Academic consultants bring a different perspective to business problems

April 23, 2008

The stereotypes are familiar to consultants and people who hire them: Commercial consultants are in it for the money. They offer boilerplate products and simple answers to complex problems. Then there are academic consultants. They are detached from the real world, miss deadlines, and make things more complicated than they need to be.

While kernels of truth can be found in these simplistic characterizations, commercial and academic consultants, in fact, bring different and important perspectives to problems companies face, according to W. P. Carey School of Business researchers, some of whom happen to do consulting themselves.

"Companies use both," says Andrew Atzert, assistant dean and director of the Center for Executive and Professional Development. "They need both."

There are some standard business problems that commercial consultants are best at solving, according to research economics Professor Timothy James. But there are other times, he says, when companies need someone with the analytical skills of an academic.

"A lot of projects consultants work on are fairly standard in terms of what's necessary to get from start to completion," says James, who also serves as the director of research and consulting at the L. William Seidman Research Institute. "But there are one or two that may come up that are more difficult and you have to figure out how to work it out. You have to invent a new method. That's where the academic creativity comes into play."

Meeting a need

Most large businesses at one time or another need a consultant. Consultants are paid thinkers, who bring fresh perspective in addition to technical skills honed through years of experience, study, and research. Consultants help with everything from employee morale to customer satisfaction to technology improvements.

Commercial consulting firms, typically staffed by trained experts, come in all sizes and specialties. Academics also do consulting -- either on their own, through their university, or as a contractor for a commercial consultancy.

Faculty and staff at the W. P. Carey School of Business consult on an individual basis for firms, and some also hire on with commercial consulting companies. The school has a program that matches faculty with businesses seeking consulting help. In addition, faculty and research staff in the school's L. William Seidman Research Institute provide reports sponsored under contract with corporate clients.

One of the school's busiest faculty consultants is management Professor Angelo Kinicki, who holds the Weatherup/Overby Chair in Leadership Management. He does some consulting as an individual, but most of his consulting work is with a commercial company, Kinicki and Associates Inc., which is owned and run by his wife, Joyce Kinicki.

"When I go out, I'm represented as an academic who does consulting," says Professor Kinicki. "My primary job is at the W. P. Carey School of Business, so when people hire us, I think that's why they do it. It's the uniqueness of what an academic consultant brings that helps me get business on the commercial side."

Selling knowledge

What an academic brings is knowledge, as well as a rigorous approach to diagnosing and solving problems, according to Atzert. "What a faculty member at a university typically does is bring in all sorts of information about the area that you're studying -- conflicting opinions and research -- and tries to make sense of that," he says. "It's a broad perspective that faculty bring based on their research, based on their consulting across a wide range of industries."

"Faculty consulting is an avenue for the flow of knowledge and expertise from research universities to surrounding business communities," says Dennis Hoffman, a W. P. Carey professor of economics, dean for research and director of the Seidman Institute. "While distinct from basic research conducted in research labs, some academics have argued that consulting is just as important to business. It certainly has immediate impact and value, which is reflected in the fees that corporate clients are willing to pay to retain faculty experts."

In fact, Hoffman says, "the impact of faculty consulting on commercial businesses could be as important to regional development as are new licenses and patents created by faculty researchers."

Academics often bring specialized skills to their consulting. Professor Kinicki is trained in psychometrics -- the study of how things are measured -- which is useful in validating statistical analysis. "That's not a skill that a typical consulting firm would have," Kinicki says.

James recounts his experience consulting for a company that could as easily have been a project tackled by the Seidman staff. The company was planning an innovative offshore port facility in the southeast United States, and the client asked him to assess what the demand would be for this sort of facility.

"Nobody had any idea how to actually do that," says James. "There are no standard methods to assess that sort of thing. You have to start from the basics in an academic way. What would be the demand for this sort of thing? What does the demand for this depend upon?"

James constructed a model that accounted for the important variables, then plugged in available data to give his client some answers.

Creative thinking vs. quick solutions

Kinicki acknowledges that successful academic consultants must learn to shed some of their scholarly impulses.

"I do think there are some academics who are not practical," says Kinicki. "But once you start doing consulting as an academic, you soon learn you must be practical or no one's going to hire you back."

By partnering with his wife, who worked in industry before becoming a commercial consultant, Professor Kinicki believes the firm can deliver a bit of the best of both worlds.

Daniel Brooks, faculty director of the W. P. Carey MBA Corporate Program, also is familiar with both commercial and academic consulting. He has worked with small boutique consulting firms, government consulting, and global professional services and consulting firms such as PricewaterhouseCoopers, where he was a director. He says some businesses approach academics with a certain amount of skepticism.

"Sometimes faculty tend to be less sensitive to the schedules and budgets that businesses are constrained by, and as a result may expand their investigations beyond these very real business constraints," Brooks says. "On the other hand, businesses can sometimes be too sensitive to these constraints and end up missing significant benefits that could result from spending a bit more time or money investigating alternatives. The tension between business constraints and faculty investigations is healthy and brings real benefits to both sides when it is managed effectively."

The larger commercial consulting firms tend to take on bigger projects, using well-established applications or procedures, according to Brooks. "There are a couple of senior people to oversee the process, but these organizations rest heavily on size and procedure and using junior people at lower rates doing established things." Consulting with university faculty typically differs from applying established processes because the challenges are more complex and the answers are often less straightforward.

Established processes can bring other benefits to a consulting firm, especially if they can be given names, then licensed or copyrighted, according to James. "Even the largest and most high profile ones tend to do things like invent a process and then label it in a kind of product mode, so that it belongs to you as your intellectual property," he says.

Sometimes this is the kind of quick answer a client is seeking. Atzert cites the example of a company that needs to train employees in the quickest and most efficient way. Commercial consultants often have copyrighted workbooks they can distribute to a company. "The company will say, 'Give me a template, give me some worksheets and some tools to train our folks, and better yet, train some trainers.'"

A matter of priorities

The W. P. Carey researchers agree that academics are not pure seekers of truth without concern for financial gain. However, in matters of money there is an important difference between commercial and academic consultants. Academics draw their regular salaries from their college or university.

"Our primary role is as an academic, which means we're teaching people, we're doing research," says Kinicki. "When I'm in the role of a consultant, my goal is not I've got to make as much money as I can from the client."

This is not the case for commercial consultants, according to Kinicki. "If they are a commercial company, they have to generate income. And if they're publicly traded, they've got to generate income for shareholders," he says.

But being unaffiliated with a big company can be a drawback for academics, according to James. When complications arise, the academic consultant typically does not have a home office to call on for help.

Also, for most academic consultants, their top priority is their academic job. From the perspective of a business looking to hire a consultant, this can be a strike against the academic.

Kinicki handles it this way, "If I have a heavy teaching load, and I have a client who wants to talk to me, I tell them very honestly, here's my schedule, and here's my availability and if that doesn't work for you, I completely understand you might want to get somebody else."

According to James, the most prudent approach for a business looking for help might be to use both commercial and academic consultants.

This can deliver the backup of a large organization and the creativity of an independent thinker. "That's the sort of thing where you have the two bits working in conjunction," he says.

Bottom Line:

  • Commercial consultants and academic consultants bring different strengths to their roles. Academics tend to use creative approaches based on the latest research. Commercial consultants often have quick solutions based on established procedures.
  • Academics often bring specialized skills to their consulting work. Even very large consulting firms do not have the range of expertise found in major universities.
  • Unlike commercial consultants, who need to generate revenue for their firms, academic consultants do not rely on consulting income as their principal source of income, since their regular salary comes from the academic institution.
  • Academic consultants who work on their own do not have access to the support services that large commercial consulting firms provide.