The intrigues of Management Consulting

Management consulting is no different than any other advisory role. Though simplistic at first glance, it is not much different than a legal or medical advisor. The one most common similarity is that all advisory roles illustrate certain business and ethical issues. The most pressing issue, however, is the clients’ ability and willingness to adhere to guidance.

It is no secret that one of the greatest challenges in maintaining positive relationships with existing and potential clients is to convince them of the benefits of the advice given to them ; or as we refer to it as protecting the client from itself. This does by no mean imply that clients should blindly follow their management consultants’ suggestions; however it does imply that based on consistent record and relationship longevity, clients should be able to distinguish appropriate and useful recommendations from negative or self serving opinions.

Many times small business owners which have been lacking expertise in innovation and organizational effectiveness and efficiency, resist the dire and necessary organizational changes that would lead to greater profitability, effectiveness, efficiency and ultimately greater ROI and improve bottom line. Internal factors such as less than competent managers and executives , lack of continues education by upper management , industry specific habits , as well as lack of third party audits to improve upon existing procedures , farther create organizational redundancy which may in turn decrease the likelihood of organizational improvements.

  
Similarly the organizational culture that has led to some preliminary success may contribute to the halt of farther positive development in organizational evolution. Many times the previous success that may be correctly contributed to old and outdated business practices create sense of satisfaction which create a false sense of comfort for executive which may lead to neglects in innovation and evolution.

Ultimately, the abstract concept of organizational culture will depend on many factors that may or may not have a positive impact on overall outcome. Yet the alternative solutions to improve upon past successes can have similar negative impact; which brings us back to the issue of ethics .

Generally speaking it is certainly more profitable to prolonging problems; however, is it ethical? Of course it is not ethical nor does it actually make sense. From a business point, management consultants are certainly better off to create and maintain a relationship based on honest and upfront assessments and projections. From an ethical point it is equally important to illustrate integrity by consistently pointing to weaknesses that may influence the outcome.

Yet the ultimate question is when does one give up on an organization that is not willing to follow advise , is plugged with incompetence employees and executives , lacks clear strategy and even more importantly creates frustrations within the management consulting firm ? There is no good answer to this. One may suggest that it depends on loyalty issues; others may suggest that separation from such client may lead to negative rumors that can be harmful; yet others may argue that the success of projects that is hindered by clients errors should be clearly identified and criticized before the lack of success is blamed on the management consulting firm .

The final word on this is rather ambiguous. Each management consulting firm should decide on clear lines of tolerance. Basically deciding when a client becomes more of a liability than a business partner or client should be allowed. Many factors may contribute to a decision to sever relationship with such clients; including business profitability, industry specific reputation, personal relationships as well as contractual agreements.

Nevertheless, separation from a client should not be taken lightly. Any and all efforts to convince the client to change course should implement in order to preserve the relationship before any decision to separate is even considered.

Brought to you by: World Consulting Group ; your premier management consulting firm .

Ethics and Ethic Officers

As it is well known, the translation of ethics in to tangible real life situation may open the doors for substantial squirm room for interpretation. Hence it rational to assume that a point of contact will enable individual business entities to create an environment which translates in uniform and consistent application of business morals, ethics and the consequent ambiguities 

The benefit of creating such position maybe twofold: the initial implication that the particular stakeholders insist of volunteer efforts to implement common moral standards, as well as reduce possible legal liabilities that would otherwise exists.

Additionally, there may be some unintended consequences that may be positive in nature, such as volunteer implementation of procedures that enable the participation of minorities, prevent abuse, encourage accurate reporting as well as create a first line of defense for those that would be otherwise without a voice. Yet, Ethic Officers may also induce some negative impact in terms of internal conflicts, negative public relations; discourage team work as well as weakening employee unity.

Ultimately, it is a question of trial and error to achieve the most effective way to enhance the Ethic Officers ability to prevent negative immoral acts and practices, but not interfere with team building and employee unity efforts.

Interest Based Avenue refers to a particular sub category of ethical analysis in which the evaluations of the ethical and moral impact are determined by the out come, hence the means to an end is not as important as the end itself.

In its most basic form, the Interest Based Avenue attempts to assign subjective value to the “interest” of the stakeholders of the participating matter; the interest of the stakeholders trumps the individual rights. Clearly, this particular approach appears to be a rather morally flexible in order to protect material and non material interest of the participants. One might even suggest that the interest based avenue is a capitalist form of moral evaluation.

However, there are some apparent issues with this approach: first and most importantly, it seem virtually subjective to assign moral values to particular outcome. Further, it is equally discretionary to discard fundamental individual rights in exchange for tangible material interest. Additionally, it is not particularly clear if there are preset values that would mirror the stakes and interest, nor is it clear if the outcome simply justifies all possible means.

Ultimately, it appears that the Interest-Based Venue is the moral equal of capitalism, in which the maximization of the beneficial and profitable outcome outweighs the basic rights.

In the case of Arthur Anderson, this particular approach is at the hart of matter: similar philosophy may have been the cause of the intellectual and philosophical breakdown which lead to attempts to hide loses by means of fraud, in order to enhance accounting reports which in turn may have contributed to increase of share holder profits. Likewise, one may argue that though Arthur Anderson has abided by most basic principal of business i.e. creating the greatest possible profit for all the participating shareholders, they chose a morally inferior approach to ignore the means to achieve the end. But the results speak not only to failure of this mode of theory but also its practical consequences.

Ultimately, it appears that those that use Interest – Based Venue to justify non linear, obscure and dubious actions to protect material interest, simply ignore the substantial flaws of moral derivative that my result not only in less desirable income, but even may end in harming their stakeholders.

The Right-Based Avenue appears to be the most viable options. In essence the Right-Based Avenues dictates pursuing those rights that are fundamentally granted to the individuals, instead of protecting rights based on particular interest. Essentially, the Right-Based Avenue virtually eliminates the conflict of interests in assigning quantitative measurement to proportionate rights which may in turn preserve those in minority interest.

The most powerful pro argument for the Right-Based Avenue, is certainly the ability to have predetermined and understood set of rights that are universal and will not be changed or challenged based on material or tangible interests. Hence leading to a sense of fairness based on societal values that emphasize the individual rights.

However, the opponent may argue that in a democratic society which the concept of majority is fundamental to social, cultural as well as financial decisions, the Right-Based Avenue creates the daunting perception that minority / individual interest outweigh the greater good of the collective / majority. Yet such argument is flawed: even in the democratic societies, the building stones are still compiled of individual units i.e. individual human beings. No collective can precede the rights of its individual units without alienating those units that form the collective. 

Similarly, the concept of collective sense of entitlement can be found within the sense of entitlement by individuals. Hence, it is impossible to maintain coherent unity within the collective, by eliminating the triumphing needs of individuals.