Well, I have to admit Mike’s argument in The Silent CEO Addiction Killing Productivity and Talent Development (Forbes 10/17/2013), is a strong one and one I even subscribe to. Consultants should not be brought into a business to tell management, or the board, what time it is using the client’s wristwatch. This is a waste of resources. But… There’s always a “but”.
First of all, I do not think any CEO worth their salt will engage in such wastefulness. If they did, they would be dismissed for just cause. No, the CEOs I know bring in these big name consultancies to legitimize their course of action to the board. It is lonely at the top and having the support you need to change the direction your company has been going in is not easy. These consultancies help balance the playing field and get the decision through.
As a matter of fact, it is often the board who requests the consultancy be brought in not only to legitimize the course of action recommended by the CEO but in some cases it is they, the board, who are recommending the change and want to be perceived as legitimate by the shareholders.
Consequently, in my view, the use of strategic advisors has much more to do with internal power politics than efficiencies.
The second area Mike addresses is efficiencies, or productivity gains, where consultants can also be brought in to affect change. In my experience, here the issue has more to do with the type of managerial talent a corporation needs to conduct business as compared with the type needed to bring about change. In other terms, a manager who excels at overseeing the process of making widgets out of steel is not necessarily the same person who will do an equally great job making widgets out of plastic or capable for migrating from one to the other.
The truth of the matter is in exchange for productivity gains we have created a talent pool that is hyper-specialized. A person specialized in one area will increase their uncertainty of future employability if they take on other tasks by doing something too far outside the “norms”. An foreign investor had just bought a company in the U.S. and asked me why the acquired business had double the headcount of a commensurately sized company abroad? I explained the foreign company had employees who did multiple jobs while the U.S. employees were very specialized; asking the U.S. employees to behave like the foreign ones would adversely impact their careers, they wouldn’t do it. To achieve the same result, they would have to either create a Shared Services Center in the U.S. where the employees could maintain and develop their skills or outsource to a third party vendor in the U.S. or abroad.
From my point of view, Mike’s battle cry against the norm is not properly directed. I invite Mike and any others who care to join to take up battle against the hyper-specialization of employment, which makes it difficult for employees, managers and executives alike to do anything radically different from their assigned task. This economic approach goes beyond consultancy services to the whole company, the economy and the polarization of politics.