Businesses in general put far too much emphasis on analytical skills, while grossly ignoring the even more important synthesising skills, which is a key skill for innovation.
In this two-part series we talk a little bit about the great advantages of the well-rounded generalists over the narrowly focused specialists.
Some people may say that we must specialise (or die), but I believe it is also important to have a breadth of knowledge not only a narrow but also deep skills. For example, look at firms that – used to - promote narrow concepts like Six Sigma, Reengineering or Quality Circles. Where are those puppies? All right, Six Sigma is still alive and kicking, but the other two and many other fads have died to death. And people who specialised on those concepts have just vanished. Where is Michael Hammer, the Reengineering dude?
On the other hand, look at Peter Drucker. He is a lawyer by schooling, but his real skills help him to reach well beyond law. Or consider Tom Peters? All right, he is a first class provocateur. Beyond that he is a great generalist who can think big and kick some corporate arses into serious action.
And here comes a typical problem with accountants who also pose as business consultants. The problem is that accountants in general are pretty risk-allergic people and business is inherently riddled with risks. The other problem is that accountants are educated in numbers. For them every problem is a number problem. When all you have is a hammer, everything looks like a nail. I still maintain that profitability is the material manifestation of a great business culture and people with passion, enthusiasm, ambition, and other emotional indicators.
That reminds me of a doctor in my little town in Hungary. Whatever illness people visited him for help, he automatically asked everyone to strip butt naked. Then he looked at the person from the front and from the back and that was the diagnosis.
And this is what most accountant-turned-consultants do. They look at the balance sheet and recommend to cut the marketing budget, disallow any kind of skill development and propose a 35% downsizing. These are the people for – most of - whom every expenditure is a waste of money, and there is no such thing as investment in future improvements.
Maybe that is why most accounting firms suck financially. Just check productivity (generated annual fees per person)
So, why do executives hire broad-based consultants, coaches and other advisors? They provide ongoing reality check, they offer new perspectives and fresh frames of reference. Here are some more examples:
* giving us a broader view of the problem * helping us to discover the real cause beyond symptoms * expanding our thinking and our horizons * pulling my nose off the grindstone, so I can see clearly the forest from the tree * assisting us to dissect problems and rebuild the pieces into a brand new whole
The common denominator is that advisors offer their experience, education, intuition and finesse to think and act beyond the limitations of a specific industry’s conventional wisdom.
A firm’s senior partners can say they are planning to grow by 25% in the next year by hiring two new associates. That is great, but maybe with the help of an external advisor they could achieve 33% growth without hiring anyone.
For example, when a firm says, that for next year we project 15% revenue growth. That is great, but with a short examination an external advisor may discover how to push up the 15% to 25%.
But most service firms are complacent (yes, the overinflated ego) and grossly mismanaged, so they will overlook that potential extra 10%.
What clients value the most in their advisors is zero-based thinking, that is, thinking big, thinking on the edge, which is based on the skill of synthesis, and not analysis, as so many managers mistakenly believe.
Analysis is taking the whole apart, and anyone can do that with reasonable ease. Just look at a simple example. Can you take your car apart? I bet you do? What about putting the pieces together in such a way that you end up with a roadworthy car and not with a pile of scrap metal? That may be just a tiny bit more complex.
Synthesis is putting the pieces together and creating a broad variety of “wholes”. That is real skill. The concept of synthesis is that you have the ability to recognise patterns and trends, reframe things and simplify concepts, so you can re-build the whole in many many ways.
Because of this ability to synthesise, it is always a good idea to invite a consultant to conduct a company’s strategic planning programmes.
Very often synthesis includes a healthy dosage of illogical, counterintuitive and even crazy ways of putting known pieces together.
Just look at the telephone and the telex. How many years went by until some renegade – someone who was not limited by the conventional wisdom of that specific industry - dissected the phone and the telex, put the pieces together and called it the fax machine. Can you see why it is a dumb idea to demand industry-specific knowledge from your advisors?
The common problem with analysis is that it repeatedly uses the same patterns to find out more about something that should be replaced altogether. Just think about it. For years, people had been breeding better and better horses for their carts, and one day a “lunatic” came along and suggested that people should get rid of their horses, and put engines into their carts.
Or here is another example. Firms get so busy growing their revenues that they totally ignore an even more important indicator: Revenue per associate. Tell me quickly. If you double your revenue from $1,000 per year to $2,000 (100% growth), and also grow your personnel from 10 people to 15 people (50% growth), what is that? Is it really 100% growth or self-delusion? It is fine and dandy, except that your growth is not 100%, but a mere 33% from $100 revenue per person to $133.
But, analysts are still basing a company’s growth on total revenue. How sad! How narrow-minded!
So let’s discuss how we can bring in some zero-based thinking to our clients.
Let’s get started with the basics, which is usually a great purpose of doing what we are doing. As Bill Gates’ purpose is to put a Windows-driven PC on everyone’s desk, we too must have a purpose that is huge. So, with this in mind, we must keep our clients’ biggest goals in mind.
You must understand the client’s bigger picture. There is a good chance that you will see much further, thus you can think bigger than your clients. Remember, besides thinking big, your clients are also bogged down with micromanaging. Count on this puppy. It is just human nature that we love poking our little noses into other people’s affairs. The only exception I have experienced is in the United Kingdom. The British have this – in my opinion – highly admirable attribute of “None of my business”.
You must understand the company’s critical challenges, so you can make sure your clients do not get replaced by working on irrelevant issues. When a company has 100% talent turnover, then it is a fatal mistake to run a marketing analysis project. However, if the CEO got her MBA in marketing, for her everything is a marketing issue, and the board of directors may easily pronounce the ultimate “Red Queen” judgement on her: “Off with her head”.
This is where the purpose comes to your aid. Every critical issue must be measured against the purpose and vision of the company. If the company’s vision is to be a market leader, it cannot clog up the shop with minimum-wage people (a sadly common practice in Canada). As the British say, “if you pay peanuts, you get only monkeys”, and when we look at the overall business performance and level of innovation in Canada, we can better understand why Canada is ranked at the bottom end of the western world.
The other factor is that what your client’s see is hardly ever the problem but a mere symptom. As an objective outsider, you have a much better chance to see the real problem. Yes, when you point out that the emperor has no clothes, sometimes you may get fired, and in the long-run it is better for your sanity and want to keep business a jerk-free zone.
So, let’s sum it up here the three key ingredients you need for doing a thorough analysis and, even more importantly, synthesis. Get clear on the client’s vision, the big picture of the business and the critical realities. Also, it is important to note that more businesses are limited by attitudes, beliefs, behaviours and thinking patterns, not by economy and governments. First people must be willing to change inside, and only then they can manifest changes outside.
Conventional wisdom says: If I have (something), I can do (something) and I can be (someone).
I believe first we must be (vision, beliefs, character, attitude, etc,) then we can do (behaviour, whatever we are ready, willing and able to) and then we will have (whatever).
Next month (August 2003) we discuss some tools for zero-based thinking.
About the Author
Tom "Bald Dog" Varjan helps service businesses to improve personal and organisational performance. Requests his FREE fee-setting guide "Why Most Service Firms Grossly Undercharge for Their Services?" by sending an email to booklet@di-squad.com with "booklet" in the subjectline.
Written by: Tom ''Bald Dog'' Varjan
