Privacy Filter

Confidentiality is a big part of consulting. In much the same way that the practice of medicine and law would be very different (and probably for the worse) if there was no confidentiality between parties, consulting (both the selling of cases and the actual act of providing advice) would be severely hampered without a basic guarantee of privacy.

I don’t know how other firms do it, but there are some general practices at the firm I work for. They are mostly commonsense (ie don’t pass around sensitive information, keep your desk clear of confidential documents, use enterprise email to maintain access control over files, etc.), but my personal favorites are of course the provided Thinkpad T60 (with hard drive encryption) and the privacy filter: a 3M black film which restricts the available viewing angles for your screen. Therefore, when I’m on a plane or a train, I can do work with minimal fear that the passenger sitting next to me has just read secret corporate data.

I don’t actually know how it works (does anyone know?) — I think it may be some form of light polarization combined with a mesh in the screen to make viewing outside of a set of angles unfeasible — but it not only protects corporate data it also lets me surf the internet guiltlessly (so long as I’ve completed my work) as passerbys have no idea that my screen is not actually a giant Excel spreadsheet but my Google Reader page.

Something for Nothing

Where I work, just like in college, I have instant electronic access to numerous databases. While I no longer have access to Scifinder Scholar (for Chemistry papers and structures and patents) or (almost) full access to journals on PubMed (which indexes every biological/medical paper published), my research workhorses are now Factiva (for news and magazine articles), Euromonitor (for economic and market data), and OneSource (for general company information).

Access to these databases cost money. Lots of it. I remember balking the first time I saw the purchase price for a Thomson research report ($10,000 for some analyst’s research on an energy company) that wasn’t covered by the firm’s subscriptions.

(Seriously, $10,000? Do you know what I could buy for $10,000? Will that report generate a similar amount of joy for me? I love data — but, seriously. $10,000? Okay, I’ll stop now.)

And these databases are, if used properly, well worth the cost to the institution in question. Ask a scientist to do research without electronic access to journals and see how they respond (shock probably followed by outrage if you don’t take it back right away). Eric, soon-to-be grad student a novice when it comes to biological research, couldn’t seem to get over how he couldn’t (momentarily, it was apparently a technical mishap) access Nature Cell Biology. Similarly, the difficulty of providing business advice without a reasonably accurate sense of the dollars and cents of what’s going on means that access to good market and corporate data is a must.

But sometimes, you don’t need fancy-shmancy million dollar databases. I’m currently doing research which involves finding historical operating margins and I’ve found the following resources to be very useful and also very cheap (as in free) and just thought I’d introduce three of my best friends from this past week:

• Google Finance – This is a pretty awesome tool. It’s flashy (literally, as if you look up a public company it will present a Flash control which allows you to view with different levels of detail and over different time periods the stock price) and aggregates an enormous amount of useful information. You get corporate information, stock price data (back to 1980), a quick summary of the stock performance of related companies, links to recent news articles, and a quick aggregation of top-level income statement, balance sheet, and cash flow statement numbers.
• Reuters – I used to think this site was purely for news (I’m a huge fan of Reuter’s Oddly Enough which I guess isn’t exactly news), but it’s a hotbed of financial information. Most useful of all are its industry profiles whereby it describes multiple industries, what makes them tick, and industry statistics that enable you to compare how a company is doing relative to its industry. It also lists some information for companies that are not publicly traded!
• SEC EDGAR – Any company report that has ever been filed with the SEC within the last 13 years can be found here using EDGAR, the SEC’s report search engine. This was particularly helpful when I was looking up financials for telecom companies that no longer exist because they either went out of business, changed their name, went private, or were bought out by someone else. Who would’ve thought the government would actually create a tool of value?

So useful are these sites that I’ve actually created Firefox keyword searches for them (except for Reuters who I still can’t get the keyword search to work). Now I can look up Dell’s financials with a simple “fin Dell” (to search on Google Finance) or “sec Dell” (to use EDGAR).

How to Have a Great Company Culture

This past Thursday, I attended a seminar presented by Kent Thiry, the CEO of DaVita, a dialysis company and former partner at the management consulting firm Bain & Company. Thiry presided over a stunning turnaround at the firm, but the focus of his presentation was not so much on the corporate specifics [which while impressive, are fairly ho-hum for a management consultant who's career is built on "selling" that we can always replicate those successes], but on DaVita’s amazing firm culture.

That’s right. Amazing. Firm. Culture.

It’s not something I used to consider very much, because, frankly, I thought it was mostly fuzzy bullshit. Yes, firm culture can indeed be “fuzzy bullshit” — and in fact, many companies deliberately make it that way. They skim books like Jim Collins’ Built to Last and half-listen to human resource fads about how the mere fact that a mission statement and a list of values exists makes a company more productive and lasting — not knowing that most of the employees not only know it’s a sham but are already biased to think such efforts are false.

What Thiry had to present was an example of a community. DaVita, as presented by Thiry, was not merely a dialysis company where manufacturers and techs work with doctors and nurses to help treat patients, it was a village, where community members watched out for each other, watched out for the community as a whole, and got together on a regular basis to show each other that they cared. Never before have I seen videos of people proudly singing and dancing to the company song, crying when they discussed how much they loved working for DaVita and working with their co-workers and of course their village mayor (his title is not CEO) KT (Kent Thiry).

There are probably two questions on your mind at this point:

1. What evidence do I have that this isn’t just corporate lip-service?
2. How did Thiry help construct such a powerfully moving culture?

I’ll grant there is no completely satisfactory answer to question 1 — no matter what, there is always room for skepticism. But, I’ll try to answer both in one go.

So, how did Thiry help construct such a powerful culture? The simple answer — the multimillion dollar, the make-or-break phrase is show that you care. I’m not sure if Thiry and DaVita paid a couple million to a HR consultant or to a mission-writing consultant to help craft a statement of community, but at the end of the day whether or not they did had nothing to do with the success of DaVita’s culture. The high point was that they did not compromise — to paraphrase Thiry, it’s easy, really easy, to stick to your values and your mission statement and your ideas of community when business is good, what makes or breaks a culture is whether or not you stick to it when business is bad.

Among what Thiry did:

1. Make hiring and firing decisions based not only business and technical competent, but on adherence to the values of the company
2. Emphasize that DaVita was a community first, a company second
3. Spend time honoring those who adhere to the values, not simply pay lip service to them in a vague sense, not simply reward them financially — but actually honor them, with plaques, with ceremony, with recognition
4. Make people self conscious by having them sing the company song, recite the company motto — because when you do things that make you self conscious you really analyze whether or not your life and your own personal values really stack up against that song and that motto — and if it doesn’t, you feel more self-conscious and wash out
5. Establish a practice whereby senior management lead by example — if the C-level management (CEO, CMO, CTO, CIO, etc.) are not following community principles, then why should anyone else?

So, examples of how DaVita cares? The DaVita community (meaning the broader community of workers and not just the corporate leaders) has established a fund to help the children of DaVita employees pay for college. It has established a practice of having senior management and the firm match contributions that the community endorses to charities and noble causes. It honors doctors who it considers to have made the biggest impact in their patients’ lives, because that is a broader part of the purpose of the DaVita community. It has established a practice whereby community members in need receive assistance from other community members. Thiry proudly showed off videos of interviews with cancer patients/employees who emotionally described how their coworkers not only raised money to help pay for treatment but sent cards, gifts, helped around the house, etc. The most amazing example from that presentation, was a case of a female employee who died along with her husband, leaving a daughter in college to not only deal with the emotional impact of their deaths, but with huge financial burdens and with her own college tuition. A company would express their condolences and pay a pension, maybe. A community would come together to take care of the daughter — and that’s what DaVita did. They helped pay her tuition so she wouldn’t have to drop out. They helped pay for the funerary expenses.

In all honesty, DaVita’s culture more scared me with what I can only call its ”cult”-ishness than inspired me to craft a corporate culture even remotely similar. I’m not here to evangelize Kent Thiry or DaVita, but the example, I think, firmly established two things:

1. Culture matters. Ask any of DaVita’s workers — or any workers, period. It’s very difficult to be productive or, more importantly, to be happy if you hate the environment you work in. Yes, technical and business competence is necessary, but in no way is it sufficient for creating a good business.
2. To get a great culture, you have to show that it matters. You can’t just write a values statement and expect a wonderful culture to spring up. You have to stick to it, especially when it is hard to, especially when there are conflicting priorities.

"Boiling the Ocean"

In many ways, scientific training crosses over very well into consulting. It trains individuals to think critically about the world around them, to take in all observations for careful analysis, to skeptically consider evidence, to craft and test falsifiable hypotheses, and to find rigor in numbers and computation. It is no small wonder that so many science students at all levels successfully make the jump into consulting.

On the other hand, scientific training also instills within trainees a few trends which run contrary to what a successful consultant needs to be. Science emphasizes thoroughness and depth. Your training is not complete until you know every little detail relating to your field of interest — and quite a bit more about associated fields. It is quite inconceivable to the layperson just how much a grad student has to read just to be able to “tread water” in his or her field, let alone be successful at it. To that end, grad students are not only forced to but strongly encouraged to read broadly and constantly, leaving no stone unturned; no tree missed, no matter how large the forest.

Unfortunately, while this focus on depth can lead to very deep insights and very complete analysis, a consultant rarely has the time to “boil the ocean”, or perform an analysis with a thoroughness and completeness which leaves no room for uncertainty. It is simply not feasible for a single consultant to read every relevant piece of literature dealing with a given client or industry or division or even a product and yet still have time to complete a segment of analysis fast enough for a client team to meet a deadline or be agile enough to switch strategies when necessary.

Instead, a consultant (or anyone in a non-research oriented job, really) has to learn when enough is enough — when there is enough information to make a judgement or perform a piece of analysis but not too little such that the judgement or analysis has no possibility of being reasonable.

And even as I write this seemingly simple yet deceptively difficult to follow piece of advice, I know that tomorrow I will partake in more ocean-boiling, as I lose the struggle against my gut instinct to read more literature and take in more information. Curse you, scientific training! 

Consulto-nomics

For those of you who are interested, I was staffed the day after the Fourth of July on an internal project. But… shhh… if I tell you any more, I might have to kill you.

While doing research for the secret secret internal project (I’m sorry, if I tell you, I do have to kill you — better if you don’t know), I stumbled across a book, The Boston Consulting Group On Strategy, one of the many books that various consulting firms put out on a regular basis to establish themselves as relevant experts on business strategy. The book itself is a compilation of opinion and analysis pieces by various BCG (Boston Consulting Group) partners from the past including a few interesting pieces by BCG founder Bruce Henderson.

Henderson is interesting in that he is one of the “founding fathers”, if you will, of management consulting. BCG history is full of examples of powerful insights: the Experience Curve, the growth-share matrix, “The Rule of Three and Four”, among others. To this day, the public persona of the firm is one of a puzzle-solving/innovative thinking culture dedicated to solving and analyzing complex business scenarios.

Yet, despite his role at the beginning of consulting, Henderson’s writing is distinctively not consultant-like. Nowhere are the excessive TLAs (three letter acronyms) or use of impressive-sounding but utterly empty sentences and phrases which seem to mark today’s consultant. Instead, he is simple. To the point. Decidedly not long winded.

I like him already.

One of the points that he makes pertains to economists. And, while I’m certainly no hardcore economist, any casual reader of this blog will realize both from past posts and the sidebar, which is linked to items I tag in google reader as things that I find interesting, that I have a strong respect for and interest in the subject.

Henderson makes the argument that economics leaves one very ill-prepared for the business world, because economists deal in abstracted, perfect conditions which bare no semblance to the world. In the business world, there is no perfect competition, or information symmetry, or pure rational agent which the economist often relies on in his or her thinking and theorizing.

Mind you, this was written in 1970 which was not the heydey of game theory and studies of market failure and monopolistic competition in economics. And to their credit, economists do give good answers to Henderson’s criticisms.

But at the same time, Henderson’s criticisms cut very deep. I’ll admit at times the scientist in me wants to just stop what I’m doing at work and question the lack of hard evidence and analytical rigor (at least by a theorist or an experimentalist’s standard) in a consultant’s final product. But, Henderson’s point bites back. I took a fairly high level evolutionary dynamics course in the Fall semester which dealt with evolutionary game theory, and while we looked at very complex bells and whistles (spatial components, strategies, memory, etc.), at the end of the day we were just analyzing the infamous prisoner’s dilemma, a game with only two possible moves — an analysis which could become exceedingly complex. Yes, the analysis was conducted with mathematical rigor. Yes, it was done in a fairly complete fashion, with experimentation, with observation, with hypothesis testing, with reasonably advanced computational analysis.

But, at the end of the day, it was still just a two-move game (tic-tac-toe, by comparison, is an, on average, 5 move game) with idealized assumptions. The business world doesn’t have two-move games. It doesn’t let you make nice assumptions. It doesn’t give you the time to conduct complete analysis. You don’t have a Cray supercomputer at your desk with hours to code to do a hard numerical analysis. You have a deadline. You have gray areas. You have incomplete data. You have to deal with people and their volatile personalities and emotions.

So, yes, a proof, an experiment, a mathematical model – these are certainly beautiful and interesting. But, you just can’t do that in business. You have to prioritize. You have to manage your time. You have to work together to tackle a big, amorphous task. You have to make guesses. You have to sometimes leap before you look. You have to beg, to intimidate, to coax, to laugh and to cry and to smile.

And that’s not economics or accounting, but for lack of a better word, consulto-nomics.

Dilbert on Consultants

It’s rare to see ANY mention of management consulting in the press. For good reason. Because consulting is an insider service, firms are required to maintain the highest standards of privacy. The only time you ever hear about the clients that a consulting firm has dealt with is when the clients themselves consent (and probably only after a truckload of wheedling and cajoling). Moreover, a consulting firm’s success, regardless of the nature of the case and participation of the individual actors involved, is always to the credit of the client and its executive team — for better or for worse.

As someone who wasn’t even sure what consulting was a year ago, I’ve oftentimes wondered what the general public thinks about this secretive little industry. The only impression I ever had was a result of my more science-oriented background which included a strong mistrust of corporations and the corporate-speak which seemed embodied by the consulting types. Kind of like this Dilbert cartoon:

Now whether or not the buffoon represents all of us…  

KABOOM!

This just in (hat tip to The Chem Blog):

BEIJING: In the first such case, a Chinese youngster was killed when the battery of his Motorola cell phone exploded, police in northwest China’s Gansu Province confirmed on Wednesday.

The accident occurred at noon on June 19, when welder Xiao Jinpeng was working at the Yingpan Iron Ore Dressing Plant in Jinta County, Gansu Province.

The cell phone, a genuine Motorola, in his chest pocket suddenly exploded and Xiao, 22, died at a local hospital after emergency treatment failed, commissar with the public security bureau of Jinta County, Bai Shixiong said.

The initial investigation showed the phone battery exploded after being exposed to a high temperature, breaking Xiao’s ribs and penetrating into his heart, Xinhua news agency quoted police as saying.

“We haven’t ruled out quality problems with the battery induced the tragedy, but other causes remain possible,” Bai said.

Local police and work safety officers are still trying to ascertain the model of the phone and the battery, and whether they had any quality problems. An investigation report is expected to come out in a couple of days, the official said.

Many Chinese handset users, who are familiar with fake or low-quality accessories, are demanding an immediate reply from relative departments and Motorola about whether the explosion was caused by battery defects or improper use of the phone, the report said.

The local work safety administration temporarily recorded Xiao’s death as a work safety accident as the explosion occurred at the workplace, about 800 km west of the provincial capital, Lanzhou.

However, it is waiting for the investigation results to ascertain direct responsibility. A team of representatives of Motorola are expected to arrive at the site today to help the investigation.

Exploding cell phone batteries were very rare, a public relations official at Motorola’s China branch said. However, Motorola was taking the incident very seriously and would respect the results of the investigation.

Experts said quality defects, frequent overcharging, short circuits and exposure to high temperatures or flammable materials could lead to battery explosions.

A consultant’s life is a deadly one — not only must we brave the horrible addictions of life with a crackberry, er I mean Blackberry — we must also deal with the constant threat of a cell phone exploding. Oh woe is us…

To Love or Not to Love "the Beach"

When I first started work, several senior consultants noted that starting consultants would oftentimes find themselves “on the beach” as they waited for staffing rounds to fill them into cases. They noted that most starting consultants would grow restless and worried over their state of limbo.

I thought I would be above that: “You mean, I have no work, still get paid, and can go home early? What’s not to love?”

And yet, here I am. Trying to convince myself that this is a good thing.

Yes, I know that consultant hours can be rough and that I will soon be craving easier days when I’m at the office crunching Excel models or pouring through customer data late at night. Yes, I know that this is a wonderful time to review subjects I’m not as familiar with (i.e. accounting, IT, a given industry, etc.) on the company’s dollar. Yes, this is a great time to be able to go home early and spend time with my family or do those things that I constantly complain about not having the time to do (today, I reconfigured our wireless network so that all of our home computers would enjoy coverage).

But, at the same time, I’m filled with a restlessness that just doesn’t go away which is compounded by doubts concerning whether or not I am ready for a case and whether or not the office thinks I’m ready.

To love or not to love, that ’tis the question. Whether ’tis nobler to…