- Management consulting news
- 26 April 2017
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Politics and consultancy – for many people, the two professions aren’t just similar, they are practically joined at the hip. Why is this?
Those with a cynical outlook might draw similarities between consultants and politicians by describing them as people who enjoy ‘knowing what’s best’ – and enjoy telling it to you too – sometimes with the not-so-subtle hint that only they appreciate the true lie of the land, and that only they know what’s ‘right for you’. Consultants and politicians – both can share similar levels of suspicion.
Perhaps it’s no surprise then, that both entry into- and out- of both professions is a fluid affair – existing consultants can find a political calling later in life, while politicians can also find themselves moving into consultancy after the public have had their say at the ballot box.
The most famous consultant-turned politician is, of course, the former presidential candidate (70th Governor of Massachusetts), Mitt Romney, who was one of the original founders of Bain Capital, and was the CEO at Bain & Company in the mid 1980s.
However, he is by no means an isolated case. In the UK, one of the most well known politicians with a former strategic consulting background was the former leader of the Conservative Party, William Hague. Hague worked at McKinsey for five years before being elected as a Member of Parliament aged 27.
In his case consultancy was a minor detour in a career that was always destined to be in politics. He resigned as leader after losing the 2001 general election, but he famously spoke at the Conservative Party conference in 1977 as a 16-year old child, the consultancy urged him to apply to join them. “It was one of the best decisions of my life,” he said later in an article for The Guardian.
“I started as an analyst, went off to business school, came back as an associate and finally was an engagement manager.” He says: “I worked in banking, retailing, restaurants, mail-order catalogues, and brewing.” He added: “I was stretched all the time. It is not a job where you can coast for a day. You work extraordinary hours, including weekends and evenings. The competition was intense.”
It’s all about skills
Other former consultants-turned MPs include Archie Norman, the former Member of Parliament for Tunbridge Wells between 1997-2005. Since then, he’s best known as being a businessman too (he’s been CEO of Asda, and until last year was chairman at ITV). Norman joined McKinsey straight after graduating, and (at that point), became it’s youngest ever partner, aged 28.
Chris Philp, currently MP for Croyden South was also ex-McKinsey; while Ita Kettleborough used to work in the office of Rachel Reeves MP, but is now a consultant at Bain.
It’s clear that those who move to politics value the skills consultancy gave them. “As pensions minister, where I needed numerical analytical skills, working at McKinsey certainly helped me structure my workload,” said Hague. Reflected Norman, in an interview in Management Today magazine: “McKinsey had a very strong professional culture which always put clients first and went way beyond personal gain.”
Those that have made their movements in the other direction have included Rafael Borrás, who in 2014 joined A.T. Kearney as a senior advisor, after serving as under secretary for management and acting deputy secretary of Homeland Security.
Conflicts of interest?
However, the obvious debate that these, and moves the other way create are inevitable accusations of conflicts of interest. So is the biggest concern about the two-way street that politics and consultancy sometimes is?
Certainly, in the early 2000s, eyebrows were raised that McKinsey had won £millions of public sector contracts while Lord Birt – a former consultant in McKinsey’s Global Media Practice – was working for Number 10 as a policy advisor. In June 2005 David Bennett, a McKinsey director who retired earlier that year was appointed head of No 10's policy directorate, one of the most important roles in the Civil Service.
More recently there have been yet more accusations of a ‘revolving door’ between politics and consultancies. In 2015, former UK health secretary from 2010-12, Andrew Lansley – who had been leading government efforts to part-privatise the NHS – was hired in a part-time capacity by Bain & Company.
It was controversial because he was brought in to advise clients on healthcare strategies, including how to get access to some of the £5.8 billion of NHS work that is commissioned to the private sector.
Celebrating symbiosis not differences?
Some might say it’s simply an example of Bain hiring someone with the right skills. The UK’s Advisory Committee on Business Appointments approved the move, on the basis he didn’t ‘draw on any privileged information available to him from his time in Government.’ Critics might argue this is very tough to do though – its arguably it is his knowledge from government that Bain’s clients want.
But, it’s very clearly laid out in parliamentary rules that UK politicians cannot be personally involved lobbying the government on behalf of their new consultancy employer for two years. So, perhaps the links between politics and consultancy should be looked at differently. This parliamentary rule should draw a clear line about what those who leave politics can do in consultancies.
Which leaves – in theory – consultancies to harness the very formidable skills politicians have, or the world of politics to gain from the skills consultancies drive into their staff. As Archie Norman once said: “‘People get a sense of an institution that does not leave them. McKinsey was pretty special.’ So, maybe everyone should really embrace the fluidity between consultancies and politics – because ultimately each area benefits from having those from the other – no matter how temporary their time there is.
Peter Crush for Consultor.news
Freelance business journalist