Shrewd Insights and the Role of Consultants

The take away lesson: pick your consultants carefully

We had an interesting conversation with Tat Biswas today about whether consultants should provide “shrewd insights”.

The catalyst for the discussion was yesterday’s post, in relation to which Tat made the following remarks:

I am wondering why you … decided to use the term ‘shrewd insights’ in today’s post?

“We remain, as always, a publication which provides business leaders, management consultants and top students with shrewd insights on… “

I feel the term shrewd has a negative connotation. Being a consultant myself, we all perhaps know after being in the industry for a while that Consultants do draw a lot of flak for coming up with shrewd solutions for organisations which are often not in the best long term interest[s] of the community.

I think the consulting world needs to a do a lot more … to position itself as leading ‘holistic thinkers driven by [a] human-centered problem solving approach and not shrewd strategists driven mostly by monetary rewards. Being shrewd strategists is also perhaps not the right image we should portray to students who want to enter the world of consulting attracted by the prospect of challenging problems and good money. It works very well for consultants themselves and the organisations but not for the wider community and definitely not from a humanistic stand point.

Tat’s comments raise two good questions:

  1. What does the word “shrewd” mean?
  2. And, what should be the role of a consultant?

1. What does “shrewd” mean?

We have always tried to provide shrewd insights, and were disheartened to learn that this may carry negative connotations.

To explore the matter, we looked at OxfordDictionaries.com which defines the word to mean: “having or showing sharp powers of judgement; astute”.

This is the meaning we had hoped to convey. We are aiming to provide you, dear reader, with astute insights which demonstrate sharp powers of judgement.

So, why the negative connotations?

To double check things, we Googled the answer, and clicked the first link that came up. We landed at TheFreeDictionary.com, one of the world’s most reputable online dictionaries, I’m sure you’ll agree, and found three definitions for shrewd, the second one being “disposed to artful and cunning practices; tricky.”

This definition plays up to the typical consulting stereotype: “Consultants are people who borrow your watch, tell you what time it is, and then walk off with the watch.” And this appears to be the source of the confusion.

While consultants can sometimes provide astute insights, they can also just as easily provide carefully power pointed presentations full of information you gave them the week before.

The take away lesson: pick your consultants carefully.

2. What should be the role of a consultant?

Tat made an interesting observation that consultants tend to come up with shrewd solutions for organisations that work very well for the consultants themselves and the organisations but which are often not in the best long term interests of the community.

An example of this would be a consulting firm which recommends redundancies, resulting in a short term win for the company’s bottom line, but potentially long term hardship for its former employees. 

Where should a consultant’s duty lie?

On the one hand, consider lawyers. When a lawyer is admitted to practice, he or she takes an oath to the law society. Even if the lawyer’s client pays for the advice or representation, the lawyer has a duty to the court to obey certain rules and uphold certain codes of conduct. A lawyer who breaks the rules can be barred from practicing.

Management consultants, on the other hand, take an oath to nobody. And owe a duty to no one but their client, which is normally the company’s CEO or members of the senior executive team.

Is this a problem?

Well, from the perspective of society, it may well be.

In a world where many large corporations are publicly owned, and where CEOs are under pressure from investment analysts to meet quarterly earnings estimates, is it any wonder that key corporate advisors, the management consultants, tend to provide advice that serves the CEOs short term interests?

Short-termism puts money in the pockets of executives and the consultants who serve them, but it forgets about the shareholders, the long term survival prospects of the company itself, and the interests of the societies in which these companies operate.