Consultants – highly paid scapegoats?

Consultants charge huge sums for superficial but well “powerpointed” presentations in return for the company executives’ right to take full credit for any successful outcomes

MANAGEMENT consultants are often loudly criticised. Why is this so?

A large part of the reason is that consultants are paid a lot of money to provide recommendations which may or may not be implemented, and may or may not work.  They get paid regardless of the outcome, and this rubs a lot of honest, hard working people the wrong way.

A consulting joke one of my good friends told me recently provides some insight into the negative sentiment that sometimes surrounds the profession:

A man drives up to a farmer who is herding his sheep and says “if I tell you how many sheep you have, can I have one of your sheep?” Intrigued, the farmer agrees. The man sits down, pulls out his laptop, does some calculations, makes some phone calls, takes some satellite photos and finally announces, “you have exactly 413 sheep.” The farmer is impressed, “that’s exactly right, you can have the sheep of your choice.” The man picks one of the animals and the farmer says “now can you do something for me? If I can tell you what you do for a living, will you give me back my sheep?” The man agrees and the farmer immediately replies, “you’re a consultant!” The man is amazed, “yes, how could you know that?” “Well”, says the farmer, “you came without being asked, you told me something I already know, and you don’t know anything about my business … Now give me back my dog.”

Hat tip to Nick Cocco for the joke.

This joke, apart from being pretty funny, conveys the idea that consultants don’t add value. Could this be true?

“NO!”, I hear myself say (shout, scream), “if consultants don’t add value then they wouldn’t be highly paid and smart managers would stop using them. But consultants are highly paid and smart managers do use them. Therefore, consultants must add value!”

Mustn’t they?

This argument is certainly sound. Or at least, I like the sound of this argument.

The question is, why would smart managers employ expensive consultants if they don’t add value to the company?  Why indeed!  To quote Peter Spencer:

… it all started when executives at large companies decided that they needed some external scape-goats to blame if and when costly new business ventures failed.

Over the years this symbiotic relationship has developed enabling the consultants to charge huge sums for sometimes superficial but well “powerpointed” presentations in return for the Company Executives’ right to take full credit for any successful outcomes while shifting the spotlight of blame comfortably away from themselves in case of failure. “Failure is a bastard but success has many executive fathers”.

What do you think, are consultants just highly paid scapegoats?