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Ética em Consultoria - em inglês


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Ética em Consultoria - em inglês

  1. 1. DONALD C. MOSLEY Professional Ethics and Competence in Management Consulting may well become known as the decade when the profession of management consulting reached maturity. Today, more than ever before, the businessman is turning to management consulting firms and to individual management consultants to help solve increasingly difficult technological, organizational, and personnel problems. Moreover, the consultants are being called on not only for recommendations regarding problem areas but also for help in decisions aflFecting the future destiny of the firm, decisions concerning diversification, mergers and acquisitions, and the exploitation of international opportunities. Many U.S. firms have benefited greatly by using management consultants. The continued use of consultants is testimony that an expert from outside the organization can provide progressive recommendations and initiate needed changes that an equally competent inside expert cannot. At my university as a result of our consulting activities, we have worked with a number of companies, primarily branch plants of large corporations which were having problems and with familyowned companies which were suffering growing pains. We have also gleaned insights into how others in the field operate, and from our frame of reference the techniques of some management consultants are disturbing. Since my field of interest is organizational theory, personnel, and industrial relations, my analysis will be confined to this broad area of management consulting. Within this broad area I have encountered what in my judgment are three clear-cut cases of unethical behavior or incompetence within the past year. In all three of these cases the consultants demonstrated the following similar characteristics in their consulting work: THE 196O'S I / T h e y were not fly-by-night types but full-time professionals, two of them having Ph.D. degrees in industrial psychology. Moreover one heads a firm which maintains oflBces in some of the major cities of the world. 2 / Through their evaluation of managers they played the role of God in such a wholesale manner that they put the late Douglas McGregor's autocratic manager of traditional performance appraisal to shame. 3 / Apparently all three consultants believe they are qualified and omnipotent to forecast future career performance of managers at all levels. In fact, one of the consultants has been quoted in a major publication as saying he can determine a rough measure of a manager's ability after an hour and a half interview. 44 California Management Review
  2. 2. In two of the cases top management accepted the recommendations and have either implemented them or are in the process of attempting to implement them.^ Fortunately, the third company had a top management which recognized that the consulting firm focused on psychological aspects and seemed to ignore other aspects of running a business. They quickly concluded that the recommendations were questionable and that to implement them would cause more problems than it would solve. The experience of this company serves as the basis for making the case against unethical behavior or incompetence. A brief survey of the literature relating to management consulting initially revealed a seeming paucity of concern with the problem dealt vidth in this case. A more thorough survey did reveal a few writers who touched on the problem although their primary focus was on other aspects of consulting. However, considerable support for my thesis occurs in a not too unlikely source—Vance Packard's book The Naked Society. Although the book contains a number of illustrations raising the question of ethical behavior on the part of management as well as consultants, the following excerpts present the problem most incisively. The harshest words yet addressed to the multitude of psychologists who work for management's assessing men on the job and screening applicants came from Dr. Jay L. Otis, director of the Psychological Research Service at Western Reserve and one-time president of the Division of Consulting Psychology of die American Psychological Association. Dr. Otis kindly supplied me with a copy of the scalding remarks he addressed to his colleagues a few years ago on the occasion of turning over his presidential gavel. His talk was entitled "Psychological Espionage." He said he chose that title because the trend in consulting work had made him pause and wonder. The phrase "psychological espionage," he conceded, "is not a nice phrase; yet it does characterize some of the work we are doing and describes the attitude of some of our examinees and clients towards us." He observed: "We are professional practitioners with very complicated professional obligations." He singled out aspects of the work done by psychological consultants when working for industry that were of particular concern to the conscientious professional: 1 / The use of disguised tests. 2 / T h e role of the psychologist in making attitude surveys. . . . 3 / The dual role of serving an industrial firm and serving the individual. . . . "I wonder how infallible we think we are when we make a recommendation, after a SPRING / 1970 / VOL. XII / NO. 3 day or two of observation, that may affect the lifetime career of an employee."^ A Study: XYZ Chemical Corporation The XYZ Ghemical Gorporation is a mediumsized, growing company with branch plants located throughout the country.^ Because of its technology the company hires large numbers of engineers and scientists, many of them having advanced degrees. The plant we are concerned with is located in the mid-south, is approximately three years old, and is involved in a highly technical process of production. This process is so complex that only one other company in America has perfected it. The home office is located in a large metropohtan area outside the South. The company decided to use the consulting firm after the president heard the head of the firm make a speech. Among other things, in his speech the consultant discussed the problem of unions, pointing out that his firm had chalked up many successes in helping companies keep imions from getting in or in getting them out once they were in. The secret he said was to find out where a company's problem areas were and then take the necessary steps to eliminate the problems. This job could be accomplished by the consulting firm conducting an opinion survey, the results of which would then be used not only in coping with unions but in helping the company in other vital areas as well. Although most of the plants of the XYZ Gorporation are unionized, it is apparent top management would prefer not to have umions. With the exception of maintenance employees, workers in the mid-south plant are not unionized; however, they are paid union wages. The philosophy of the plant manager is not to concentrate on keeping the union out but rather to treat people equitably whether tliere is a union or not. The maintenance employees in the plant were organized in the first year of the plant's operation when there were severe technical problems, diflScult working conditions, and inexperienced men and leaders. At any rate the decision was made to hire the consulting firm to conduct an opinion poll in two Donald C. Mosley is Professor and Chairman of the Management Department of Mississippi State University. He has gained experience as adviser to management of a large firm. 45
  3. 3. mid-south plants of the XYZ Corporation. A fiveman team, headed by the firm's owner, an industrial psychologist, came into the plant and spent a total of four days conducting the opinion survey. The consulting fee was $15,000. Consulting Firm's Methodology, Findings, and Recommendations Organization of the Report. The output of the consulting project was a bound, typewritten report divided into the following categories: 1 / The first section presented a summary of the findings. A. It stated the morale of eight different groups ranging from management to production and maintenance employees. B. It listed favorable features including such things as lighting, overtime, the personnel department, job security, and the vacation plan. C. It listed unfavorable features including such things as dust and fumes, seniority, training, safety, treatment of men by foremen, pay, communication, and benefits, as well as performance reviews vWth supervisors. D. It presented the role of middle management and supervision in determining plant morale. 1. This sub-section gave a description of first level, middle, and top managers who were considered possible sources of trouble. 2. The second section presented recommendations classified as those for immediate action and those for longer-term action. a. In addition to making recommendations regarding pay, policies, benefits, and working conditions, the report recommended personnel changes, especially of managers who were considered possible sources of trouble. 2 / The concluding section dealt with the outlook for union organization. A. It concluded that if the company adopted the firm's recommendations, it could defeat the union among the production employees if the election could be forestalled for two months. B. In addition it concluded that morale of the maintenance personnel was so low "that the likelihood is poor that the union can be decertified under present conditions." However, the firni did suggest that if the recommended changes in working conditions and supervision were effected, "it is possible that within a year morale can be improved to the point where the company might have a chance to win a decertification election." Under separate cover individual performance appraisals were provided on every supervisor and manager within the plant. These included a listing 46 of strengths and weaknesses and an interpretation of the findings. The interpretations included an assessment of present performances, an assessment of probable future performance, and finally, a recommendation that the manager be promoted, demoted, transferred to a staff position, or retained at his present level. Methodology Tliere were two distinct methodologies used in arriving at conclusions. One approach was utilized with operative, supervisory, and professional employees. A different approach was used in evaluating performance of managers. The first approach utilized opinion survey questionnaires, administered to all employees, followed by patterned interviews conducted with selected operators, supervisors, and engineers. Since our quarrel is primarily with evaluation of managers, attention will be directed to this area. Like the operative, supervisory, and professional groups, all managers completed opinion questionnaires. Beyond this step, however, an entirely different methodology was utilized to determine present and potential future managerial effectiveness. This methodology included interviews with a manager's immediate superior and the immediate superior's boss. The two superiors were asked to give an overall appraisal and to indicate the principal strengths and weaknesses of the subordinate. The consultant then made an interpretation of the interview results. In several cases the interviews were supplemented by the consultants' observations based on their contacts with the managers and in one case by follow-up interviews with subordinates. Results From a morale standpoint the plant had a good rating. Out of seven groups, four were judged as having good morale, two fair, and only one poor. In contradiction of these judgments the plant was evaluated as having an ineffective managerial team. According to the consultants' appraisal, only one of ten middle and top managers—excluding the plant manager and first line supervisors—was rated as being promotable to a higher level position. It was recommended that four managers be transferred out of line positions and into staff or technical posiCalifornia Management Review
  4. 4. tions without supervisory or administrative duties and that one manager be demoted to the level of foreman or machinist. In short, out of ten managers above the level of supervisor, five were considered incompetents who should either be transferred or demoted. Critique If the moral question of conducting an opinion survey with the primary objective of preventing or removing a union could be ignored, it would be hard to criticize opinion surveys per se. Rensis Likert has demonstrated the importance of measuring variables which affect organization health and performance provided the job is done by experts.* With one qualification the opinion survey covering operative, supervisory, and professional employees was worthwhile for the company and above average for an opinion or attitude survey. The qualification is that it appeared to be slanted toward weaknesses. The charge of management quackery arises as a result of the consultants' wholesale appraisal of all managers above the supervisory level and the incorporation of these findings with those of the opinion survey at the operative level. More specifically, the consultants' manner of determining strengths and weaknesses of managers reveals glaring omissions and deficiencies, some of which are as follows: • An incomplete picture was obtained of managerial strengths and weaknesses in that only two superiors were interviewed. Interviews with the manager's subordinates and co-laterals were not made. In fact, in only one case were subordinate interviews considered in the appraisal. • In nine out of ten cases the consultants' appraisal dijffered from the consensus of the two superiors. For example, in one case the two superiors stated that a man was performing very well and exceeding or meeting expectations and was now promotable to the next higher level. The consultant's conclusion was that "he is well qualified for his present responsibilities but is not equally well suited to higher level duties." • Related to the above, the appraisal interpretations seemed to be based on "psychological" interpretations and the consultant's impression rather than on what was actually said by superiors. Moreover there were inconsistencies in shifting the final report. For example, several managers who were rated very high in the opinion polls were downgraded in the final report. • The plant was concluded to have an ineffective management team; yet a most important criterion was omit- SPRING / 1970 / VOL. XII / NO. 3 ted in reaching this conclusion. From a results standpoint, the plant has succeeded in profitably developing a production process where three competitors have failed. That these results were achieved under difficult circumstances was ignored. For the most part workers with farm backgrounds were successfully trained as mechanics and chemical workers. At the present time the results of the plant operations are exceeding company expectations and targets. • Finally, and the most shocking aspect of the entire report, was the glib manner in which the consultants played God with the careers of professional managers. For example, in evaluating one key manager the consultants concluded that although he was doing a fine job in his present position, he should not be promoted to higher level because the increased pressure might cause him to become an alcoholic. The manager's two immediate superiors—one being the plant manager and the second a vice-president—had not mentioned anything about a drinking problem in their intei-views. The plant manager was quite dismayed when he discovered the consultant reached the potential alcoholic conclusion upon hearing office talk that the manager in question had become slightly inebriated at one cocktail party he had attended. If the top management of the XYZ Company had been the type who believe when you call in outside experts for $15,000—then you should follow their advice—the following events would probably have happened. Ten managers would have been written off for future promotions. Five would have been written oflE as complete failures as managers. The plant manager's opinion is that when word filtered down through the grape-vine, this plant would have had an exodus not only of managers but also of professional engineers and scientists. Indicative of the plant manager's reaction to the report are these excerpts from a letter to the President of the Corporation: I loould be doing ijoti a disservice if I were not to he candid and give you my true feelings about the quality and nature of the survey. In general the recommendations made by the consulting firm indicate a very serious bias aimed only at fighting unknowns. They apparently are not qualified to evaluate the overall operation of a chemical plant. If one were to take the survey seriously, he would have to take tlie position that a very incompetent job ivas done in selecting key people for staffing the plant. Their evaluation of our staff and recommendations, if taken seriously, would mean that toe should remove or consider non-promotable most of our key people. No constructive ideas are advanced regarding the fact that individual toeaknesses should 47
  5. 5. be compensated for by building a team, by choosing subordinates strong in tlie areas of deficiency. The consulting firm apparently wasn't experienced enough in industrial life to point out that the same team they so easily damned is the one that very successfully tuned up a complex plant which had more than its share of technical and mechanical problems to solve under very adverse working conditions. Further, this job was done by taking virtual field hands and backyard mechanics as raw material. The report in essence recommends that we choose personnel whose prime purpose in life is to keep employees happy. In fact, we should make life truly perfect by improving all economic benefits and make this truly a wonderful plant, working simply because a poll of our employees so indicated. Apparently technical com.petence, cost saving attributes, and the many other facets to a man's character which are needed to run a competitive chemical operation are not important. I say this because the report further states in essence that I do not have competent or promotable people. Actually the record shows that a very competent job was done, contrary to the implication of the report. Fortunately, the president of the corporation agreed with the plant manager that the consultants' report was a distortion of the true situation and the report would go no further than their respective desks. Later events have confirmed the wisdom of the president's decision. The consulting firm had indicated that unless the company followed its suggestion, it would probably lose any future election covering production employees. The suggestions were not followed—yet within a year a union election was held and the union was defeated by a tbree to one ratio. In addition, four managers that the consulting firm had recommended not promoting were later promoted. All of these men are either meeting or exceeding company expectations in their positions of increased responsibility. Recommendations and Conclusion Management in the future will turn more and more to outside consultants for help in taking advantage of opportunities and in coping with organizational and personnel problems. The profession of management consulting and the number of consul48 tants in the field will grow in the years ahead and some people will become wealthy. Until positive action is taken, the profession will continue to attract more than its share of unethical and incompetent people. One action that could be taken is the development of a clearing house for considering charges of unethical and incompetent consulting practices. The staff of the clearing house could sub-contract with a professional standards group, such as the Association of Consulting Management Engineers of the division of industrial psychology of the American Psychological Association, to investigate and either confirm or deny such charges. If the charges were confirmed, a warning could be issued to the guilty firm that any further substantiated unethical or incompetent practice would result in widespread publicity being given to the charge. Of course the above is only a general idea and many details would have to be worked out. However if certain key professional groups, such as the National Association of Manufacturers, the American Management Association, the Academy of Management, the Society for the Advancement of Management—just to mention a few—were to unite behind such a cause, the problems should not be insurmoimtable. Representatives from the associations interested could form a committee to initiate the project and to contact various professional standards associations for support. After tliis step it should not be difficult to secure funds to finance the establishment of a management consulting clearing-house. In the short run, organizations planning to employ management consultants would do well to do their home work and check with previous clients of the consulting firm being considered. Certainly the problem of unethical and incompetent consulting practices is grave and the hour is late. REFERENCES 1. Ill-effects are already observable in one of these companies, primarily in an exodus of capable middlemanagers to other companies. 2. Vance Packard, The Naked Society (New York: Van Rees, 1966), pp. 96-98. 3. To respect management's request, the company's actual name is not used. In all other respects the facts are correct. 4. Rensis Likert, "Measuring Organizational Performance," Harvard Business Review (March-April 1958), 41-51. California Management Review