book.chapter Consulting in management

In the intricate world of management consulting, a striking contradiction presents itself: the consultants, often recent university graduates, are tasked with advising seasoned business veterans. While these young consultants are supported by more experienced senior partners, it is they who undertake the majority of the day-to-day consulting work. This phenomenon is peculiar to the business sector, where it is rare for novices to guide experts in other fields. The business community may accept this because of a belief that the freshest business strategies and ideas are taught in business schools, and thus, these fledgling consultants are thought to bring cutting-edge thinking to the table. However, this belief is largely a mirage. Business schools are not the breeding grounds for innovative thought they are often perceived to be; rather, they serve as archives of case studies that detail past successes. When examining the management consulting industry, several intriguing facts come to light. In 1980, the industry employed approximately 18,000 consultants globally, a number that ballooned to over 180,000 by 2005. Consultants at top-tier firms typically work for an average of two years before moving on to more stable employment opportunities, leading to a high turnover rate and a constant need for recruitment. A significant portion of graduates from elite business schools and universities start their careers in consulting, viewing it as an advantageous entry point into the workforce. However, from the perspective of the businesses that hire them, one must question the real value these fresh graduates can add to the operation of a company. The act of advising others on how to run their businesses has become a lucrative industry in itself. The first company to offer business consulting services was Arthur D. Little, which began providing management advice in the 1910s. The Boston Consulting Group, established by Bruce Henderson in 1963 after leaving A.D. Little, set the precedent for many other consulting firms that would later emerge as offshoots of existing companies. Management consulting, at its core, is an acknowledgment of the quantitative aspects of our reality. It suggests that a thorough analysis of numerical data can reveal much about the structure of the world we live in. Reflecting on his early days in consulting, Matthew Stewart recognized that his belief in the primacy of numbers in management, a belief shared by many MBAs, was being challenged. He pondered whether management was truly a numbers game, a science of sorts, and what the implications of this were for life, work, and education. As Stewart delved into his consulting work, he quickly became adept at various tactics designed to secure more business for his firm. These tactics included repackaging good ideas from one part of an organization and disseminating them elsewhere, introducing so-called "experts" who would provide advice and then depart, and serving as a convenient excuse for management to instigate changes or create a sense of urgency among employees. A significant portion of a consultant's day is spent strategizing on how to encourage clients to purchase additional consulting services, even when these companies are capable of handling many tasks independently. Despite Stewart's growing skepticism about the value of his work in management consulting, the financial rewards and perks made it difficult for him to leave. However, by the age of 28, he decided to return to his passion for philosophy, resigning from his consulting position. Stewart's experience highlighted the fact that consultants are able to command high fees because they work for clients who do not consider such amounts to be significant. The primary tool in any business consulting assignment is often a skew chart analysis, which consultants use to demonstrate the need for their services by identifying the most profitable customers. Stewart realized that he could apply this analysis to virtually any business, regardless of its quality or management. He came to see that the skew chart was not a scientific tool but rather a clever trick. Stewart's journey through the world of management consulting led him to the conclusion that management is a neglected branch of the humanities. He argued that the study of management is more akin to the history of philosophy and that business leaders would benefit more from reading historical and philosophical texts or novels than from pursuing business degrees.