Commando Consulting: April 2009 - Recruiting Consulting Associates With Knowledge Or With Understanding

By Tom "Bald Dog" Varjan, Organisational Provocateur

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Do you know that in Kansas there is law that specifically forbids people from shooting rabbits from motorboats?

The reason why I mention this strange law is because there seems to be a similar law somewhere in the consulting universe that forbids consulting firms from hiring people with real understanding, so they hire people with mere knowledge.

For most consulting firms the number one hiring criterion of a candidate is an MBA.

In the early 90's when Enron started its Enron Capital and Trade, big boss Jeffrey Skilling went ballistic on hiring a steady stream of MBAs with the top grades from the best business schools. That was his way of stuffing (the "u" is not a typo) Enron with top-notch talents with 250 newly graduated MBAs per year.

As one Enron executive bragged to Richard Foster, a McKinsey partner, in his book, Creative Destruction...

"We hire very smart people and we pay them more than they think they are worth."

So, Enron blindly followed McKinsey's (Enron's strategy advisor) advice of hiring top-graded MBAs from Ivey League business schools and rewarding and promoting them at obscene levels.

McKinsey's idea was that this was the only way of standing out and doing truly excellent work in the last decade of the 20th century.

So, Enron set up complicated evaluation systems to grade its associates. The best associates got rewarded and promoted beyond human imagination and the rest was eliminated.

And what were the evaluation factors for hiring these MBAs? Typically two factors: University grades and charisma.

But as psychologists Robert Hogan, Robert Raskin and Dan Fazzini point it out in their research study, "The Dark Side of Charisma", there is a problem with charisma, especially one aspect of charisma: Narcissism.

Narcissists have incredible self-confidence and charm, which can lead them to amazing rewards and promotions. But they make horrible leaders for they believe they are better than anyone else and they know everything better than anyone else. They are good at taking credit for everything under the sun but vehemently deny responsibility for their mistakes and do their best to blame their errors on anyone and everyone. The authors write...

"Narcissists typically make judgments with greater confidence than other people…and, because their judgments are rendered with such conviction, other people tend to believe them and the narcissists become disproportionately more influential in group situations. Finally, because of their self-confidence and strong need for recognition, narcissists tend to "self-nominate;" consequently, when a leadership gap appears in a group or organization, the narcissists rush to fill it."

So, with this approach, Enron, and many other similar companies, created a culture in which the universe was revolving around the superstars' arses and the shareholders and clients were put on the backburner as mere afterthoughts. Well, especially clients.

Now, everything you've read so far is a pretty harsh criticism of MBAs, so we'd better look at some more facts just to clear up any misunderstanding. And don't get me wrong. I don't blame the people. There is an "MBA culture" out there that expects certain behaviours from new graduates if they want to succeed in corporate life.

According to the study "Academic Dishonesty in Graduate Business Programs: The Prevalence, Causes, and Proposed Actions", reported by The Toronto Star, 56% of graduate business students admit to cheating to obtain their credentials.

The study, which included 5,000 MBA students from 11 graduate schools in Canada and 21 schools in the U.S., was conducted by management professors at Rutgers, Washington State and Pennsylvania State universities. Researcher Donald McCabe also noted "Those numbers are probably under-reported."

This study points out an ongoing trend that lying and cheating in the world of business is just normal and they are here to stay. So, students learn at an early age that since business is based on lying and cheating anyway, using lying and cheating in studying towards business credentials is also an acceptable practice.

Based on that, the common notion is that one group of lucky bastards make their money by screwing a group of unlucky bastards out their money.

In a 2005 study by analysts at Wetfeet, over 800 students, who pursued careers in management consulting, were asked...

"Please select up to 3 factors that make your top ranked company appealing to you."

Only 0.25% 2 (two people) said that "Ethics" was one of their top 3 factors for choosing a consulting firm. Shockingly, even the category "Others" was rated more highly than "Ethics." Go figure.

And now think of the recent bailout events in the US and other countries. What the most troubled US companies have in common is that they have Ivey League MBA's in vital executive positions. And as a result of this MBA brainpower, these companies are lining up at the White House with begging bowl in hand grovelling for alms.

In contrast, companies run by folks who've never seen the inside of business schools are creating delighted clients and making great profits in the process.

I've just recently attended the Canada Marketing Summit in Vancouver (Rob, Jeff, thanks for the amazing event), and talked to many attendees. These folks don't even realise there is a recession because they're making such great progress.

They've also realised that in the recession, while the competition steps on the brakes, tries to cut costs and save money for the rainy days, they have stepped on the accelerator, floored it and are leaving the competition behind in the dust.

Vancouver-based personal development expert, T. Harv Eker says...

"If you save your money for the rainy days, rest assured you'll have plenty of those days."

We just attract what we expect because our actions will be congruent with our expectations. An expectation without an investment and commitment is merely hope.

So, instead of hiring associates with perfect resumes and impressive alphabet soups behind their names, I believe consulting firms should...

Hire Associates With Real Understanding Not Only With Knowledge

Many people may ask what the difference is between knowledge and understanding.

In an article written for the American Marketing Association, Travis Adkins explains the difference this way...

"There's a difference between knowing and understanding, although the two are often confused. Two organizations might have the same knowledge, but the one that posesses [sic] understanding can see consequences and implications that remain invisible to the other."

Knowledge is out of context. Understanding is in context.

Knowledge is how to make the perfect steak. The ultimate, best of the best steak.

Understanding is that a "merely" great steak as part of a full gourmet meal and properly marketed is more valuable to the market than the world's most perfect but non-marketed steak which sits on a piece of tin foil.

This difference was nicely demonstrated in Donald Trump's reality show The Apprentice (2nd season)...

Kelly Perdew, a West Point graduate and former military officer with Ranger qualification won because he could lead a team and deal with unexpected situations.

His opponent, Jennifer Massey, was busy touting her excellent school credentials (a Phi Beta Kappa graduate of Princeton and another degree from Harvard Law School.)

Perdew had understanding, while Massey had knowledge.

But there is another point to consider...

Hire Associates With Character Traits That Fit Into Your Firm's Culture

And here let's go back to another episode of The Apprentice...

By the end of the first season two remaining apprentice candidates were a Harvard MBA, Kwame Jackson and Bill Rancic, the founder of a multimillion-dollar Internet company.

Each candidate was asked to select assistants from the already fired candidates. Kwame selected Troy McClain, a successful entrepreneur and proven project leader.

As a second choice, Kwame selected Omarosa Manigault-Stallworth, a rather controversial character with a celebrity syndrome who proved again and again that she couldn't be trusted and relied upon. Her ace was that she had an Ivey League MBA and was working on her Ph.D. It was later discovered that she had been fired from four different jobs while working in the White House as an intern.

Throughout the project Omarosa proved that, among others, she was also an expert at blaming, lying, refusing to follow instructions, deceiving, vanishing unexpectedly, failing to communicate, sweeping problems under the carpet and hell knows what else.

Omarosa also used every opportunity to berate Kwame for his incompetence and being too laid back.

When announcing Rancic as the winner, Trump told Kwane...

"She lied to you twice. You should have fired her or got her out of the way where she could have done no damage."

Kwame tried to build a peak-performing team based on a superbly schooled "superstar" who had no discipline and other vital characters to be part of a team.

I firmly believe that in a good consulting firm we have to focus on these two elements: Character and understanding.

Understanding leads to the ability to apply skills that are required to be able to do the job, and character leads to the will to actually do it.

When we look at some of the best and most profitable consulting firm, they are very similar to the military. Maybe that's why Tom Peters calls the army the "Ultimate Professional Service Firm".

The military is all about...

1. Preparing teams of soldiers for battle


2. Leading teams of soldiers in battle

Having character and understanding, soldiers have the skill to fight battles and the will to win them. Without will, they would merely go through the motions as long as it's easy and comfortable. They would quickly acquire the mindset of the typical union employee...

"Do as little as you can, but demand as much as you can."

So, how does this play out in consulting firms?

A consulting firm is all about...

1. Preparing teams of professionals for consulting engagements and firm building


2. Leading teams of professionals in consulting engagements and firm building

Obviously, engagements are the activities associates do outside their firms to create and deliver value to generate revenue. And firm building is a group of activities which associates do inside their firms to make their firms more attractive to great buyers with sexy opportunities.

And just as military leaders' number one priority is to build battle ready units, firm leaders' top priority must be to build engagement ready teams of professionals of skill and character.

For the military, in order to win battles three key elements must be in place...

1. Soldiers and weapons are concentrated at specific locations and at specific times


2. The battle must be controlled to achieve maximum impact and minimum casualties and equipment damage


3. At the crunch point, soldiers must apply their skills to fight and their willingness to win battles

For consulting firms, the situation is pretty similar...

1. Associates and systems are concentrated at specific locations and at specific times


2. The engagement must be controlled to achieve the required value using minimum internal resources


3. At the crunch point, associates must apply their skills to do the work and their willingness to win those engagements and create delighted clients

If you seek people with understanding not merely with knowledge, then...

Forget About Conventional HR Wisdom

I've never been a so-called HR expert but over the years I've assisted clients to hire over 500 people ranging from junior associate to senior executives.

I also believe that the very reason why my hires have worked out over 95% of the time is because I asked clients to kick their local HR experts out of the recruiting process, and regard talent acquisition as a top-priority function for the executive team.

And there is a huge difference between being recruited by HR and acquired by partners and executives. I use both partners and executives because while most consulting firms follow the retarded partnership model, the best ones have corporate type leadership with presidents and CEOs on the top.

We can't get many good examples from governments, except for corruption, but one thing governments do well is that they understand that leadership is a one-person function and leadership can't be bestowed on committees made up by partners.

The only institution where I can accept the partnership model is married couples. But even there, when there is an emergency situation, one partner takes single-handed leadership. Well, this is even more applicable if the leading partner has only one hand. Now he or she can take real single-handed action and single-handedly tackle the situation.

The problem is that in the traditional HR world, associates are hired by HR folks who don't have subject matter expertise.

For instance: Junior OD consultant associate wanted. So, this candidate sends her resume to an HR person. But the HR person has never done OD, so all he can do is looking at her resume. But for him, most of the resume will be Greek because he doesn't understand the OD lingo.

So, what gives this candidate a chance to get hired? Two things...

1. A perfect gap-free resume from birth to graduation


2. Excellent school and college grades

Then this person gets interviewed and maybe hired because she's managed to account for each second of her life and learnt how to pass exams with flying colours.

The fact that she can still be the proverbial Omarosa with a grossly distorted character or someone who knows a lot but understands a little, doesn't seem to matter.

At a veneer level, beyond which HR doesn't have the expertise do dig, she is the perfect candidate. At a deeper level, she may well be a walking disaster.

When we're hiring for character and understanding, we have to structure the interview process drastically differently from the traditional interview.

Traditional hiring is about hiring a worker for a non-transparent master-servant (employer-employee) relationship. And this is the wrong attitude. What we have to realise is that people don't choose consulting as a job. They choose it as careers, and therefore they must be treated differently from the people who work at McDonald's to save up for an iPod or for a bouquet of flowers for their sweethearts.

So, How To Recruit Career People?

Instead of interviewing between superiors and subordinates, career people are recruited through dialogues where peers compare notes about the value the candidate can bring to the table.

While for job people money is a major driver, for career people money is just a sign that their potential employers take them seriously and value their contribution. Hence, let's forget about competitive rates. Good companies want to hire excellent people not merely competitively competent ones.

Career people want to know a few things job people don't care much about. Let's look at all 12 of them...

1. Career people want to know what outcomes they're expected to create. Tell them what you want and that's all. They know how to do it more than you do


2. Career people want to know they get all the necessary resources they need to do excellent work. If you hire a graphics designer, don't give her an old computer with Windows 98 that crashes every 10 minutes


3. Career people want to know they have the opportunity to do what they do best. Just because a PHP programmer finishes his work before 5:00pm, don't ask him to fill up the day by cleaning the windows or taking out the rubbish. Hire a janitor


4. Career people, being proud of their expertise, want to receive praise and recognition for good work. This is normal human need. Praise upfront and you get better work. That's all to it


5. Career people want to belong to an environment where their supervisors or managers care about them as human beings not only as employees


6. Career people want to work in a culture where their professional development is encouraged and supported


7. Career people want to make sure they can speak up on company matters without being punished, and their opinions count


8. Career people want to know that what they do is important and contributes to something bigger than the company's bottom line or shareholder value


9. Career people want to know that everyone around them is equally committed to doing high-quality work


10. Career people want to have best friends at work


11. Career people want to receive frequent feedback on their work and progress. They want to be in constant communication


12. Career people want to learn and grow on the job

Most consulting firms are excellent at demanding outstanding performance, but pathetic at bringing out excellent performance in their people.

On Summary On Top Tier Talent Acquisition

Talent acquisition and talent engagement of top-tier talents for consulting firms is drastically different from hiring competent workers for competitive wages for manual labour type jobs.

And since the traditional HR practices are tailored towards the industrial age of mass-hiring of manual labourers with pretty high attrition rate, we'd better forget about using them.

Similarly, let's forget about using headhunter agencies. They are good for finding workers, but finding and attracting talents must be a concerted effort by the top executives.

This is why...

When you're hiring workers, everything you need to know is right under the veneer. You don't have to dig deep. It's on the resume how much manure this person can shovel in a day. Or at least you can find it out from the previous employer.

But when acquiring talents, the essence of these people lies very deep under the veneer. And I dare to say, 80-90% of a talent's essence cannot be detected by from resumes. Sadly, headhunters and HR folks don't have the expertise to go any further. So, they make decisions based on incomplete information.

I find it shocking to see how reluctant partners are about getting involved in marketing and talent acquisition. These two are the two main functions of a consulting firm, yet, partners get busy working on trivia.

Partners must understand that their firms' success stands or falls on the quality of people they can bring to the table and how well they can market their people's expertise and their value-creating capabilities.

Yes, I know partners have busy lives, but they also have to evaluate what makes them busy in the first place. In most cases it's useless minutiae and micromanaging. They have to make sure their work is strategic not tactical.

When you look at a cruise ship, you find three groups of people: 1) people who keep the ship in motion, 2) The captain and other officers who sail the ship in the given direction and 3) The owner(s) of the cruise ship company who set the direction for the ship.

Similarly, firm leaders must know their roles and they should stop running down to the engine room to make sure each engine is running. They should work on strategic issues, that is, where the firm is headed.

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Recommended Reading

Small Unit Leadership

A Commonsense Approach

By Dandridge M. Malone

When you need a book on boardroom leadership, you can go to any bookstore and find many titles.

When you need a book on leading small groups of professionals in the front lines of engagements, then you have a problem. Jack Welch and other highly-esteemed corporate leaders know how to create visions in the comfortable safety of their boardrooms and behind layers of gatekeepers, but they can't say much on the obscure topic of leading professionals on a daily basis to pursue that vision.

And this is the gap Colonel Malone fills with his book.

The book is full of the ins and outs of leading small groups of professionals on engagements when a lot is on the line. The difference between corporate leadership and military leadership also applies to leading knowledge workers, that is, career professionals on their paths of delivering value to their clients in order to advance both their firms' success and their own careers.

Place your order with Amazon.com for Small Unit Leadership. You'll be glad you did.