Consulting Value and the Information Age Impact

Posted by David on Jun 5, 2013 in Market Insights | 1 comment

The value of consulting comes primarily into two forms – reaffirmation or value creation.

Of the two, reaffirmation is not likely to lead to as great of a value formation since the consultant is re-affirming what you would likely do.  However there is significant value as it will likely make you act quicker than if you were not re-affirmed.   In addition, the re-affirmation value would be more robust if your consultant came from another perspective, but still ended up with the same conclusion.   Here in lies the value of a re-affirmation consultant.   If your consultant primarily thinks like you do, re-affirming your thoughts should not be a surprise.   A consultant who has a different thought process and different perspective really adds value, even though the conclusions may be the same.   This re-affirms the conclusion to be robust not just a chance outcome.   If you hire consultant for re-affirmation, ask yourself if my consultant is going to color my situation the same as I would, or would he or she be able to add substance/robustness to my conclusion.

Value creation from a consultant comes from the consultant being able to take his or her own unique experience and produce something you would not expect to be able to do because of the time frame and/or plain knowledge of the situation.   The “super” consultants will not create an average thought piece that you could get from a government paper and/or mass media.   If average is what you need, you would be better off asking your employees and/or industry associations versus paying a consultant.

I have been fortunate to be both a person who hired consultants and worked as a consultant.  I understand the value of consultants and how one picks a consultant.  At AEP I was in charge of the consultants we hired to examine the energy markets.   The consultants I have hired included CERA, Wood Mackenzie, PIRA, Energy Ventures Analysis, Hill and Associates, Global Insights, Moody’s,etc…Over the years I saw changes in consulting.  There were many consulting companies in the beginning that offered deep insights and different perspectives which challenge my thought process, allowing me to build my knowledge of the markets.   The fascinating transformation occurred as many of these consultants got larger.   As one could expect as a consultant firm gets larger, thoughts need to “co-mingle” as corporate heads expect team/consensus building.

However what do you expect to get if you build a consensus of many people vs. a vision and thoughts of a few?   There is some sort of scale at which adding expertise into a consulting firm produces an effect of converting knowledge back into information.   For my consulting experience, I was fortunate to have the experience in a 50 person consulting company Purvin & Gertz.   We had some very interesting and heated debates on the outlook of the petroleum markets.  The process was very personal, but in the end there was no requirement of consensus as accountability could not be washed out in numbers.

I also had the experience to work in a mega consulting company Deloitte Consulting.   As expected, the outlook in the mega company generally involved more political maneuvering as people tried to climb the corporate ladder.    I saw a dampening of individual thought as corporate mantras would likely lead to greater career success.    Not much different than one would expect in any corporate setting regardless of the consulting aspect.   There will be those individualists who can make a name for themselves and rise above the consensus thoughts, but the odds are against them.   If you are a number person and/or just observant you can plainly see; tying ones ideas and thoughts to the corporate mantra will likely/statistically lead to a -greater career success.  Coming back to consulting, if you create a mega corporate consulting company- are you creating a potential to dilute the very in-depth different insights your client requires of you?  I am not saying that it is not possible to obtain this from large consulting companies, but it certainly requires a company to be different than most corporate cultures at that point.

Perhaps someday I may once again join the ranks of a mega-consulting company, but it would have to be on the grounds of still being able to offer a unique perspective to my clients, or else what is the reason to consult?   The world is well into the Information Age, given the internet revolution.  We all have access to mainstream media, government analysis, industry associations, and the futures market.   There is more data than you can possibly analyze now.  Consulting becomes harder as consulting is not just about bringing information anymore since that seems to be ubiquitous, it is about bringing your unique experiences and processes to the table and converting that into knowledge for the client.    At All Energy Consulting that is the very premise of the creation of this consulting group.  We don’t want to be another information shop – we  focus on value-creation and robust re-affirmation through transferring knowledge.

Please do consider the reasons for hiring a consulting company and then consider All Energy Consulting.

Your very thoughtful Energy Consultant,

David K. Bellman

614-356-0484

Twitter: AECDKB

“The answer was fewer clients. Less money. More attention. Caring for them, caring for ourselves and the games, too. Just starting our lives, really. Hey – I’ll be the first to admit, what I was writing was somewhat touchy feely. I didn’t care. I have lost the ability to bullshit. It was the me I’d always wanted to be.” Jerry Maguire

“Look I don’t have all the answers. To be honest, in life, I failed as often as I succeeded. But I love my wife. I love my life. And I wish you my kind of success.” Dicky Fox from Jerry Maguire