Barrier:
Management consultants

I think you may be confusing correlation and causation.

Eric -

Good call.

I don't want to speak for all management consultants (I am one actually), but you are absolutely right. Unfortunately, most management consultants possess analytical experience but no soft skills required to run a business. They give customers advice but rarely (if ever) see their advice being implemented, so they don't know if it worked. They get MBAs and believe that having an MBA makes them smarter than everyone else (disclosure: I have an MBA).

While there are lots of great management consultants and lots of great advice they produce, it's rare that you see people come out of management consulting and create or grow businesses. Those that make it to the CEO spot rarely perform well.

I was thinking about posting another hack or barrier with a similar idea. My thought was to suggest removing all MBAs from the organization.

Peter - I'd like to comment on companies being out of business in 15 years - There were many studies done that determined what made companies survive for long periods of time. None had come up with a magic formula other than "pure luck". I would argue that there's no empirical evidence showing that companies will survive longer if they use management consultants. My gut feeling even tells me that it may be the opposite.

Good that you shared your experience with us. Perhaps I should not call your 4 companies in 15 years a study that would allow me drawing such conclusions, but may I highlight something anyway? Another common feature of all those businesses in your story that eventually went bankrupt is that they all employed you.

You guessed, I am a management consultant. In my 20 years in business my team and I have helped over 200 companies operate better - where my clients lacked competence and/or capacity to do things right then and there themselves.

I am not defending bad consultants and unnecessary projects. But suggesting that companies always have all the capacity and competence at hand when and where they need it, well I think - and many executives on this forum will confirm - says more about the depth of your experience than about management consulting in general.

My Friends,
As debate has progressed, I can see something is lost. Again here we are trapped in categorization and fallacies such as "rod your company of management consultants" or "removing all the MBAs from organization". Management Consulting like all other businesses or better to say, industries, has poor performers and great contributors both. I recommend trying to find a higher ground rather than sticking to one end of the spectrum.
Let me share my experience as a management consultant. I have been involved in this business for about 6 years. I have had good days and gloomy days in my career as a consultant. I have had clients who religiously followed my advice, plan, or prescriptions (I never tell them to do so since I am against religiously following anyone or anything) and they have gain considerable benefits. I have also had dissatisfied clients and unsuccessful experience in some initiatives or projects.
The thing is that we should look at the issue from a management consultant's perspective. I am trying to do so by diagnosing my failures and learning from experience.
In other words, the point is not deciding to hate or to love management consultant in this matter but trying to improve consulting practices both as client and consultant.

My experience is not that Management Consultants are bad or good or an indicator of a company's future viability. How a firm uses management consultants seems to me be key.

When firms spend on consultants to avoid decision-making and/or allow their own people to learn a helplessness, then the problem is not the consultants. Unfortunately, these firms tend to be large and profitable consulting clients.

I've been on both sides of this fence: client and consultant. Eric is right in that the presence of consultants may be an indicator of poor business culture but that experience is not shared by others where consultants are used wisely as a useful plug-in capacity.