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An extended anecdote by MIT alum Keith Yost, paid $200,000/yr. straight out of school by Boston Consulting Group to consult in Dubai:
I was regularly advertised to clients as an expert with seemingly years of topical experience relevant to the case. … Even my very first case .. I was the most senior consultant on the team. …
Analytical skills were overrated, for the simple reason that clients usually didn’t know why they had hired us. They sent us vague requests for proposal, we returned vague case proposals, and by the time we were hired, no one was the wiser as to why exactly we were there. I got the feeling that our clients were simply trying to mimic successful businesses, and that as consultants, our earnings came from having the luck of being included in an elaborate cargo-cult ritual. In any case it fell to us to decide for ourselves what question we had been hired to answer, and as a matter of convenience, we elected to answer questions that we had already answered in the course of previous cases – no sense in doing new work when old work will do. …
Most of my day was spent thinking up and writing PowerPoint slides. … What I could not get my head around was having to force-fit analysis to a conclusion. In one case, the question I was tasked with solving had a clear and unambiguous answer: By my estimate, the client’s plan of action had a net present discounted value of negative one billion dollars. … But the client did not want analysis that contradicted their own, and my manager told me plainly that it was not our place to question what the client wanted. … “Change the numbers, but don’t change the conclusion.”
Hat tip to Kevin Burke.
Consulting Isn’t About Advice
why would anyone want to lose $1bn
Well it can be a case of corruption, after all this is allegedly happened in a petro-state/monarchy. So the 1bn is not a "loss"... all happened as it should have.
I red the article, talk about naive... this guy actually thinks the world of business is pure and productive all the time(apparently by the wonderful invisible hand...), delusional is a better world.
While I am no fan of management consultants, while reading the link I couldn't stop thinking "sour grapes".
For instance the author complains about his advice not being taken. I would say the blame for this lies in his lack of persuasion skills. He failed to realize that this is part of his job, in fact in business and real life, you can't just come up with the analysis, you also have to find ways to get people to implement it. From his story he obviously could not do this, his example proves this, I mean why would anyone want to lose $1bn if they really understood this was the real risk? Probably this was the first time the author had failed at anything, hence his sour grapes at the whole experience, he is blaming the system rather than examining why he failed.
I have come across quite a few smart people like the author (actually disproportionately now I think about it from MIT) who are bitter about their advice being ignored all the time, yet they never think about their role in this.