frameworksWhen offered a solution that would positively affect their company in the next 12 months – but could impact their results in the next 3 – 80% of CEOs in large US corporations said they would not go ahead.

… funny – Paul Polman must read the same stuff – see below – though he remembers 75%) … still either number is fundamentally depressing. (I will ‘re-find’ that quote and post it when I do !

Yesterday, I posted this piece about long term thinking in a short term economy. Of course the problem is driven by the quarterly financial reporting that IS the US business world. Everyone plays the game – with one very interesting and notable exception that I heard about yesterday …. Unilever  – who have “putting an end to quarterly reporting and (are) changing the company’s compensation system accordingly.”

Great interview on NPR with Kai Ryssdal BTW.

Polman sees a lot of dangers lurking around the corners for businesses that increasingly worry only about pleasing shareholders every 90 days, with their quarterly reports.

“I saw a recent survey in the U.S. that 75 percent of the CEOs were willing to postpone the right decisions if it would affect their quarterly reporting, and that cannot be healthy for the long-term of the business,” Polman points out.

He lists the ever-shortening tenure of CEOs as one major challenge for companies in today’s global economy. He’s been at Unilever for four-and-a-half years — longer than many peers at other major corporations.

Hold that thought – because I had lunch with a buddy a couple of weeks ago – and in the process we covered off solving all the world’s business problems (needless to say we also discovered – if not created – several more).

One of the topics was categorisation.

I talk and write a lot about stove pipes and how Social Business is breaking down (we ‘hope’, but that’s a different topic) those walls. But people are stove piped as well. How often do we hear that someone who has been in Marketing for 15 years, must mean that they can’t know about Sales. Or if you have run operations for a semi conductor company for 10 years – then no way can you be qualified to run a partner program for a SAAS company. And and and …. Everyone suffers from this classification problem, which is one reason why actors have forever taken very very different roles to avoid being type cast.

But in business you are ‘typecast’ (though stove piped is a more accurate word), because of the industrialisation of Business (and Sales in particular). We have stove piped function, organization and people. It is a problem. And it isn’t new. The fact is that though someone might be  known for one thing – there are a lot of other things that they are capable of and do – even though it isnt recognized.

This is actually at the core of the offer for the business I co-founded called Expert Alumni – a business focussed on the ever growing skills gap challenge that is hitting core industries as baby boomers hit returement.

Corporations are masters of ‘management through silo’.

A colleague of mine works specifically in the SAAS space. He is known for very specific models and knowledge that allows a SAAS business to understand itself better – and make more money – more consistently. Sounds good – no ? But with all that we were talking about how cool it would be to deliver a full service. Let’s call it ‘full John’. .  ‘JAAS’ for short – that’s right “John As A Service” – whereby you get to call ‘John’ up – and he would bring his worldly knowledge to bear on the challenge you laid out. It’s rennaisance man right ? The most interesting man in the world model.

“Very Interesting – But it Won’t Work” as Art Carney used to say ….

To quote Einstein

No problem can be solved from the same level of consciousness that created it.

… which would suggest that any enterprise that has a problem would do well to bring external people into the organization to solve them – but that is happening less and less.

Some quick observations

… and as I re-read this in the cold light of morning – I have decided to add more as they come up …

  1. We live in tough economic times – and people are without jobs, those with jobs fight hard to keep them
  2. People in corporations are employed to do their job, but to bring in consultants to solve your ‘Wicked Problems’ could be seen as you admitting that you can’t do the job that you are employed to do.
  3. Corporations are increasingly focussed on the short term not the long term (see the opening of this post)
  4. As such, programs of work need to be tightly bound, short in tenure and result driven
  5. The asked for results are often the wrong thing – personally I always like to measure

Now of course, there are plenty of people working in corporations as ‘consultants’ – but I would contend that they are more surrogates for full time workers. And lets not get into how that came to be) And I am specifically excluding those kind of temporary workers. I am talking about the heavy hitting, strategy setting, big thinking consultants that can make a difference …. in the long term.

And all of this JUST at the moment when the need for that thinking is paramount.

I have written before about the need for corporations to think as flat as they can, to be customer centric, to break down the silos. And everybody I talk to agrees. But it isn’t happening because it can’t be solved ….

  • by the self same people that created the problems
  • by people playing defence
  • in three months
  • by a series of projects
  • easily

Which is a core reason behind my thinking that ‘Product is the new Consulting’ and why I have steadily been turning solutions into logical quantifiable products that can be bought through a license.

EMail me at  ‘john [.] philpin [@] beyondbridges [.] net’ if you would like to know more, disagree or have more insights ….or just comment below.

40 thoughts on “Product Is The New Consulting

  1. Well ya know… my mama always said, a Jack of all trades is a master of none. Then again, she was only good at one thing, and I won’t bother telling you where that got her. I think organizations have been pushing to flatten out the silos for quite a long time. And I think it actually works at some levels – in the middle. If you’re schooled in Marketing, chances are you’ll get your first job as a Marketing Intern or some similar role. Responsibilities will be specific, tactical and repetitive. As you gain experience, insight and knowledge, you’ll naturally move into positions with more responsibility – hence some decision-making, thinking outside the box, and probably some cross-functionality.

    The higher you go in the middle tier, the more cross-functional your role, which ultimately becomes a cheerleader and someone who blocks and tackles, clearing the path for the team. Until, that is you work yourself into that coveted senior director level where it becomes more about operating your individual silo – the specific groups underneath – and negotiating with other senior managers to satisfy corporate initiatives.

    I recently finished a project with a SaaS organization in Portland. It was extremely difficult for me to tell them that their philosophy – no job titles / nobody wears a single hat – was going to be acceptable to the FDA. This SaaS is a medical device, and FDA likes layers, they like specific roles, and they like it all to be clearly defined in writing. Not to mention this SaaS works in an Agile software development environment, but the first thing the FDA will look for is the old familiar waterfall. A very tricky and challenging proposition indeed when the CEO says, ‘screw the FDA, we’re not changing – deal with it.’

    There are a lot of reasons to hire a consultant, but maybe you’re right. Some people may see that as an admission of ignorance – they wouldn’t want to admit they need help, so they don’t hire consultants. There’s a risk there that I’m not convinced everyone would take. That, of course being the likelihood of failure, should that person make a go of something on his own when he knows he doesn’t have the knowledge or experience to make sound decisions or even know if they’re the right decisions.

    As a consultant, I do produce deliverables. Every project requires something tangible at some point. Rarely have I taken a contract where I was a pseudo-temp-contract employee, either. And I do define that role by its legal meaning – clients make appointments with me, I set the schedule, I control my calendar, the number of hours I’m available, provide all of my own resources and tools, etc. Of course, there are deadlines, but that doesn’t mean the client is controlling any aspect of the project. They only set expectations, but not specific instructions.

    I’ve been working with a client in San Diego for about 18 months as an adviser. I don’t produce much for them in terms of tangible deliverables, with the exception of a report or memo every now and then, but I meet with them regularly, sit in and observe meetings, and give my opinions about the direction they’re going / should be going with their product development. In all, I spend roughly 15-20 hours per month with them. I’ve probably got another year left on the odometer before it’s ready for FDA’s scrutiny then I’ll move along. I’m working with another in Portland in somewhat the same capacity, but at the top level rather than with one product.

  2. Great post, John.

    Reminds me of Milton Friedman, one of the most influential economists of the 20th Century, who wrote in an article in The New York Times Magazine in the early 1970’s that the only legitimate objective and rational purpose of a business company is to make money for its owners. Everything else, he said, is secondary and incidental.

    I guess that’s why we have quarterly reporting – shareholders want to see how their investments are doing. And so who’s to blame – the businesses or the shareholders? The Japanese have this right – they take a much longer view of history and society. Perhaps it’s time we do the same and not worry about 90-day share price fluctuation and instead look at how our actions impact our environment.

    Enjoyed the read and have bookmarked.

  3. This is the dilemma that is facing every single tech player now. I agree with your post. In fact I have reco-ed this URL to a few of my account manager buddies. Cheers!

  4. I am not as focused on this as I once was (turn-of-the-century), but has the industry of management consulting gone on the decline? Last I knew, more than ever, companies were bringing external minds into the equation to help with their problems.

  5. MMicro —–managing for the quarterly report leaves many companies very shallow in their strategic planning. The financial crisis in 2008 is a perfect example of this short term thinking. You have nailed it in this blog how thin on true leadership the corporate world really is.

  6. Great, well laid out points. I agree, and without the right message being sent out by the advertisers, what’s the point at all. Definitely sharing this.

  7. Yup selling a product wont work but like someone said previously if you sell yourself with the product, that works.

  8. You hit my most exposed nerve……

    Narrow hiring inhibits the creativity process when positions are filled. It also simultaneously leave positions unfilled (making deadlines slip) while leaving great talent unemployed.

    I have seen very few thoughtful evaluations of the resulting gap that leaves jobs unfilled and talent on the street. Corporations only seem to see the number of people on the street which leads them to believe that 1. they can pick up the hires they needs easily 2. competitive salaries will not be an issue because everyone is starving for a job and 3. their product will come in on budget and on time. OUCH!

    When in fact, yes, there are several hundred candidates that apply for the position. They will interview 4-6 people and find that none of them are perfect. They will eventually want to circle back to the earliest candidates only to find they are no longer available. The entire search will tak 5-6 times longer than expected. The final hire will be on budget and close enough to the job spec or just right and very expensive. During this time, their project deadlines have slipped and morale is rapidly decreasing. It is never spoken out load if it does occur to someone that they could have made a fantastic “close enough to the job spec” hire with a person who is enthusiastic, intelligent and a great cultural fit for the team. This hire would have started on time, typically taken 4-6 weeks to come fully up to speed to fil the “gap” and saved the company more time and money than they will ever bother to calculate.

  9. The problem cannot be solved by the people who created it. 90 percent of the waste in big corporations is from ego ,incompetence or defensiveness. And Often they travel together in sort of a trifecta.. Clear you really get it.

    • 🙂 thankyou Judith – I do like the trifecta – and it is about to become a new post – if only because the trifecta spells out D – I – E ….. something in there methinks !! That all said – your comment did remind me of The Peter Principle

  10. After further consideration… I think you’ve got two different trends going on here. It is indeed disconcerting that CEOs don’t see investment opportunities. I’m not convinced that is directly related to technology-enabled changes in selling, though. Nonetheless, in this market where it is harder to make B2B sales, what you describe is important.

    • yes – agreed. not directly connected. For example – CEOs do not make all the investment decisions in a company – but they do set a strategy and tone – if not explicit instructions – like ‘no more consultants’. More thoughts to emerge.

  11. Interesting. What I know is that we can only affect that which is our future thought or action. The past is gone. We learned from it or we did not. Either way, make a plan and those individuals or companies that have a goal and take determined massive action with focus are the ones that succeed.

  12. BTW, totally agree. Beware of method hacks with a hammer looking for nails. Among the worst are BSC, 6-Sigma and Agile. These are CYA techniques for weak managers. As always the only predictor of future performance is past achievement. Weak management does not know how to use consultants. They fall into the ‘shiny object’ trap from pop method wonks. Beware. -j

  13. “Now of course, there are plenty of people working in corporations as ‘consultants’ – but I would contend that they are more surrogates for full time workers.”

    This is a old-fashion tax dodge. If you have consultants you don’t pay FICA, Withholding (state & fed), insurance, etc. Even startups try this scheme. Doesn’t work for long. Usually, you will end up with a huge tax bill at the end of the day.

      • “agreed – but also easier to remove them at short notice”

        You’d be surprised. To be a real consultant, an independent contractor, you must be absolutely, 100% independent. There can be NO supervision, no work schedules, no required tools, and above all, according to very strict labor laws, positively no ‘right to control.’

        In business and IT there are very few authentic consultants. Most are employees that the client has opted to call consultants.

        You see, the ‘DLSE’ (Dept of Labor Standards Enforcement) is very keen on collecting taxes (imagine?) for the State.Thus, the lean heavily in favor of the employee classification versus consultant.

        For example, once we had a good number of IT consultants for a project. Whenever we had an office birthday cake event, we’d invite the consultants to have a piece of cake. Uh-oh. Since we made them feel like employees, according to the DLSE, they were employees. It created a huge, expensive mess…

        As mentioned, true consultants, independent contractors, are scarce, as most are contractors are really employees according to the Labor Laws (in California).

        To remove a an authentic contractor just cancel the contract and pay what’s do. In addition, most all employees are ‘at will’ and very easy to can too.

        However, the problem is if you wish to terminate a trusted, long-term, so-called consultant or contractor. If they decide to make a visit to their local deputy labor commissioner and complain that the employer had the ‘right to control’ the work you will be in deep yogurt.

        Basically, you will face back taxes and big fines if you don’t terminate your ‘consultants’ nicely. Be sure to buy them lunch, pay what’s due, say you love them… then pray!

        -j

  14. I run into this issue every day. If I try to sell my product on it’s merits, it falls flat. But if I sell myself as someone who can solve their problem USING my product, they bite.

  15. You say “corporations are increasingly focused on the short-term” – I’ll posit that only works if you’re using a timeline for “increasingly” that started in the late ’80s in the heyday/nadir of Big Bad Arbitrage.

    The siloed thinking that has prevailed in corporate boardrooms from sea to not-so-shining sea since … forever is now layered with the worst case of Shiny Object Syndrome, Enterprise Edition in recorded history. The confluence of the post-job economy (we’re there, have been since around ’05) and SOS means that we’ve got massive opportunity for a complete destruction/creation cycle in American enterprise. IF, and only if, a cohort of Fortune 500 CEOs – and the boards they report to – nut up and say “screw this, we gotta focus on our customers, not the shareholders.”

    I see this as particularly problematic in healthcare (the vertical I cover), where the consolidation of healthcare systems since the late ’90s has led to a severe case of Shareholder-Happy-Generation-itis. When lives are literally at stake – remember the old “it ain’t brain surgery” consulting catchphrase? Well, what if it IS brain surgery? – paying more attention to shareholders than customers can have fatal effects on one’s bottom line AND one’s survival.

    Short version: you’re right. But getting the attention of boards and the CEOs whose strings they pull is a highly challenging prospect. Lotta blood in that water …

  16. So that would be “John as a service” or “Shrink-wrapped John”? In either case I think you’re on to something.

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