Covering Undiscussed Topics of SAP Projects

What This Article Covers

• Who is actually paying the subcontractor’s fees on consulting projects?
• Who deserves the knowledge transfer?
• What does this behavior indicate about the ethics of small consulting companies versus the major consulting companies?

Background

I very rarely work as a subcontractor to consulting companies. One reason is that they control subcontractors so that they use the credentials of the subcontractor to build credibility with the client, but more often than not attempt to steer the opinions offered by the subcontractor into offering advice that somehow benefits the consulting company. Many consulting companies operate similarly to cults, which seek to control the minds of the consultants. I was actually watching some old videos of L Ron Hubbard, the con man who started the Church of Scientology, one of the largest cults in the world. I remember thinking, “this guy reminds me of a lot of partners I have worked with at the major consulting companies.”

Consulting companies have a great emphasis on group cohesion, the necessity to meet after work to listen to the grand pronouncements of the directors (i.e. the generic self-aggrandizement of various con men or directors and partners in the consulting firm who all suffer from narcissistic personality disorders). The stated purposes of these meetings is to improve communication among the team, but the length of the meetings points to another purpose, the reinforce the organizational hierarchy of the team.

“Sir, You Are Tedious”

One of the more tedious parts of dealing with consulting companies is when the feel compelled to tell you about their great history. I sometimes feel like stopping them and saying.

Look, your consulting company was started by several greedy individuals who then subordinated a number of less experienced individuals, sold them on the concept of a pot of gold at the end of the rainbow, and then became accustomed to living off the work of others and then bought some European branded automobiles for themselves. Stop me if I have missed any part of your story.

However, another reason I don’t work for them is that they typically want to mine sub-contractors for knowledge transfer. This is so on the next project they can staff positions internally. However, on the converse I have found, and discuss this in my book “Supply Planning with MRP, DRP and APS Software,” that I have yet to see a really effective knowledge transfer job performed by a consulting company to their clients. I combine this with the fact that the amount of documentation created by consulting companies that is anything more than marketing literature in disguise, that consulting companies are completely hypocritical when it comes to the topic of knowledge transfer. When they have the knowledge, it is to be jealously guarded and it is a “trade secret.” However, when they don’t have the knowledge, all of a sudden the term “knowledge transfer” becomes one of the most popular in their lexicon.

Who is Actually Paying?

However, the hypocrisy goes further. When a company is hiring a consulting company, part of what they are paying for is knowledge transfer. However, with a subcontractor, the consulting company is paying the subcontractor with the client’s money. Furthermore they are adding on a margin to the subcontractor which can be anywhere between 50% to 100%. Therefore, they are making money off of the sub-contract resource every hour they work. If they are not paying the subcontractor, what right do they have to make a claim for knowledge transfer from the sub-contractor? Secondly, lets all take a guess what the effect is on the knowledge transfer provided to the client if the subcontractor is also providing knowledge transfer to the consulting resources? My guess is it goes down. Therefore, the most honest statement that could be made for this scenario is the following:

Take some of the knowledge transfer that you were going to provide to out client (and which we are talking up to them in order to convince them to let us bring you in), and then divert as much as you can to our own resources. Also, do not tell the client that you are doing this.

Who Deserves the Knowledge Transfer?

Ostensibly the subcontractor should actually be providing knowledge transfer to the end client, as they are paying the bill. However, consulting companies don’t see it that way. They believe that while the client is paying, that the real important knowledge transfer needs to go to their consultants. This is the situation that software vendors find themselves in. Often a vendor will become a subcontractor to a consulting company that is a prime. However, once the software vendor resources get on-site, they find that their role is to both educate the client and to educate the consulting company. Therefore the consulting company, on multiple occasions is actually taking money from the client, and not performing services with it, but using the client’s funds to train their consultants. It is quite a tangled web they weave.

Give Me Free Information…..

The issues of consulting company information parasitism is not simply limited to working for them as a subcontractor. I have been contacted on a number of occasions by directors at consulting firms who “would like to have a conversation” about the SAP APO market and how they should proceed with improving their consulting practice, that is to get some SAP APO billings.

All of these requests have been without the offer to pay for this information. These directors seem to think that the best use of our charity is not giving to the United Way, but instead should be given to needy consulting companies.

However, when these consulting companies market their services, they seem to always charge for their services. You can imagine my confusion as the unwillingness of consulting companies whose directors need guidance on how to grow their consulting practice to pay money for this information. I get a request like this every few months. I am not sure why I would care either way. If they are successful, then I can work for them as a sub-contractor, they can put a margin on my rate and then control the opinions I offer the client? What a privilege. Their thought process seems to be “Help us get clients so that you can subordinate to us.” Even when consulting companies lack knowledge, they still think they should get consulting business, and they will steal the information by any means necessary. This free consultation is on top of all the free information that we already give out through this website.

The Consulting Company Ethics Mambo: How Low Can They Go?

If I have learned anything, it’s that there is no floor to the ethics of consulting companies. Every time I think the bar is at one level, another experience drops the bar again. At once I thought that this behavior was concentrated in just the major consulting companies, but I now realize that the smaller consulting companies are often just as sleazy. In fact many of the directors who manage large consulting companies were trained in large consulting companies. They did not leave because they were offended by the terrible ethics of Accenture or IBM, but simply because they were unsuccessful in those organizations. I have realized that they are essentially all the same. The only real difference is that large consulting companies are more powerful than smaller consulting companies, so they have more opportunities to be unethical.

There is a great quote from the movie Meteor, a movie from the 1970s. The quote is stated by Sean Connery. When some department is essentially attempting to use him he says “maybe you can stick a broom up my ass, and I can sweep the floor on my way out.” I think that quote applies here.

Conclusion

Consulting companies use the term knowledge transfer quite flexibly. What they really mean when they use the word is knowledge transfer to them…..for free, so that they can bill for knowledge they did not have to begin with that they bought with other people’s money. This is one of the many problems with hiring consulting companies as a client or working for them as a subcontractor.

Questions or Comments?

Have you been put in a position of providing knowledge transfer to inexperience consulting company resources? If so comment below, others might find your experiences of interest.

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