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Spending: £1.8Bn Consultants Bill In Labour’S Final Fling

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http://www.express.co.uk/posts/view/179241/Spending-1-8bn-consultants-bill-in-Labour-s-final-fling

LABOUR splashed out £1.8billion of taxpayers’ money on consultants during its last year in government, according to figures released yesterday.

The total represents a huge rise on the previous year, when official estimates put the bill at £1.5billion.

The increase comes after several years in which Labour reduced the consultancy bill following an efficiency drive.

The new Government open­ed up the accounting books for the first time yesterday as it published the entire contents of the Treasury spending database in an attempt to lift its “cloak of secrecy”.

The vast database contains a total of 24 million individual entries, documenting every item of Government expenditure in the financial year 2009-10. Initial analysis of the complex data shows the Government racked up a total bill of £1,809,676,000 for employing consultants.

The Department of Health spent most – £480,402,000 – followed by the International Development Department which spent £288,100,000.

The Home Office splashed out £194,116,000.

I hope we got in excess of £1.8bn in savings from all this expert advice.

I'd be more interested to know what pearls of wisdom the taxpayer got for this.

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I'd be more interested to know what pearls of wisdom the taxpayer got for this.

I met a management consultant in the pub once - they did a huge amount of work for the NHS. Their take was that they would tell the NHS managers the most basic concepts about business management, and the NHS staff would sit there completely dumb struck - as if you'd just told someone that actually the world isn't a flat plate supported on the back of a turtle, but it was actually round.

The sort of pearls of wisdom that the NHS would pay thousands for was stuff like "You need to identify inefficiencies. Inefficiency means things like idle equipment, idle staff, waiting for equipment to become available, etc. The first thing you need to do to make something more efficient is to find out which parts of the institution are working efficiently and why they are doing so, and which parts aren't. Only then can you start to take action."

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They are worth every penny NOT.

About ten years back there was a documentay about this sort of sh-t !! Alan Sugar had them pushed on him from city investors in his company , in the end he ignored the city investors and threw them out.

Was also stated that years prior B.P. was nearly bought to it's knees by them. Yet our last government still lavished billions on them.

IMP , if a company or organisation needs consultant's to tell it's managment what to do the managment are not doing their job .

What a fuc---g Gravy TRAIN !!! who are these people ? who gets the contracts? how much do the consultants themselves that stand there spouting sh-t earn ?

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I met a management consultant in the pub once - they did a huge amount of work for the NHS. Their take was that they would tell the NHS managers the most basic concepts about business management, and the NHS staff would sit there completely dumb struck - as if you'd just told someone that actually the world isn't a flat plate supported on the back of a turtle, but it was actually round.

The sort of pearls of wisdom that the NHS would pay thousands for was stuff like "You need to identify inefficiencies. Inefficiency means things like idle equipment, idle staff, waiting for equipment to become available, etc. The first thing you need to do to make something more efficient is to find out which parts of the institution are working efficiently and why they are doing so, and which parts aren't. Only then can you start to take action."

But NHS salaries are some of the highest paid.

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Philip Green, like him or loathe he, but he is very successful. His view is that why should he employ consultants, that's what he pays his staff to do ie manage the business and make savings and improvements. Sure, use consultants for one-off projects or specialist advice, but for day to day business issues? I think Green has some rather colourful language to describe consultants - mainly in basic anglo saxon.

Yes and he is right !!

I used to work for a major PLC , and they bought in consultants and agreed a project that cost millions . It was all about saving money and people went around saving money on this and that , we were always getting told how much had been saved .

The problem was they never returned to their money saving projects and calculated how much they were costing due to the cost cutting making things less efficient in other ways . I have seen a whole plant shut down for a day due to the correct materials not being in place at the right time , due to the guy who saw to them being in the right place at the right time being let go. This became a regular occurance ( things totally fu--king up ) due to peanuts having been saved by consultants who cost millions messing up an entire operation .

Another thing i found was they seemed to change things for the sake of changing things to justify their money.

Edited by miko

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They are worth every penny NOT.

I never understood it.

You get these (presumably bright guys) who have been running a company for 30 years and must know the ins and outs of every process/department.

They then hire a consultant, who they expect to introduce efficiency savings after being inside the company for a week.

IMHO, if someone can make efficiency savings in 7 days that you missed in 30 years you really shouldn't have been managing the company in the first place.

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Another thing i found was they seemed to change things for the sake of changing things to justify their money.

I think the reason people get so easily duped is that they worry their competitors might know something or be doing something they don't.

They probably think if the consultant has been around the block a few times they may have seen what your competitors do that's better and help you do the same. I don't think they ever consider that if the competitor is doing it worse the consultant might give them all your ideas!

Edited by libspero

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I never understood it.

You get these (presumably bright guys) who have been running a company for 30 years and must know the ins and outs of every process/department.

They then hire a consultant, who they expect to introduce efficiency savings after being inside the company for a week.

IMHO, if someone can make efficiency savings in 7 days that you missed in 30 years you really shouldn't have been managing the company in the first place.

That sounds mighty familiar.

Some years ago, I, and my co-directors, sold a company to a PLC. We stayed on to help run it on three year service contracts. The PLC directors kept telling us how much easier things would be with the weight of the PLC behind is. Anyway, to cut a long story short, the PLC pissed their money up against the wall and went bust. Our company was sold to another PLC and I bought back my bit for £1 and the stock at cost.

They thought they knew damn everything but in reality they knew damn all :rolleyes:.

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The PLC pissed their money up against the wall and went bust. Our company was sold to another PLC and I bought back my bit for £1 and the stock at cost.

Nice work!

Back on topic.. I wonder how much of that £1.8B the LibCons will be able to cut.

£500m seems more than enough for that sort of thing.. not least because half the government advisors do it practically for free anyway (from what I understand).

Edited by libspero

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I'm a management consultant and I don't recognise the descriptions above. I can safely say, having worked at both BP, the NHS and deep in the financial sector and FMCG industries, that I earn everything I charge.

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I once did a small consultancy job for a a guy who writes reports and produce government brochures etc. Basically it was to advise on the cost of setting up a wireless network for a housing association estate about 5 or 6 years back. I think I said it would cost around £3-4k to do it properly. The report cost around £15k to produce and the project wasn't even trailed.

Hopefully this kind of thing will soon be resigned to the heap for a while

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I'm a management consultant and I don't recognise the descriptions above. I can safely say, having worked at both BP, the NHS and deep in the financial sector and FMCG industries, that I earn everything I charge.

What kinds of things do people miss after years in a company that you are able to trouble shoot within weeks?

Is it all Kaizen / Kanban or is it more involved than that?

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I'm a management consultant and I don't recognise the descriptions above. I can safely say, having worked at both BP, the NHS and deep in the financial sector and FMCG industries, that I earn everything I charge.

Can you elaborate on what it is you do?

Have you been back to the people you've helped to see if they have continued with your advice? Are things still running smoothly?

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What kinds of things do people miss after years in a company that you are able to trouble shoot within weeks?

Is it all Kaizen / Kanban or is it more involved than that?

It's a skills thing and niche experience.

Things like:

- fixing big projects that have gone wrong due to a lack of deep project management experience internally

- helping an NHS organisation split in two (not their choosing, central government mandate)

- negotiating flexible resourcing agreements for an IT department so they can scale their capability

- bringing best practice to procurement exercises to ensure companies don't make silly expensive mistakes

- etc.

Intellectually hard stuff, backed up by a business case, where every day I charge is recovered between 4 and 20 times in terms of savings.

I can't speak for the whole industry, but by conscience is very clear and I am proud of the work I have done in every industry I've worked.

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It's a skills thing and niche experience.

Things like:

- fixing big projects that have gone wrong due to a lack of deep project management experience internally

- helping an NHS organisation split in two (not their choosing, central government mandate)

- negotiating flexible resourcing agreements for an IT department so they can scale their capability

- bringing best practice to procurement exercises to ensure companies don't make silly expensive mistakes

- etc.

Intellectually hard stuff, backed up by a business case, where every day I charge is recovered between 4 and 20 times in terms of savings.

I can't speak for the whole industry, but by conscience is very clear and I am proud of the work I have done in every industry I've worked.

No offence but the managment in those companies and orgaisations should be able to do the above themselves . That is what they are paid to do if they can not then they should not be there .

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No offence but the managment in those companies and orgaisations should be able to do the above themselves . That is what they are paid to do if they can not then they should not be there .

I'd agree in principle.

However, if big systems delivery isn't a company's core skill set, why would they have a permanent employee (or team) paid £200k a year to do that stuff if they only need them for a year or two?

And for other organisations, if they don't have those skills internally (or won't pay enough to keep them) then there is a demand for external short-term skills to fill a gap.

Hence I exist.

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No offence to you but if managers in the NHS and other organisations can't manage projects, carry out a re-org, negotiate contracts and buy stuff efficiently (procurement) then they should not be there. A clue is in the word; manager B)

Who would you rather have managing a team of thousands of nurses - someone who understand nursing and how to make patients happy, or someone who understands SAP Finance and how to implement it across a fragmented organisation?

The NHS is rightly focused on patients and quality of care - structural re-orgs and systems delivery etc. are not what they are good at. Clearly if the priorities were to build skills in this area then they could easily do so, but that's not the drum that's been beaten for the last X years.

No offence taken. I earn a fortune and am very happy with my choices.

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In addition to my day job as a university lecturer in modern history, I've done some freelance consultancy jobs, mainly advising archives that hold oral history recordings (the methods for the making, use and interpretation of such recordings being one of my two main research areas). As I am acutely conscious that most of my clients are either public or what I call semi-public sector (i.e. they derive some, but not all, of their running costs from the taxpayer), I've never tried to charge more an amount that will allow me to take home my hourly day job rate after tax.

Within a year of starting to take these jobs on, I found that it was the purely private sector archives and collections that were most cost conscious. Last year, I did two jobs over the summer. The first was advising a multinational pharmaceuticals company on the preservation of training films and videos that it had produced in-house or commissioned over a 40-year period or so. I had to fight to secure a fee that secured me, in effect, the same amount of money for the job as if I'd done the work as part of my main job (given that I taking annual leave to do it, I thought this reasonable). In the end, they demanded detailed costings, analyses and comparisons of options for the preservation work that they didn't mention at the start and which meant that, in the end, they got around 20 hours' work for free out of me.

The second job was a large local authority, whose public library system had a load of acetate-on-glass and lacquer-on-steel disc recordings from the '30s and '40s of the musings of various local celebs of the time, and wanted them digitised to put on their website. As part of the consultancy I transferred ten sides myself as proof of the concept of the preservation and access strategy I was recommending. The day after I put the CD in the post, I got a phone call from the head of the libraries service. There was a pot of money she could apply for (an internal council budget) that needed to be spent by the end of the month or they'd lose it. Could I do the digitising myself, she asked? To be honest, I didn't really want to. I had a lot of work and family commitments on at the time, the recordings weren't particularly interesting, and the mould treatment required by some of the discs was a messy pain in the neck. So I sent them an outrageous quote for doing the job myself within their timescale, which even the figures I'd put in my report to them suggested was taking the mick. I'd even included more or less unnecessary (i.e. would increase the quality of the result, but beyond what was really needed) equipment expenditure, e.g. a £3k record cleaning machine. No problem, she replied, barely batting an eyelid! Basically, I pocketed a five-figure sum (only just, but it was five figures) after tax and also acquired some state-of-the-art gear into the bargain for a week's work (albeit a very intensive and boring week). They paid my invoice without so much as a murmur.

If these people had gone through the competitive tender process to the specialist contractors I'd cited in my report, they could have got the job done for less than half what I charged them. As I say, the quote I gave them was an attempt to decline the offer gracefully! If this sort of thing is going on across the public sector, there very clearly are colossal savings that can be made. However, as it's my taxes that are funding this largesse in the first place, I can't say that I feel particularly guilty over the episode.

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I'd agree in principle.

However, if big systems delivery isn't a company's core skill set, why would they have a permanent employee (or team) paid £200k a year to do that stuff if they only need them for a year or two?

And for other organisations, if they don't have those skills internally (or won't pay enough to keep them) then there is a demand for external short-term skills to fill a gap.

Hence I exist.

Couldn't this be done by a Quango? :ph34r:

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(snip)

If these people had gone through the competitive tender process to the specialist contractors I'd cited in my report, they could have got the job done for less than half what I charged them. As I say, the quote I gave them was an attempt to decline the offer gracefully! If this sort of thing is going on across the public sector, there very clearly are colossal savings that can be made. However, as it's my taxes that are funding this largesse in the first place, I can't say that I feel particularly guilty over the episode.

Like I said, I am happy that the savings I have made for organisations (that includes savings from giving procurement advice and implementing better procurement processes) has been more than repaid in savings for that organisation.

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Bottom line good managers are rare as rocking horse poo. How many managers are actually trained to be managers with proper ongoing Professional Development. Truth is we pick the best at the job promote them to manager. When they should be technical expert (a completly undervalued job)

Consultants can be useful, especially for a high level cull "It was not me it was the consultants"

You always have to be clear with your success critiria e.g. JIT does reduce inventory and tied up capital but increases supply chain risk, what is important to your company?

It is better to execute the most basic of strategies well than an intelligent one poorly.

How did the consultant agree the savings were they accountable? on a hard or a soft saving (if you dont know the difference you are not a good manager)

Consultant primary objective is to make money from you, your savings are a byproduct to enssure they get future contracts

However you look at it 1.8bil is a shed load of money if they didn't save 18 bil the person who signed the contracts needs to be dragged into the street and shot for treason

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The latest initiative my PCT has launched is the engagement of a communications consultancy for a 3 year project. The PCT scored lower than average on the national patient survey. The consultants are engaged to improve survey results. They will do this by providing incentive payments to and policing GPs that implement and deliver a plan drawn up by the communications consultancy.

This is a giant waste of money. Potential payments to GPs could run over £1m. The cost of the consultancy project has not been disclsed. There are attendant PCT indirect management costs that are no doubt unaccounted for. All to employ useless ******* coaching GPs to hit useless targets

The money for this crap comes out of the primary healthcare budget - money that should be going to the frontline services

I have worked as a management consultant too. It's par for the course for consultants to make inflated claims about their profit-boosting powers. They don't hang around and are not accountable for the long term consequences of their action. Like bankers boasting about their wealth generating prowess while clinging to the skirts of the state that bails them out. In the NHS, consultancy has been used by ex-managers to cash out - feed like parasites on the system that once employed them.

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