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10 Issues that hold Deloitte Consulting back

Deloitte Consulting is not a global partnership. Each region, country, and sometimes regions within a country, like India, operate as different legal and economic entities. They have separate P&Ls.

This means no one office can tell a region what they need to do. If quality drops, or an office is unwilling to meet the standards of true management consulting excellence, an office can merely advise.

10 issues that hold Deloitte Consulting back

The fact that Deloitte Consulting is not a global partnership is a major weakness. Many of the ten problems we listed below stem from this point.

1) There are standards differences between offices. There are tremendous standards differences between Deloitte Consulting offices. If you held up a report from the Santiago office, Indian offices, Australia and New York, USA, you would see different branding, quality standards, references, etc.

This is a big problem. When pursuing a global client like Toyota, Deloitte Consulting will claim it is a global firm, but in reality the office which sold the work understands the differences between countries and will try to do all the work itself.

2) Different partnerships breeds mistrust. Different partnerships breeds mistrust. This need to hoard work means that Deloitte Consulting does its best work when it can leverage its consulting teams in the developed markets like UK, Netherlands and the US.

When it needs to “hand-over” thinking and work to emerging markets offices, the larger partnerships are unwilling to do this. Quality suffers as a consequence.

3) Unwillingness to send its top global people onto a client. Deloitte Consulting cannot send its top global people onto a client. It can send its best regional people, but not the best people globally. That’s because there is no global firm.

Staffing of international projects can be a nightmare. Different partnerships implies different rates, mistrust between offices and an unwillingness for one Deloitte Consulting office to send its best people into projects run by another separate office in a different partnership.

Therefore, an engagement in Russia, for example, is usually staffed by the Russian offices, unless it was sold by the Deloitte Consulting partnership from another country, in which case the consultants from the foreign office will likely lead and the Russian consultants will have a very minor role. This is driven by the separate partnerships and separate P&L structures.

4) Weak training and development of consultants. Deloitte Consulting has spent a lot of time and money trying to recruit heavy weights from McKinsey. The problem with this approach is that Deloitte Consulting has not yet developed an approach to produce star management consultants.

All they are doing is relying on McKinsey’s and BCG’s training programmes to produce great consultants and they are poaching them. Until Deloitte Consulting fixes its development process it will always be playing catch-up. Great firms produced stars steeped in their own cultures.

5) Does not put the client first. Has Deloitte Consulting ever turned away work because it was not in the client’s best interests or because it was not proper management consulting etc? The metrics for senior managers, directors (non-equity partners) and principals (equity partners) is heavily skewed towards sales and delivery. We looked at a partner’s assessment sheet and revenue type of targets (including margin) makes up over 85% of the metrics.

Management consulting is about putting the client first. That means putting the client first in the performance metrics.

6) Deloitte Consulting tries to be everything to everyone. Deloitte Consulting’s moniker of being the largest consulting firm does have one major, gaping caveat. Deloitte Consulting consists of strategy, operations, etc as well as a very large technology consulting business. In terms of sheer numbers, there are a lot of technology consultants. They do not do high end management consulting work. There are lots of code writers, etc.

Deloitte Consulting tries to be everything to everyone. Therefore, its brand worldwide really stands for very little. Think about it for a minute? Worldwide, what do people think of the Deloitte Consulting brand? In some places it means technology consulting, in others operations, etc. There is no consistent brand and it is very difficult to build one if the activities of regions cannot be controlled.

7) Deloitte Consulting has a mediocre knowledge management system. Knowledge management is the lifeblood of management consulting. Deloitte Consulting has a mediocre knowledge management system. Forgetting the technical system itself, offices are particularly reluctant to place their best material on a knowledge sharing system which can be accessed by an office in a different partnership, which will use the material to sell work, which will likely exclude the office which produced the material which sold the work.

Therefore, offices hoard work and it is excruciatingly difficult to get the best material.

8) The consulting capabilities in emerging markets are weak. The action is in the emerging markets. Yet, Deloitte Consulting is not active there in a meaningful way. If you look at Deloitte Consulting’s offices in Santiago, Rio, Sao Paulo, Bogota, Caracas, Mexico City, Johannesburg, Moscow, Kiev, New Delhi, Mumbai, Beijing, Bangkok etc, they are not offices where heavy investment has been made. The consulting capabilities are quite weak.

That’s because these partnerships may not be able to afford the investment nor can they hire from the best schools. For example, the Bogota partners will hire from local schools. Deloitte Consulting scores quite poorly on its ability to leverage opportunities in the emerging markets.

9) Weak thought leadership. Critical infrastructure such as knowledge management systems, research centres and industry groups are rarely shared. Yes, an effort is made, but these are superficial efforts at best.

You know a firm is producing quality research, insights and thinking when its work is heavily (and usually illicitly) trafficked on the net. See how many Deloitte Consulting documents you can find on the internet. If a consulting firm’s reports are not widely shared and distributed that tells you a lot about the perceived quality of the reports. Things worth distributing are distributed.

10) Deloitte Consulting is not yet a leadership factory. At random, think of 5 Fortune 500 firms. Go to their websites and see the profiles of the executive officers. If a management consulting firm is training future CEOs, then surely their alumni should be populating the executive ranks of industry. Deloitte Consulting does not score very highly here.

On an aside, Accenture does score particularly highly when it comes to technical leadership positions. Bain’s head of IT consulting was a former Accenture Senior Partner.

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Image from Trey Ratcliff under cc.

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