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Value Drivers
Mark C. Scott
The Intellect Industry
Profiting and Learning from Professional Services Firms
Mark C. Scott
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A couple of provocative questions: Is all this management writing actually of any use to managers? Secondly,
does management writing draw its lessons from the right place or are we looking to the wrong companies for our
examples? These are the two questions that prompted me to recently publish two books, "Value Drivers" and "The
Intellect Industry". Let me explain……
The world of management theory has come a long way in the last twenty years. From the inception of modern
management writing with the publication of, "In Search of Excellence", a vast plethora of concepts and
paradigms has been spawned, from reengineering to core competencies. Each new invention, from EVA through to
The Balanced Scorecard, has added yet another weapon to the vast armory of tools and concepts available to
managers seeking to enhance the competitiveness of their organizations. The increasing complexity of the
competitive environment has been matched by the equal complexity of competing intellectual frameworks and
paradigms purporting to help managers respond to the challenges they face.
Your average manager is a stressed person, with little time for absorbing the vast number of business ideas
pumped out annually. The problems they face are practical, specific and ever shifting. Their window for
decision making is tight. In such an environment, it is my contention that the current welter of concepts,
titles and ideas risks being more confusing than helpful. There is a danger that all this great thinking has
created its own sense of purpose and mission amongst its manufacturers, divorced from the practical needs of
its principle audience. This is the "art for art's sake" labyrinth.
I wrote "Value Drivers" to respond to this challenge. It is not original in its observations. It offers no
great new paradigm, no revolutionary precept. Instead it synthesizes an array of other people's key-stone
concepts and packages them into a simple framework which can be put to practical use by managers. It is my
contention that, in the business cycle of management thought over the past twenty years, the challenge is now
integration, assimilation and simplification. The link needs to be reestablished between the worlds of academic
business thinking and the practical world of management. If you also believe this to be the case, please check
out the book.
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So that is a response to the first question. What about the second? Following "In Search of Excellence"
virtually all the business literature has worked on the basis of example and empiricism. The vast majority of
these examples are drawn from industry, from heavy engineering through to pharmaceuticals. The interesting
thing to ask ourselves is are we looking at the right examples? Are these going to be the prime sources of 21st
century management innovation?
What industry has been growing in double digits for the past ten years? What industry has its competitive
advantage founded on intangible assets and knowledge? In which industry have the Western economies retained
competitiveness against low cost, emerging economies? What industry attracts the best grads? The answer, if you
didn't already know, is professional services.
Professional services range from commercial law through to advertising. They account for around 20% of GDP and
employment, and are growing at 20%. Yet they are rarely analyzed and even more rarely cited as examples of how
to compete in the knowledge economy of the 21st Century.
I would posit that the next few years will witness a big shift in management literature away from an emphasis
on traditional industry and towards professional service businesses. This is one of the few areas where Western
firms will continue to dominate. It will continue to attract the best talent. It is the area of the greatest
expertise about that critical management skill - knowledge management. As many of the larger professional
service firms come to market to raise capital, management theorists will of necessity become more familiar with
them.
"The Intellect Industry", my second book with Wiley, is an attempt to get these firms on the radar and identify
the management challenges they face in securing their future competitiveness. If you believe knowledge based
businesses are the future, then this book may also interest you…..
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