I’ve been doing this a long time now; 17 years this summer with Libra and 20 years in total in what I still refuse to see as a ‘proper job’. Given that I’ve never physically made, moved or sold a product for or on behalf on any of our clients in that time, I will stand by this view. Thankfully enough people see value in the contribution we make to justify this ‘non-career’.
With this perspective, it is easy to be objective about the role of management consultancies and many professional service providers play with their clients. Our stated objective at Libra is to provide capability and capacity to client teams in support of delivering their objectives.
At the heart of this must be knowledge transfer - so whatever change is brought about is understood, owned and managed locally rather than by a third-party resource. In working this way, the clients’ objectives become our objectives, our team in many ways becomes part of the clients’ team and we work together to deliver.
So, where’s the conflict to resolve?
I think it comes where professional service providers put self-interest ahead of the needs of their clients. There is always a line to tread when advising a business if that advice also comes with the consideration of fee paying work for the advisor. How can the client organisation be certain that the prospect of fees hasn’t influenced in some way the nature and quality of advice given? Equally, in our profession where consultancies work on a contingent basis, with fee payment predicated on the delivery of results there is a potential conflict to resolve. How does the client reconcile payment of fees for delivery that has been driven by a third-party to realise commercial targets, that may be short lived or at the expense of greater benefit elsewhere?
Our answer. Honesty with clients even if it may occasionally not be what people are wanting to hear.
An example. A c.£100M business with a ‘materials control’ issue resulting in a profitable business turning to losing money. Having met the team, seen the site and looked at the numbers our advice conflicted with the view of the exec team. We could see that the issue was not materials control, it was the recently re-costed prices leading them to lose money on sales.
However, the client was looking for an operational fix, that we couldn't justify, to their problem and spent significant time and resources with people who were prepared support this view. Regardless of the quality of support provided, the act of diverting focus from the real burning platform in the business most likely contributed in one form or another to that business going into administration.
I’m not saying we should always expect to be right but we should always try to be honest.