And, like a good MBA/consultant, he put together a framework – although instead of it being a 2 x 2 (as is most common in business/consulting circles), he put together a 3 x 3:
Across the top are the three basic types of consulting projects that most management consulting firms partake in:
- Strategy work: Helping a company develop a winning strategy or a successful response to a competitor
- Diligence: Helping either a company or a private equity/venture capital/holding company conduct strategic and financial diligence on a potential acquisition target
- Operations: Helping a company streamline its decision-making or business processes (e.g. manufacturing, call center, etc)
Across the left-hand side are the three types of tasks that consultants need to master to add value to their clients and their firm:
- Analysis: Understanding the analytics and business drivers to allow you to solve the key questions a business needs to answer
- Team: Contributing to team by providing leadership and support for one’s teammates
- Client: Being able to successfully create a meaningful partnership with the client
My partner’s advice to me, unsurprisingly, was to make sure to touch every aspect of the job. Unwilling to go for a simple “diversity is good” argument (as I’m not especially fond of the long hours of diligence work that my firm performs for private equity clients), I pressed him on the reason for this.
In response, he told me about a conference call he had with several other senior partners to discuss the technology client’s future. On the call, the operations guys and the strategy guys all saw different aspects of the project.
The operations guys saw the client through an operational lens – they felt the client was secure due to its strong market position and profitability. They saw opportunities for rapid improvement (cutting out extra waste, etc) to further fund the company’s ability to develop the technology it needed to stay competitive.
The strategy guys saw a different picture. They saw the client as sub-scale in a scale-driven industry. They saw the client chasing the wrong technology and saw the client’s differentiation eroding as the client’s competitors pursued a path towards greater integration with other technologies.
My partner, on the other hand, because of his involvement in cases along each of these dimensions over his 15 years as a consultant, painted a more holistic picture. What he saw was a company that would be in a strong position in the near team (as the operational guys were saying), but would be in a poor competitive position over the long haul (as the strategic guys pointed out). But, to this, he added the perspective he had received from his numerous diligence projects – instead of chasing a strategic or operational strategy to maximize the client’s chances of winning in its market, he advocated that the company figure out how best to sell itself.
In his mind, the client’s struggles was just a small part of a greater backdrop involving two enormous technology titans who would eventually run straight into each other. And much as many developing countries learned to play both sides of the Cold War to their benefit, my partner’s recommendation was for the client to figure out how to capitalize on this struggle to better position the client to win in a new market or to sell itself to the victor.
Of course there’s no way to tell if he’s right or not, but the ability to see the holistic view is something I would value. And, given my lack of experience thus far in the operations and client-facing side of equation, I’ve currently preferenced that my next staffing assignment be an operations-heavy and more client-facing role.