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#528: Trust Your Consultant Gut

Posted By Mark Haas CMC FIMC, Wednesday, March 23, 2011
Updated: Wednesday, March 23, 2011
I sometimes don't get why some companies seem so successful and others do not. By any objective standards, financial, operational of market, these successful companies are described as being so because of some magic strategy (usually attributed to a consultant) that doesn't sound like it should work in any company. What am I missing?

At a minimum, the questioning of appearance, facts and assumptions is a large part of what makes consultants valuable to our clients. A bit of cynicism is always useful. We are all too familiar with the poor performance of many of the companies in the book In Search of Excellence. The authors made a methodological mistake (to be fair, many of us do the same) by looking at successful companies, finding common attributes, then branding them as "best practices." We then intend to use them for our clients to, in turn, make them successful.

The problem is one of logic and methodology. Strategic intervention does not necessarily lead to a successful company, just as a successful company may not result from a presumably great strategy. Don't confuse causality with correlation, despite the claims of strategy consultants. Also, it is not necessarily true that what looks like success will always be so. You may remember the investment fund that shorted the stock of companies whose executives graced the covers of business magazines (it beat the market).

I highly suggest The Halo Effect: ... and the Eight Other Business Delusions That Deceive Managers as a wakeup call to think harder about why a firm (or consultant) is successful or not. One of the delusions the author describes is "Connecting the Wining Dots" trap In Search of Excellence fell into.

Tip: Trust your (supposedly cynical) consultant gut. Companies are not successful because someone says so and provides a "simple truth" of why they are so. Have faith in your experience and make the effort to hone your logic and methodologies.

© 2011 Institute of Management Consultants USA

Tags:  advice  assessment  consulting tools  customer understanding  diagnosis  management theory  methodology 

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