The crack between business models

“What I want lies somewhere between consulting, outsourcing and interim management.  It’s a hybrid of all three which we don’t really have a word for.”  These are the words of a strategy director in a big utilities company whom we interviewed earlier in the year.  Like many senior people he ‘got’ consulting: struggling to get things done across a big, highly politicised organisation, he regularly turned to consultants to provide not only the honest feedback he couldn’t rely on from the people who reported to him but the ability to focus on a given task, to get things done in an environment teeming with distractions.  But above all else, consultants offered him flexibility: the ability to supplement his own staff at times of peak activity.

And it was always thus.  Consultants might like to think that they sprang fully-formed from the heads of management theorists in the 1920s, but the reality is that the growth of consulting has been driven by two external factors: regulation and inflexible labour markets.  Indeed, you could argue that the shift away from vertically integrated corporations in the 1980s was driven less by the ideas of a ‘core’ business which were being promulgated by consultants at the time, and more by the fact that they embodied at least part of the solution.  Don’t think strategic planning should be a core or permanent function of your business?  Bring strategy consultants in when you need them. Fill the gap.

In re-writing their history, consultants run the risk of forgetting this.  The nouveau riche of the business world, they’re anxious to conceal their origins: the ‘firm’ is a bit like the large country house, recently erected in a faux-Tudor style to give the owners the credibility they think they need.  The result, as clients are only too quick to point out, is consulting firms with an ossified organisational structure.  Flexibility, unlike charity, does not begin at home.

Yet, when clients talk about the opportunities they see for consultants to do more in their organisations, it’s to this flexibility they often return.  And they want something they find it hard to buy.  Interim managers may be experts in their field but there’s no broader hinterland of knowledge they can draw on when the work they’re involved in changes direction.  Most outsourcing has been of routine processes: the idea of outsourcing knowledge-based ones holds out the tantalising prospect of big savings but is clearly more complex and  requires careful handling if the best people aren’t to leave.  Traditional consultants come with baggage – processes and policies which dictate, for example, the ratio of junior to senior staff.  What clients want is something that sits in the crack between these traditional models – they just don’t have a word for it yet.  And, more worryingly, neither do consultants.