Consulting Versus Diagnosing: Lessons Learned through Two Seminal Works and Twenty Years as a Management Consultant

By Daniel T. Murphy

Introduction

During more than two decades in the management consulting world, this consultant has been a practice leader, project leader, trainer and mentor to dozens of new practitioners. The challenge is always twofold. First, new practitioners must be taught the basics of their practice area. For example, organizational change management (OCM) consultants must be taught OCM, and business analysts must be taught business analysis techniques. The second part of the challenge is always more difficult. How does one teach a consultant to be a good consultant? And, which texts can help provide time-tested perspectives and techniques?

Whether studying organizational consulting from a traditional business perspective, or from a more social-behavioral perspective, two texts have become classroom standards. This consultant has read both books as a student in a traditional business education graduate program, and also as a practitioner while working as a consultant in four of the “Big Six” management consulting firms. The two books are especially valuable when read in concert with one another. The first book provides a bigger picture of the consulting process. The second book is more tactically focused on diagnosis. A medical analogy might suggest that the first book tells how to treat a patient from the time they walk into the doctor’s office with an ailment until the time they depart fully-cured. The second book focuses specifically on how to diagnose the patient’s ailment.

This paper will summarize some of the most salient topics within each of the two books. The paper will also seek to contrast the purposes of the two books, underscoring the difference between consulting and diagnosing. To do so, the paper will be organized around the five consulting phases described in the first book, since that book provides the more macro view of the consulting lifecycle. And, to help make real the concepts described in the two books, the researcher will provide examples from multiple previous client engagements of his own. Finally, throughout the paper, this consultant hopes to make clear the parts of the consulting lifecycle where he himself is passionate and where he believes he has added the most value in his career.

The first book is Peter Block’s Flawless Consulting: A guide to getting your expertise used (2011). Since it was first published in 1986, the book has helped literally millions of consultants, especially organizational change and organizational behavior consultants, in organizations large and small, and in all industries, plan and execute consulting engagements.   At the beginning of the book, before jumping into the first phase of the consulting lifecycle, Block lays out three goals that he believes should be consistent across all consulting engagements. First, the consultant must establish a collaborative relationship with a client. Like all consultants, this consultant has seen (and participated in) a percentage of client engagements that were not successful. In several of those engagements, the clients stated that they felt the consultants consulted “to” them or “at” them, rather than collaborating “with” them.   Unfortunately, this is a typical occurrence in the consulting world. Block’s approach is intended to decrease the likelihood of that happening. Second, Block suggests solving problems so that they stay solved. This consultant couldn’t agree more. Consultants and clients often try to treat symptoms, rather than discovering and problem-solving the true root cause of a problem or phenomenon. Again, the medical analogy is apropos. Third, Block emphasizes the need for attention, not only to the technical or business problem at hand, but to the relationships as well. Unfortunately, a percentage of consulting engagements are simply not successful, or are only partially successful, which is one of the reasons why Block wrote his book. Honestly, consultants, including this consultant, have been responsible for a landscape littered with innovative and well-constructed technology and business solutions that failed because the human element was not properly addressed. Block’s approach seeks to address the variety of people-related components in an engagement that must be done well in order to achieve project or program success, including executive sponsorship, stakeholder identification and alignment, skills and knowledge alignment, and communications planning and execution.

Phase I: Entry and Contracting

Block’s first phase is entry and contracting.   The consultant engages with the client to build an initial description of the problem that needs to be solved, or at least describe the symptoms that concern the organization. Also in this stage, as emphasized in Block’s first objective described above, the consultant begins to build rapport with the client so that information is free-flowing between the two parties, and the expectations of both are clearly articulated. The emphasis on collaboration is critical. If the client is simply hiring an extra “pair-of-hands” (Block, 2011, p. 24) to fix a problem that they do not have time to fix, then the engagement is not really a consulting engagement at all. Rather, it is a contracting engagement.   The consultant and client then must agree that the consultant or consulting team is equipped to address the problem. They must also agree on the dimensions of what will be studied, including the specific tasks that the consultant will do to address the problem, when and where those tasks will be performed, who will complete the work, and the terms, conditions and fees associated with that work.

As described in Block’s third objective, the Entry and Contracting phase must pay attention, not only to the work to be completed, but to the human relationships. For example, the consultant must take time to identify who in the organization really wants the problem addressed? Who will provide executive sponsorship for the engagement, so that the consultants can proceed forward with sufficient credibility and authority? Who will be the day-to-day point of contact for the consultants to address logistics needs? What specific roles and contributions are expected from both consultants and client team members? What will be the vehicles, venues and timing by which the combined engagement team will communicate? And most importantly, what specific actions will be taken by all parties in order to continue to build trust and rapport as the engagement progresses. The Entry and Contracting phase ultimately ends with a contract signed by the consultant and client documenting expectations by both parties. Typically new consulting relationships require contracts with a greater amount of detail. In cases where trust has been previously built through prior engagements, a less detailed contract may be sufficient.

While Block seeks to enable “whole” consultants who can become reasonably adept at the entire consulting lifecycle, this consultant has learned that the larger and more complex the consulting engagement, the more that the contracting activities require experienced contracting professionals. Client culture also comes into play. On one end of the spectrum, some clients work very naturally and trustfully with consultants, often based on their history of experiences with consultants. On the other end of the spectrum are clients that do purposefully misrepresent their intentions, with the intention to pay less for more services. More often, a client who hasn’t themselves been a consultant is simply not very adept at describing what they want the consultant to do, especially at the beginning of the engagement. Block describes these situations as “agonies of contacting”. (Block, 2011, p. 107) After two decades of work, and much reflection, this consultant has opted to focus as much as possible on what he does best (and what he likes to do the most) which are the next two phases of the consulting lifecycle – Discovery and Dialogue and Analysis and Decision to Act.

Phase 2: Discovery and Dialogue

For Block, the Discovery and Dialogue phase is ultimately intended to develop an “independent and fresh” (Block, 2011, p. 159) look at what is going on in an organization, create client commitment and ownership and move the client to action. He emphasizes that a consulting engagement is not research. Rather, it is action-oriented. For example, while a researcher is interested in all factors that have an impact on a situation or phenomenon, the consultant is primarily interested in identifying what can be controlled or changed. And, according to Block while a researcher seeks to eliminate bias (although scholar practitioners might disagree with Block on that point), a consultant is paid to bring their bias. For example, this consultant has been hired many times by clients based on prior experiences in a specific industry, or experience solving specific business problems and experience with specific technologies, and has sold tens of millions of dollars of consulting work based on having “fixed this same problem down the street.”

Block emphasizes that the consultant should strive for something more than merely solving a tactical business problem, but rather to help create a new future for the organization or some part of the organization. He points to two methodologies that can be helpful in this regard, including Sternin’s (2002) positive deviance, and Cooperrider’s (2005) appreciative inquiry. Yet, here is where Block steps back and does not deeply explore the multitude of options available to rigorously diagnose problems in organizations. After briefly mentioning the Sternin and Cooperrider methods, and emphasizing the need for a “whole system” approach that includes all stakeholders related to the problem being addressed, Block leaves the discovery slice of the consulting lifecycle to other theorists, and pushes forward to what he describes as the “call to action”. (Block, 2011, p. 163) With that in mind, this paper will now turn to the second book that is the subject of this course.

While Block provides a more macro picture of the consulting process, Michael Harrison’s Diagnosing Organizations: Methods, Models and Processes (2005), is more tactically focused on diagnosis. Harrison tries to help the consultant understand the nature of a problem or phenomenon in an organization. First, Harrison breaks down the mystery of diagnosis into three digestible parts: process, modeling and methods. Process is essentially a further breaking down of what Block describes at a more macro level. Specifically, a diagnostic phase must be described in tangible steps, including: (a) Entry and Contacting, which overlaps with Block’s same named phase; (b) Study Design where the consultant selects a diagnostic method and measurement procedures, develops a sampling model, determines the analytical methods and tools to be used in the study, and the administrative procedures that will help the diagnosis move from planning through execution; (c) Data Gathering, where the consultants conduct document reviews, client interviews, observations, questionnaires, workshops, etc.; (d) Analysis, which is where the data collected is aggregated, compared, etc., using a variety of qualitative or quantitative methods and tools, and finally, (e) Feedback, where the results of the analysis, plus general findings and recommendations are communicated to the client.

Second, Harrison provides valuable guidance regarding the difference between using a previously developed diagnostic model versus a grounded model that emerges as a study is conducted. In some cases, and especially when diagnosing a very tangible business problem such as employee attrition, loss of market share, etc., the consultant may be able to leverage a previously developed off-the-shelf diagnostic framework. That framework might include all the necessary tools and techniques required to determine an appropriate population sample, plan and implement data collection, analyze the data, and present the results. Harrison points out the risks of such an approach, specifically that the study may fail to address the challenges and problems critical to the specific situation. This consultant can attest to that risk, having had multiple clients through the years voice their concern that the consultants brought a “cookie cutter” approach that did not take into consideration the company’s particular operating environment. For that reason, Harrison discusses the value in developing grounded diagnostic models that “emerge during the initial study of the organization and focus more directly on client concerns.” (Harrison, 2005, p. 14) To explain the idea behind a grounded model, Harrison describes a case study in which consultants initially drew on two diagnostic frameworks, and then tailored those frameworks for the situation. The first was an open systems framework that helped assess the current-state business strategy, and its relevance within a changing external environment. The second was a political framework which helped guide the client leadership team in mobilizing support for change. In the feedback phase, output from the two frames was combined into a final set of findings and recommendations. This consultant has used similar approaches combining client-tailored versions of Kaplan and Norton’s (1996) Balanced Scorecard approach for documenting an organization’s integrated strategic objectives and measures with Senge’s (1990) organizational change model to present a holistic path forward for business transformation.

Third, and perhaps the most significant value in Harrison’s work is its emphasis on having an open systems paradigm in the diagnostic phase. No matter what specific organization theory (e.g., organic theory, etc.) forms the analogy of a consultant’s or client’s perspective on what makes an organization tick, that analogy is likely based on some open theory starting point. A key challenge in the diagnostic phase is to help the client expand their view beyond the specific things that are occurring within their organization, or within their particular corner of their organization. An effective open systems-based organizational diagnostic model assesses how phenomena inside the organization are affected by things outside the organization, and how things outside the organization are affected by things within. Amazon, Apple, Facebook, and Uber are all examples of companies where things internal to the organization had dramatic ripple effects society-wide. Harrison provides an example of a graphic model depicting an organization’s tangible behaviors, processes and technologies at its center – The things that Schein (1984) would call the cultural artifacts of the organization. Outside the artifact core is the organization’s cultural layer, which affects the tangible artifacts at the center (inputs) and, is itself affected by those tangibles (outputs). Outside the cultural layer is the external environment, which affects the culture (inputs) and, is itself affected by the culture (outputs). The consultant uses such a model as a starting point to inform multiple activities in the diagnosis phase, including development of the data collection instruments, the analytical approach, and if appropriate, when presenting findings to the client.

Depending on the client environment, the consultant should determine whether to keep the open systems model in the background, as a quiet theoretical construct, or more in the forefront, and central to the consultant-client conversation. This consultant has used graphics similar to Harrison’s, and tends to lean more toward explicitly sharing it with the client. For example, this consultant recently helped a financial services client analyze its changing competitive environment. The consulting team posted an open systems graphic model to frame the conversation regarding the client’s external environmental influences versus its internal capabilities, and how those capabilities had evolved in recent years and months. In this particular situation, the client did not view the model as too scholarly for the “real world.”

Harrison suggests consultants approach the diagnostic process from a combined outside in/inside out approach, through an environmental relations assessment (ERA) which includes the following activities: (a) Describe the conditions in the organization’s operating environment. Harrison cites the oft-used SWOT (strengths, weaknesses, opportunities and threats) as an example of such an activity; (b) Describe the external entities with which the organization interacts; (c) Identify the organization’s internal groups and individuals that regularly interact with the external entities; (d) Describe the way those groups respond to demands from those external entities; (e) Assess the effectiveness of those responses; (f) Identify opportunities to improve those responses. This consultant has completed dozens of diagnoses of sales and service organizations that essentially mirrored Harrison’s six step process. For example, in a recent engagement with major motion picture company’s human resources organization, the consultant’s team conducted a SWOT-like analysis to compare the organization’s reputation amongst actors and actresses. The team then identified external entities (e.g., agents, agencies, production companies, Screen Actors’ Guild, etc.) with which the organization regularly interacted. In a multi-day working session, a collaborative consultant/client team process-mapped and created typologies of the most typical customer interactions. The team then noted the customer interaction points where process breakdowns most often occurred, and the failures that caused the most customer distress. Finally, the team identified the most meaningful customer interactions where process-based, technology-based and behavior-based improvements could contribute to a more customer-focused experience.

What makes Harrison especially valuable is the way he brings open systems theory from the organizational level down to the group and individual levels. Again, the top-level organizational layer affects and is affected by what happens at the group level. Groups within the organization affect and are affected by what happens at the individual level. This is especially useful in informing the development of data collection instruments, whether those instruments are qualitative or quantitative, or survey-based, interview-based, etc.

As a consultant and client work through the process of diagnosis, they will be best served to occasionally step back from Harrison’s deep focus on diagnosis, and once again look at the engagement from Block’s macro perspective. In fact, Harrison specifically refers to Block’s emphasis on early client engagement and a collaborative approach in order to “increase the chances that their findings will reflect the experiences and perceptions of key clients and will therefore be believable to clients.” (Harrison, 2005, p. 13) This consultant can attest that even some of the most watertight diagnoses of root causes and some of the highest potential solutions have been left to gather dust on the client’s bookshelf. Block emphasizes that the call to action must be a focus from the beginning of the diagnosis phase. The client must be included in the development of the instruments and events whereby facts are gathered, the model or models that are used for data analysis, and the methods by which results and recommendations are documented and communicated. For Block, a critical action-oriented tactic is to understand how an existing problem is currently being “managed” by the client. This is what Block calls the “social system problem” (Block, 2011, p. 172). Understanding the social system problem is a pre-requisite to understanding how a potential solution to the root cause will need to be implemented, and whether such a solution can be implemented at all.

 

Phase 3: Analysis and the Decision to Act

In most consulting engagements, the most important output of Phase 3 is the list of recommendations and actions that are generated by the analysis. It could also be argued that recommendations and actions are defined or more fully refined in Phase 4. Block does not dedicate much time to explaining the analysis process, since the specifics of the analysis will be largely driven by the specifics of the preceding diagnostic phase. However, Block does spend significant time addressing the decision to act. To reiterate, Block argues that the challenge is to begin building the call to action from the beginning of the diagnosis phase. The call to action is especially important during data analysis, and in selecting the methods by which the results of the analysis and recommendations for improvement are documented and communicated. In particular, the consultant must focus early and often on resistance, and remember to not fight resistance head-on, but instead allow it to “blow itself out” (Block, 2011, p. 149) like a storm. Block suggests three steps. First, the consultant must watch for, and discover, signs of resistance from the beginning of the engagement and throughout. Second, the consultant must “name the resistance” (Block, 2011, p. 153) in a neutral way that will allow the resistance to be addressed by the client without making it worse. Third, the consultant should be quiet, and let the client respond. Block advises “Don’t keep talking. Live with the tension.” (Block, 2011, p. 155)

For at least two decades, consulting teams have been designing business strategies, business processes, and technology solutions that could potentially have saved a failing organization had those solutions not been stopped or incorrectly implemented. While Block does not provide a magic list of tactics to ensure a successful call to action or decision to act, he does provide multiple tidbits of advice throughout the book, including 16 tactics for “consulting with a stone”. (Block 2011, p. 157) For example, the consultant should ensure that the project has a sufficiently high-level sponsor who agrees that there is a problem, believes the problem is bad enough that it needs to be fixed, is willing to invest resources in fixing the problem, agrees with a collaborative approach, has the authority to engage all stakeholders, and is willing to abide by what the discovery and analysis shows. In the experiences of this consultant, nearly every project failure or partial failure occurs because one of those specific success factors was missing, which is curious, since every organizational change management (OCM) methodology at every major consulting firm in the world addresses each of those success factors.

Phase 4: Engagement and Implementation

In the opening paragraph of Chapter 16, Block himself ponders why, in his first edition of Flawless Consulting, he devoted only two pages to the implementation phase. Presumably, it is because implementation is a fairly cut and dried thing. The recommendations or actions that were generated in Phase 3 are validated and refined at the beginning of Phase 4. They are then placed on a implementation plan or project plan with specific tasks required for their implementation. Each task is given a begin date, end date, resources, etc.

One must ponder, however, why Block continued to keep engagement and implementation combined into a single phase, even in the most recent edition of his book. The most likely explanation is that Block chose to continue to adhere to the five phase lifecycle that he originally developed in 1986. Most modern consulting methodologies have since broken out engagement as an individual ongoing OCM work stream that supports all consulting phases from beginning to end. Block defines engagement as “the art of bringing people together.” (Block, 2011, p. 250), and identifies eight ways that the consultant can seek to keep stakeholders engaged in the effort. The first is transparency, especially from top-level leadership who has hopefully sponsored the engagement. Second is to renegotiate expectations regarding participation. If members of the organization expect to contribute to diagnosis, problem-solving and creating change, that is a good thing. If historically, they have simply tolerated change to be done to them, then expectations should be renegotiated. A shared solution is a more powerful solution, has more buy-in, and is more likely to be implemented. Third, Block recommends rearranging the room, both literally and figuratively, to reinforce collaboration, a tactic that Schein (1984) might identify as a purposefully created cultural artifact. Following along Schein’s point of view, having a physical chair for representatives from each impacted stakeholder group contributes to what Block calls “whole-system discovery”. (Block, 2011, p. 175) In other words, the chair arrangement can signify, and therefore help reinforce the organizational values of collaboration and flatness. Fourth, create a platform for openness and doubt. Stakeholder concerns can only be addressed if they are known. This consultant has had clients who embrace technology platforms such as http://www.glassdoor.com, where company and executive reviews are viewed as opportunities for improvement. This consultant has had other clients who view such tools as threats and venues for sedition. Fifth, Block recommends consultants ask “What do we want to create together?” (Block, 2011, p. 269) As explained at the beginning of the paper, this consultant has had positive experiences where clients felt that the consultants consulted “with” them to co-construct a collaborative future. This consultant has had less positive experiences with other clients who felt that the consultants consulted “to” them, and architected a future “for” them in which they had little skin in the game. Sixth, Block recommends creating a “new conversation” (Block, 2011, p. 270), with bigger objectives than mere operational improvements. Such an objective is especially relevant for a scholar practitioner-focused consultant who is not merely seeking to help an organization achieve top or bottom-line business benefits, but rather is seeking to help change the world. Seventh, Block suggests choosing commitment and accountability. This may be Block’s most powerful message – That “low faith” (Block, 2011, p. 271) tactics such as incentive schemes and legislating accountability are only partial solutions that create their own deadweight. This consultant has seen this phenomenon especially in government organizations where millions are spent on accountability schemes intended to prevent the misappropriation of only thousands. The alternative is to have faith that people want to have high goals for themselves and for each other, and they want to be accountable. And finally, Block recommends utilizing peer accountability as a driver of change because it is significantly more powerful that accountability to a supervisor.

Phase 5: Extension, Recycle, or Termination

While Block does not have a chapter specifically dedicated to his final phase in the consulting lifecycle, he does have chapters focused on the key actions that should occur, or be reinforced in this phase. For example, in the chapter on preparing for feedback, Block emphasizes some of the do’s and don’ts of presenting the findings at the end of the engagement. He suggests focusing on the things that the client has control over changing, and on areas where the client is already doing some work. He suggests the consultant should strike a balance between confirming the client’s opinions that are correct or nearly correct, and appropriately confronting the client on the things that they are missing, or the things they are doing that are self-defeating. Block strongly suggests being assertive and authentic, but not aggressive, especially since the end of the engagement is when the consultant is presumably trying to sell a next phase of work.

An organizational diagnostic engagement is often the first phase of a larger, more transformational project that might include process improvements, technology improvements and especially people improvements. The people part of the transformation typically includes helping the organization develop skills, knowledge and behaviors that are absent or weak in the current organization, and need to be strengthened in order to become a more effective organization in the future-state. And, even if the next phase of the project is a pure technology implementation with no specific people components to implement, there will always be a need for an organizational change management (OCM) effort to help align stakeholders around the solution being implemented. When the client sees the consultant not as judge, jury, prosecutor, or defendant, but rather as a “witness” (Block, 2011, p. 225), then the client is more likely to bring the consultant along to the next project phase as a trusted advisor. And, the next phase is almost always bigger in both mission and revenues.

Conclusion

As explained at the beginning of this paper, developing management consultants is always a twofold challenge. Practitioners must be taught the specifics of their practice area, and they must also be taught how to be good consultants. Much as the education world has too many teachers who understand math, but do not know how to teach, the consulting world has far too many consultants who are talented at mapping a business process, but do not know how to properly engage and contract with a client, and guide a client through the phases of discovery, analysis, implementation and project wrap-up. The result is that the landscape of every industry is littered failed or partially-failed projects. As a practice leader, project leader, trainer and mentor, this consultant has relied multiple times on both Block (2011) and Harrison (2005) to help practitioners learn how to be good consultants. Stepping back and thinking for a moment about the big ideas of both books, the commonality is that they are both primarily intended to enable a connective dialogue between consultant and client. The vast majority of this consultant’s client engagements have been successful. The few that have not been successful have almost always had some common variables – Failure to establish an effective dialogue, failure to collaborate, and failure to trust. When consultant and client are working in a collaborative and trustful partnership, projects rarely fail, and consultants and clients rarely get fired, even when a few things go tactically wrong.

 

References

Block, P. (2011). Flawless consulting: A guide to getting your expertise used. New York, NY: John Wiley & Sons.

Cooperrider, D. L., & Whitney, D. K. (2005). Appreciative inquiry: A positive revolution in change. San Francisco, CA: Berrett-Koehler.

Harrison, M. I. (2005) Diagnosing organizations: Methods, models and processes. Thousand Oaks, CA: Sage Publications.

Kaplan, R. S., & Norton, D. P. (1996). Using the Balanced Scorecard as a strategic management system. Harvard Business Review, 74(1), 75-85.

Schein, E. H. (1984) Coming to a new awareness of organizational culture. Sloan Management Review, 25(2), 3-16.

Senge, P. M. (1990). The fifth discipline: the art and practice of the learning organization. New York, NY: Doubleday.

Sternin, Jerry. (2002). Positive deviance: A new paradigm for addressing today’s problems today. The Journal of Corporate Citizenship, 57 (1), 57-62.

Advertisements