Hypothesis-based consulting: guessing the answers to clients problems

Yes, we call it hypothesis-based consulting, but some cynics might call it educated guessing.  Either way, it is a smart way to break down complex or ambiguous problems, and quickly start driving towards an answer.  At its heart is the scientific method – used for hundreds of years by scientists and thinkers to prove their ideas using evidence.

Hypotheses start early.  For the non-engineers in the audience (which include me) this is something you probably last heard of in science class.  The concept is simple enough, but it may seem a bit counter-intuitive when you put it into practice.  In the generic project plan below, you can see that the hypothesis development happens early on. The idea is to put together some initial ideas (logical starting points, not just wild guesses) and quickly eliminate the bogus leads and only focus on the promising ones.  Basically, only dig in the places where there will likely be oil.

Hypothesis Based Consulting

Think about the problem broadly.  Initially, a lot of time is spent thinking about the problem broadly.  It is important to cast the net wide because the real root causes of the problem can sit anywhere – in other functions, other business units, or even with suppliers.  In the example below, the client might believe ABC is the reason for the fall in market share, but in reality, it is a combination of other reasons that the client did not see (or want to admit).

Hypothesis Based Consulting

ColumboTreat hypotheses like suspects.  Using the analogy of a TV detective from the 1970s and 1980s, Columbo would not rule out any suspects initially.  He would survey the crime scene and start formulating some ideas on who the suspects were – based on eye-witness accounts, clues, and experience.  He would keep sleuthing for clues until he was confident that suspect was either guilty or not guilty.

Same thing here.  The goal is to put together a list of hypotheses (“suspects” using the crime analogy) that are distinct and separate.  The start going down the list to figure out if they are guilty or not.

For some clients, this approach can be unnerving because they inadvertently assume that the consultants comes to the project with the answers already.  So, when the consulting team spends the first few weeks interviewing people and gathering data, it seems like the project is going slowly or not at all.  Here are a few things clients can do:

  • Help get the data that the consultants need to confirm / disprove the hypotheses
  • Share previous project work which tried to solve the problem and failed
  • Think broadly and propose some ideas of your own
  • Do not be shy; ask what the key hypotheses are
  • Bring in the right people (even if in other departments)

By the end of the project, there should be very little guessing.  The consulting team’s confidence in the solution typically ebbs and flows during the project.  As there is more fact-finding and discovery, new hypotheses are created and eventually whittled down.  By the end of the project,  the team should be fairly confident in their answer and have the data and analysis to back-up their recommendations.  As shown in the graphic below, there are lots of ups and downs, but confidence should trend up as time goes on.

Hypothesis Based ConsultingGive the consultants a little space to take in the information and think deeply on the problem. This is where a lot of the brain power is spent early in the project or during the proposal stage.  It is not time wasted.   In a famous story about Bill Gates, his mother was getting frustrated when he would not come to dinner or respond to her calls.  She demanded, “What are you doing?”

I am thinking, Mom.  Have you ever tried thinking?

– Bill Gates

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One thought on “Hypothesis-based consulting: guessing the answers to clients problems

  1. The idea of espousing an hypothesis early on in a consultancy situation can be unnerving. Obviously the client has been mulling over things for a while and is ready for some exclusive input for their money. Then, very early in the process, the Engagement Mgr. & Team proffer their hypothesis, which is broad and nonrefined.

    Seems a tad premature at the outset and may be met with resistance. That is why a huge part of being a consultant is decorum and knowing politics is afoot. Being overly intellectual and supercilious is a death knell. Getting the client’s team together and involved from the start is crucial and takes the sting out of any contrarian overtures.

    Hypothesis(s) >>> Framework/Decision Tree[MECE] >>> Begin Work. McKinsey has a nifty case interview example that involves a fictitious pharmaceutical co. that wishes to acquire a smaller R&D firm that produces a different type of drug that is intriguing. Excellent reading.

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