Despite the bad press for EY in Germany and PwC in Australia; the big four and their sprawling professional services activities continues to grow. Accounting and audit services aside, advisory services appears to be in demand across the international business world. Overall across the economy, as best practices across the industry spreads, companies becomes more competitive and efficiency goes beyond just market prices and matching of customer demands. Innovation takes place as well.
Consultants, through advisory services helps information and knowledge work themselves out in the market. Mariana’s Big Con argument about economic rents however, might still somehow stand in the sense that the fees they attain may be somewhat outsized compared to the value created. And I’m referring more to generic type of business consulting as compared to technical advice or consulting that augments capacity of businesses during special situations such as a transaction or some kind of innovation project.
Yet I would say that the bigger con that is present in the market is the financialisation of our economy and everything that the financial industry abd banking does to generate rents. The issue is that the labour of financial industry keeps serving capital, and capital, with its sustained bargaining power (as pointed out by Thomas Piketty), continues to direct rents towards the financial industry.
The main force that can change this will be the government and regulators; there has to be more research and thinking around the manner we are setting up our economies.
I’ve been reading the ‘Strategy and the Fat Smoker’ by David Maister. I think very highly of David’s crisp thinking in the manner he approach strategy and the manner in which he cuts through issues and topics. He simplifies the concepts to the core of the subject matter without ignoring the human elements in them.
One of the interesting ideas he introduced is the idea of expert vs advisors when it comes to serving in professional services. A lot of consultants claim to desire to serve customers as advisors, as trusted partners but in reality they want to be treated as the expert, to have control and defend their expertise rather than to build strong trusting relationships with their clients.
In essence, from my perspective, the expert cares about the topic and the subject matter more than the client’s problem. And as a result, the client can benefit from the expertise but more as flat information or knowledge than actionable insights.
The advisor may not be the expert but he gains his authority to consult with the client through his deep understanding of the client’s problem. And that allows his synthesis of insights gathered from other parties, especially those who consider themselves experts.
A client can decide what he needs is an expert but he can never expect the bespoke synthesis to come from the expert. He or she will have to take responsibility for that.
Chanced upon Mariana Mazzucato’s The Big Con in the bookstore today and took the chance to read a bit of it. I first heard of the book from the media and my curiosity was piqued, not least because I’m a consultant myself. The firms highlighted by the book are the usual big consulting groups and Mariana’s main area of attack was on their work for governments enfeebling the public sector and exercising undue influence on the decision and politics of countries.
Being focused on the energy transition, I thought perhaps that my work is less implicated by Mariana’s attack but having been a public servant myself, I do wander if the government contracting out work to the consulting industry is a problem in itself. I think for Singapore, we can safely say that Mariana’s attacks don’t have teeth because the public sector in Singapore maintains a lot of the critical capabilities and information even whilst drawing upon consultants to help drive forward its work.
The Big Con then has in mind very specific governments as targets and in some sense, cherry-pick specific stories, case studies and situations to make its argument. Nevertheless, I still empathize with what the authors are driving at and the change they are hoping to make. Mariana Mazzucatto also wrote The Mission Economy and while I have not read it, I understand the underlying ideas and how The Big Con interacts with some of those fundamental notions. I do think that governments and more actors in the economy needs to get together to galvanise the economy and wider society to collectively embark on the joint mission for a future that is worth creating.
I write for many different reasons and with different objectives. One of the recent struggles I’ve been having with writing is to be able to convey depth of analysis and value of those ideas and insights to my target audience. I’ve traditionally always pondered deep and hard about various matters but did not necessarily structure my ideas properly.
While my role as a consultant helped significantly in terms of creating structures for my analysis, I need to get better at putting together the pieces of analyses not in the order by which they are done but in a manner than gives a compelling story and call to action for the audience. To put it simply, this is actually a life skill to develop that everyone and anyone can benefit from having. It is more about storytelling and bringing out the story with various mediums and different ways.
It is also a reminder that my training as an artist during my high school days were not wasted. Those were the times when I had to not just deliver a piece of art work as an end result but to document and share that process. Documenting the process may not be enough to really give a clear view of how one arrives at the outcome of a particular art work. It takes quite a fair bit of storytelling. That means filling in gaps, building bridges across different moments and different intermediate ideas, even seeing these intermediate moments that one can use to make the bridges connect.
Ideas are great but if they’re not put together with a good story, flinging those ideas around haphazardly is not useful. The poise and elegance of those ideas emerge through the stories that we tell.