Under any corporate’s new banner of missions or core initiatives, especially those yet to be clearly defined, we will always see the creativeness and inventiveness of the people inside the corporation who try to align themselves to the new terms.
For some traditional large “Product” company who is moving towards a “Services” company, the same thing can be expected – many new “services” can appear inside the corporation. We are not talking about the traditional IT or back-office type of supporting “services” to any large corporation; let’s take a look at the “Insider Management Consulting Services” on business strategies, process designs, technical evaluation, problem solutions, etc. Instead of using 3rd party expensive management consulting firms, corporate divisions can now hire from an inside “consulting” division of the corporation for such services.
The practice can hardly be said new or inventive since it has happened in many large corporations already, but the effectiveness and results of such a practice are yet to be documented or measured. Some corporation (for example, former Motorola) had such a practice during some sort of situations when many divisions were facing similar problems at a certain time (although could very well be suspected as a lack of prescience). For example, system integration with new and legacies, etc. One division’s best practice could naturally come out as an example to provide similar analysis, planning and execution services to the other division. The longevity of that service division might depend on how large the corporation was, how deep the same problems existed in many divisions at the same time and how good the service provider was able to execute, adapt, continue marketing themselves inside the corporation. There haven’t been many WSJ reports on such practices and its developments for the parent corporations.
Still, the concept is a bit hard to fathom for some reasons.
First of all, the core objectives of such a consulting division – do they provide management consulting, technical consulting or both? Ideally inside a well-run corporation, each division’s strategic goals should already be well aligned to the corporation’s core mission or its present or future initiatives. Does the division heads need a helper from another management consulting division to interpret the corporate mission and initiatives or design the strategies?
Second, each corporate division’s core products/services or goals should not be the same by default (duplications can be a huge waste to a corporation). The most common problems could happen to multiple divisions are most likely in the management space, including process innovation. A management training or “advisory” type of common service will make sense, either by an outsider with the expertise or by an insider, but it needs start from the C-office first to be most effective for the corporation. Will other types of consulting services by insiders make long-term sense?
Third, there could well be some political reasons for a division to hire another division’s consultants from the same company(without worrying too much about the confidentiality) to look at some touchy problems, to cross the aisles reaching out to some a silo-ed sub-divisions, to help collaborate horizontally or to break the hostilities among peers. Could they expect an expedited consensus or result? It depends. Just like outside consultants, inside consultants also want to play neutral most of the time and they will have to tip-toe with all sides instead of a quick proposal. If a division cannot work together and make its own decisions, no one can do it for them.
Fourth, the scalability. One consulting group cannot have all the business and technical expertise to solve all other corporate divisions’ problems, especially if many inherit problems of the corporation are triggered by the corporate culture. Even if by acting like a traditional consulting firm, a consulting division can try to build and market its several core competencies, different divisions of the same corporation own different knowledge spaces and require different specific problem-solving skills. No single consulting division can have the full spectrum of resources as “tools of all trades”. If consulting resources can not be scaled to serve different client groups, they are just temporary helpers instead of consultants.
Fifth, the longevity of such a practice. When it comes to the budget and income, unless it’s a C-level sponsored program division or the corporation truly has so many touchy political problems that constantly need some outside insiders’ help, it may take some extraordinary efforts in promotion to make it truly a “consulting service” sustainable on its own for a long run.
One thing is clear, so far these inside practices appear only in large corporations when many divisions are facing some tough problems that they feel they cannot solve themselves or need new ideas/concepts that they themselves find it hard to learn or adopt directly. This phenomenon may well be an indication of something else inside a large corporation.