Why Management Consultants Love Data

By | April 15, 2012

Management consultants are always on the prowl for good data. After all, it is the stuff that client recommendations are made of. To a cynic, it might seem obvious.The title of this post would be a kin to: “Why chefs love ingredients” or “Why district attorneys like evidence” or “Why gardeners like sunlight.”

Even so, what exactly about the data do consultants love so much?

1. It is where the treasure is buried

Like miners, consultants are paid to uncover something that is often difficult to find.  Where a 49er might sift through tons of gravel looking for gold, a consultant sifts through gigabytes or terabytes of data looking for insights. On the surface, an analyst cleaning and filtering data doesn’t look a thing like a miner loading and sorting ore. But if you look closer, they are both in the same laborious, messy, and often frustrating business of rummaging through a mound of crap to find something of value.

2. It is free of politics

Data is objective. It speaks louder than anecdotes and company folklore. When two departments disagree, it is the only way to cut through the bureaucratic white noise and get people on the same page. The client is paying for expertise, critical thinking, and also objectivity. Staying close to the data is the safest route.

In many ways, Google embodies a corporate culture where data is king. Even executives (read: Larry, Sergey, Eric) are eager to drill down at meetings. Marissa Mayer, Google’s VP of Location Services, gave a talk at Stanford’s Entrepreneurial Thought Leaders Speaker Series and explained it best when she said “Data is apolitical.”  At Google, if they want to choose between two different features, they do an A/B test to see what the user prefer

3. It is an ugly mess

It is rarely organized. It is scattered across the organization in different software programs, filing cabinets, desktop computers, and employee’s heads. It is poorly maintained and unclean data grows like a mushroom. It is not uncommon to find 5-6 different spellings of the same customer’s name (e.g., Walmart, Wal-mart, Wallmart).

Gartner says that business intelligence software sale was $12+ billion in 2011, but most will agree that it is usually not that intelligent, nor used in the business. Most pockets of data sit isolated and rarely analyzed until someone invests the sweat equity to piece it together. The uglier the data, the more likely a consultant will be hired to analyze it.

4. It can be beautiful

Data by itself is flat, boring, binary. But sometimes, it can be transformed from a random set of data points into something, well, beautiful. In a very famous TED talk in 2006, Hans Rosling, combined multiple sets of mundane World Bank information into something remarkable. (If you are in a hurry, start at minute 3:00, but definitely watch until the applause at 5:00)

Photo credit: TED, Hans Rosling

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4 thoughts on “Why Management Consultants Love Data

    1. consultantsmind Post author

      Surely, data is the only way to go with clients. Always surprises us when don’t use their own data, right? Here the CTO of Tata Consulting talks about harnessing unstructured data. And I thought clients were under-utilizing the data that they already had . . . not to mention the data they have not even started looking for.

      http://forbesindia.com/article/rotman/the-unstructured-information/32782/1

      Also, congratulations on seeking out the entrepreneurial life. As you know, consultants are great thinkers and communicators. Often, too often, consultants are not risk-takers. Best of luck and look forward to hearing of your success via the blog.

      Reply
  1. ConsultingFact.com

    Thanks for a great post and an interesting website. As a former consultant, I completely agree with this article. When working on consulting projects it is amazing how much impact you can create by data-driven methods.

    Of course, I love data as a former consultant 🙂

    /Daniel S

    Reply
    1. consultantsmind Post author

      Thanks for the comment. Yes, it seems like the first 1/3 of any project is all about data collection, analysis, and root-cause analysis. Some cycnical clients say, “Yes, we knew that already”, but strangely, it is only when you show them the data – in all of its painful glory – do all the diverse stakeholders really start nodding their heads and change happens.

      Reply

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