Having spent time in consulting and in industry, I’ve noticed several key biases and weaknesses about people who’ve spent their entire careers in industry. This is in comparison to those who have spent some time in consulting first, before working in industry.
There are two key weaknesses.
I’ll address the first weakness below, and the second in a follow up article.
First, industry lifers tend to be functionally strong, but cross-functionally weak, for much if not most of their careers.
Career paths in industry are overwhelming functionally focused.
A junior engineer becomes a regular engineer. Then she becomes a senior engineer and hopefully an engineering manager. If she’s good, the engineering manager becomes the Director of Engineering and eventually the Vice President of Engineering.
The same is true in sales. The junior sales executive becomes a regular account executive, then a senior one, then manager, and so forth.
The same in finance, human resources, marketing, and so on.
You almost never hear of an engineering manager suddenly becoming a financial analyst, or a marketing manager becoming an engineering manager.
These career paths tend to be vertically focused within a single functional area. The reason this occurs is because it is the most cost efficient approach for an employer to develop middle and senior management talent within their organizations.
However, it is NOT the most effective way to develop exceptional middle and senior management talent.
The most effective way to develop mid and senior level executives is to rotate them across different functional areas so that they develop cross-functional skills, perspectives and breadth early in their careers. It allows the rising star middle manager and the senior level superstar to make better decisions, recruit better talent, and ultimately deliver better results.
The problem with this approach is that when you rotate a junior person through many functional departments, they often don’t contribute as much to the company compared with specializing in a single department.
As a result, for a company to make this effort, it requires them to adopt an investment mindset towards key rising stars in their organizations. Most companies do not, because they want a return on their investment immediately.
This cross-functional rotation approach doesn’t have a very high return on investment in the first few years. It’s often quite low.
I know of a few companies that will use this approach for their undergraduate hires from top universities. Procter & Gamble I think did this at one point.
At the mid levels of management, General Electric used to do this (and I believe still does) with their high potential program. If you were in the top 0.1% – 0.5% of their employees, they would pull you out of the standard functional career path and rotate you endlessly for 30 years until you would become a Fortune 500 CEO.
If you’ve been in industry your entire career and a stint in consulting isn’t likely to be in your future, you are not alone.
This represents both a problem and an opportunity.
It’s a problem because compared to ex-consultants hired into industry, you will be at a major disadvantage. However, it’s also likely a problem for 99% of your co-workers too.
It’s also an opportunity because if you can find a way to adopt consulting caliber skills, without having to actually work in consulting, then you will have an enormous (and arguably unfair) advantage over your colleagues.
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Success in Industry