The Case for Trusted African Management Consulting Partners
By Alex Mabunda
Building a management consulting business, by any standard anywhere in the world, can be daunting. It is certainly not the same as building a business in the more traditional industry sectors such as retail, real estate, or even engineering, where the products are often physical and easy to assign value to. When people ask, “What do you do?” and you say “consulting”, in most cases the retort is “consulting in what?”, with that condescending tone screaming: “Consulting can mean anything and has no value”. If you are lucky enough to be responding to someone with a scant idea of how the world works, then you can get away with sounding like you are doing something that is at least remotely valuable.
Yet if there is a single industry that provides foundational value for unlocking development, it is management consulting. Over the past 100 or so years since the industry emerged, there have been debates even among scholars about what truly defines management consulting, with some even disputing its professional status and value. So much so that, in the industry’s formative years in the early 1900s, even the term ‘management consulting’ was settled upon after several attempts to name the profession. Some of the early names included “business doctors”, “management engineers”, etc. The naming conundrum notwithstanding, those early partitioners recognised and understood the profession’s intrinsic value. The simple internet definition of management consulting reads along the lines of the practice of “improving performance, solving specific problems, and enhancing strategic goals by identifying, analysing, and helping to implement solutions, usually without taking over direct management responsibility”. This is by far an evolved definition of the industry over the decades of its development.
Marvin Bower, the man who helped build a firm whose name has become synonymous with management consulting, writes about how they persuaded their professional staff to stick with the profession. “McKinsey provides the kind of work that is personally satisfying and fully rewarding as a lifetime career” because “our work to strengthen the managing of organizations is of critical importance”. In making this point, he invoked the work of Theodore Levitt, professor of business administration at Harvard Business School, who wrote in his seminal work, ‘Management and the Post-Industrial Society’, that “Management is the primary engine of progress, as progress is generally defined.”
Indeed, the one thing that stands between intentions, and I dare say ‘right intentions’, and results, is management, for management produces outcomes and good management produces good outcomes. This rather simple and obvious fact is amazingly taken for granted, especially in the public service here in South Africa and across Africa. Reading Bower’s work, I cannot help but notice the extent of McKinsey’s consulting work over the years to prop up American and, later, European public institutions that today form the foundation of the first-world status these countries have earned. Research shows that, of the estimated average 1.4 trillion-dollar global consulting market, Africa’s spend averages 4 billion dollars, or less than 0.3 percent of the total. This is almost a 10th of its share of global GDP, at 2 to 3 percent, suggesting a rather misplaced view of what management consultancy can do to build and maintain institutions that anchor development.
This statistic notwithstanding, you still hear a deafening chorus on how consultants are sucking resources out of these public institutions without adding value. And while this is not an unusual occurrence given the inherently intangible nature of the service and therefore its susceptibility to misalignment and at times even abuse, it is fatally oblivious to paint the industry as cannibalistic. One or even a few fatal operations do not render the medical profession a mortal trap.
What is a mortal trap is the real cost of going about running large public organisations and operations, as well as planning and implementing large projects, without the input or even hand-holding from a value-driven consultancy. African public institutions, such as local, provincial, and national governments, as well as state-owned firms, are burning billions in cash annually with very little to show for it, much of which is derived from taxpayers’ money. The South African public health service is a case in point. Due to poorly designed systems and processes, misaligned management structures, poor governance, and, at times, misaligned incentives, our hospitals and clinics cannot adequately serve their target communities.
Patients have to endure long queues at these facilities, only to receive the bare minimum care when they reach the front. Specialised medical services, such as operations, have patients lingering on waiting lists for months and even years at times. Yet we have one of the biggest health budgets in Africa. The same is true of education, where our maths literacy index is surpassed even by some of the poorer countries on the continent. And of course, corruption alone cannot explain these deficiencies. Even if it were to, you still need to “improve performance, solve specific problems, and enhance strategic goals by identifying, analysing, and helping to implement solutions” to solve the problem. Now, who is better placed to do all of that than loathed consultants?
On the contrary, take the example of both SARS and the Home Affairs Departments, which, with the proper use of consulting services, have turned their fortunes around. Sars alone has achieved in excess of 100 billion in additional revenue from implementing management and technological interventions through consulting services. Home Affairs has made significant improvements in reducing queues and enhancing the quality of its records by redesigning and digitising its processes.
Perhaps at this point, one must at least acknowledge that consultants – their portrayal as non-value-adding notwithstanding – are used in many more departments and entities. The problem lies in how they are used and, mostly, in who the consultants are. Regarding who the consultants are, one must acknowledge that consultants themselves are also limited by how well they can execute an assignment once tasked. And for the doubters, here is where, for once, I am empathetic with their course. For indeed, consulting is no easy work. If wishes were horses, beggars would ride, as the old English saying goes. Management consulting is necessary to drive development, but high-quality management consulting services are essential to achieving results.
Africa’s development is retarded not merely by the limited use of consulting services, but importantly by limited access to high-quality, affordable consulting services. Most consulting firms operating in this market suffer from soft issues, including a lack of understanding of the unique context in which their clients (governments and public institutions) operate. Because of the industry’s elitist nature, where names and international branding outclass strong problem-statement definition and execution techniques, many consulting gigs end up as gimmicks, further eroding trust in the profession. Africa needs to build its own cohort of like-minded and patriotic consulting firms that combine the highly technical and strategic nature of the profession with local context to realise Levitt’s adage of management (consulting) being “the primary engine of progress, as progress is generally defined.”
By Alex Mabunda
Group CEO of Ntiyiso Group
