dispatches from the new world of work

Create the "Perfect Storm" PSF/Professional Service Firm!

Rule the World!

Approaching Novosibirsk

He was perhaps the most independent, self-assured person I'd met—certainly the most independent-minded under 30. He worked for me for several months during my McKinsey days, on a distribution project for Frito-Lay in Dallas. I'd worked with a lot of very smart guys, but he was somehow different, though I couldn't at first put my finger on the how. Over dinners together, talk would sometimes turn to our backgrounds. We both had pretty similar, not particularly scintillating origins; and we'd both ended up in engineering school, he mechanical, me civil. But our paths then diverged. The U.S. Navy paid my way through school, and I returned the favor with four years' service. He had gone to work, at world's end and virtually alone, as a young—and remarkably independent and accountable—field engineer at Schlumberger, the French-based, lean-mean-autonomous-R&D driven oilfield services firm. I continued to follow the company, through some ups and downs, for the next 25 years. It surfaced again, with a bang, this week.

This week's BusinessWeek cover story (0114.08) informs us that Schlumberger may well take over the world: "THE GIANT STALKING BIG OIL: How Schlumberger Is Rewriting the Rules of the Energy Game." In short, Schlumberger knows how to create and run oilfields, anywhere, from drilling to fullscale production to distribution. And the nugget is still those hardcore, small, technically accomplished teams. As China and Russia, among others, make their move in energy, state-run companies are eclipsing the major independents. (China's state oil company just surpassed Exxon in market value.) At the center of it all, abetting these new players who are edging out the Exxons and BPs, the Kings of Large-scale, Long-term Project Management wear Schlumberger overalls. (The pictures in the article from Siberia, alone, are worth the cover price.)

At the center of the center of the Schlumberger "empire" is a relatively newly configured outfit, reminiscent of IBM's Global Services and UPS's integrated logistics' experts and even Best Buy's now ubiquitous "Geek Squads." The Schlumberger version is simply called IPM, for Integrated Project Management. It lives in a nondescript building near Gatwick Airport, and its chief says it will do "just about anything an oilfield owner would want, from drilling to production"—that is, as BusinessWeek put it, "[IPM] strays from [Schlumberger's] traditional role as a service provider* and moves deeper into areas once dominated by the majors." (*My old pal was solo on remote offshore platforms interpreting geophysical logs and the like.)

As I see it, and you doubtless know my longterm, noisy bias toward the "PSF-as-center-of-value-added" (PSF = Professional Service Firm), Schlumberger is transforming itself into the biggest and most powerful "PSF" in history. Moreover, paths like this, from IBM and UPS and Best-Buy to Schlumberger, are open to many firms—and provide, to use the term du jour, "blue ocean" of unimaginable breadth and depth.

All I ask is "think about it." If your imagination is fertile enough, there may be a space for you—tiny or large, local or global outfit—in a game like this.

So: Think about it.

(By the by, last year Schlumberger, growing at 25% per year, netted $7 billion on $23 billion in revenue. Its market cap is $120 billion—and it's by far outstripped its traditional rival, Halliburton.)

(Above you'll see my April 2006 picture—as my Air Siberia flight approached Novosibirsk in central Siberia.)

Tom Peters posted this on 01/08/08.

Comments

One of the things, that I must admit, that amazes me is that the PSF concept is a bit dated now and yet, so few people and organizations have made the switch. Within the Information Technology community, questions like what is your business value and what are your products, services, and solutions are still very foreign to most people. And look out if you actually bring up a concept like Customer Experience. The question that remains to be asked is will these concepts ever sink in or will there be a few industries or organizations that never embrace these ideals.

Posted by RTodd at January 8, 2008 1:58 PM

Great post, Tom. Happy New Year to you.

PS A big thank you for the many years of inspiration you've given me et al over the years.

I just blogged you, by the way. 4 years later, "Re-Imagine!' still resonates.

http://www.gapingvoid.com/Moveable_Type/archives/004397.html

Posted by hugh macleod at January 8, 2008 3:50 PM

RTodd. On the one hand I agree that PSF is "dated." On the other, as you say, if something important has not been implemented, then it's not dated by definition. One of consultants' big failings is to get bored with an idea before it's been implemented--and then move on to the next cool thing, which we label "fresh" and write up in the Harvard Business Review.

Posted by tom peters at January 8, 2008 4:08 PM

I would endorse and reinforce RToddâ€™s view about non-implementation of these ideas. Management in the UK National Health Service probably believes PSF is a disease. I remember in the mid 1990â€™s a very senior manager in the NHS (white, middle-aged, middle-class, English male, in grey suit, white shirt, dark tie) who was one of my bosses. I suggested to him it would be great if we could implement ideas such as PSF promoted by Tom Peters in â€˜Liberation Management.â€™ His response was â€˜Who is Tom Peters?â€™ â€“ Therein lies the problem â€“ those who refuse to look will never see. And of course the flip side of that some coin is "In the kingdom of the blind, the one-eyed man is king." - Desiderius Erasmus

Posted by Trevor Gay at January 8, 2008 7:21 PM

PSF's have the same associations that Big 5 consulting companies have. A brand new MBA doesn't come with experience, but it may come with a consulting job, and that isn't always good for the category.

As Trevor points out in his comment, PSF's are often considered a disease, and they can act like a disease. But they aren't all bad. An analogy might be bacteria. While some bacteria cause disease, much of our digestive processes are based upon symbiotic bacteria.

PSF's have to make sure that they are delivering value, not just watching their own gross margins. It is management's job (on both sides) to make sure that there is a relationship between a PSF and its clients in which the success of one ensures the success of the other AND vice-versa.

Posted by Ben Tallman at January 8, 2008 10:05 PM

Tom's first publication on the subject of PSF (that I possess) is a Tom Peters Group Occasional Paper dated 1988, so, I can see why the idea could be described as "dated." However, my experience of working with Tom and helping our clients apply his ideas is that the lag between the idea being presented and its more general application can take many years. For heaven's sake, In Search of Excellence, now over 25 years old, still attracted a massive audience to hear Tom speak in London last October.

However, I think there is an important reason why the PSF thinking has been difficult to apply, aside from the unhelpful associations that Ben mentions. PSF requires a major mindset shift for many well established organisations in that it puts the "professional" at the centre of the organisation. What great PSFs know is that they must find the world's best professionals in their field, and then create a context for them where they can do their best work -- in which case the practice benefits and they get great rewards. My experience is that this orientation goes against the much more scientific and rational approach to management that has become embedded in much western corporate thinking of the 80s and 90s. Becoming "talent centric" is not a quick or easy journey, and requires leaders who have ambition to be different.

I am convinced that the PSF orientation will be at the heart of the revolution that is undoubtedly taking place in organisations over the globe, and that its impact will eventually be as great as that of the production line thinking that dominated the organisation thinking of the 20th Century.

To try and reflect the much more expansive potential of PSF thinking, in Tom Peters Company, we describe the approach as the "Future Shape of the Winner."

The big question is, who is "up for" this massive shift in thinking? It's more often seen in start-up companies, particularly in the high-tech arena, where talent is so critical for success. But you might argue it is much easier for them as they have no status quo to disturb. What about existing organisations -- can they change?? Examples like the one Tom has pointed to in Schlumberger seem the most promising approach for larger organisations -- find a piece of the business that can be "PSF'd" and give them the scope to try to be different.

Most heartening -- thanks Tom!

Posted by Madeleine at January 9, 2008 5:50 AM

I completely agree with the PSF concept.

viagra mastercard online pharmacy

Unfortunately, it can have negative consequences if the company leadership is not engaged. When truly embraced, an individual's ownership can be perceived as overbearing to those that would prefer the cost center mode of operation. Self imposed deadlines for results will result in challenges to co-workers that are integral to successful (& timely) completion of a project.

As a long time employee of a very large company, I was called on the carpet for offending 3 different co-workers over a period of 2 years, none of which from within my direct organization. Bottom line was that I was told that it was my responsibility not to offend others. Quite an awakening. First discussion of this nature in 28 yrs.

I still have the PSF in my core, but have learned to temper my enthusiasm. It's unfortunate because the company could benefit tremendously from this approach.

Keep up the great work!

Posted by CKD at January 9, 2008 8:59 PM