Consultants a Waste Minus an Adaptable CEO

Consultants have a place in business but are no substitute for the CEO

I often say being a CEO is the most personal of jobs. It’s difficult to separate the person from the role, and good character is fundamental to the position. This is why hiring consultants can be tricky territory for a CEO who isn’t open-minded and doesn’t handle it correctly.

Damaging the CEO’s Ability to Lead

It’s common for CEOs to bring in consultants to solve problems in their organizations. Outside eyes can be valuable. They can validate the challenges the CEO sees in the business and act as impartial advisors.

Yet bad management of consultants can tarnish a CEO’s perceived caring, credibility, and competence. These three “Cs” are essential tools of the trade. Losing just one of them in the eyes of their constituents will make CEOs about as effective as a two-legged stool.

For example, depending upon why the consultants are hired, employees and others could take it as a sign that the CEO lacks competence. They could also believe that the CEO doesn’t trust his or her internal team, which hurts credibility. Not taking a consulting firm’s advice could also harm a CEO’s reputation, especially without any explanation.

Communication is key in these situations. Radio silence from the CEO could also be perceived as lack of caring. In the absence of information, employees are likely to create their own theories, leading to more problems.

Using Consultants to Confirm Biases

In addition, many CEOs have ulterior motives for bringing in a consultancy, which could further damage their ability to lead. Helen Lee Bouygues, founder of the Reboot Foundation, recently spoke to Harvard Business Review about how the lack of critical thinking causes a lot of business failures.

Consultants can help, she says, but “…In a lot of situations CEOs seek validation and look for evidence that supports their preconceived notions. And consultants are often trained to agree with their client’s theories.”

Bouygues also says that CEOs will hire consultants to justify their strategic direction and actions to their boards. This is the opposite of critical thinking. She recommends being very specific with consulting firms up front: CEOs should communicate clearly that they are not hiring yes men and women but want unfiltered, objective advice (if they really do).  

Expecting Consultants to Do the CEO’s Job

Another issue I see often is that CEOs bring in consultants to actually drive the change they want. This is unrealistic and shows that the CEO is either unwilling or unable to perform the five key responsibilities of the role: Own the vision, build the culture, provide the proper resources, make good decisions, and deliver performance. It’s important to understand that consultants cannot take on these unique CEO responsibilities.

For example, if you want to change the culture in your organization, it will require that YOU as CEO change your behavior. I recently interviewed Ray Greer, the CEO of transportation software company Omnitracs. He said cultural transformations are one of the most difficult challenges a CEO can face. He didn’t fully appreciate what’s involved in leading them until he became a CEO. It’s not something you can learn in school or train for on the job or outsource to consultants.

“You can’t master the art of that until you’ve been through it a couple of times,” Ray said. He should know, as he’s been through it three times now. Only the CEO has the credibility to drive systemic change within an organization.

Becoming an Adaptable CEO

At the end of the day, being a better CEO inevitably involves being a better person. This includes always working on and improving the three Cs (caring, credibility, and competence). It also involves showing gratitude, knowing where to apply your strengths and how to use your time, trusting your team, constantly learning, being humble, and much more. CEOs who don’t realize this will make many mistakes, such as hiring consultants for the wrong reasons or not managing them effectively.

Consultants can determine what needs to change, provide a plan for how to change, and even track progress. But to transform the company, you must evolve. If you aren’t ready to do this, don’t waste your money on a bunch of consultants.

1 Comment

  1. When I worked at a Top 3 Telecom company in the late 90s I observed as an executive hired a well-known consulting firm to identify issues that were suppressing our progress.

    They interviewed several of us and took good notes. Then they told the executive what we told the consultants. That list became the basis of an action plan.

    All in all, a costly way to “find out” what the management team already knew, and was already saying.

    Maybe other consulting arrangements are better – I certainly hope so. But this “first impression” has stayed with me a long time.


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