Consulting Shortfalls

Over the years management consultants have been used in employee reductions. That has been the main selling point by many. That has also been the failure of most management consultants and the death of their clients.

A RIF or Reductions in Force plan is only one tool of management consultants although it has been the most used and the most abused. It has been used to generate quick cash flow for both the client and the consultant. This type of downsizing is addicting and is rarely a one-time event. In general I don't believe planned reductions in force will alone put a company on good footing. In many corporations gradual and continuous downsizing is just one way to go out of business.

Another abused management tool is outsourcing. Outsourcing is an American idea that it is easier and cheaper to just buy what we need. It is true that you can't always save money by bringing an operation in-house. However the concept that a company can significantly lower costs by sending part of its work out suggests that there are some inefficiencies in the company's organization and those savings may not be within the operation that is being outsourced. Additionally the company may not be considering the effects that decision has on the company as a whole. This is also a tactic that soon becomes habit-forming.

In some cases the two are often used together to drop employees from the payroll and then having them hired back via a new outsource company often with reduced pay or benefits. That has been the M.O. at UTHSCT for the last 4-6 years. In such cases the outsourcing company may not even be a major provider of the service. This maneuver is characteristic of a dishonest and manipulative company or organization.

The mire of a mismanaged (or unmanaged) company is made up of several layers of bad decisions and incapable managers. The efforts to improve systems quickly with such things as RIFs and outsourcing often make bad situations worse. The consultants may carefully craft goals that are vague and generalized not unlike your daily horoscope when all they are actually doing is improving cash flow and reducing the size of the operation. I suspect the consultant may just be the scape-goat for administrative decisions already made.

By collaborating with such companies management consultants have given the profession a bad image both with employment and with companies that are truly in need of a competent consultant.

No feedback yet
Leave a comment

You must be a member of this blog to comment. Log in now!

If you have no account yet, you can register now...
(It only takes a few seconds!)