• By German Anitua Azkarate
  • Rating:( 369 votes )

Network versus Networth

With every passing year, people management is becoming an aspect of major concern for businesses, and especially for those, knowledge-intensive as consulting services. Whether small or large, consultancies that even, and despite having detailed and well-defined professional development programs, find it difficult to retain talent once already trained. On the other hand, clients of these consultancies expect solutions to their problems; I mean… "value". Moreover, the problems of these companies are increasingly numerous and varied, and where search and entry into international markets seems to be the unsettled issue.

Above all, it is the issue to which consultants face with regards to training and retaining talent, the min reason why they have opted for the "Network" formula; for instance, to have access to a pull of external collaborations agreements that allow them to offer to their customers a number of various solutions without having to train their employees in new themes, and/or having to hire new profiles. Today, it seems that every professional service provider (consulting advice, auditing, legal, etc ...) either it has a network to which it belongs or it seems to give the image of being obsolete!

The Network formula are varied. The most comfortable and frequented formula for these professional service providers is to register and through a fee, which can be monthly, quarterly or yearly, become a member of a community of companies, which in its sector of activity, each contribute to network with their different areas of expertise. However, this is the crux of the matter! The "Network" concept is not always linked with the "worth", or value word. This is because the vast majority of these "Networks" work like an outsourcing procedure. For instance, the company with a problem to be solve contact either with any of these professional service providers and hires the solution to its problem. However, this company alleged initial service provider, lacking of the knowledge to provide the required solution submits the problem to its "Network" in the search of the best service provider able to offer such a solution. Here is where all the commissions and margins game begins between these two professional service providers, while to the client and holder of the problem is still waiting. In most cases, and post it have been arranged between them the matter of percentages and commissions, the final solution provider is presented to the client, usually unknown to the later.
Once finalised contract work, the image that usually fits conclusion, and that the client takes is as follows: (i) that of having worked with a company that did not know his previous history, but with which already counted the company initially hired to give a solution to their problem; (ii) that of having seen no communication whatsoever among both service providers; (iii) that of having perceived a disorder in the communication channel between both service providers; (iv) that of having perceived that the system of quality of work of both service providers are not standardised and each acts to look their best; (v) that of having to deal with all three companies and the communication has been neither fast nor agile; (vi) that of having felt that rather than working with the initial service provider contacted, this service has been outsourced it to a third company which has hardly ever or previously worked with.

Do you think the effect of this whole experience has been of a direct contribution of "VALUE" for the contracting party?

In most of these cases the "Network" does not provide any "worth", or value, at all. That is to say, the relationship between the network and the value are in follow completely opposite directions. The reason for this lies primarily in two key features. FIRST, service providers do not known each other since they have never worked together or for at least 5 years or more on monthly assigned projects, and SECONDLY, for not having any shared standards of work.

Accordingly, we advise any company before hiring any professional services enacting the virtues of their "Network", to ensure that they truly meet the two key features mentioned above.

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