Consulting 101 - Advisors or Consultants?

Hello again. In this essay, I will try to address in a preliminary way a concept that is not yet widely spread in companies: I will share with you the advantages and reasons for using consulting services to solve a small, complex or structural challenge in the company.

To begin, we will rationally define the approach to a problem. In order to simplify the analysis, let's use a common phrase that is frequently heard in board or senior management meetings: "our systems are not aligned with the company's business objectives."

Ways to approach the problem

A problem so generically stated could have many ways of being approached. Purists could state the Heuristic Theory, which proposes multiple solutions for the same problem, and that each of these can be ideal depending on the scenario we face. Therefore, we can deduce that there is no single solution to a problem. There are dozens or hundreds of solutions for the same problem (depending on the degree of complexity), but some are more expensive (but not sustainable) than others and do not make sense for certain companies. Other solutions are very simple, with immediate implementation, but they are probably short-term and will not leave us with a "clean" ground for what may appear in the future.

In any case, these "theoretical" concepts are of important relevance when we look for a solution to the problem that an organization faces. When I write the word "organization" I refer to any private or government company.

Returning to our simple statement "our systems are not aligned with the company's business objectives", this may be the vision of the owner or CEO of the organization. But from the point of view of the Sales Director or Financial Director, their perception regarding the same problem could be "our technology team fails to understand that the delivery of their projects must be faster, more agile and more complete." For his part, the CTO can explain that the cause of the problem is "the company's strategy is not clear, one day certain objectives are pursued and they quickly change. There is no way for our systems to keep pace with those expectations."

And so, we can have a long list of perceptions or "approaches" depending on the area of the organization where we stand. We call these approaches "horizontal perspectives on a problem." Needless to say, each approach can have its own derivatives or particularities. For example, in a specific area of the organization (e.g. Sales), we could see that the "approach" of the Sales Manager is one, that of each salesperson is another, that of the sales administrator is another and so on. We call these approaches "vertical perspectives on a problem." In the end we can have a "mesh" or two-dimensional matrix of "approaches" to the problem originally stated.

If our problem is relatively simple and everyday (I mean, it happens in most companies and has all these kinds of complexities), let's move on to a more complex problem: How does Elon Musk and SpaceX manage to solve all the inherent challenges to be able to launch 100 satellites annually into our outer space? (It is estimated that they have put about 6,000 satellites into orbit to become the new way of transmitting the Internet throughout the planet).

If we make realities more complex and look at the solution of problems on a larger scale, how can a municipal, state or national government focus (and anticipate) the problems related to its control? Such as reducing environmental pollution through the use of green energy, effectively increasing gender equality, mitigating the increase in crime or illegal drug abuse? Or on a global level, how could the COVID pandemic be addressed in record time by the WHO, laboratories, the global medical community to find the vaccines, while millions of people and loved ones died daily all over the planet?

If we draw a Cartesian axis, we could see that the “Complexity” function has an exponential behavior curve, with the X axis being the “level of complexity of a given problem,” and the Y axis being the “matrix approaches to the problem.”

Solutions on the fly without much reflection?

Ok, I recognize that this may seem like a lot of theory, but it does not help us to solve the problems of organizations in a practical way. Don't worry, we are going there. When we face a problem like the one stated in our previous statement ("our systems are not aligned with the company's business objectives"), many times the "solutions" are determined in the "weekly committee", during the presentation of a supplier of a manufacturing automation solution, or while the manager is shaving one morning in front of the mirror. In fact, beyond the humor of this last scene, there are renowned psychology studies that confirm that when simple and routine activities are carried out, people solve big problems ("Zeigarnik effect"). Examples such as the employee of the Austrian patent office, who allowed the modeling of the Theory of Relativity, or the Greek inventor who, taking a refreshing bath in the tub, allowed the discovery of the principle of buoyancy.

Translating these historical examples into the everyday reality of 2024, the reality of small and medium-sized organizations is that they tend to solve problems, relying on their "sense of smell", without further analysis of the possible impacts, disadvantages and extra costs. There is still a trend to implement a solution, without carrying out further detailed analysis. Many times this way of acting obeys a logic of "rush" to solve the problems faced: the competition is gaining ground, our clients no longer request services, we are having losses or lack of liquidity, the bank is claiming late payments, etc. The slogan is one: a solution must be found and there is no time to find it, because we are consumed by day-to-day work. Therefore, organizations that make a "better" decision, decide to hire the services of an external advisor.

The Advisor shows up on stage…

Respectable advisors, or SMEs, are typically professionals with years of experience in the market and who offer their knowledge to organizations. I, personally, prefer to call them "gurus". I say this because nobody argues with the gurus about their solutions. They are a kind of Oracle of Delphi, who is told what torments our organization, and after thinking about the solution, during a Yoga session, walking on the beach or watching a TedTalk conference, he/she will return to us to give us the long-awaited solution. Many times they are right, but just like with Startups, behind each success story, there are hundreds or thousands of failures. And our frustration, more than the failure, can be huge. The logical question that appears in our head is "if the advisor was such an experienced person, why the hell did he get his solution wrong?"

Well, the truth is, despite having the best of intentions, it may be that the guru is simply a great friend of the owner, has attended university with some director or his children study together in high school. The guru, naturally, does not ask anyone if his solution is viable or not. Worse still, he only hears the complaints of his friend in the organization, and does not bother to analyze the whole network of approaches to the organization's problem. He only hands out his magic recipe like a druid's potion or a fortune cookie, and hopes that everything works out as his intuition tells him. Unfortunately, when everything fails, the mistake will never be the guru’s, but rather the fool responsible for implementing the solution, who did not correctly understand what had to be done and who will pack his things in a box on Monday morning ("the chain is only as strong as its weakest link").

… and so does the Consultant

As I have already posted in a previous post, a professional consultant tends to follow a rigorous methodology to analyze the context of the organization, people, processes, systems, etc. He/She contrasts reality versus expectations. He demystifies the "hallway gossip" and concentrates on the facts and objective data. Only in this way will she be able to find where the Paretto of the problems that afflict the organization is and provide a viable proposal to "focus on 20% of the problems, to solve 80% of the situation".

You have to know how to differentiate whether you require the services of an advisor, who can give sound advice but not necessarily a solution, or the services of a consultant who will not necessarily play golf with the owners but will talk to any level of the organization and review all data where reality remains.

In small and medium-sized organizations, the practice of consulting services is not widely used (firms’ rates are unattainable) and is rather associated with auditing services. In practice, often without any valid reason, consultants are not very well received in organizations. And they can help a lot, if they know their job well.

Eureka!

Of course, if the CEO, while shaving one morning, finds the right solution to a given problem, he will not need to hire his advisor friend, much less hire a consultant. But in terms of probability, this “inspired morning” is almost non-existent.

At Educapolis we help small and medium-sized organizations ?to solve automation and business efficiency problems. We work in many industries and we are warm and friendly. Our interest is to help use technology to be competitive, and as we always say: WE SPEAK SPANISH.

At the end of the day, what counts is that whether it is because a manager found the solution or because the advisor or consultant helped find it, the entire organization can shout: Eureka!!

Feel free to contact me to [email protected] if you feel somehow identified with this type of situations

So long.

Walter