Professional Services; the economic situation takes its toll

A couple of interesting items I spotted over the weekend that show evidence of how the economic situation is affecting the world of professional services.

A major North-West England based regional law firm,  Halliwells,  plans to go into administration, reports the Liverpool Echo.  I know, I can hear the cheers from here.  It seems to have been caused partly by some pretty ill-judged borrowing to fund expansion and new premises as much as by the recession, bu nonetheless it is a pretty unusual event.  I don't suppose many procurement departments have their legal services providers on their risk management  'watch list' of major suppliers who might go under.  Perhaps that needs to be reviewed?  On the other hand, some firms have reported an increase in earnings per partner so it is clearly not a generic problem.

More amusingly, the drastic cut in new consulting work * being awarded by the public sector has led to a row between the Management Consultancies Association (the trade body for large consulting firms) and the Institue of Interim Managers (who as you might guess represent smaller firms and one man band type contractors and interims.

The MCA have issued a report; "21st Century Government: Adding value, cutting the deficit" which explains how much value consultants add to the public sector.  But they also take a pop at interims.

"Speaking about the differences between contractors/interim managers and management consultants, Richard Goodson, Vice President of Hitachi Consulting said:
“Contractors and interim managers should be short-term solutions to resourcing problems but, unlike consultants, they can’t constructively challenge the requirements because they’re simply filling a pre-specified role. A team of consultants also brings a mix of skills and a willingness to work immensely hard whereas a single person tends to work at the rate of the people around them.""

Ooohh! Consider yourselves slapped, useless interim person, incapable of challenging the requirements and slobbing around like those other idle "people around them"!  Meanwhile, the hard working consulting team challenge away throughout their 15 hour days...never once stopping to think about selling another ten team members to the client or expanding the assignment...

Hilary Husbands of the Institute of Interim Managers responds by saying this about interims; "They work from within a customer organisation to identify ways to strengthen that organisation's capabilities and ensure the organisation has the capacity to continue to deliver results once they have left. They have an exit plan from day one and are looking for or already know their successor",

The exit plan line is a nice little dig given some consultants have a pretty clear objective to stay in the client forever.  Anyway, our book ("Buying Professional Services") gives a lot of attention to this issue - what are you really buying in a 'consultant' (or interim)?  Is it personal or corporate expertise; is it a pair of hands or an expert brain?  There are times when a large consulting firm is the right answer; there are times when a single contractor is best.   But the squabble is fun to watch anyway!

* I am available now at very reasonable rates for weddings, funerals, Bar Mitzvahs...a song, a dance, a bit of light consulting...

First Voice

  1. peter:

    Hi Peter,

    well commented…. it is quite funny reading that comment “they can’t constructively challenge the requirements because they’re simply filling a pre-specified role” …apologize Richard, I am sure to be much more competent as other big name (company) consultants can tell about themselves….keep in mind, the name on the visit card is everything for that guys, they are good actors but that´s all too.

    All the best
    Pietro Mutolo
    ITALCONSOR Procurement Services

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