Sunday, February 20, 2011

Operational Effectiveness

Within my firm, there are a couple of answers to this question. As I mentioned in the Strategic Positioning discussion, I work for a large management consulting firm; specifically within the federal government sector. The Operational Effectiveness within my sector is lagging its commercial counterpart. 

As a whole, my firm has many functions that add to its Operational Effectiveness. Included among these are a wide depth/breadth of knowledge and industries served, vast technological assets, a robust recruiting and talent retention program, and individualized career paths. However, the federal sector practice has not integrated well with a strategic plan that was built for the commercial sector. 

While there is an abundance of information to be found on the firm’s intranet, it is often not useful to the federal sector. Furthermore, employee performance is often measured by utilization rate. While this might be adequate for consultants who can bill clients for all hours worked, this is often not the case with government contracts. The contract might limit each practitioner to 40 billable hours per week. As a result, any unbillable time affects an individual’s utilization rate. Ironically, one can be considered underutilized merely by attending mandatory firm training and functions. 

Additionally, service lines might fall between two sectors. For example, while I work in the federal government sector, my service line is health care. Health care, however, is a general service line that functions for both sectors. No clear distinction has been made, as it is obvious that there was failure to integrate these areas when the buyout of a large federal consulting practice was completed a couple of years ago; leading to the firm’s large federal footprint.
 
While the opportunities within the federal sector increase, resulting in what appears to be great revenue growth, problems still exist. Some of these issues have resulted in talent trying to cross over to the commercial side, or leaving the firm. These struggles illustrate how Operational Effectiveness can be very different, even within one firm.


Prior to the acquisition, my firm merely dabbled in the federal markets.  However, it did not build an infrastructure specific to this sector, as it was not large enough at the time.  The acquisition not only grew the practice, but caused an influx of over 90% of the other entity's personnel.  At present time, there is a struggle between the two cultures.  Those brought over from the acquired firm still compare company policies to the way that they used to do business.  The new hires to the firm have embraced the culture of the acquiring entity.

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