All style, no substance

If a rising tide lifts all boats, a falling tide exposes all flaws. Last year’s economy created HR consulting paradoxes. In an up economy, companies can grow without outside advice yet they have money for consulting services. In a down economy, companies have less money for consulting expertise, but need it more. In a down economy when there is less demand for consultants, the supply has increased as many former employees naively envision consulting as their career redemption. These paradoxes reveal consulting realities and opportunities of current market conditions.

Looking for value

First, consultants must offer unique value. While low-cost, generic products often prevail in a thrifty economy, consultants who offer generic ideas and insights will be quickly exposed. Branded consultants who have a deserved reputation for innovative ideas and pragmatic solutions will continue to add value as clients scrutinise the value of such services.

Good consulting firms focus less on their costs and more on the value they deliver to clients. This requires that consultants have a clear offering focused on how their knowledge creates client productivity. In a recessed economy, clients need insights not only on how to manage in a shrinking market but also on how to continue to invest to grow, for example, in emerging markets and new niches.

Consultants who offer tangible results that clients could not otherwise find will continue to grow. In RBL’s work on organistion transformation, leadership brand, HR, and talent, we have found that more than ever clients need innovative solutions that may not be found in their own history. They need to access and apply ideas and actions from experiences of others. Consultants transfer knowledge that leads to client productivity.

Second, to paraphrase Darwin, only the best survive. It has become trite to say that a crisis is a terrible thing to waste. The good news is that this economic downturn has exposed charlatans, fads, and what we call “consulting foo-foo”. Quick-fix consulting solutions are like fad diets with bold promises but few sustainable results. Consultants who have creative ideas, thoughtful theories, and research roots, will likely be better fit to serve and survive.

Consulting budgets are not empty, but they are more scrutinised for the value that is delivered.

Trees grow more after they are pruned and managed forest fires are now seen as healthy because they cleanse the underbrush that limits growth. Economic recessions may ultimately increase consulting viability because the consultants left standing have demonstrated their value across economic cycles.

Third, successful consultants need to adapt and learn. Consulting firms must offer tailored, targeted, and measurable solutions to client problems, both expressed and unexpressed. Tailored projects demand that off-the-shelf solutions be replaced by joint learning. Clients should prepare to adapt, not adopt, solutions found in other settings. Creative consultants engage by listening and diagnosing more than recommending and solving.

Targeted projects demand consultants who scope and bound their interventions with outcomes and timelines. Clients should “lease” to own consultant knowledge rather than “rent” it.

Measurable projects come from consultants who see the value of their work for the clients investors (economic value), customers (customer share value), and employees (emotional value). Innovative consultants share the risk and gain of successful projects. When consultants adapt their offerings by tailoring, targeting, and measuring them, clients come to trust that consultants have their interests in mind.

Tough times build better relationships

Finally, we have learned that most people who speak many languages still swear in their native tongue when caught off guard. In a blunt and bleak economic recession, consultants’ true values reveal themselves. Consultants who privately believe that they have all the answers will be exposed for their inability to learn.

Those who seek first to sell their products or services will become recognised as placing their self-interest above a desire for other-service. Consultants who have learned a single solution to all problems will find themselves unable to adapt to change. Clients and consultants who find that their styles mesh in a recession will likely continue to work well together when the economy recovers.

Personal relationships are not forged in the good times, but in the tough times when the partners disagree and have to find ways to manage conflict and differences. This means that each party to the relationship sacrifices, compromises, apologises, and stays engaged. When true values are revealed, consultants and clients can mutually discover a fit or misfit that may lead them to future success.

The principles of value creation, survival of the fittest, learning, and values will likely shift the consulting industry for the better. In our field today, it is popular to talk about people “building on their strengths.” But this was not enough for successful consultants during the recession. Consultants need to build on their strengths that will strengthen their clients.