Meet the MasterMinds: An Exclusive Interview With Jack
Chapin
 Tilting
at Windmills?
Jack Chapin is an advocate for the adoption
of formal standards for Management Consultants, and he is
an expert on the subject. Chapin is a Certified Management
Consultant (CMC), the past National Chair of the Institute
of Management Consultants USA, and past National Co-chair
of the Council of Consulting Organizations.
Chapin also chaired the 2001 joint committee of the Association
of Management Consulting Firms and the Institute of Management
Consultants USA on Standards for Management Consultants.
MCNews talked with Chapin about the state of professional
standards in the consulting industry and the Statement on
Standards for Management Consulting Services recently adopted
by the Midwest Society of Professional Consultants.
In an attempt to understand if and how U.S.-based consultants
might fall under the regulatory grip of the government,
MCNews queried the U.S. White House, and the Campaign Headquarters
of U.S. Presidential hopeful, John F. Kerry. Our letters
and calls were…uh…not immediately returned.
* * * *
MCNews: How would you define "standards" for
the consulting profession?
Chapin: Let me answer by giving you an example. In the
accounting profession, the AICPA Code of Professional Conduct
requires members who perform professional services to comply
with enforceable standards of professional competence, responsibility
and conduct. And these standards have been used in defending
and prosecuting disputes between clients and practitioners
through the years.
My view is that standards for the consulting profession
must define the scope of a consultant's responsibilities
and the client's responsibilities in the course of
an engagement. And, standards must be enforceable in a court
of law.
MCNews: Why do standards need to be enforceable in court?
Chapin: In lawsuits against consulting firms, some
plaintiffs' lawyers attempt to expand the definition of
the consultant's professional responsibilities beyond what
is specified in the agreement between the client and the
consultant.
In some cases against consultants, the client claims that,
as a "trusted advisor," the consultant should
have known the client needed something above and beyond
what they were doing, so therefore the consultant is financially
responsible for damages to the business.
Consultants, of course, take the opposite point of view,
attempting to minimize the scope of their liability for
damages by arguing that the consulting engagement letter
establishes the boundaries of the client/consultant relationship.
And, in the end, the court has to sort it out.
An enforceable standard solves this problem by defining
the roles of the consultant and the client, and I think
that's beneficial for everybody. It helps clients and consultants
understand their respective obligations when they agree
to a project.
MCNews: Doesn't the engagement letter govern the definition
of the work in a dispute more powerfully than a set of standards
would?
Chapin: I can tell you haven't had to spend time
in court, and you're lucky for that.
The engagement letter has been viewed by courts as a contract.
But without standards that specify the responsibilities
of the consultant and the client, plaintiffs have successfully
expanded the definition of a consultant's responsibility
to a client to the "knew or should have known area."
MCNews: Many consultants resist the idea of professional
standards. Why the controversy?
Chapin: Well, the controversy is that standards
may raise the bar for consultants and individual consultants
are fearful of that. And, many individual consultants don't
think they'll ever be sued because most of them don't have
very deep pockets and it's not profitable for a client to
take them to court.
MCNews: What's your opinion on how to implement industry-wide
standards?
Chapin: The answer is there is not a professional
association right now that's representative of all consultants.
And no one has taken on a leadership role to really speak
for the profession on this subject.
The Midwest Society of Professional Consultants has adopted
a set of standards for management consulting services that
we believe addresses the issues we've been discussing. Anyone
who wants to read the standards can find the document at
http://www.mspc.org/SSMCS.pdf.
MCNews: Do you believe that a government agency will
step in to impose standards if the industry doesn't act
on its own behalf?
Chapin: I think it's inevitable. How quickly it
will get here is an unknown. In the U.S., the implementation
of Sarbanes-Oxley is consuming the regulatory agenda, so
consultants have a pass right now. It's my view that will
change. I just don't know when.
MCNews: Thanks for your time.
Find out more about Chapin and his services at www.chapinassociatesltd.com.
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