Keeping the Flame Alive 317Copyright © 2005, Idea Group Inc. Copying or distributing in print or electronic forms without writtenSETTING THE STAGE
The Resource Structure of SMSI
SMSI is organized around lines of business and geographic regions. Within each
region, it followed what is more or less a prototypical staffing model, consisting of three
professional levels. Consultants are the “worker bees” responsible for the execution of
specific tasks. Managers, the next level in the organization, organize, instruct, and review
consultant work as well as develop work that requires more experience. Partners, at the
high end of the structure, are responsible for leadership of major projects, define strategy
for the firm, develop business opportunities, and maintain client relations. These three
roles are “the grinders, the minders, and the finders” of the consulting business (Maister,
1997). These professional roles are backstopped by a support organization that sustains
the day-to-day operations of the firm.
The Role of KM
Consulting is fundamentally a knowledge-based business. Clients use consultants
to provide hard-to-develop skills, retaining them for short periods, the duration of a
project, or sometimes longer. Over the last decade a transition has occurred in the
consulting business, away from treating every problem as a unique opportunity, and
toward rapid leverage of experience. This creates a new perspective on the role of the
consultancy, where consultants act as information brokers, using connections across
industries and projects to identify classes of problems, and applying their collective
skills to solve them (Sarvary, 1999). Consulting firms act as a resource hub, with networks
of staff that can reuse their knowledge for multiple clients. Finding the right skills within
the consultancy and bringing them to bear quickly is a key selling point. Therefore,
consulting firms need to find techniques for sharing their experience quickly, and
creating the linkages and team structures that attract clients.
Staffing and Knowledge Retention
Every year consulting firms organize hiring plans based on their projected project
demand. Many recruit from undergraduate and graduate programs, preferring to train
staff in their unique approach to business and clients. New consultants face a great deal
of work pressure and competition for managerial positions, and a large proportion of them
leave before moving to the managerial ranks. The combined effects of long work hours,
uncertain career paths, and competitive pressure for recognition all exert adverse
pressure on junior staff. Similarly, there is churn in the managerial ranks as experienced
professionals try to develop the client relationships required to support promotion to
partner. A small proportion of managers achieve partner status; the remainder may
change firms or launch other opportunities. There is something of an “up-or-out”
structure, similar to that seen in law firms.
Concern about turnover is of greater concern during upswings in the market, as
there is more competition for talented staff. In these times, firms must replace staff
recruited away by competitors as well as recruit new consultants to meet swelling demand
for services. These two forces have generated hiring rates as high as 40% per year for