2) What is strategy executive coaching, and how is it different from management consulting for strategy?

01/01/2011 00:00

    A consultant/consulting team crafts a strategy for you. A coach assists you in crafting your own strategy. These sentences are, of course, an oversimplification. One may make the following distinctions:


· Teach: to cause to know how to do something, with the giving of incidental help.

· Instruct: suggests methodical, formal teaching.

· Train: suggests methodical, thorough instruction and guidance with a specific end in mind

· Consult: to give professional advice or service in a field of special knowledge

· Coach: refers to training with demonstration and practice in some specialized activity


    Naturally executive coaching has elements of all of the above, depending on the circumstances and, of course, who is doing the coaching. Our definition of executive coaching (which, like any other, needs to be taken with a grain of salt) is to help achieve agreed upon goals -- to achieve together, hence to co-achieve.

Most managers already have a great deal of formal education. Above and beyond that, they have the "learning by doing" that comes from business experience. The essence of executive coaching is to enable "making the right things happen" to occur faster, with more significant, sustainable results.

    Naturally management consultants also endeavor to generate results. They are unquestionably an asset to a corporation, above all when they are doing what they do best, solving specific one-off problems, helping seize immediate opportunities. Then they are a real strength. However strength, when it becomes excessive, can turn into a weakness. 

    Scott Paper is a case in point, as explained by Albert J. Dunlap in his book, written with Bob Andelman, Mean Business, How I Save Bad Companies and Make Good Companies Great.1 Two brothers founded the company in Philadelphia in 1879. In 1994 it was the 8th largest paper company in the U.S. and No. 1 in the world in tissue paper, with a 15 percent market share. Over time, Scott Paper had developed a culture in which consulting was leaned upon heavily. The company was spending $30 million a year on a multitude of consultants. (This example is by no means isolated. The telephone giant AT&T, among many other companies, has also had periods since 2000 when it has spent extraordinary sums on consulting and exhibited some of the same symptoms as described below for Scott Paper.)

    Consultants were being used as a source of credibility at all levels of the corporation. The CEO was using them to support actions to the board. At lower levels, highly competent managers were using them to "sell" their own ideas to senior management, which would not otherwise accept them. As this process became inherent to a culture otherwise resistant to change, the usage of consultants ballooned.

    The consulting engagements, individually often (but not always) well run, where not aligned with one another, or with a coherent strategy. The sum of the parts for several independent engagements was not greater than the whole, but less. Each engagement achieved an isolated result without significantly contributing to cumulative improvement. Frequently one engagement was in conflict with another.  Negative synergy became the order of the day and operations suffered.

    In fact, they suffered so badly that in 1994 the company was considering filing for bankruptcy. As a last, desperate alternative, it brought in a turnaround CEO, Albert J. Dunlap. He fired 70 percent of upper management and cut back the work force by 17,000. (About 11,000 people were "terminated" and another 6,000 people worked at companies and divisions that were sold.)

    From the perspective of the 20,000 people who kept their jobs, the turnaround was successful. From the perspective of Wall St., it was brilliant. The stock market loved it. The shares went from a rapidly sliding $38 to $89 and rising in the year of the bloodletting.

    Albert J. Dunlap completed the turnaround in twenty months, receiving total compensation of $100 million ($80 million as a result of stock options). However many did not view the turnaround as having a "happy ending." In 1995 Scott Paper was acquired by its archrival Kimberly Clark and ceased to exist as an independent company.    

    Albert Dunlap is also not universally admired in his own right either. Although he has been referred to as "America's premier turnaround artist" and "Rambo in Pinstripes," he is more commonly known as "Chainsaw Al." He is the ultimate "no-nonsense" business executive. He writes that a real chief executive says, "Here's what we're going to do, here's how we're going do it, here's when we're gonna do it. And I'm accountable."2 No "touchy-feely" consensus, bottom-up management here, no, no.

     Interesting is that as tough as he is, Albert J. Dunlap did have one long-term (15 years) advisory relationship with C. Don Burnett, a partner at the accounting firm of Coopers & Lybrand. Albert Dunlap referred to him as someone he respected for being efficient and cost-sensitive, and as one of the few outsiders who could influence him: "He gives me extra eyes, extra ears."


1 Albert J. Dunlap, with Bob Andelman, Mean Business, How I Save Bad Companies and Make Good Companies Great, Fireside, 1966. Scott Paper is discussed here and again throughout the book, and particularly on pp. 3-12; 17 - 23; 91 - 97; 153 - 155; and 170-179.

2 op.cit. p. 154.


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