A few lines from the epic office-life satire Office Space were quoted in an August 29th Valley Wag blog about Yahoo hiring consultants to support their reorg:
TOM: We're all screwed, that's what. They're gonna downsize Initech.
SAMIR: Oh, what are you talking about Tom? How do you know that?
TOM: They're bringing in a consultant - that's how I know."
As a former consultant, I’ve heard just about every joke about the profession there is (see one of my faves below a la Dilbert), but the sentiment expressed by Valleywag struck a cord in me, as I’ve recently been thinking a lot about the great divide between the tech world and the consulting world. Most large consulting firms have had trouble gaining significant traction at today's tech giants, such as Google, Yahoo, eBay, etc. Why is this?
I have a few hypotheses, represented by this fictional exchange of blatant stereotypes:
Consultant: Let us come work for you. We have the brightest people around; I have an MBA from Wharton
Engineer: I have a PhD from Caltech
Consultant: I have deep expertise in your field that could be extremely valuable
Engineer: Then when aren’t you using it yourself?
Consultant: We know what all of your competitors are doing and can help you learn from their experience
Engineer: But we're better than them already
Consultant: We bring disciplined problem solving techniques to your toughest dilemmas
Engineer: I have an ode to the scientific method tattooed on my lower back; disciplined problem solving is my middle name- seriously, I had it legally changed
Consultant: I'll push my business analysts tirelessly; they'll never stop working for you
Engineer: I can offer them a fifth of your rates and they’d be thrilled to come work for me- and never stop
Okay, so this might be a bit extreme, but after all, tech firms do have a lot of incredibly bright people (including numerous hired-away ex-consultants), with strong work ethics who take a disciplined approach to their jobs. To make matters worse, high-tech is known for having a healthy disrespect for conventional wisdom and competitive analysis- something other industries explicitly hire consultants to provide.
But that said, I still believe there’s a role for consultants as trusted advisors in high-tech. For one thing, tech firms are notorious for being horrible at knowledge management and leveraging cross-functional efficiencies, due to the high degree of secrecy demanded by the rapid pace of product development and obsolescence. Consultancies, on the other hand, are rather skilled at finding new ways to build bridges across organizations- and generally are better positioned to see opportunities by looking from the top down. Secondly, tech shops are beginning to converge with other industries at lightning pace (media, financial services, etc.)- a phenomenon that begs for some outsider perspective on those industries’ business models and competitive dynamics.
What other opportunities do you see?