Tom Leary - Global Partner and Australia MD, Q5 consultancy

Q5 is an award winning consultancy with over 200 Q5ers delivering projects across their offices in the UK,US, Australia and Hong Kong.  They are relied upon by executive leaders of businesses across the public, private and third sectors to tackle their most pressing strategic challenges.  They work across multiple sectors and in Australia focus on media, retail public sector and infrastructure.  Their key specialism is in strategy development and operating model design. 

Alistair Marshall talks to Tom Leary, Q5 Global Partner and Managing Director of the business in Australia, to get some perspective on the journey they have had in building the Australian practice over the last 4 years.

So how did you end up with a career in management consulting?

I have always been interested in building things. When I was at University I studied mechanical engineering at Leeds in Northern England and when I left there I joined Accenture which was a really good fit for me at that time. It was all about fixing things, but in business and that's where the link was made. I spent 11 happy years there.

And how did we get from Accenture to running a practice here in Sydney?

I knew that I didn't want to be at Accenture long term. I wanted to join a smaller organization. At that point Q5 was just in London and it was a bit of a risk. Q5 has now grown globally,I've been here since the beginning of 2012.

You've been really successful here, taking it from a small practice into something significantly larger, so the obvious question is, what are the key ingredients to take a practice from a certain size and build it up to what it's become today?

It's an interesting one because when we talk about success, I don't personally think of it as being successful. I always really think of it as a work in progress. Things are going well, if you measure it in traditional terms, but in the moment you think to yourself that this is successful, it is probably the moment you've failed. So I don't really think of it like that.

 When we first came here in 2015, we had some friends of the firm, organizations, global organizations we worked with in the U.K. and elsewhere. But we didn't have any business when we started and it was just me and another guy in a small shoebox in Surrey Hills. It was just all about getting out and talking to lots of people, no meeting was a bad meeting.

The success has been about starting to refine and hone who those conversations are with. But ultimately it's about getting out there and talking to people, finding out what's going on in the market, what people want.

A lot of it's about being human and building very, very personal relationships. A brand is important, but ultimately it's the conversations you're having within that, that count. How you bring that brand to life with people. I think we've been successful because there's an opportunity in the market in Australia, not just in terms of what we do, but how we do it. The minute you think you're successful, the minute you rest on your laurels and then simply go about delivering work and putting your head down, that's a short term view. You have to see the business as a longer term play over time.

You clearly got in front of decision makers in fairly large organizations, are there any secrets about how you got yourself in front of decision makers when you didn't necessarily know the people that well?

 Yeah, it's quite simple. It's picking up the phone and asking questions of people who you might think are sitting in an ivory tower somewhere, but ultimately aren't. I think it's really easy to think, how do I approach a business, whether it be a small niche player, or a big multinational. It doesn't matter. Ultimately those organizations are being run by individuals who have challenges that they're facing on a daily basis.

 Sure. And people still buy people. Right?

 Yeah. People buy people. So it's about being bold and doing things that for most people are pretty uncomfortable things to do. Most people in organizations are skilled and capable at what they do and their craft. But very few of those, or a small portion of those individuals are also going out and having the bold conversations with organizations or people.

So when people choose you over some fairly big competition in global names, like McKinsey or a Boston Consulting Group, what do you think people are really looking for from a professional services provider? Why do you think they choose one over another, apart from that personal connection? In terms of delivery and things. What do you think people are chasing?

 Perhaps if I start with where the criticism comes of consultancies or the challenges for those in the sector that we're in.

 The challenge we face is that, for transformation of any description to be successful in the business, it needs to be led by the business. And so therefore organizations, consultancies, advisory businesses who can work with clients, and enable them to transform their business themselves, are likely to be successful.

 You need to know how you can truly partner with an organization, and not just be a load of smart people in a room putting a powerpoint together and delivering it to your client.

 That I think is the big differentiator. And that's what I think organizations want and I think it's what they need. So therefore, Q5 and the way I believe that we work with organizations is in that partnerial way. Buy that I mean, you're able to actually help them change their business, rather than change it from the outside.

There's a question here which I always ask around entrepreneurial approaches, you may actually have already answered it by one of the old classics, saying it's having the confidence and the ability to pick up a telephone to a stranger.

 You know there's so many different routes to market now around uses of digital media, speaking or networking or writing articles and sharing thought leadership pieces. Or do you need all of those?

 It's a good question. I want to say something really profound. And I think you've got to have those elements, those thought pieces and so on. You've got to have that for credibility of your brand. And for people to feel confident that if they are engaging with you, they are engaging with a brand that they're prepared to associate with. I don't think we've done anything particularly clever. But I think we've done things that others just don't do.

 You've been here four or five years now. You've landed some pretty enormous clients. What would be on the list of the biggest achievements for you since you are here?

 We are fortunate to have grown a business here in Australia with a relatively modest up front investment.  And we are delighted to have recently opened our doors in Melbourne.  These are great achievements for us.  A highlight from last year was winning a programme of work with a ASX100 listed business. We were chosen, against the competition to shape and deliver an important piece of work for this organisation. The encouraging thing for us was the fact this was another Australian brand which gives us the confidence in this market that our services have value.   

 I don't want to dodge your question around entrepreneurialism, but I think it's much more about the philosophy that you have, your entrepreneurial spirit which drives you. When we first came here, I went to a seminar that was run by the American Chamber of Commerce and Mark Scott, who at that point was the outgoing Director General of the ABC was talking about the transformation that he had lived through and stewarded around IView and the digital piece that they'd been working on.

I asked him a question about how he did that and what organizational challenges he came up against. Following that, I wrote him a hand written letter and asked him to do an interview, because I was interested in the topic. We do a lot of work in the media space and we have a point of view around how organizations in that space can transform and the unique challenges that creative businesses have when they're going through that transformation.

 Mark got straight back to me from his office and I conducted an interview with him, which we then published as part of one of our newsletters. Now, that was an example of just going and taking some initiative. The traditional methods are as useful today as they have ever been. I believe in the personal touch. I could have pinged him on LinkedIn, I could have used any of the digital channels.

Do you do training or skills development? You know some people talk about the Richard Branson side of things and born salespeople... I've never actually taken that view. I've trained thousands of sales people, and the best ones I've ever met were taught. I think personality plays its part, but you still need a structure or a framework to work around. What might that look like in your past. Have you put yourself through that? I would imagine Accenture was a good place for training?

Accenture is fantastic in terms of training people to build skills in the craft that they deliver. You can argue second to none in terms of the facility they have in Chicago. We do do some of that. We've actually got an alliance with a similar sized European businesses.

An organization called The Transformation Alliance. So for us to actually to be able to compete globally and to build scale, we've joined with similar organizations in Europe which not only enables us to have scale if we need it from a delivery perspective but also in terms of providing scale around training and capability development.

A lot of the training that we focus on, certainly here in Australia, is group training, we invest in helping people become leaders, helping people to have the confidence to understand who they are and to be comfortable in their own skin. To be able to put themselves out there in the market and think about their own personal brand.

 So organizations that think the individuals within them have to be, you know they have to mold themselves into the brand of your organization, are very short sighted. Certainly at Q5, we don't hire people that are conformists.

Therefore people need to understand that they have their own brand. They might be associated with Q5 and that's great. But they need to have their own brand. What do they stand for that makes them interesting to talk to. How do they hold themselves. How do they want to present themselves, either physically or verbally so that they can have an authentic voice.

A lot of the training we do is around that, because that is how you drive business performance. The team can go on a course and learn some particular skill, that's fine, around capability of what we deliver, but actually understanding how to be an authentic human and have the confidence to sit down in front of anything up to CEO's, board members, that's where our focus is.

 Culture is an over talked about word in all businesses. I believe a lot of the businesses I go to, fall down in this area because they talk about it but don't actually deliver in this area. Do you have a view on what a good culture looks like, what it involves. How would you describe the culture here at Q5?

 I certainly wouldn't claim to have cracked the code in any way, but there's probably a few things I would say are important to us in terms of how we build culture. Certainly culture is led from the top so you know, you get what you deserve to a degree. And so recognizing that everything you do as a leader in the business, ultimately is what others will either value or they will try and ape. So that's the first thing.

The second thing is that people have got to be motivated to come and work with your organization. They've got so many choices these days from an employment perspective, they can go anywhere. Therefore you've got to create an environment that people want to be a part of, you need to be very honest with people in the business and as transparent as you absolutely can be around what you're about, what you value. At Q5, It's about entrepreneurial spirit, it's about providing opportunity for the most junior people in your organization to have exposure to very senior clients.

Which wouldn't happen in lot of firms that I've spoken to!

No. And we celebrate that. We celebrate that risk. That's a risk for people. It's a risk for us as an organization to let more junior people sit in front of CEO's. But that's how you learn. So it's creating that entrepreneurial spirit in the team and giving them exposure and getting them into a position where they actually understand how an organization works, rather than sitting in a room, banging out test scripts for an ERP system or what have you.

I'm a firm believer that if you want a transformational business you need transformational human capital, which goes partly to the culture thing. If we were to have discussion about what successful businesses in the future require, another word we'd come up with is 'technology'. So how does technology play a part in the world of management consulting? Or how is it becoming an increasing part of management consulting?

There's probably two elements to that. One is how you use technology to make yourselves as efficient as you can be as a business, the second is how you use technology with your clients in the services that you provide.  If I look back five or six years ago, everything was on spreadsheet and they were all well organized, but ultimately they were on spreadsheets. That's fine, it works. But we're now in six offices in the States, U.K., We've got teams in the Middle East. We've got Hong Kong, we've got Australia, two offices in Australia. There is a point at which you literally cannot organize information on spreadsheets, you have to get some sort of systems to help you.

We've chosen well, we've learnt lessons along the way but ultimately, I think we're pretty good in terms of how we leverage technology internally. In terms of the way that we work with our clients, we use it more than anything, to provide insight. If you can provide insight to a client, then that's ultimately what they want. They don't just want pointy heads sitting around, banging out data.


 Reports. Or a slide deck. It's not about just information. They want insight. We leverage technology to provide insight or to enable things to be done quicker in an organization.

We deliver strategic advice on significant operating model change and we help them make that happen. That's broadly what we do. So anything that enables us to derive insight around where the value is in an organization, and where they should invest, is where we leverage technology.

 Q5 are very much about bringing change to an organization, what advice would you give to people who were looking to bring about change. Where do they start?

The first place to start is the leaders of the organization. Change will only happen if the leaders, right up to the CEO, are behind the change and sponsoring that change. Without that, you will not be successful.

Sure. Anything else other than the commitment of the board room?

 I think the second thing I would say is external organizations can't bring about change in your organization. No matter how good they are. So to make the best change in an organization, it has to be done from within the organization itself.

 The easiest mistake we often see in the market is where very capable consultancies or advisory businesses are brought in, as an easy fix. You know, we'll pay some money for an organization to come in and make a change happen. That’s not the way it works.

What you're actually doing then is divulging your responsibility to an outside organization. The success is about the flip of that. Which is recognize you're investing in a partnership and therefore there's going to be some difficult conversations to be had because ultimately, it's the leaders of the business that are going to have to make that change.

 One of the questions that inevitably comes up when I'm having discussions with professional firms, is the way that they charge for their service. We're still in a world where as much as 80% of legal businesses, accounting practices, would still charge by the billable hour. Have you got any views about how services are charged for or how that might change over time? Whether that be fixed fee or success fee, or people having to get skin in the game and sharing the risk or anything like that?

Yes, a really interesting question we come across a lot, every time we pitch a client. I think firstly the type of project or type of challenge you're trying to help an organization with is relevant. I don't think you can apply any particular one size fits all. If an organization is looking to say make a process more efficient or you're trying to clear a backlog for a government agency of applications or whatever it might be, then having success fees and incentives aligned with doing that quicker, or an incentive for over achieving, it's fine. It makes loads of sense. Everyone's aligned, everyone's a winner. 

 I think if you're looking to apply success fees around transformation of your organization, especially when it involves people and either reductions in work force, or changes, significant changes to the make up of the organization, I would personally steer very clear of anything that is around a success fee because anyone can get money out of a business. It's not hard. The hard bit is leaving a business in a state where it can actually thrive.

 Given that the majority of the work that we do is in that latter area, ie. where are we heading strategically? What do we need to change in our organization? And then latterly, how do we make that change happen? Typically the way we like to work is for a fixed price for a fixed scope of work, over a fixed period of time and that works pretty well.

For the longer standing relationships that we have, in particular where there's lots of potential changes to scope, or time frames, then we will often put a time and materials contract in place. But we'd do that in a very open way. The engagement partner will sit down with the clients and say, "This is what I believe. What works for you? How do we get the right balance and value for money for you?" But also from our perspective, the level of predictability around our resourcing is important. That's the main issue for us, you know organizations want to make change very quickly and depending on how quickly you want to make that change, changes the premium and ultimately you need to pay to make it happen.

 So we work typically on fixed price or very open book transparent time and materials, ie. day rates for different levels in the organization and we agree that upfront and at the end of the month we say, this is what's happened. But it's all based on trust.

What would you foresee as the future for consulting? I would argue it seems to be a boom industry. All accounting and advisory businesses now seem to want to have a management consulting division and more and more people are playing in that field. Where do you see the management consulting industry going?

I think you have to look at the needs of clients and how those needs can be serviced. Clients are trying to deliver the best outcome for the lowest possible cost. Therefore, some organizations will take a view, ultimately what do they outsource, how do they buy advice? Do they want to have in-house advice? Do they want to build big change capability within the business? Or do they feel they want to work with partners? I think that increasingly there will be ... there's going to be space for a number of those.

 The government in Australia has taken a view that they will lean heavily on consultants. They want to have a smaller work force. You may argue whether that's right or wrong, but they actually want to lean on consultancies to provide, not only just capacity, but also a large portion of the capability. If the Australian government take the view that that's what they want to continue doing, then the future in Australia will be that there is a significant place for consultancies.

For a lot of organizations, they don't have that scale and they actually want to buy advisory services providing expertise, real expertise, smaller teams of real experts to help them ... Because most leaders worth their salt have a view of where they're trying to go.

Sector specialism is something that I always stress as being relatively important. So for those listening or reading to this, can you just give us a heads up on where you would see your sector specialisms here at Q5?

 In terms of Q5 it is worth mentioning that we started from a sector agnostic perspective. We didn't come in saying we're retail experts and therefore you need to hire our retail expertise. We came in by developing a way of working with organizations that takes them from where they're trying to go, to how do they make it happen, through to the design of those organizations. Over time we have developed some sector specialism, so I can talk to those, but our core capability is very importantly sector agnostic. Globally, I'd say from a media perspective, we are very well known brand. Arguably one of the best known, most capable organizations currently in helping organizations in that sector.  

We've done a huge amount of work in retail and retail is clearly a pretty diverse sector, and it's interesting to see what's going on globally and in terms of Australia in that particular setup, how those organizations deal with the disruption that they're experiencing.

  The third sector and one of our main areas of focus, is the public sector. It takes a lot longer to build relationships, but we have delivered work at the federal, state and the city council level here in Australia. 

I always like to ask people if they've got any regrets or having got to this point, is there anything they look back on and think how they might have done it differently. 

You could criticize me for not spending as much time as I would have liked trying to build our Melbourne practice. But in reality, you are only as good as the projects you're delivering and the clients that you know, partnerships that you have. And I think you ignore them at your peril.

 Is that to keep an eye on the balance between how much time you spend on the business versus work in it? I guess that's a challenge faced by lots of people who would be reading this.

 Yeah. I think it is. And it depends on how you go about delivering your services . We don't have a separate sales and delivery team, it's not where we want to go. It's not where we see how we want to deliver. One thing is for sure, if you're not doing any work on the business, it's a very short term view.

So what does life look like in Sydney when you're not working?

 I'm pretty family based I would say. We live near the beach in Bronte, which is beautiful. I'm very lucky to spend a lot of time down there with the kids. So, just enjoying time with the family that's the main thing. I used to play a lot of hockey and golf. I'd like to play more in the future, you know I've got young kids less than 10, it's spending time with them and my wife. And yeah, just having good times in this beautiful country that we live in.

 All good. Thanks Tom for spending your time with me Today.