posted 16 Apr 2002 in Volume 5 Issue 7
Consultants and the privatisation of publicly-funded expertise
Public sector organisations are regularly criticised for their inefficient use of taxpayers’ money, but the vast amounts of public money spent on consultancy fees are often overlooked. Paul Dodds assesses the state of affairs that so often leads to the loss of publicly-funded expertise and calls for a more responsible approach among public agencies towards knowledge management.
It is astonishing, when one thinks about it. There would be a major scandal if it came out that a public purchaser of million of pounds worth of barely used computers had let the vendor take them back after a month, put them into new boxes and re-sell them to the taxpayer. Yet no-one thinks twice if a public purchaser of million of pounds worth of barely used consulting services does the same thing. No-one would think of re-using consulting services; except, of course, the consultants themselves.
Governmental and supra-governmental agencies are major purchasers of consulting expertise. Studies are constantly being commissioned, reports prepared and recommendations made at public expense. And then what? Typically, the final product is reviewed only by the few people who initially commissioned it. On rare occasions, high profile studies make it into the news, but only fleetingly. Electronic forms of a report may be delivered to the client, but not always. Decisions may or may not be made based on the report’s recommendations. The analytical documents behind the final reports may be delivered to the client, but this is also rare.
If work is undertaken by a consulting firm, as is normally the case, the work will be prepared and submitted in the name of that firm. The names of the people who actually carried out the work and acquired the publicly-funded expertise may or may not appear in any of the project records. Typically this does not happen, despite the fact that these people are the real carriers of the knowledge.
These regrettably anonymous project experts may have any on-going affiliation with the consulting firm whose name was on the contract. But often project experts are independent nomads, placed under contract, as a result of their particular expertise, for only as few days, or as long as is necessary to do the job. Even when project experts are actual employees of the consulting firm, they may not be for long. Large consulting companies typically have an extremely high turnover, particularly among project staff.
And what happens after the consulting firm has submitted the costly report and made the final presentation? The issues that prompted the publicly-funded consulting assignment might be resolved quickly, but again this is not usually the case. The issues covered by the assignment may be truly unique to that time and place, but this too is rare. More likely, similar problems have been confronted elsewhere and dealt with in a similar manner, also at public expense. Other public agencies, often closely related ones, are likely to have hired consultants to confront similar topics. Or perhaps the same agency previously hired consultants to deal with very similar issues in another geographical region.
Time passes. Within just a few years, politicians change. People within the bureaucracy change seats, and then change seats again. Attention eventually turns again to the very issues studied before. The problems are (still) complicated, facts must (again) be found out. No-one in the responsible agency really has time to deal with the problem, not to mention the expertise. Something must be done, and quickly. But what? The answer is obvious: consultants. The budget is found; a competition is announced. When bids are reviewed, the consulting firm that did the work the last time is normally given substantial credit for related experience. This can be in spite of the absence of anyone who had substantive involvement in the prior, related project.
The acquisition of publicly-funded knowledge is typically a well organised and highly transparent process. Tenders are competitively run, according to strict rules of accountability and public review. For those who care to, in most western democracies, it is a simple enough task to find out which firm won what consulting contract to do what, when.
The same can rarely be said for work done under the contract. The split is an odd one. While some agencies may make final reports publicly available, the analytical meat behind the reports is often nowhere to be found. In the beginning of a project, great care is taken to ensure transparency in the acquisition of publicly-funded expertise. At the end of a project, far too often, there is an incredible absence of care. Little is done to ensure that reasonable access to the documentary work product purchased, or to the people who received public money to develop the expertise.
Far too often, the public purchasers of consulting expertise fail completely to recognise the potential, future value to others of the work they have commissioned. Even though they are purchased with public money, the documents acquired are simply not seen as public assets, to be conserved in the public interest and made available for re-use.
And if consultants’ documents are treated as trash immediately after their initial use, the same is even true for information relating to the complex network of experts who carry the implicit knowledge in their brains. Typically, no information whatsoever about who actually contributed to the documentary work product is retained in any systematic form by the agency. Typically, the commissioning agency, even if it has a repeated need for the kind of expertise used in the study, will also take no active steps to foster on-going electronic dialogue or to form a community of practice among experts and between experts and the agency.
Who benefits from this? If the public client treats the project artefacts as trash, of no further use to anyone, the same cannot be said for consulting firms. They know that there is gold in the project documents, and are canny enough to claim it for themselves. Consulting firms know that all they have to sell is their knowledge, or failing that their claim to knowledge. They know the value of the work the agency pays them to undertake. They treat project documents as objects of value and the most sophisticated firms know how to mine them well. As long as public clients let them, who can blame consultancy firms for privatising publicly-funded knowledge, re-packaging it and then re-selling it to the taxpayer?
If knowledge management is to mean anything in the context of publicly acquired consultancy services, this must change, drastically and quickly. This change requires an immediate paradigm shift. Public purchasers of consulting services must expand their horizons beyond the immediate project and, as a matter of practice, retain project information to maximise chances of future use. Public agencies must see that once they have paid to create knowledge with public funds, this knowledge must to be treated as public property; property for which they should become responsible stewards.
As an, albeit important, aside, consulting firms often subject both their employees and nomadic consultants to exceptionally broad (and probably unenforceable) contract terms. These clauses can seek to claim proprietary rights on behalf of the firm in everything the project employees learn or produce while assigned to a project. The on-going, if rarely used, threat of legal action and the wild breadth of the consulting firms’ asserted rights can act as quite an effective gag order on knowledge carriers. While the worst clauses may be struck down in court, what individual wants to risk challenging a major consulting firm?
Currently, commissioning public agencies almost never get involved with sub-contract or employment agreements, may well never hear of their terms and are highly unlikely to consider how the agency itself could be damaged by them. But if they are to properly husband the knowledge paid for with the public’s money, public purchasers must begin to care intensely about such limitations as a matter of policy. Insofar as they restrict the ability of the true knowledge carriers to share publicly-funded knowledge, such clauses represent a potential knowledge management disaster.
Public purchasers of consulting services should insist on having access to the relevant contact information to ensure that, as and when it is required, the knowledge formed at public expense can be made readily available. Within consultancy firms, people who conduct project work are often far removed from the level of firm managers. Senior managers are normally kept busy with the marketing and managing of multiple projects. But theirs is the face of the firm, presented to high-ranking clients at the critical moment. Behind the partner and the beautiful presentation, the real project knowledge is often walking out of the door. How many clients, caught up in the slick presentation, are shrewd or rude enough to ask how many days the presenter himself has actually devoted to the project, or who actually did the work?
Public purchasers of consulting services must plan from the start, and continue to plan throughout, how they can best capture and make available the documentary records of the project. The focus needs to go much deeper than final and quarterly results reporting. It must include digging into actual project analysis and implementation documents. Final payment should be made on the explicit condition that the project documents are passed in the required form to the public agency’s knowledge bank. The public client should then take great pains to make these documents available: some to the public in general; other sensitive documents on a password basis to those within and outside the agency who need the results and who can be trusted with them. Rather than throwing all project documents into the same messy pot, real thought should be given as to how best to organise results. If the agency has a repeated need for similar services, it may be best to organise results around on-going, agency-supported communities of practice.
Much of what publicly-funded consultants prepare is clearly of interest only to a very limited audience. But for this audience, prior reports and the corollary research can be invaluable:
· For those working for public agencies, confronting issues where ‘call in the consultants’ is likely to be a response, overcoming amnesia can save money and time, at the same time improving results;
· For those competing to provide services, having access to functional public knowledge banks can help make the difference between being able to write a winning proposal, and not being able to find enough of the relevant context to be convincing;
· For the public agencies purchasing the services, ensuring broader access to existing publicly-funded knowledge can free the agency from the sometimes dubious claims of expertise from the small oligopoly of firms that have carried out previous, related projects. Other consultants, maybe even better and cheaper ones, might finally have a chance to break into what is too often an artificially closed market;
· For those called in to do the work, having good access to what has been done before – and a structured way of finding who really did it – can make the difference between efficient, best practice progress and the re-invention of the wheel;
· For decision makers, knowing how similar problems were addressed elsewhere, and what the results were, can make the difference between success and failure. Or, perhaps, between re-election and having to become a consultant themselves.
Paul Dodds is an independent consultant. He can be contacted at: firstname.lastname@example.org
Amnesia at work
I am called to undertake a short-term consultancy project for Public Agency A, reviewing progress in a delicate corner of Devolandia. My former supervisor at Public Agency B had funded a major consulting company, Bigconsult, to work on a long, closely-related project in Devolandia, which was completed only last year.
Agencies A and B co-ordinate well. Agency B’s internet-based document bank includes over 100,000 reports, but they are in no order that I can discern. I give up, and call my former supervisor for help. He looks but cannot find the relevant documents. He is kind enough to instruct those at Bigconsult to provide me with the final report from last year’s project. No fools, they agree to do so, once I promise to give them an update on Devolandia after my trip. Tit for tat.
My new, Agency A supervisor only recently arrived in Devolandia, the third person to take the position in three years. The relevant Devolandia counterpart ministry also has a new minister and deputies. On my arrival, I am provided with a few documents. These, plus the Bigconsult final report, are the only reliable papers that I have. I mine them for all they are worth, as they are likely to make all the difference between success and failure for my brief mission.
The documents include references to two highly relevant Agency A projects completed in Devolandia three and five years previously. No-one at the local office has any records from either project. The local Agency B office has monthly reports from the Bigconsult project, but nothing further, and nothing in electronic form. I am told that everything was delivered to the ministry, but the Agency B civil servant formerly in charge of the project is now working on the other side of the world.
A persistent local expert tracks down some former local Bigconsult project staff. They are very helpful, but none knows where the missing documents are. One suggests that the ministry computer man might know. He is in London, and may or may not return in a month. Without him, no-one in the ministry can find any electronic documents, other than those on the outdated website left by Bigconsult. The person who was in charge of the project for the consultancy firm has since moved to another country, and is no longer with Bigconsult.
Towards the end of my stay, a mid-level ministry official manages to deliver to me some chaotic piles of paper, containing a small, but potentially useful, portion of the records. They are in a language he cannot read, and the translations are missing.
All of this happens in the new millennium, in sophisticated bureaucracies that declared themselves ‘knowledge organisations’ during the old one. Agency A has spent a fortune on KM systems, and Agency B is not far behind. Both also spend enormous amounts of money on external consultants, often on projects with substantial overlap. Yet the work of external consultants remains only very imperfectly captured by the agencies’ expensive KM systems.
My colleagues seem almost amused at my efforts to investigate the background history of the project I am assigned. They seem to find me quaint. After all, consultants’ reports are throw-away products. Aren’t they?