Three Types of Management Consultants
A complex view of management consulting
I never liked management consultants, and something happened to me by the law of karma - I became one.
It wasn't about their salaries or fancy suits - I started there but eventually realized their bread wasn't as sweet as it seemed. Actually, there were only three issues with the consultants I met:
- I haven't witnessed enough experts, mostly interviewers turning your answers into paid recommendations;
- I couldn't compete with them being overwhelmed with routine while they had 100% capacity to crunch our problems. I envied them and wished to ever have that luxury of time and peace of mind to dedicate myself to the joy of continuous improvement.
- They said the same as I did and got listened to and paid handsomely.
Recently, I came across organizational management science calling management consultants "legitimizers" and "devil's advocates," which are simply their roles in corporate decision-making and not labels hung on them by haters.
My experience working with legions of strategy and management consultants over 20+ years of professional life resonates with some of the following definitions and role descriptions.
At least, this article should help the wider audience consciously identify the roles of consultants they're searching for or actually dealing with.
Why do we need management consultants?
Of course, the answer to this question could be as simple as solving problems and finding better ways to do things.
Two less apparent explanations could help to look at consultants differently, as organizations call them to
(a) reduce uncertainty,
(b) treat post-decision anxiety.
Let's see what that means.
Consultants and the uncertainty.
Consultants can be used as a means through which client uncertainty over how to achieve objectives can be reduced.
Indeed, as was suggested above, consultants should tell us what to achieve and how. By hiring them, we seek prescriptions of success and recipes of prosperity.
On the contrary, the consultants themselves may increase the uncertainty:
- The quality and outcome of their work are ambiguous.
- Their relationship with the client's organization is uncertain, and so is their trust level.
- The "unbounded" nature of the consulting industry and profession also creates uncertainties and anxieties for both consultants and clients.
- The very existence of consulting organizations is uncertain, as it is based on the discretionary nature of client demand.
Consulting treats post-decision anxiety.
Originating from Festinger's theory of cognitive dissonance, decision-making comes at the cost of post-decision anxiety, which the decision-maker naturally wants to reduce. A primary source of post-decision anxiety in organizations is accountability, which is resolved by providing justifications.
There are two types of justifications - strategic and tactical. The tactical one preserves the status quo - stability, operation continuity, and short-term gains. Strategic rationales assume critical course corrections.
While executives aren't likely to require anyone to legitimize their tactical justifications, the strategic ones might need additional support and investments, e.g., external knowledge.
However, justification does not always have these positive effects on the
quality of the decision; it might also shift the decision maker's attention from good performance to a good explanation of performance.
Six benefits of management consulting.
We will now study some aspects of strategic decision-making by consultants. There are six main reasons to engage them:
- Independent and unbiased judgment.
- New ideas and innovative approaches.
- Advanced ability to diagnose problems and evaluate solutions.
- Possession of unique technical skills not readily available within the client's organization.
- Augmentation of resources and skills.
- Knowledge and skill transfer.
Typical skills of management consultants
While my favorite definition of management consultants is "critical outsiders free of ingrained perspectives," their skills are somewhat more diverse and complex.
Consultants may educate, facilitate, challenge, or legitimize. Researchers identified three main roles of consultants: experts, provocateurs, and legitimizers.
The expert role
Experts are hired because of their specific knowledge, unavailable to their customers, e.g., competitor pricing. Otherwise, they might possess some unique professional skills.
Experts focus on the content, not the process. They intervene mainly in unusual situations and operate a relatively new knowledge panel.
The provocateur role
Provocateurs are counselors making inputs into strategic decisions. They are also called the "devil's advocates,"
The term "devil's advocate" has its roots in the Roman Catholic Church, where an official, known as the Promoter of the Faith, was assigned to challenge and critique the arguments in favor of declaring someone a saint.
In the early decision-making stage, such actors are hired to identify critical information assets, ask difficult questions, and challenge the status quo. In other words, provocateurs introduce structured conflict into the decision-making process.
They are focused on a process and demonstrate generalist knowledge.
Consultants aren't usually hired for this role alone but tend to take it in the early stages of complex projects.
The legitimizer role
Legitimizers are a mixture of previous ones.
They are brought in to reconfirm or elaborate further on the information their customer already believes in, e.g., recommend or validate the company's committed strategy.
Legitimizers aren't hired to question assumptions but to support the implementation. They prefer to seek standard solutions to provide "best practice" advice.
As we already discussed in the post on prospect theory implications, they may use the availability bias of our boundedly rational decision-making, i.e., providing selective reference cases that support the preferred outcome.
The radical view on consultants
This research represents a radical view of consultants, differentiating them from experts.
It observes that the consultant and the expert develop various learning processes in their respective practices and use and produce specific forms of knowledge.
Unlike the consultant, the expert employs creativity, imagination, and articulation of knowledge through arguments.
Whereas consultants reside on standard solutions that fit the predefined outcome of their project.
The best type of company consulting
People used to hate doctors, lawyers, and consultants and still ask Google how much money they make.
Another popular question is the best type of company consulting (most likely, from the compensation perspective either.)
The typical answer would be the rating of consultancy forms from Bain and McKinsey downwards or suggestions that strategy consulting provides for better living than the operational one.
This post refers to some notions that let us look at company consulting from a new perspective:
- Being an expert is the undisputable honor and precondition for a proud and prosperous career.
- Being the legitimizer is the least attractive role from the professional perspective, yet it might be the best-paid one.
- I would prefer to act as the devil's advocate by challenging traditional norms and habits and stimulating new approaches to solving complex problems.
The three roles and skillsets identified above are beneficial for the consultancy customers-to-be. They should consider what roles they need, not just hire some guys from the Big 5 and hope for groundbreaking outcomes.
Still, the best consultant is the one you trust.
Truly yours, Captain Obvious.
More information on this and other exciting topics could be found in "The Technology Procurement Handbook." It represents 23 years of experience, billions of dollars worth of successful sourcing projects, and 1000s of hours spent on research, analysis, and content creation for the most demanding professional readers.
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