CBR15Bingo: Politics square
This book is dense with a capital D, with a seemingly never ending list of examples. It walks the reader through a comprehensive study of how the modern consulting industry came to be. The authors offer up dozens of specific examples warning against the proliferation of consultants replacing full-time employees and in-house brain power. More specifically, it explains in detail how using highly-paid consultants in lieu of experienced civil servants led to empty coffers and unsuccessful schemes meant to run governments like a for-profit business.
I eagerly added this book to my library holds and was cackling with delight as I dug into the stories of capital greed and unrestrained spending. However, my enthusiasm quickly turned to gut-sinking nausea. The amount of money and human energy spent to produce so little value is astonishing.
Many years ago, I was part of the consulting machine. Being a management consultant is the highest-paid job I have ever had. It was also the most emotionally taxing job I have ever had. I have never worked longer hours or had to deal with so many truly ‘challenging’ personalities than I did in that job. I have incredible respect for the consultants who do care about their clients and who do genuinely strive to create value. However, in my experience, the entire business model was appallingly superficial and sales-driven. That is how it works. I get it. But, after seeing how much we were charging our clients versus what we actually produced, I have no doubt that the clients could have saved millions of dollars and come up with a working solution without our brand name. Since that time, I have only been on the client side and have never looked back. I learned so much about human nature, how to advocate for and protect myself, and how to spot sketchy managers. I am not sure I will ever make that amount of take-home pay again, but I also get to focus on one project for an extended amount of time and I get to spend my time working on something I genuinely care about versus constantly having to justify my presence (and hourly billing rate).
Anyway, back to the book.
I enjoyed it because it provided specific examples that were in line with my experience working as a consultant. However, the point could have been hammered home in a much shorter read. I think this book is necessary but it was a bit of a slog to get through. If you read it, you will not be disappointed. However, you will probably get just as much out of a synopsis.
With that, I leave you with the parts that resonated with me, as well as the four final recommendations provided at the end of the book.
On the size and influence of the consulting industry
“Estimates of the value of the consulting industry globally nonetheless all suggest that the market has soared in recent decades. In 1999, management consulting revenues globally were estimated to be worth somewhere between $100 billion and $110 billion. By 2010, one study estimated the market size at around $350 billion. Estimates in 2021 ranged from almost $700 billion to $900 billion.”
“In 2021, Deloitte was the third largest private company in the United States, and was followed closely by PwC in fourth position, with EY following with number 6. “
“The Big Four have offices in more than 130 countries and employ a total of about 400,000 people. McKinsey alone operates across more than 130 cities in over 65 countries. Despite this reach, their revenues are derived overwhelmingly from just a handful of countries. One study suggests that 96 percent of consulting revenues come from North American and Europe, and that 70 percent of the consultancy fees worldwide are generated by just five nations – the United States, Canada, the United Kingdom, France, and Germany.”
On the perception of value
“Ultimately, the consultants only need to ensure that the client perceives that value has been created. Satisfying clients may well entail the sharing of actual expertise or knowledge, but it may also involve simply instilling confidence in the value of what has been created.”
The four recommendations
- Reimagine the role and purpose of civil services
- Invest in state capacity
- Reform and regulate the scope of consulting contracts
- Enforce transparency