far, budget looks health everyones happy. The client is impressed with the tight knit project team beavering away at all hours to produce the eagerly awaited deliverables.
Two months go by, no problem; the project team beaver away; one's has gone off sick no problem, some deliverables are not produced but the client seems to understand.
Three months go by, clinet seems to be a little aggitated because the promised deliverables are not on their desk. All sympathy for the tight knit project team has been replaced by a disgruntled client who cannot comprehend why sufficient support is being provided to the project manager by his / her bosses!
Complaints are made by the clients to the corporate hierarchy about the under-manning on the project; threats on the none performance of the team and late deliveries abound. Naturally, shaken but not stirred the corporate directors stir into action to resolve this shortcoming and find out that the under-resourcing is the result of the project manager's misinterpretation of their strategies!

posted by Veros Consultants @ 8:33 AM 0 comments