In my last post I referred to Steve Hsu’s (on Twitter @hsu_steve) post on credentials and elite performance. Hsu distinguishes between the “hard” and “soft” elite, where law, consultancy, and investment banking firms are…
“soft” elite firms, whereas I will refer to hedge/venture funds, startups and technology companies as “hard” elite firms. …In the latter category performance is a bit easier to measure, and raw prestige plays less of a role in marketing to customers or clients — i.e., the customer can directly tell whether the gizmo works (“these search results suck!”) or the fund made money. Whether or not the advice received from a law/consulting/M&A firm is any good is much more nebulous and, well, soft.
I would clarify in one way: the inability to measure “softens” negative consequences, which IMO is the true driver for “softness”. A “consequences of failure” scale would refine Hsu’s categories: e.g., litigation-oriented law firms are “harder” than lobbying-focused firms. So, given the challenge of the many nebulous partnerships we must forge with “soft” firms, do you all have any tips beyond the few I’ve added below?
- Stay aligned ahead of them: Hsu identifies one core competence of soft elite firms: the ability “to appear elite and smart enough to snow their clients and sell the work.” If you find yourself in conflict with the approach of top-tier consultancies, you’d better be ready to come in to your executive team “firstest with the mostest” (not exactly what Forrest said, BTW).
- Measure what you can before you pay: Good luck clawing back cash after paying one an elite firm. Whenever possible make payments contingent on deliverables or withhold payment on time and materials deals until you get satisfaction.
- Restraint of tongue and pen: It may feel good to blow off steam or air dirty laundry, but your consequences may be dire. Remember, another core competence of soft elites is the ability to avoid consequences and shift blame…don’t tape a “kick me” sign to your own back!