Will the birth of the Gig Economy disrupt the world of consulting?

By Chethan Reddy

“Five seconds left in the game. DO YOU BELIEVE IN MIRACLES?!?! YES!!!”

February 22, 1980. The Miracle on Ice. Everyone who watched that historic hockey match between the ragtag Americans pitted against the mighty Soviets remembers that day. It was the height of the Cold War and the world was watching. The Americans supposedly had no chance. The Russians were experienced professionals, former Olympic champions, the greatest hockey players in the world! On the other side of the ice were a bunch of 20-year-old college kids, who probably only recently started shaving. They were supposed to get laughed out of the building as the Russians marched on to yet another Olympic Gold Medal, what would have been their 5th in a row, to go along with their recent World Cup and World Championship victories. What happened instead has consistently been referred to as the greatest upset in the history of sports. Team USA played the game of its life, coming back from behind twice to stun the Russians 4-3 on their way to winning the Olympic Gold Medal for the first time in 20 years. It is impossible to watch the clip of the final seconds of the match and listen to announcer Al Michaels famously exclaim, “Do you believe in miracles?!” without chills going down your spine.

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How did they do it? How did the Americans outplay a team that held such a decisive talent advantage? They played as a team. They played together. They played for each other. They played for a nation. They played for a common goal. The now legendary coach of Team USA, Herb Brooks, understood that the players on that team were simply not good enough to beat out the vaunted Russian unit. He understood that the players needed to play with unity and come together in the pursuit of something bigger than themselves in order to rise above their limitations and become a team which was greater than the sum of its individual parts. They had to forget about themselves as individuals and play as a well-oiled, cohesive unit. Despite the fact that nearly 50% of that Olympic team actually had played together as teammates at the University of Minnesota, under the very same Herb Brooks, many of those kids had actually played against each other as rivals. In the based-on-real-life movie “Miracle on Ice,” there are two separate but related scenes that show how Herb Brooks was intent on bringing the team together as one.

In the first scene, the Americans are practising a certain type of play. Instead of focusing on trying to perfect the play, however, one of the players, Jack O’Callahan, decides to use the practice as an opportunity to level some old grudges he held against a player who played for a rival school (Rob McClanahan). Jack blindsides Rob with a nasty cross-check when he wasn’t looking. Rob gets up off the ice and the two get into a bloody fist-fight. After the fight, Coach Brooks is none-too-pleased and emphasizes the importance of playing as a team. He suggests that the team needs to get to know each other better and makes the players introduce themselves. Rob starts: “Rob McClanahan, St. Paul Minnesota.” Coach Brooks asks him, “Who do you play for?” Rob replies, “For you, here at the U (University of Minnesota).” Then Jack goes: “Jack O’Callahan, Charlestown, Mass (Massachusetts), Boston University.” Coach Brooks doesn’t look too impressed.

Fast forward to the second scene. The Americans have just had their butts kicked by an opposing team. After the game Coach Brooks is very upset. He forces them back onto the ice to do skating drills saying, “You guys don’t wanna work during the game? No problem, we’ll work now.” He gets them doing a brutal shuttle run skating drill barking, “You think you can win on talent alone? Gentlemen, you don’t have enough talent, to win on talent alone!” He continues, “You’re gonna think about something else, each and every one of you. When you pull on that jersey, you represent yourself AND your teammates. And the name on the front (USA) is a hell of a lot more important than the one on that back (individual names). Get that through your head!” The painstaking drills continue. The players near the point of physical collapse, but Coach Brooks is relentless. “Again. Again. Again.” Finally, about to collapse, one player gets it. He shouts out “Mike Eruzione! Winthrop, Massachusetts.” Coach Brooks responds right on cue, “Who do you play for?” Mike fires back, “I play for the United States of America!” This scene represents a turning point in the fates of the American team. They started to play together as one rather than as individuals. They started to care more about their shared goal than about themselves as individuals. One by one they were able to take down their opponents in the Olympics, including that legendary upset of the Russians, on their way to an Olympic Gold.

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Why am I telling you all this?

With the rise of technology and the ability to connect with people all over the world in an instant, we have seen a rapid development of what is known as “the gig economy.” The gig economy is defined as “a labour market characterized by the prevalence of short-term contracts or freelance work as opposed to permanent jobs.” Think Uber, Airbnb, Amazon Flex, Taskrabbit, Postmates. For some types of work, the gig economy is perfect. There is simply no need to have a permanent workforce to get some types of simple tasks or jobs done.
The problem, however, is that this so-called “Uberization of the economy” is being applied to every industry without stopping to think how such a model impacts performance and outcomes. In more sophisticated industries, these types of ad hoc arrangements do not yield optimal results for the concerned party.
Consider management consulting. Consulting is a highly team-oriented endeavour. It’s not possible for one person to do all the work required in an average consulting project. This involves getting relevant data, analyzing that data, reporting on that analysis, creating a strategy, implementing the said strategy, reporting again, and following up with clients. It is necessary to have a highly capable team of people working together to get all these tasks done in a timely manner. Every consulting team needs an industry expert who takes on a leadership role on the project. However, that leader needs to be supported by a strong team of senior project managers who are functional experts and are able to execute consulting projects perfectly. He also needs full team analysts who are proficient in industry research.

Recently, however, we have witnessed an increase in “gig consulting”. Companies like Talmix, HourlyNerd, Expert360, and AlphaSights offer to connect independent management consultants with clients who are in need of their services. Consulting veterans predict that gig consulting could have far-reaching implications for an industry that has historically focused on recruiting the best and brightest talent and developing that talent for the long haul. These firms promise access to a world-class network of the brightest and best talent out there. They let you choose which consultants you take on, guaranteeing that you will find the most relevant consultants for your job. These consultants would then quickly come together and work together to achieve the client’s goals and once the project is done, they disband and are off to find their next project. This sounds very appealing for both companies and consultants alike as it takes out a lot of the hassle and inefficiency of connecting supply and demand. In some cases, this may even work out well for both parties. It actually seems to be an ideal set-up for small one-off consulting assignments, of individual consultations. However, when it comes to larger projects that required significant resource allocation and a whole fleet of consultants working together, is it the best solution?
Consider for a moment the research work of Alex Pentland, the renowned MIT Professor and Computer Scientist, and founder of MIT Media Lab. Pentland has extensively studied teamwork and believes he has identified the key secrets of high performing teams. Pentland’s research with teams of all shapes, sizes, and performance level showed that individual capabilities on the team were much less important than you would imagine. Instead, he found that the most important predictor of success was actually the way that the teammates were communicating with one another. In fact, patterns of communication were as significant as individual intelligence, personality, skill, and substance of discussions combined!

He found that teams that socialize and spend time with each other outside of work, and who carry on side-channel conversations with each other have much higher performance than teams that don’t do this. In fact, social time accounted for over 50% of positive changes in communication patterns.

Research has shown that the highest performing teams share certain core characteristics:

1. Everyone is working together towards one common goal.
2. There is open and honest communication within the team.
3. Trust and respect for one another is evident.
4. No one person on the team is more important than the others.

When Google did its own research into what the most important factors of team success are, they found that, far and away, the most important factor to team success was psychological safety. In other words, how comfortable do team members feel taking risks on the team without feeling embarrassed? People who feel safe are more likely to admit their faults and are also better teammates to their colleagues. They are more comfortable with failing and in fact, sometimes failing is encouraged!

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In light of this, we can see why the independent consultant model would not be the most effective or optimal for clients looking to achieve the kind of outcomes delivered by traditional consulting partnerships. These outcomes can only be delivered by teams-the kinds that forget about themselves as individuals and play as well-oiled, cohesive units. When individual consultants are just thrust together on an ad hoc basis, where is the time for socializing and getting to know each other outside of work (I mean real quality time. Just getting drunk together doesn’t count)? They just do their job and split up. There is no common goal here. Since consultants are bidding against each other for clients regularly, the client’s goals become less important than the individual’s goals of gaining the most credit and best reputation in order to buttress his resume in order to find the next client. In this type of competitive environment, how can there be open and honest communication in the team when you are trying to outgun the other? As a result, trust erodes as each person tries to be more important and significant than the other. It is a prisoner’s dilemma. How does one feel safe in such an environment? How do you feel comfortable admitting that you made a mistake when it means you could risk getting another gig? These “uberized consulting platforms will not be truly disruptive to the consulting industry because the will not and should not be awarded projects that require a true team effort.

There are glaring shortcomings in a model like this. Luckily others seem to have found a way to remedy this. Companies like Konsälidön offer a nice middle ground between the benefits of traditional consulting relationships and the efficiencies of the gig economy. Konsälidön has a model that seeks to match already existing consulting teams from boutique and niche firms with clients who are in need of their services. Konsälidön promises to find teams that are highly qualified and specialized in the area of need. This allows clients to save time and money on the hassle of finding consultants to get their job done. The client benefits from the fact that these teams are already used to working with one another and are likely going to perform at a much higher level than consultants who have just been brought together for a single project. Consulting firms also stand to benefit from being part of a vast network of companies which will allow for a steadier stream of work along with opportunities for much larger projects in collaboration with other member firms than what they are individually capable of taking on.

It seems that Uberization of the consulting industry is inevitable, as it certainly does offer some notable advantages to the traditional model of doing business, both for clients as well as the nearly 1.8 million boutique consulting firms around the world. However, it is necessary to maintain a sane balance between the benefits of the new way and the advantages of the old. Companies like Konsälidön seem to achieve this balance of matching the right talent with work along with maintaining the benefits of team camaraderie. As the great American basketball player, Michael Jordan said, “Talent wins games but teamwork and intelligence wins championships.”