There are more than 250,000 management consultants in the United States today, according the U.S. Bureau of Labor Statistics.
For a majority of these professionals, especially the 40,000 or more who leave their positions or firms each year, a question burns: How do I leave the role of consultant and move into an operating position within a company?
Successes and Failures
It's an understandable question given high-profile success stories of transitions from consulting into top-level operating management.
Harvey Golub and Lou Gerstner, for example, moved from McKinsey & Company to American Express, with Golub going on to become CEO in 1993. Gerstner left the financial services giant to become CEO of RJR Nabisco and then, most famously, became CEO of IBM and led it back from the brink.
While there are numerous other cases of successful consultant-to-operator transitions, the fact is that there are many more cases of dismal failures.
Often, consultants and the companies that hire them underestimate the significance differences between a career as a consultant or member of any professional services firm and a position as an operating manager.
What's more, when someone moves from consulting into a senior operating position directly, the odds of success are lower for all concerned.
It's timely, then, to do some research on consulting-to-operating transitions, determine why it's so tricky, what can be done to support the shift, and how to minimize the risks both for the individual and the organizations.
Therefore, I conducted interviews with a number of operating leaders who had successfully transitioned from consulting into line management, as well as others whose changeovers were failures.
Many senior-level consultants make the mistake of thinking that it's not that big a deal to move into a top operating position. After all, they have lots of experience in boardrooms and CEO suites and have, in many cases, led CEO thinking on key issues.
Two Different Beasts
However, there are significant differences between advising and operating. Nothing in a consulting environment really trains you for the different challenges of line management.
It's therefore essential to be aware of the fundamental differences, establish an appropriate set of expectations, and go in with a carefully laid out plan.
While there are many differences between consulting and line managing, the following three warrant the most careful attention:
1. The pace of decision-making.
Decisions must be made much more rapidly and with less information in a line environment than in consulting. When consultants move into a corporate environment, they step into a situation where they have to make numerous decisions every day. Only periodically do line leaders get the chance to study an issue and perform thorough analysis in order to come to a fully thought-through decision.
For example, as a general manager, you need to make frequent calls on pricing, product, marketing, technology, services, and suppliers. Employees come to you frequently for advice and counsel on sensitive organizational and personnel issues.
On most issues, you don't have time to put together a project plan and study the facts. You have to make many decisions on the fly in real time.
The greatest difference in the pace of decision-making is likely to be about people. In a consulting environment, partners and management generally evaluate people every month, year, and/or at the end of an engagement.
But in an operating role, managers find themselves having to make people decisions every single day: To whom should they assign an urgent priority? Should they hire the person they just interviewed? Who should be fast-tracked and who should be slowed down? Who should they bring into the loop on confidential topics? How should they communicate to the immediate team and to the broader organization?
2. The nature of the work and how it gets done.
As a consultant, your principal activities are to assess a situation and set of issues, perform analyses and test hypotheses, and develop recommendations and action plans to implement the proposed course of action. As a line manager, you are responsible for taking the actions and making the decisions necessary to achieve results for your organization.
Committees and collegial environments dominate most professional services firms. In a line environment, by contrast, people are usually somewhere between skeptical and disdainful of committees. Those who propose them are often described as not being able to make a decision.
3. The intense pressure of short-term financial realities.
In an operating environment, you have a performance scorecard every month and every quarter and real pressure to deliver financial results that meet Wall Street's impatient expectations. Every decision you make must therefore be thought through along this dimension.
Serving important constituencies, including employees, customers, investors, regulators, and partners, needs to be continuously balanced with delivering short-term financial results.
Finally, in a CEO or presidential position, it is much more likely that you must manage regulatory and legislative agendas than in professional services.
Minimizing Risk During Transition
As a consequence of these major differences and others, it is no surprise that the most tried-and-true transition from consulting into an operating role is through the well-worn paths of strategic planning, business development, and marketing. Taking such an interim step, even for a year, is often seen as a sound way to minimize the risks of a transition.
If this isn't the case for you, however, you have to be even more aware and of and sensitive to the challenges than others with whom you'll be working.
A key way to minimize the risk is to develop a sound transition plan. Recognize that the early days in a new position create both a unique window of opportunity and also a heightened state of risk. The opportunity comes from the fact that leadership transitions are the time when many assumptions are open for review.
As the new leader, you are generally given the benefit of the doubt and will have license to ask a lot of questions, even the "dumb" ones that no one else dares ask. With your consulting experience, you should take advantage of your training to ask as many questions as you can.
During the Honeymoon
The window of opportunity also derives from the fact that people expect a new leader to bring about change. The decisions you make during your first three months are in some ways less likely to be challenged, because there's both a presumption and an expectation that you will do things differently.
It is a honeymoon period in which your authority and permission to act are still rooted in your appointment, rather than in the results you will have achieved.
On the other hand, because you are under a spotlight, the decisions you make and how you make them will have a magnified effect. The actions you take, who you consult, how you manage the decision-making process, and what you say will categorize you as either inclusive or authoritarian, fair or arbitrary, a visionary or a bureaucrat, purposeful or rash, firm or indecisive.
The impression you make and the signals you send could motivate people to become loyal, allow them to sit on the sidelines, or, worse, impel them to turn against you.
Two Principles to Success
Among the cacophony of advice on how to make a transition and get off to a strong start, there are really only two essential principles to keep in mind. The rest are tactics.
These principles are to listen and learn, and under-promise and over-deliver. Following these will give you the chance up front to get the lay of the land, learn the unique culture of the new organization, get to know the key players and thought leaders, and understand the rhythms and politics of the company.
If you follow these two principles vigilantly, you'll maximize the chance of a successful transition -- even one from consulting directly into line management.