Consulting 4.0: the best remedy to mitigate 2 of the biggest illnesses of modern businesses

From the title, you are probably inquisitive to know more about the two of the biggest illnesses that we at Magellan Consulting Group have diagnosed to business performance. Two main reasons preventing companies to achieve higher business performance are simple in nature and straightforward to understand. No, it’s not rocket science or a complex business strategy difficult to grasp. These issues appear in front of us every single day! There’s no need to go to Harvard Business School to identify organizational illnesses that are simple to detect with just common sense, pragmatism, and openness to assess fundamental operating problems.

I personally have had the opportunity to perform assessments of >50 companies across the globe and each of those business suffer from what I consider to be two of the modern biggest illnesses of businesses: improper communication and Excel spreadsheets. The former is managerial and more complex in nature; the latter is simply a management tool, therefore much easier to address.

These two illnesses are preventing businesses to get to their next level of performance in numerous ways. As a result, they are sources of rework, misalignment, errors, delays, manual and paperwork processes, non-standardized operations, lower productivity, which reduces processes’ effectiveness and ultimately impacts profitability.

1.    Excel Spreadsheets

Let’s get started with the simpler one. The bottom-line is that a single copy of Excel spreadsheet means a process is not repeatable, nor standardized. Because of the flexibility of Excel, everyone feels empowered to adjust to their own version [that’s improperly focused empowerment]. If you want to know how many fundamentals deviations your company has against the ideal business processes, just count the number of excel spreadsheets that are used as a structural management tool. Every single organization has the excel/macros heroes that can make everything from Excel. Our assessments revealed that many businesses still use Excel as fundamental management tool to plan work, monitor, execute and report results. We have found that the use of Excel alone is responsible for +20 % of non-value-added activity of middle-management positions. Consequently, on average, those managers lose one day per week executing Non-Value Activities due to their lack efficient management tools. 

2.    Communication

Miscommunication or lack of proper communication negatively impacts most individuals in both the workplace as well as our personal lives. The most common error is assuming that communication has taken place. Poor or lack of communication is the root cause for numerous major business challenges, such as failure to implement major transformation programs or strategy execution. At Magellan Consulting Group, we have found that 60% of communication problems are linked to an unsuitable Target Operating Model. It’s kind of a paradox that technological tools are more and more available, yet communication still remains a fundamental issue! To address this matter, it does require significant effort, standardization, and organizational alignment from executive level to front-line workers. 

The solution for improved communications is considerably more complex then eliminating Excel Spreadsheets. It does require organizational awareness, personal commitment, courage, and frequent business alignment across all business functions and positions through robust processes and suitable technology to facilitate communication. This is where Consulting 4.0 comes to play. 

So, what is Consulting 4.0?

Consulting 4.0 is the combination of traditional operations & supply chain consulting methodology and techniques combined with technology & advanced business analytics through digitalization and industry 4.0 applications. Consulting 4.0 means ‘get rid of excel and utilize modern integrated solutions that are now readily available and affordable. As a client of mine would say, “No BS Excel Spreadsheets left behind”. Also, Consulting 4.0 ensure robust communication and alignment across functions and positions.

The aftermath of Covid-19 pandemic shows accelerated and increased adoption of new technologies to improve business performance as a paramount element to solve fundamental problems such as Excel Spreadsheets and Communication. Companies are getting increasing pressure to become more digital as a means to be more productive, more profitable, and meet ESG objectives in order to remain ahead of the competition. Many organizations don’t know where to start and how to identify the solutions.

Companies are being forced to be ‘Tech Savvy’, independently of their industry. Regrettably, they face the following paradigm; as a company “where professional people run professional businesses”, how is it that almost any person can instantly know their heart rate with a device collecting IoT data through a digital watch and a manager is not able to measure real time performance? 

The implementation of Industry 4.0 applications to support and sustain performance management through Consulting 4.0 approach allows the elimination of Excel spreadsheets as a structural management tool. As a result, businesses unleash capabilities such as real time performance management, automated and standardized processes, improvement planning and execution, and transparent reporting at all levels. Per its nature, Industry 4.0 creates a foundation for better communication. 

In conclusion, consulting 4.0 means the application of technology to leverage business best practices, utilize tools such as Data Automation & Artificial Intelligence, Digitalization, Process Mining, and other Industry 4.0 applications. These enhancements will result in improved communication and the elimination of Excel spreadsheets. Businesses pursuing a complete business transformation through Digital Transformation require experts and consultants who dare to look beyond traditional approaches and bring technology to the forefront, making businesses sustainable. 

About Magellan Consulting Group and Consulting 4.0

‘What makes Magellan unique while creating value for our customers is our ability to ensure Technology and Sustainability of Change are embraced within the consulting paradigm, ultimately creating a 'Consulting 4.0' vision which goes beyond people and process.’