Comments on: Chuck the consultants? http://kimwarren.com/strategy/chuck-the-consultants/ with Kim Warren Sat, 17 Jul 2010 15:26:15 +0000 hourly 1 http://wordpress.org/?v=3.2.1 By: ‘Gestures’, not strategy at … talking about strategy http://kimwarren.com/strategy/chuck-the-consultants/#comment-1297 ‘Gestures’, not strategy at … talking about strategy Tue, 14 Apr 2009 15:41:10 +0000 http://www.kimwarren.com/?p=527#comment-1297 [...] already asked why a company would chuck out consultants if they were doing useful work. Others I have recently [...] [...] already asked why a company would chuck out consultants if they were doing useful work. Others I have recently [...]

]]> By: Mason Carpenter http://kimwarren.com/strategy/chuck-the-consultants/#comment-1293 Mason Carpenter Tue, 07 Apr 2009 19:14:11 +0000 http://www.kimwarren.com/?p=527#comment-1293 I'd like to take Kim's observation a step further. It a great example of what I call "across the board thinking." That is, faced with our current dismal situation, we are all going to have to hunker down and share the pain -- this shared pain will be felt in the from of across the board cuts to [you fill in the blank]. The problem with across the board cuts is that they aren't strategic -- strategy tells you what to do and what not to do, and across the board cutting suggests that no activity is more important than another. But in most cases, this is just not true. As Jim Cramer says on his Mad Money CNBC show, whenever I hear "across the board" emerge from an executive's lips I hit "sell"! (as in sell that stock). Across the board cuts to consulting budgets can be particularly damaging. I can provide ample examples of firms that have consultants essentially directing key strategic initiatives. Initiatives on which the future competitive position of the firm is ostensibly based. There is nothing wrong with this approach, as long as part of the consulting engagement involves teaching key firm players how to run the new thing once its built. The problem with firing the consultants is that now no one in the firm can cover those particular bases. And, to add insult to injury, those fired consultants are likely to be laid off from their firm because, as the consulting firm cuts back, many will start by cutting those without current assignments. The irony here is that the focal firm is now off track in terms of move a critical strategy plank forward and the consulting firm has lost folks who might have more human and social capital than the people it is opting to keep. Yes, quite the mess. I’d like to take Kim’s observation a step further. It a great example of what I call “across the board thinking.” That is, faced with our current dismal situation, we are all going to have to hunker down and share the pain — this shared pain will be felt in the from of across the board cuts to [you fill in the blank]. The problem with across the board cuts is that they aren’t strategic — strategy tells you what to do and what not to do, and across the board cutting suggests that no activity is more important than another. But in most cases, this is just not true. As Jim Cramer says on his Mad Money CNBC show, whenever I hear “across the board” emerge from an executive’s lips I hit “sell”! (as in sell that stock).

Across the board cuts to consulting budgets can be particularly damaging. I can provide ample examples of firms that have consultants essentially directing key strategic initiatives. Initiatives on which the future competitive position of the firm is ostensibly based. There is nothing wrong with this approach, as long as part of the consulting engagement involves teaching key firm players how to run the new thing once its built. The problem with firing the consultants is that now no one in the firm can cover those particular bases. And, to add insult to injury, those fired consultants are likely to be laid off from their firm because, as the consulting firm cuts back, many will start by cutting those without current assignments. The irony here is that the focal firm is now off track in terms of move a critical strategy plank forward and the consulting firm has lost folks who might have more human and social capital than the people it is opting to keep.

Yes, quite the mess.

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