How to Find a Good #Lean #Consultant
Lean manufacturing is difficult. External expertise can help you in improving your business. However, the wrong consultant can at best have no effect, or worse damage your company, or at worst kill the company. Hence the consultant you hire will have a significant impact on the outcome of the project. This post will give you some advice on how to select a good consultant.
Some (Public) War Stories
The advice of consultants can make or break a company. Here are some examples of high-quality consulting work (all examples from The Gateway, but there are plenty more out there):
- Boston Consulting successfully helped GM, Chrysler, and Ford with their turnaround after the 2008 US government bailout;
- PA Consulting saved the UK Defence Ministry £17 million;
- McKinsey warned beforehand about the high risk of failure of the ObamaCare website
Of course, failures are also plentiful. However, both consultants and clients like to talk about successes and try to downplay the failures. Besides, creating a direct correlation between the consultant’s advice and the failure of the project is sometimes difficult. Nevertheless, there are also stories of failures in consulting. Here are a few. As with all failures, depending on who you ask, there may be always someone else to blame:
- Oliver Wyman advised UBS to invest in sub-prime debt instruments;
- Swissair went into bankruptcy after implementing a McKinsey strategy;
- Oliver Wyman named an Irish Bank the best bank in the world in 2007. The next year, the Irish government was forced to nationalize the bank.
Often you will hear stories of failures associated with big names. This is simply a) because they are big and have many projects, and b) it makes a better story if everybody knows the consultancy. As an former McKinsey consultant, almost every time I introduce myself and my background to a group of people, there is one person with a jaundiced comment about McKinsey. McKinsey is not bad. It is actually quite good – although like all others it also has its share of failures.
Before You Look for a Lean Consultant
Before you look for a consultant, there are a couple of things that you should be clear about:
Know What You Want
As in most things in life, the more precisely you know what you want, the more likely you will get what you need. The fuzzier your goals are, the more likely you will be disappointed. If you pay a consulting team € 250,000 to do something, they surely will do “something”.
Especially in lean manufacturing, it does not help if you narrow it down to money, time, and quality. Money, time, and quality include pretty much all problems you can possibly have on the shop floor (unless you are in legal trouble and the cops are looking for you – but let’s hope this is not the case).
One point is quite important here: You need to describe your problem clearly. However, do not fall for the temptation to describe the solution!If you tell the consultant that you want kanban, sure, you will get kanban. Unfortunately, it is far from certain that this will actually help you to improve. On the other hand, if you say that your delivery performance is bad, increasing your delivery performance will be much more likely improve your bottom line. If during the project, the team decides that kanban can help you with that, no problem. But keep the focus on the problem, not the solutions.
It is also possible that you have exhausted your list of detailed problems. You know that your performance is not yet where you want it to be, but you don’t know where to start. In this case, an analysis and comparison of the potential levers is a very valid lean consulting project.
Be Prepared for the Possibility of a Failure
Projects sometimes do fail. A good consultancy can increase the chances of success, but even then failures do happen. It is estimated that between 70% and 90% of all lean projects fail, both consulting and otherwise. Of course, the real outcome and the outcome on PowerPoint can look quite different. I estimate about 70%–90% of all consulting projects are reported as successes, even though only 10%–30% really are (see also my series on KPI fudging). In any case, be prepared for the possibility of a failure.
Of course, if you will only hire a consultancy that promises you a successful project no matter what, then you are pretty much paying someone to lie to you.
Know about Lean Manufacturing
This is a tricky one! If you know lean manufacturing, it helps you to weed out the frauds. On the other hand, if you really know lean manufacturing, you may be better off doing it yourself. From the consultant side, I can also attest that clients with a half-baked knowledge of lean are quite difficult to handle. If they think they know it all but don’t, then it makes it more difficult to have a successful project.
Ideally, you should know enough lean to sort out some of the bad consultancies, but please do not try to micromanage them. For money, most consultants will do what you want them to, but not what may have been necessary.
Good Lean Consulting Will Take Your People’s Time
Similarly, a good consultancy needs a strong counterpart on the shop floor. The consultancy may be an expert in lean, but chances are your people are the experts in whatever gizmos you produce. The knowledge of both has to come together to make things work. A good consultancy works together with the shop floor, from the operator upward. And yes, the consultants will also learn a good deal from you.
Good Lean Consultants Teach Rather than Do
“Give a man a fish and you feed him for a day; teach a man to fish and you feed him for a lifetime.”
While a good lean consultancy should not be afraid to get their hands dirty, they should teach your people. For one thing, this will increase you ability to do projects yourself. More important, however, is that it will increase shop floor acceptance, and hence the likelihood of success.
Overall, it is difficult to estimate the quality of a consultancy beforehand, and even more difficult to predict the outcome of a lean project. The above points will give you some clues, but you will know for sure only afterward. You could also have a smaller test project to see how they work before giving them access to your crown jewels. Similarly, getting a trustworthy recommendation may help in finding a good consultancy, even though in both cases previous performance does not guarantee future success.
Finally, if you are daring, you can request a “no PowerPoint slide” project. Consultants often spend an insane amount of time on slides, which of course reduces the time for actual problem solving. However, taking PowerPoint away from consultants may put some consultants out of whack!
Also, as not every consultant may be right for you, not every client is right for a consultancy. Both sides have to work together to increase the chances of success, and the chemistry between consultant and client is important. Now go out and with or without help organize your industry!