Managing professional services – are you getting lamb or beef?

A report last week found that almost a third of ‘lamb’ dishes tested from take-aways in Birmingham and London contained meat other than lamb. The Foods Standards Agency (FSA) found that 43 out of 145 samples - usually curries or kebabs - were wrongly described. The FSA said 25 of the samples were found to contain only beef, which is cheaper than lamb. Chicken and turkey were also found. But I suppose we should be grateful it wasn’t horse. Or badger.

More problems there with the food supply chain, which seems to have deep seated issues around authenticity and quality. But this also got us thinking about other spend categories where category managers and budget holders might not be getting exactly what they think they’re buying.  Now the most obvious area might be around raw materials, components and spare parts. We know for instance there is a large trade in fake or counterfeit branded products in many areas, from consumer goods like perfumes to industrial components.

But even in the services area, there are cases when the buyer isn’t really getting what they think they’re paying for.  For instance, how many consulting firms have exaggerated the credentials of an individual consultant, either in order to bump up the day rate they can get for the person, or to give the confidence that their experience is just what the client needs?  “Yes, of course Sophie has run numerous reverse auctions”. That’s numerous as in one and a half...

Engaging individual interims can be even more fraught with issues. Few buyers or HR people have time to take up multiple references or go through a cv in forensic detail. There have even been cases where people with criminal records have been put into sensitive positions based on fake cvs. But even at a more mundane level, can the “experienced Oracle ERP implementation expert” really deliver what he says he can? Is he as counterfeit as the ‘lamb kebabs’ at some of these premises? Because in a sense, these examples are conceptually pretty similar to meat substitution.

And just like the meat example it is not easy to eliminate –we can take up references, we can develop expertise in interviewing, we can carry out cv checking, but just as it is hard to test every kebab shop in London every week, the sheer numbers of people involved in these areas makes 100% certainty impossible. So that’s yet another reason why these people-based, professional services spend categories are a real challenge to manage well.

Voices (2)

  1. RJ:

    A good starting point with the major prof services providers is simply to ensure that the people presenting the pitch are the team that will deliver the final product. All too often the Business Development team and impressive, silky-tongued partners are wheeled out to sell the deal and then a more junior team turns up on the doorstep on Monday morning.

    However, we shouldn’t decry the skills of the “junior” teams too much. In many instances these individuals (often working at 90%+ utilisation) are going to be far more in touch with the realities of the marketplace than the more “strategic” but distant views of the partners. Often it’s simply the balance of the team working on a project that needs to be clearly assessed so that practical, hands-on experience is complemented by broad strategic insight. Clear, business-focussed deliverables are also critical so that you can then manage the team (or individual consultant) against their output, and only pay for the value they deliver.

  2. Final Furlong:

    Herewith some insights (based upon personal experience):
    – consulting firms adopt somethng called the ‘resource leverage model’ where they deploy as much (cheaper) junior resource into a client as they can – ‘partners’ earn circa £900k+ pa by maximising the utilisation of their lowest cost (salaried) resource. At some stage, they also try and deliver value to their clients (dependent upon the assignment), and sometimes, some intellect. Full stop.
    – clients often fail to be an ‘intelligent client’ when buying consultancy, generally relying upon references far too much, as opposed to undertaking their own robust, competency-based assessments aligned to their own requirements
    – never ever eat kebabs – like consultants, you never really know where they’ve been. And, when one thinks about the final output (what comes out the other end), well, let’s not go there….

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