Contact us

Sections: Business Models - Organization - Strategy - Policy - Trade Events

about consulting

Misconceiving the Globalization of Professional Services

"...the bottom line is that professional services, as defined by the sale and execution of ideas and information, need not be global in order to sell and endure."
(Wordcount: 973; Pages: 3) With eye-watering, throat scratching, red-cheeked pride, a once-future Bainie gushed in a September 1990 case study of Bain & Co. (1), one of the premiere management consulting firms, that when Bain decided to open in a new market, it was only to cater to an existing client, as is Bain's "single-minded client focus". This contrasted with McKinsey & Co.'s (a Banie's paternal grandfather and sworn arch-nemesis at the same time) more haphazard, IBM-inspired growth strategy of launching offices everywhere in the hopes of selling consulting like hardware to every business in that market (2).

Elsewhere in the professional services world, the past 5 years has seen law firms become gargantuan through mergers (3) - there are now two firms with monstrous payrolls of 3,000 attorneys (4) - with an impetus being the voluminous low-margin commodity work of transactional paper-shuffling. It's gotten so bad that would-be litigators have spent so much more time pushing papers that they've practically forgotten how to argue in the courtroom (5) while some even more monotonously routine work is even being outsourced to India.

And, as I'm sure you know, the Big 8 accounting firms are now down to a schizophrenic 4, unsure if accounting is all they really want to do, with many of their smaller brethren also hiring Indians to do basic IRS filing work. What's going on?

If you had your choice between "super-star" consultants (not to be confused with "super-consultants") Jack Welch or Rudy Giuliani for the same fee as an entire team of consultants, who would you pick? When you hire renowned Marty Lipton of big corporate law firm Wachtell Lipton or the legendary Tom Greenhill of boutique investment bank Greenhill & Co., do you really care if they've got a bunch of junior people running around doing any of the work? (One of my personal favorites is Joe Perella's angry exit from Morgan Stanley, after which he was appointed lead banker of Bank of America's purchase of MBNA, a stunning coup for any bank, and an unheard of feat for an individual banker, one that unquestionably proves the point of this article.) Whether you're a huge global concern or an individual advisor, there's clearly one thing that's valued most by paying clients - and that's ideas that get results (relations are important, too, but assuming you've got them, let's focus on ideas). Thus, as globalization continues unabated - since roughly 1492, in case you've been living in a cave all this time - it may do you some good to stop worrying about how it impacts your business now and concentrate more on delivering these fangled ideas that clients want.

Let's explore this concept of ideas and globalization a little more. The globe-hopping political-reporter-turned-business-guru Thomas Friedman, aside from pointing out just how easily anyone can credibly comment on global economy, has also noted the currency of ideas in societies mostly bereft of them. "See", Mr. Friedman continuously exhorts from the perch of his book and column, "see how we're too stupid to recognize that we're living in a world where anyone anywhere can do anything!" (I'm paraphrasing, of course.) "That U.S. citizens, especially consultants, don't have a monopoly over generating ideas. That communications, travel, and a willingness to take a risk (or sheer necessity to survive) inspires even the most barefooted secular Far Easterner or Pacific Islander to sell in a global marketplace, all from the back of his cab, while many of us civilized folks are allergic to selling and depend on benefits and weekly paychecks like middle-class crack-addicts." All social commentary aside, the bottom line is that professional services, as defined by the sale and execution of ideas and information, need not be global in order to sell and endure.

The most obvious example is, of course, advertising. Despite its organizational dysfunction and incessant anecdotes that seem to worship an utter lack of professionalism and loyalty to anything, a single, sometimes even fickle, idea has and can continue to resonate throughout the world. ("I'm lovin' it".) If the objective is disseminating ideas faster within a global platform, it is no longer necessary to possess a captive one in order to disseminate said idea, as Mr. Friedman and many others have already noted. In fact, as I've written previously:

"What defines a firm isn't the global network of offices; isn't its plush and well-appointed offices with breathtaking views; nor its 'vast, unmatched' resources. What defines a professional management consulting firm is how it learns, thinks, and advises its clients; how and how many individuals execute these things with a common style, format, and structure, (the way things are done around here); and the culture that gets created along the way. As a result, concepts like recruitment, selection, training, methods, and mission are absolutely critical to defining a firm. A working environment can be anyplace for a consultant, so what ultimately connects them is the collaborative execution and relationships that develop under the umbrella of an organization."

Conversely, global professional services organizations need not deglobalize in order to effectively compete in a world made smaller or flatter. Their size is part of what makes them unique and when leveraged optimally (or at least attempted - IBM's efforts with knowledge databasing comes to mind) certain valuable ideas that can't originate at smaller organizations are produced.

In this humble writer's opinion, the herd mentality of globalization is a by-product of our own human desire to be at the cusp of "society", our ever-consuming craving to be among the glitter and bling, only to return to our lowly origins with tales of shock and awe, so that perhaps, we're liked a little bit more than the next guy. Ideas, due to their as-yet unexplained process of conception, can be born anywhere at any time, and if ideas are truly the only currency of an "information age", what's all the hubbub?


(1) "Bain & Co.: Growing the Business"

(2) "McKinsey's Marvin Bower: Vision, Leadership, and the Creation of Management Consulting" by Elizabeth Haas Edersheim, published by John Wiley & Sons (April 12, 2004)

(3) Hildebrandt's International MergerWatch

(4) National Law Journal's 250

(5) "Trial-less Lawyers", WSJ, Dec 1, 2005

Al Berrios is Managing Director of al berrios & co., an innovative strategy consulting firm advising leaders on the impact of human behavior on their strategies and on how to change their organizations to address the behavior. Write to Consumer Strategies Report at editor @ alberrios.com.


This page is formated for printing. Add it to your brochure. . Privacy Policy . Get a fresh perspective on strategy.