Enter – The Road Warrior
Anyone who has been engaged in the world of Management Consulting over the past 30 years understands the tried and true model of building ‘Road Warriors’. Simply put, a Road Warrior is a consultant who flies in to the client site every week from their ‘home’ location – typically a city far away. They are the antithesis of Local Consulting and the primary reason why the model was invented.
The Road Warrior is just that – someone who lives on the road. They get up every Monday morning at some ungodly hour, catch a 6:30 am flight to Wichita or wherever, spend the next 3 nights in a hotel, and leave on Thursday afternoon to go back to their condo in some nondescript beige stuccoed suburban complex.
Over the next two days they pretend they actually live in that place. Road Warriors get wasted with their friends on Friday night, spend Saturday recovering, do their chores, take their laundry to the dry cleaner, and get back on a plane early Monday morning. Wash, rinse, repeat. Clearly, this is no way to live. Performance is sub-optimal as the Road Warrior is nearly always exhausted, eating bad food, dealing with jetlag, etc.
Who Are the Road Warriors?
Many large firms tend to prey on recent college grads who have no life anyway. So they welcome the dream of jetsetting around the country to serve clients in unknown lands for huge sums of money (for the firm) and a decent living for themselves. While they are racking up the frequent flier miles and hotel points, their 20’s drift away.
Many end up in relationships with other Road Warriors who also have no chance at a social life. So they just sleep with whomever they are sharing a client with at the time. Some of these relationships turn into marriages which thrive on Type-A behavior. Generally, they are fed by dual-six figure salaries and come with a pair of matching BMW’s. Some last, many don’t.
Sure – there are the few, grey haired grizzled veterans who thrive on the Road Warrior mentality. Some stick with it so they can leave their former consultant/spouses at home with the kids in order to be free and to blow off steam wooing clients. Most are men as many women leave the industry once they start families and can’t bear the thought of returning to such a lifestyle after becoming parents.
Based on the number of consultants I’ve interviewed in the past, I’d estimate that the average career lifespan of a Road Warrior is somewhere between 6-8 years. My educated guess is that 80% of Road Warrior consultants drop out of the industry by age 30’ish. So where do they go?
Enter the Concept: Local Consulting Beats the Road Warrior Model
About 10-12 years ago, people in the industry who had experienced this hellish lifestyle woke up and decided that there must be a better way. After all, many lived in cities where there was plenty of client work.
The challenge was that their firms had siloed them all into ‘Practice Areas’ or ‘Centers of Excellence’. This restricted what you could work on and where. And most couldn’t sustain 100%+ staffing levels required (demanded) by the firms. Hence, they were flown around to clients to ensure that they were billable within their pigeonholed area of ‘expertise’.
With a bit of rational thought, the idea of the ‘Local Consulting’ model was born. The dream to be sold was that you could get off the road, stay a consultant, and live/work in your home city. Simple enough and yet brilliant at the same time. It was a game changing concept for many who had led a better part of their adult lives in various airports and Marriotts.
And Practices? Who needs them. The Local Consulting firm would allow you to shape-shift and be a Swiss Army Knife consultant – plugging you into whatever work you were semi-qualified for. Plus, the firm could pay you more than you were making as it didn’t have the same overhead, margin requirements or grifting partner pyramids schemes to cover. Yahtzee!
Challenges of the Local Consulting Model
So, everything sounds great so far right? And don’t get me wrong – much of it is. But as with any new business model, there are inherent challenges to overcome. The key themes that I saw were as follows:
- Big 4/5 Competition – Once the big guys got wind of the model, there was no way they were going to let you into their client base. They would work relationships, cut rates, bring in heavy hitters and every other trick in the book. Only clients willing to take a risk on a little firm were open for business.
- Building Brand Equity – Great! A local firm! But who the hell are you guys? Without any brand name recognition, firms are constantly faced with being the scrappy little dog trying to nip at the ankles of the big boys. And unless you have some amazing charisma and great people you are going to find yourself SOL on more deals that you can count. Finding quick wins and references was tantamount to success.
- Quality of Billable Work – As the new kid on the block, you have to take what you can get. So those dreams about being a reliable local firm that focuses on strategic work? Throw them out the window. You are looking at a good amount of staff augmentation work before you do anything else to pay the bills. This can lead to disillusionment for newly hired consultants. They will begin to crave bigger, more complex projects vs. carrying around someone’s clipboard and taking notes for $150/hour.
- Utilization – See #3. You are operating on little cash in the bank and you are basically hiring to fill roles. Every hour on the beach is an hour of pay out of your pocket. So you tweak your compensation plans to cover only a portion of bench time and deal with the fallout of consultants complaining and/or leaving. Meanwhile, you are selling more staff aug Business Analysis and Project Management work to pay the bills.
- Scalability – The two most difficult things to do in consulting is to hire good people and sell good work to paying clients – not necessarily in that order. Both cost a good amount of money to do and are very competitive and difficult. So growing more than one local market is a major challenge and you better be able to clone your best R&D and Business Development people or find reasonable facsimiles through your network if you want to have a shot at scaling.
Depending on how a firm navigates these five key challenges will determine if they succeed of fail in time. If you have challenges with two or more of the above, you better pivot fast or pick a different career path.
The Reality: Local Doesn’t Always Equal Better
Now don’t get me wrong – I loved me some local consulting when I was in the industry. There were so many terrific things about it including having some semblance of work/life balance, being able to drive or walk to work, and having the opportunity to build a strong local community where I lived. None of these are bad things and all are an improvement over the Big 4 consulting model.
Some things that made it difficult to succeed in the model over time included the following:
- The Glut – Once the local consulting concept was established, firms started popping up like toadstools. Throw a rock and you’d hit one. In an area like Seattle there are literally dozens of local consulting firms. And so the conversation shifted from “Should we use a National Firm vs. a Local Firm?” to “Which Local Firm Should We Use?”. There were simply too many choices and the talent pool was diluted.
- Hiring Challenges – See point 1. Now that there were so many local firms, prospective employees had a wide array of choices when it came to staying in their career of choice in their own territory. Competition for hiring locally increased dramatically and both salaries and perks saw increases in order to attract local talent.
- Retention – Now that talent had more employment choices locally, it became increasingly easier to poach people from competing firms. There was/is a constant battle to hire consultants away from competing firms. Clients saw the opportunity to hire them away from their firms with the promise of stability, often better benefits, higher pay and fancy titles.
- Project Size – Even when dream projects such as SAP Implementations fell into a local firm’s lap, they were hard to staff. Local firms simply didn’t have the people to cover large scale projects and they were won, almost by default, by larger Big 4 firms. Sometimes you’d get lucky and place a couple of people to fill in the gaps on these projects. Most of the time you were left outside the gate.
- Upward Mobility – Last but not least, consultants need to grow – in pay, professionally and in title. In creating these often flat-structured hierarchies with small leadership teams, local firms limited consultant’s ability to grow their careers. So, if you ever wanted to increase your scope or have a ‘Director’ title – you usually had to go somewhere else to do it. As a result, firms reinstituted hierarchies and practice models they had eliminated in order to give people career tracks.
These are only some of the challenges local firms face among many. However, I believe they are the most significant to address in order to achieve success.
Local vs. National – Which is Best?
Clients began to realize over time that the local model was no longer a unique selling point. There were so many of them out there that everyone had a wealth of choices to make. Plus, with the evolution of technology, connectivity and collaboration tools; the location of the consultants working on a client project now meant less than ever before. Need a meeting? Let’s just get everyone on Skype. Need a whiteboard session? Let’s just use WebEx.
There are many new ways to communicate and collaborate now and the local vs. national conversation has become less relevant. The conversation is now about quality, capability and cost work vs. where people are located. If you are located 2,000 miles away from the client but can bring the best, most qualified people to the table at the right price – I’d put my money on you to win.
And, at the end of the day, sometimes you need to fly people in.