Word Count: Megan Findakly MGMT- 626: Management Consulting Pract & Meth Professor Fowler 08 December 2016 Case #3 “Divorced from ethics, leadership is reduced to management and politics to mere technique.” James MacGregor Burns After three years at GL Consulting (‘GLC’), Tim Hertach, a junior partner, learned about the “Proposal to Enhance Value,” the new revaluation proposal presented by two other GLC partners. Hertach immediately questioned the new structure, which provides senior partners, who compose 20% of the firm, with 80% ownership of the firm with huge windfalls, and more disconcerting, it leaves the other 80% of partners trying to pay for it. Specifically, junior partners would have to invest about 80% of their annual bonus, instead of the 30% they previously had invested. Hertach believed that the senior partners organized a system that would allow them to cash out, potentially draining GLC’s capital, thus adversely affecting Hertach through the financial risks and obligations this proposal would carry. While he would be $250,000 richer on paper, he would have to stay longer with the firm to have the shares vest. While Hertach voiced his opinions and opposition openly, he carried very little influence, as he was only a junior partner. In the process of opposing the proposal, he also …show more content…
The actual facts should determine his reaction. If the client had not signed any deal, then the client still had the choice to look at other consulting firms. Similar to going shopping, pricing and discounting are subjective, and the result is whether a client wants to pay the price. If this is the case, it was questionable, but legal. He need do nothing further. If GLC had changed the pricing after both parties had signed the contracts, then this would be a serious violation and should be bought to audit and compliance, for a full