An interesting read:
Since I left Accenture, I have thought a lot about how the operating model has changed the firm. Its hard to argue with success as Accenture weathered the financial crisis well and the stock is hitting new all-time highs. Yet, my view is that something fundamental has been lost, and its not just because Accenture is now so large.
I lived through many major organizational changes during my 30 years with Accenture. After all, organization change at Accenture is practically a constant. Yet, in 30 years I saw just three seminal changes: the shift from Arthur Andersen to Andersen Consulting, the shift from an office-based P&L to an industry-based P&L when Market Units were introduced, and the introduction of the current operating model.
A key element of Accenture’s culture has always been a decentralized management structure. This goes all the way back to the Arthur Andersen days. In that structure, each corner of Accenture had a managing partner with clear responsibility, authority and accountability for all Accenture services in that market.
These managing partners were close to the clients and close to the Accenture staff that supported those clients. No matter your level in Accenture, you knew your managing partner and, if you were at least a manager or above, that managing partner usually knew who you were and what you contributed. Your managing partner also controlled your destiny. They had control of your assignments, your compensation, your performance rating and your promotions. In your corner of the firm, your managing partner was “god” – but you knew who they were, knew that they were close enough to know what your efforts contributed to Accenture, and knew that they valued contributions holistically, at least for their corner of the market. Your path to your managing partner was short.
That closeness between management authority and your work has been a key ingredient of Accenture’s character. It fostered a tradition of “solving for Accenture.” It created air cover to exercise your judgment to do the right thing even if it was outside your more narrowly defined area. Your actions remained within your managing partner’s domain and their primary job was to solve for Accenture in that market. If your actions made sense for that market you could count on a fair, balanced hearing come performance review time. The managing partner’s authority and closeness also fostered flexibility – the “rules” could be modified or ignored when they did not make sense for the situation.
The first two organization changes improved this decentralized decision making model by better aligning the managing partner’s responsibility, accountability and authority with the market they served. The split between Arthur Andersen and Andersen Consulting ended the practice of audit partners trying to manage IT work that was outside their expertise. The move to market units better aligned Accenture with the industries of our clients, removing geographic boundaries that no longer mattered to our clients.
The operating model change was different. It centralized authority and reduced organizational alignment with our clients. No longer was there a managing partner with responsibility, accountability and authority for the market they served. The client group managing partners are closest to the old model but they no longer control most of the resources that work at their clients. In the operating model, only the COO has responsibility, accountability and authority over all Accenture services and resources in a market. All other managing partners need to coordinate their actions with other managing partners (e.g., client groups with growth platforms). It’s a far cry from Accenture’s decentralized tradition. Its more bureaucratic and less entrepreneurial.
The centralization in the operating model also undermines the tradition of “solving for Accenture.” It has always been risky to work outside your “deployed-to entity.” In the Arthur Andersen days, it was risky to work for another geographic office. The managing partner of your office, who controlled your advancement, was likely to place more value on how you helped him meet his goals, not on how you helped another office managing partner. A problem with the operating model is that it makes it so much easier to work outside your deployed-to entity. It can happen without even changing clients. It can even be in your client’s best interest for you to work outside your deployed-to entity, although its often not in your interest. The operating model incents individuals to solve for their deployed-to entity, not Accenture, and that is often a narrower interest than that of their clients.
For example, in my last year I was deployed to Technology Consulting. I made some great contributions to the SI practice that year. Unfortunately, Technology Consulting managing partners did not highly value those contributions. In truth, they were barely even aware of them. If anything, the time I spent on SI contributions was not spent on Technology Consulting, and that was a negative. Before the operating model, all my contributions would have had a hearing with someone who benefitted from my complete contribution, not just a part of it.
There were good reasons for the operating model. It did improve Accenture’s focus on its offerings and on building specialized skills. I can’t say that the operating model implementation was a mistake. I am only saying that I feel that something fundamental to Accenture’s culture has been lost, or at least damaged. The “short path to God” created an environment that helped incent people to do the right thing, to solve for Accenture, and to make the right decision for each unique client circumstance. That tradition still exists in many long-time Accenture employees. Yet I mourn the loss of a key element that created that tradition and worry how the operating model’s new incentives will change that tradition over time.
Source: http://johnbogasky.com/archives/54