Moral Duty in Management Consulting & Business
I want to end today’s issue of Monday Morning 8 a.m. with the final story, which is titled, “Moral Duty.” This comes from an event in my past. For those of you who follow our programs like Partnership. Memoir or Rebuilding a Consulting Practice, you know that I made a big switch in my career. I changed offices when I was an up-and-coming associate. I was being promoted rapidly, and I moved into a new office.
I was in the energy sector when I moved, and I moved to the new office and attended a meeting with the energy partners and energy consultants from that office. I assumed that I would be welcomed with open arms because their primary client, an energy company, was a client at my old office. I’d spent many years there—I basically built my entire career there. I knew the chief executive officer, the chief financial officer, the chief operating officer. I had served as chief of staff to the CEO when he had just joined. The consulting firm has seconded me as his chief of stuff. The CEO would also wave at me, even in a busy area from across the hall.
I’d worked with them on their information technology strategy, business unit strategy, energy security of supply studies, organizational design studies, R&D studies, and corporate strategy studies. I’d worked on all of their recent strategy planning work. Even though I was an associate, I had a deep knowledge of this client.
When I joined the new office and attended this meeting, I was very happy because I thought that while I joined a new office, I had a deep track record with a client that was a major client for this office. It was an important client. It was a great privilege to serve them, and these were consultants and partners who would clearly want to know how I could work with them. I remember going into this boardroom as a new member of the team. There were about 12 people in that meeting: three partners, one senior partner, two junior partners, a mix of engagement managers and associates and what we now call expert specialists.
I had assumed that because I had done so much work with this client, my views would be taken into consideration. They were to some degree, but the majority of the discussion was the fact that that senior partner had a different point of view from me in terms of what this energy client should do. That partner believed that the energy client needed to get ahead of the climate change trend and start investing in carbon capture and going carbon neutral and moving into new technologies.
I was of a different viewpoint. I knew climate change was a big issue, but it’s one thing to know a trend. It’s another thing to time a trend. You have to enter a trend at the right time. If you enter too soon, you incur costs, and you never get the return from it. So, I thought they should go down the climate change path, but they should do it slowly, maybe acquiring companies that were specialized in this. Secondly, they should not move into new technologies that were untried. They should buy-in slowly but keep their current operations as a cash cow to fund the transition.
We both presented and talked about it. The firm has a right to dissent rule, so I could talk and no one could tell me to stop. But what normally happens when you have a senior partner and two junior partners is that everyone listens to them and follows their viewpoint because they don’t want to upset that partner because they need to be on his projects. They don’t want to be seen as challenging a partner in a meeting.
I was the lone wolf, saying, “You shouldn’t do this. The company does not have a strong enough balance sheet. If you go down this route, it’s going to be a huge distraction. They can’t manage the level of capital projects. The trend is real, but you have to time the trend. You’re going all-in on unproven technologies that are extremely capital intensive. At the same time, you’re offloading old and dirtier technology, which is cash-flow positive, and you’re going to create a cash trap for yourself. It’s not going to look pretty.”
So, we had this challenge. In this meeting, I took an action which I now consider one of the deepest regrets of my life. I didn’t feel that I agreed with the partners, and I left the energy practice. For those of you who followed my career, you know that I went into the resources practice. That is the reason why. I didn’t agree with the advice they were giving the client, and I didn’t want to be part of it so I left.
But there was a deeper regret here. I’ve obviously followed that client over many years, and it’s in a little country. It’s a big taxpayer there. Securing energy supplies is a big deal in a little country. If you don’t price fuel correctly, you can cause spiraling inflation, lines outside of gas stations, and foreign direct investment to collapse.
Over many years, I’ve watched that company follow that senior partner’s strategy and basically collapse into chaos. As it happened and warning signs were raised by credit agencies and lenders from around the world; as each subsequent, massive capital expansion project and the new technology went over-budget and over-timeline; as it was commissioned and didn’t work; as it had to be abandoned in some cases so that more money had to be spent; as each of those things trickled through year by year, I watched the narrative of this country change from hope to despair. Today, because the energy sector is in so much turmoil, the country is pretty much a disaster.
What is my regret here? My regret here is I had a moral duty to not say because I could not convince the partners to change their mind, I was going to back out from it. It is probably the biggest regret of my career that I did not force the partners to change their minds. I should have said, “No, I disagree with it.” I should have done everything I could to change their minds because I knew it was a bad decision. You can imagine the impact on the country and the citizens’ well-being. Generations are going to be affected by this. Poverty has gone up. Foreign direct investment has collapsed. Diversification of the economy is a pipe dream. Children aren’t able to get the medicine they need because the government doesn’t get its tax revenues to pay for that.
By not speaking up, it caused a tremendous, burdensome, traumatic ripple effect across the country. Today, I believe I don’t want to make that mistake again. Therefore, I now act on my moral duty. If I think I have a better way of solving a problem, a better way of developing a leader, a better way of helping people unleash their careers, it’s my moral duty to do everything in my power to make sure that I get them to work with me versus working with someone else who may not care about them, may not take the time and effort to give them the best training, and, worse, may give them something that’s actually going to damage their career.
This is why I work so hard to put out podcasts, training programs and video programs—because I want as many people as possible to not experience what that client experienced. I feel if someone doesn’t work with me, they’re going to work with someone who might just not care. They may just get the money, move on and everyone will suffer.
What you need to think about is your moral duty. Everything we do is driven by a moral duty. It’s our job to make sure that clients know about what we’re doing and try it because we know it works. We know the results are there. Clients who work with us see a tremendous and dramatic change—huge changes in their careers over a few years, from being analysts all the way to SVPs, EVPs, COOs and CFOs. But it’s the impact they make on their economies, on their businesses, on their communities and on their families that matters the most.
I want to leave you with that thought: What is your moral duty? How will you act on it? That’s the most important task you will have in your entire life.
This is an excerpt from Monday Morning 8 a.m. newsletter, issue #21. Many of you have found Monday Morning 8 a.m. so useful that you’ve asked us to release a book version of these newsletters. We’ve obliged and released a Kindle version, which you can find on Amazon under “Strategy Insights.” It contains the insights from previous Monday Morning 8 a.m. issues, edited into a bite-sized format that’s very easy to use. And you can learn about other FIRMSconsulting books here.
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