FORD – a model for consulting

A little over three years ago, a dialogue began in one of my consulting classes that I teach for Sage. The conversation focused around the levels (I am not convinced levels is the right word) of consulting. In the end, the group proposed the following four levels: Findings, Options, Recommendations, and Decision. Serendipitously, this yielded the acronym FORD. (I personally own a Honda Pilot.)

This model has served me quite well over the last few years, so I thought it worthy of a post wherein I will briefly define each level and provide some overall thoughts about the model.

  • Findings – these are the issues (problems, opportunities, and desired results) that the consultant uncovers through a question and answer process, referred to by most as discovery.
  • Options – these are the different possibilities that the consultant proposes for solving the uncovered problems, seeking the opportunities, or achieving the desired results. A great consultant always includes, “Do nothing,” as an option.
  • Recommendations – this is the option (or options) that the consultant believes would be the best course of action for the customer. Making recommendations would usually include a list of advantages and disadvantages (pros/cons, positives/negatives, strengths/weaknesses, whatever you want to call them) of each options and a rationale for why the option(s) was(were) selected.
  • Decision – one of the various options or a variation of the options is selected for implementation.

A few observations about the model:

  1. Each incremental level increases the level of risk on the consultant and requires an higher degree of knowledge. Since risk and knowledge required are factors in setting price, an engagement to just collect findings will be less expensive than an engagement to present options and an engagement to present options will be less expensive than an engagement to provide recommendation.
  2. If you are making the decisions you are not a consultant, but what Peter Block would call a surrogate manager. He defines this as “a person who acts on behalf of or in place of a manager.” Surrogate manager-hood is not bad in and of itself, but it is way more risky and deserving of a premium price.
  3. Being a consultant or a surrogate manager is a strategic decision. Some people may choose to never enter the fray as a surrogate manager and only remain in the role of consultant. This leads to what could be another blog post – the paradox of consulting – which is that consultants are paid to not make decisions.
  4. It is critical to have a conversation early on with every customer or prospective customer as to the level of consulting in which they would like to engage you. Failure to do so causes not only pricing problems, but myriad of other problems that are out the scope of this post.
  5. I believe that all professionals are consultants of some kind. Doctors are consultants on the anatomy and physiology of the human body; lawyers, on the law and legal system; accountants, on accounting practices, etc.

I welcome any comments and any suggestions on a better term than my proposed levels.

Consulting Rule #3

I often state a truism that I stole from someone I can’t remember – In consulting, as in medicine, prescription before diagnosis is malpractice. (If you are this person, I apologize, I owe you a beer.)

In a recent conversation while on a walk with my wife, Christine, we concluded that there is a corollary to this rule – You can’t prescribe if the patient/customer will not let you diagnose.

I hear about this problem more than a couple of times a week from Sage partners with whom I am speaking. It usually manifests itself like this, “Ed, I was trying to get an understanding of why the customer thought a request they had made was important, and they told me that they don’t reveal that information to outsider consultants. What can I do?”

My initial response is a half-kidding, “Run away!”

After explaining that I am kidding, sort of, I state, “Perhaps you should suggest to them that they reconsider and explain that while you understand their concern, it is not in their best interest to withhold this information. Consider this – if you go to a cardiac surgeon and just ask for a triple bypass operation, any ethical doctor will first insist on a few tests before performing the surgery. Certainly, they would want to take your blood pressure and heart rate. Would it make any sense to say, ‘Hmm, I don’t know, I don’t think I want to reveal that information to you.’? Clearly, it would not. I am in the same situation as the doctor, without a full understanding of the problem, it would be unethical for me to proceed. So, I ask you to reconsider and answer my questions. If not, I really don’t think I can help you.”

Is this hardball? Maybe, but your only alternative is to violate your ethics and prescribe before diagnosing.

Ron Baker Summarizes the Firm of the Future

The Journal of Accountancy recent posted excerpts of an interview they conducted with Ron Baker. In this seven minute clip, Ron does a great job at summarizing the concepts surrounding the firm of the future, also known as a professional knowledge firm.

This is my latest slide that illustrates this powerful idea. It differs from what Ron espouses in that I make a change in the mathematical operator used in the equation to signify that the transformations enhance each other.

image

Enjoy!

“Not for the Sake of Ambition” – Oh, Please!

One parenthetical phrase from President Barack Obama’s eulogy for Ted Kennedy made me cringe – “Not for the sake of ambition or vanity; not for wealth or power; but only for the people and the country that he loved.”

I write this not as a criticism of the President or the deceased Senator, but of the attitude it conveys. First, it is blatantly false. No one without any ambition runs for the Senate or Presidency. Second, it raises an idea that I find disturbing, namely that political or governmental service is somehow more noble than economic service.

This idea is a derivative of zero-sum thinking about wealth. It encapsulates the idea that those in business are somehow stealing wealth from others and that those in government are there to prevent any massive accumulation of wealth by one person or a small group of people. What they miss is that while governments do not create wealth, businesses and individual do. Governments are instituted to allow for wealth to be created by protecting those that create it from the masses who would try to take it from them.

In short, they have hopelessly and irrevocable confused cause and effect.

Creating a Service Level Agreements

Creating an SLA (Service Level Agreement) is by far the most frequent topic of conversation I have with partners of Sage. I recently came across an mp3 file I recorded while in Sydney, Australia delivering the service level agreement section from Customer Boot Camp, so I have decided to post it.

Please note it is not the best quality recording, but I think you will be able to understand most of it.

If you have any further thoughts or question, please feel free to post them as comments.

UPDATE: As of June 2010, I refer to these as Access Level Agreements not Service Level. I admit I was wrong. Sorry!

ScreenR Is a Game Changer

Remember Lotus ScreenCam? I do and I recall it being a big deal to do them. Yesterday, I came across ScreenR, a social media tool that I think is a game changer.

Below is the first one I created as a test. In it I demonstrate how to create a new group in Facebook.

ScreenR allows you to create screen shot movies with audio and immediately post the to Twitter and the Web where they can be embedded into a blog post or sent along in an email. The service also allows you to download them movies as mp4 files for the iPod and send them to your youtube channel. It does all this for free and with zero downloaded software. It is all a web service.

To me this could change technical support in a way that remote control software and service has not. Think about it you can have your customers make a movie of their problem which they send to you. You can then create a screen movie of the solution, combine the two together with some free video editing software and publish the whole thing back on your youtube channel where you can send any customer that might have this situation in the future.

Update: Below is the ScreenR presentation I did creating this post. However, this time I am posting the embed source from youtube.

Update 2: Clearly I was wrong on this one. It is not the first time.

What Do You Know – I Am Mainstream

Yesterday, on the front page of the Wall Street Journal opposition to the billable hour went mainstream – Billable Hour’ Under Attack. The article begins, “With the recession crimping legal budgets, some big companies are fighting back against law firms’ longstanding practice of billing them by the hour.”

In addition, the Journal also posted this accompanying video, in which the client (Pfizer) lays down the law (of economics that is) to her firms. While there is much here to agree with, she misses an important point. No billing by the hour can be financially beneficial to the firm as well. The question that I have for these firms is will you now eliminate the time sheet? Your customer has just told you that you have no reason to keep them. If anyone out there works for one of these firms, please let me know what the buzz is.

Killer PowerPoint (as in death by)

Comedian Don McMillan has a terrific routine about inappropriate use of PowerPoint.

 

It is not quite as good at this one created in 2000 by by Peter Norvig, the director of research at Google.

My thoughts:

  • PowerPoint should be use to augment, not make your presentation.
  • Use pictures and movie clips.
  • If you need speaker notes, use index cards.
  • Join Toastmasters. The only way to improve you public speaking it to speak in public.

A Review of The Israel Test

Even the thought of summarizing the premise of George Gilder’s new book, The Israel Test, causes my mind to reel.

To attempt: The cause of the conflict between Israel and the neighboring Arab countries is not religion (although there are certainly elements) nor racism (although there are certainly elements), but rather it is caused by envy. Israel, in the 60 plus years of its existence, has been extraordinarily successful and the perception is that it has done so by taking from the Palestinians. In short, the conflict is about the zero-sum thinking of demand economics versus positive-sum thinking of supply-side economics. It is about the jealousy felt against people who have attained success and the belief that the only way they could have attained that success is by taking from others.

“The real issue is between the rule of law and the rule of leveler egalitarianism, between creative excellence and covetous ‘fairness’,’ between admiration of achievement versus envy and resentment of it,” Gilder says.

In Part One, Zerizus, Gilder, in his best and most brilliant prose since Wealth & Poverty, develops this premise and destroys any and all arguments against it. He posits his Golden Rule of Capitalism – The good fortune of others is also one’s own. One of the troubles with government, indeed with even democracy, is that government (transfers of wealth) and democracy (elections)  are zero-sum, while the economic system, capitalism is positive-sum. This influences the thinking of all leaders in democracies that they need to create an equity of outcomes, not just an equality of opportunity. He terms these people, “handi-capitalists!”

In Part Two, Israel Inside, Gilder introduces us to Jewish and Israel scientists and entrepreneurs who have had a profound influence on the world as we know it and a few, who he believes, are about to have even great influence. Intel’s latest microprocessors, they are coming from Israel; Petaflop networking, from Israel; Wireless high-definition interface standards, from Israel; Algorithms which map the human genome, Israel.

In Part Three, The Paradox of Peace, Gilder puts forth his by far most controversial and thought provoking  postulate – the Peace Now movement inside and outside  Israel, condemn themselves to Peace Never. Gilder quotes Nobel Laureate Robert Aumann, “If you want peace now, you may well never get peace. But if you have time – if you can wait – that changes the whole picture; then you might get peace now.” Gilder states, “Peace requires the imposition of penalties on aggression.”

Simply said, The Israel Test is not a easy read, but it is absolutely a must-read.