The consulting blog post series

Inspired by a great post on why college students choose
I decided to re-post my series of posts
on consulting, written in 2008 when I was considering a career in consulting.
I was also looking to write a more focused series of blog posts so a blog on
consulting was a good fit. Not knowing anything about consulting at the time, I
also thought it would help me get a consulting job. Ultimately I decided not to
do consulting and doing the blog was part of the reason why.

I looked at why people hire consultants, whether consultants actually have
value, why it’s a good decision for you personally. Here’s the full list of

  • Why consulting?

    Information transfers slowly; despite what economists say, firms aren’t efficient and lots of times they can do things better. Consultants have expertise about how to improve management and become more efficient, and when this knowledge is shared/diffused to companies, everyone is better off.

  • The evidence for evidence-based management

    The authors use evidence, and numerous case studies, to explain that
    financial incentive plans often don’t work, developing a comprehensive
    long-term strategy isn’t that important, most mergers only work under
    certain specific circumstances, and company culture can be more important than
    hiring the best workers. In each of these cases, studies have shown that the
    conventional wisdom is often wrong, and companies, schools or hospitals that
    implement evidence-based programs do better than those who don’t.

  • A disastrous tale from a young BCG consultant

    I got the feeling that our clients were simply trying to mimic successful
    businesses, and that as consultants, our earnings came from having the luck of
    being included in an elaborate cargo-cult ritual.

  • What skills should you learn for a career in consulting?

    A lot of your job as a consultant is selling your services and acting
    knowledgeable. Many people are stuck in Dilbert-like situations and will look
    at you as a knight in shining armor. For this you’re going to need to be
    friendly, personable, and high status; you’re going to need to sell yourself
    as an Answer Guy.

  • Is it true that to do the best work, you need to hire the best

    As Bob Sutton and Jeffrey Pfeffer point out, it’s
    a myth that the best companies are best because they have the best people.
    Usually the best companies have great systems that bring out the best in

  • Save the planet by hiring better managers

    A one standard-deviation increase in management correlates with a 38
    percent increase in sales per employee…smaller firms with better management
    out-grow other small firms with bad management…better management is
    associated with improved health care outcomes, employee satisfaction, and
    energy efficiency…Managers are not well informed about how good their own
    management practices are and which areas need improvement.

    Another experiment by the same group took a random group of textile firms
    in India and provided them with free management consulting. Not only did
    performance grow in the firms provided the consulting, but they also said the
    reason that they didn’t implement the changes sooner was because they were
    not aware of good management practices.

  • Why firms don’t experiment

    I’ve often tried to help companies do experiments, and usually I fail
    spectacularly. I remember one company that was having trouble getting its
    bonuses right. I suggested they do some experiments, or at least a survey. The
    HR staff said no, it was a miserable time in the company. Everyone was unhappy,
    and management didn’t want to add to the trouble by messing with people’s
    bonuses merely for the sake of learning.

  • What’s the downside to hiring a consulting firm?

    There’s a selection bias at play…it’s likely that consultants
    provide firms with value in excess of the costs of hiring them. Smart firms
    realize this, and want to hire consultants. But because they’re smart firms,
    they’re probably ahead of the curve and consultants can only provide them
    with limited amounts of profitable advice. The firms that need consultants the
    most are unlikely to hire them.

  • Why do firms hire consultants?

    Consulting firms can reliably signal authority and
    intelligence; bosses may hire consultants to confirm that they’re
    correct. To cite one recent example, the US Postal Service hired two
    consulting firms so that they could go to Congress and implement a
    restructuring plan.

  • There’s hope for consulting

    I have seen some serious analytical firepower (maybe not always with quite
    the rigor of an academic paper but for sure at several orders of magnitude the
    pace those are developed at) being thrown at what originally seemed like simple
    problems – generally things turn out to be neither simple nor elegant in the
    end. The art of the trade is to come up with a coherent story in light of that.

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