House of Lies Read online

  “I just had to say hello,” squeaks the Rainmaker, rising onto the balls of his feet.

  “Of course, of course—”

  “Have you seen any of Tommy lately?” Tommy… Tommy… Motolla? Middelhoff? Both were… extremely impressive references…

  Faux-Tina shakes her head and glances over at you.

  “What about Heinz? Klaus? I had Klaus in last week for a—oh my gosh, I’m keeping you from your breakfast? You want to join us—I’m with—no, okay, okay… I just wanted to say hello…”

  “See you soon, Monty”—and she’s ushered off.

  You think: Monty? Is this a trick of acoustics, a simple misinformation of the sound waves? The Rainmaker’s first name is not Monty. Not even close. Hmmmm…

  As he sits across from you, missing not a beat, not a snippet of a beat, eating nothing at all while you dip into your ill-chosen waffles and links, you think—not for the last time—What balls. Tina-esque didn’t even know him.

  “That was [her name],” he says softly. “She’s the new head of strategic planning at Bertelsmann.” So it was Middelhoff, after all.

  “Have you guys worked together?”

  “Of course. I’ve known her for years. Tommy and I flew to Germany together recently—it’s amazing what he’s doing to that company. You know, he has that European charm. They live on a farm in the middle of nowhere.”

  Tommy Middelhoff took over a family business, European publishing and music giant Bertelsmann, which started out as a printer of Bibles and hymnals, in 1998. A fortuitous (or brilliant) investment in AOL at a strategic moment gave him so much money he (and others) began to think of Mr. Tommy as something of a seer and a visionary, or at least a very rich man with cash to burn on the Internet.

  “Are you working with them now?” you ask.

  The Rainmaker has that irritating Hollywood habit of looking over your shoulder while he is supposedly in conversation with you—looking around, like a vigilant dog, always surveying—this is a working breakfast, it turns out, and the work is not with you. He’s up again—“Excuse me…”—and he’s gone.

  The waffles are really quite delicious, now that you have time to spend with them.

  Complete Summary of [Book Title] “written by” the Rainmaker

  People want to have fun.

  Products and stores need to make themselves fun.

  There are a lot of products out there.

  People like big stars.

  Hire a big star to push your product.

  Businesses need hit products.

  How do you get these? Have hit ideas.

  Also, it helps if a group of “cool” people love your product.

  Then you have a hit!

  Your host is behind a pillar now, up and down on the balls of his feet, buttonholing a man who looks vaguely but not entirely like Harvey Weinstein at Miramax. He is a very ugly man, whoever he is. The waffles have a kind of silk butter texture, and they slide across the palate like vanilla pudding. You love vanilla pudding. Your watch tells you that twenty minutes have gone by—67 percent of your allotted time with the little man. He seems in no hurry to cram it full of belated welcome to your new career…

  To be a management consultant is to be always on the defensive. Clients attack your credentials—What do you know about my business? Competitors attack your experience—They’re really just an IT implementation shop. Colleagues attack your analyses, your logic—There’s no way inventory at the stores can be higher than inventory in the warehouses; check your math.

  But these besiegings are as nothing compared to the utter, irredeemable, unknowing cruelty of one’s parents, siblings, and friends when they ask—as they always do—when they ask, quite coolly but not without a certain challenge to their tone: So what do you actually do?

  This is a wickedly difficult question—one that cannot, in truth, be answered.

  We will not try to answer it here, at breakfast, but it is appropriate to point out an odd paradox at the heart of top-tier consulting. A paradox that explains how a man like the Rainmaker can cause so much damage to a seventy-five-year-old firm with ten thousand employees and a global presence.

  This paradox consists of two apparently contrary statements of principle:

  Principle One: One is promoted from associate to senior associate to principal based solely upon one’s ability to analyze data and present these analyses.

  Principle Two: One is promoted and rewarded thereafter solely upon the basis of one’s ability to sell the firm’s services.

  The less-than-subtle transformation these principles imply can be described visually as follows:

  The firm would come to deny it later, but it almost fired the Rainmaker at many points during his struggling early years. He was not a rising star. He was not anyone’s idea of a partner. He was tagged and tagged again as a potential counsel out. He was warned—it became an annual ritual, this warning of the Rainmaker. Principle One dictated that he should not have made it past associate. Why? His analytical skills were lame; he never went to business school and didn’t particularly care for numbers. Value a company?—hah, he couldn’t even find a company’s 10-K5 with an SEC code and a map. It’s not that he was dumb, exactly; old-timers would tell you he just did not have It. It was missing. It and Rain were unacquainted.

  Inertia, some shrewd ass work,6 a Lady Macbeth in the bedroom back home, and some awareness of just how vast these family connections were—something somehow saved him. Reluctantly, far later than his peers, he was promoted to principal by the slimmest of majorities on the principal committee.

  The next day he showed up for work, and everything was different. It must have been like flying through the cloud cover into the bright silver sky. He was a principal now—and the rules changed completely, just like that.

  Principle One didn’t matter anymore at all. His progress at the firm would now be determined entirely by Principle Two.

  Overnight, the Rainmaker was born.

  Within two weeks, he had found his first client—a friend of his mother, who was a disc jockey or a lawyer or an heiress to a radio distribution fortune, he was never clear which. A small job, maybe $500,000, but it got him some notice. The extension, sold the following month, got him more notice. Within six months he had earned the firm maybe $3 million and the partners thought All rightie then and invited him into their ranks. No one had ever spent less time as a principal. But it didn’t matter—he was selling. He was fulfilling the requirements of the job, and then some. The analytics—well, there were people to do that somewhere. He had other missions to accomplish…

  Like breakfast. You finish up your waffles, skip the links. No—you have a link. If you have waffles, what’s the point of pretending to diet by avoiding actual food? The damage is done. Your time with the great man is done. A shadow approaches from behind, and you turn to see if it’s him. No—he’s still behind the pillar, shaking hands with pseudo-Harvey. The shadow belongs to an apologetic maître d’ trailed by a good-looking young guy in a suit. He seems kind of familiar.

  “I’m sorry, sir, are you dining with [the Rainmaker]?” asks the maître d’. It’s disconcerting, but his accent is American.

  “Yeah.”

  “I’m afraid this gentleman is his eight-thirty.”

  “I’m sorry?”

  “His eight-thirty. Appointment.”

  The young guy steps forward. “And you’re his eight o’clock?”

  “I guess I am. Or I was. Do you want to sit down?”

  You get the feeling that they’re kind of losing patience with you. You’re just not getting it—and then you do.

  The Rainmaker has scheduled at least three breakfasts at half-hour intervals, of which you are—were—the second. A rinse of disappointment coats you, makes you cold. You look down where your waffle platter was: It’s gone.

  “The service is tremendous,” you say, making way for Mr. Good-Looking.

  “I’m sorry?”

  “The
waffles… are tremendous.”

  It is your curse in life that nobody ever understands your dry brand of sarcasm, which in fact is simply truth. And the Rainmaker himself appears, unruffled, almost hopped up, actually, by the commotion. Bodies coming and going; acts occurring. This must be his life—how utterly, entirely, completely exhausting.

  “Let me know how you’re doing,” he says to you or to the maître d’. And after all, who are you?

  Twelve days after your breakfastlike meeting with the Rainmaker, you find yourself working rather late at the office. The economy is not good at this time, and the consulting business across the board is showing obvious signs of cyclicality. Where a week before you started work in May 2001 there had been a client staff of 250 at your firm, there are now about 200. It is two months later. Were you to annualize such a rate of shrinkage, the firm would be gone by November.

  But it isn’t gone, and you are working late. It is midnight or quarter after, your wife has gone to sleep, most of the other teams have gone home. You sit in your office, all alone. Occasionally, one of the doomed summer interns will call you from the nineteenth floor, and even these calls are not unwelcome. The summer interns are nice kids; you don’t like to be all alone.

  You scroll through your interview notes, wondering. Like many questions consultants are asked to help answer, the one perplexing this company—ToyCo, we’ll call it—is simple. One customer accounts for over 90 percent of its revenues. It is beholden to a fast-food giant. This scares the company, which is quite profitable but has been forced to give up more and more margin to its big customer over the years. The customer is hardly stupid and knows exactly how far it can push ToyCo before it will be forced to pick up its paint kit and exit the business. For various reasons, the customer does not want this to happen; maybe it likes the toys. But it faces shareholders of its own, and cost pressures, and it is not making life easy for ToyCo one bit.

  You need some decaf. The Chicago office has eliminated its free gourmet coffee caddies from the pantries, but New York has priorities: Coffee caddies first, jobs second. So the jobs are gone, but the caddies remain. Right now, you are glad. You stand and genuflect in the direction of the MetLife Building, then begin the perc walk.

  The halls are quiet, but not utterly so. Only on a Sunday morning, early, is a consulting firm entirely unoccupied. Partners are never present late at night, but associates and summers often are. In professional services, there is a well-known inverse correlation between length of tenure and time spent in the office.

  Which is why it is so surprising to find a partner at the coffee caddy. He pushes the little self-brewing pouch into the slot and closes the door with a click, stepping back.

  “Hi there,” you say.

  He gasps—whaaaha!—and hikes back.

  “God. Sorry,” you say.

  It is the Rainmaker, of course. He looks at you, not returning your smile.

  “What are you doing here?” he asks.

  “Working. Late. How about you?”

  He doesn’t answer. The machine sputters and spits its last, and then he takes the warm cup in silence.

  You stand there.

  Later, around 2:00 or 2:15, when you’re going back for another cup of decaf, you see him again. He’s carrying a large box in the direction of the elevator bank. Through the glass doors leading to the elevator lobby, you can see another box. It sits under the call buttons.

  The next day, you get in around 8:30. At 9:17 an e-mail is sent firmwide from the New York office’s managing partner. It reads:

  From: “Van der Brink Hymen”

  To: NYC User List

  Colleagues:

  As many of you are already aware, [the Rainmaker] has resigned his position within the firm, effective immediately. The CMT partnership is working with the firm’s global leadership to ensure that the transition is seamless. The commercial assignment committee has scheduled a meeting July 30 to determine permanent leadership responsibilities within the practice. In the meantime, Mr. Raymond Faulkes will be handling ongoing engagement relationships for the media and entertainment space.

  Should you have any questions or concerns, please do not hesitate to reach out to the CMT partners at any time.

  Thank you, Hy

  The e-mail fails to mention the most salient point, the one that transformed the Rainmaker’s abrupt departure from a major blow to a form of ritual humiliation.

  He has left to join McKinsey.

  Consultant, Heal Thyself

  Business books are boring. They are bloated compendiums of half-baked ideas committed in fourth grade prose. Their purpose is to transform a commonsense concept or two into a consulting career through the catalyst of hollow jargon.

  By the time you graduate from business school—two years or so after the scene on Twenty-ninth Street with two of the more powerful people in nonnetwork television—you have read dozens of business books and been impressed by only one.7 The one you were impressed by is not the source of the following quote, which echoes long-established managerial wisdom regarding the mood of an organization in the midst of a necessary layoff:

  For those involved, the transition from the current state to the future state represents a frightening journey from the familiar to the unknown. It’s only natural that people will have a host of concerns…. All those concerns boil down to the same question, the one that every person worries about as soon as he or she hears of an impending organizational change: “What does this mean for me?” The longer that question is left unanswered—and the less complete the answer—the greater the stress and the anxiety people will experience. Before long, behavior and job performance start to suffer…. They may engage in irrational and even self-destructive acts. More typically, they find subtle, passive ways to derail the new processes and procedures.8 (italics added)

  Moreover, the literature is entirely harmonious on one point of execution: When you’re throwing people out into the streets, do it quickly. Do not linger (perhaps to savor the moment?)… do not dawdle and hesitate and allow rumor and fear to rule the day. Make a clean break, suck it up, move on. This makes common sense; this makes human sense; this makes sense sense. Everybody with an MBA—everybody in your top-tier management consulting firm, which you joined today—knows this. They learned it. They feel it. It’s the right thing to do.

  But they do not do it.

  You start work on a Monday, five days after graduating from Columbia Business School, and three days after your firm chose to fire every single consultant on the staff.

  A word of explanation. Consultants at your firm are—were—not what nonconsultants think of as consultants—that is, people with MBAs and dreams of being partner. Such MBA-wielding partner-dreamers, such as yourself, are called associates.9 Those former souls called consultants were younger people with degrees from good colleges who typically spent two to four years at the firm and left for business school; many were sponsored by the firm and returned as associates. Because there were fewer of them across the industry, competition was stiffer; they tended to be, though quite young, very smart, very dedicated, and, at half an associate’s salary, very cost-effective.

  You go out to lunch with another associate, an affable guy who got out of Columbia a year ahead of you. He’s purely media; media consulting is what you want to do, it’s why you joined this firm and only ever wanted to work here. It has the best media-consulting practice in the world. You go to lunch at a Japanese restaurant around the corner from your offices near Grand Central Station, talking small. He’s a small fellow, this associate. His words are small, his feet, his hands—they punch the air in front of him as though he’s making room for something—and he’s bald, much balder than you remember, and heavier. Everyone is heavier. It’s a heavier firm.

  “We’ve been waiting for this—we knew it was going to happen for a couple months now.”

  “Months?”

  “Yeah—they didn’t tell us anything”—they, in most contexts, is
a shortened form of the partners—“but we could kind of tell.”

  “How so?”

  “The deferrals, for one.” They’d been deferring new associates since January. The take-it-or-leave-it offer was wait six months to start work or take $15,000 and say good-bye. The economy was so dismal now, the alternatives so untasty and infrequent, most everyone opted for time off. You weren’t deferred because you were the only person who volunteered to start in May, without even a week off after school. You were the only person, and the HR woman—like most women, actually—liked you and seemed to know you needed money badly. (Your wife is a musician.)

  “What did they say about that?”

  “Nothing much. They had a conference call, we all called in. They said there were some capacity issues in North America and they were going to make a few adjustments so they didn’t have to do anything later on—anything like layoffs, they meant.”

  “They said that?”

  “I’m not sure they said it exactly, but it was definitely presented like a onetime thing. That was that—”

  “Then they fired all the consultants.”

  “They fired all the consultants—maybe twenty people. Not so much.”

  “Is that it then? Now it’s over?”

  The waiter comes up and you let your friend order for you. You are very bad at Japanese food. Like all recent B-school graduates you revere the Japanese to the point almost of idiocy—but you are very, very bad at Japanese food. Whatever he orders, you are not going to like. Silence follows the waiter’s retreat, and that whiff of mild elation, the one that comes with knowing you’ve got something coming to you.